(Limerick West): Would the Minister of State clarify what is outlined in the repealing of sections 70 and 71 of the Landlord and Tenant Law Amendment Act, Ireland, 1860? Would he say what is involved in that, in what way this will aid land leasing?
Private Members' Business. - Land Bill, 1984 [Seanad]: Committee and Final Stages.
Sections 1 and 2 agreed to.
SECTION 3.
Question proposed: "That section 3 stand part of the Bill".
As the House will be aware, this is the most significant part of this Bill in the sense that sections 70 and 71 of the Landlord and Tenant Law Amendment Act, Ireland, 1860 provided for the re-instatement of a tenant if he paid all arrears and costs within six months of the execution of a decree for possession and applied to the court for re-instatement. It is felt that a lessee who is in breach of the terms of his lease and against whom a decree for possession has been executed should have no further claims on the leasehold and the lessor should be entitled to resume undisputed possession of his land. There are other aspects of other Land Acts that enter in here. We are repealing this law, as such, so that the provisions of the new Bill will mean that whatever contract is arrived at between the lessor and lessee will be deemed to be the legal position between them. It creates a situation between the lessor and lessee of an equal trading balance. As the Deputy is well aware, heretofore that balance, as new legislation was added in the earlier part of this century, for obvious historical reasons, swung in favour of the tenant.
The reasoning behind the repeal of those sections of that Act in this section of this Bill is to ensure that there will be an equal trading situation obtaining between the lessor and the lessee. Obviously that will ensure that whatever agreement is struck on a man to man contract basis between them constitutes the proper way to proceed. It is against that background that those sections are being repealed.
(Limerick West): Would the Minister of State agree that the repeal of sections 70 and 71 of the Landlord and Tenant Law Amendment Act, Ireland, 1860 changes the emphasis which is now being transferred from the lessee to the lessor, in other words, that the landlord now will have rights at the expense of the tenant who leases the land? Would it mean also that at the end of the day, or perhaps at the end of the lease, whether it be medium or long term, a lessee's rights would be questionable? Would the Minister of State say what rights a lessee would have? I accept the principle behind the repeal of those sections but I contend that there appears now to be no protection for the tenant at the end of his lease and it is about that that I am concerned.
The main reason for this Bill is that under certain parts of legislation going back to the years 1860 and 1861, certain circumstances could arise, in medium to long term leasing, under which a tenant need not necessarily leave the land of which he was a tenant. This is a problem which has been identified by the legal profession on many occasions, when the question of disturbance, compensation for improvement etc., arose.
When this Bill is passed I hope a completely new situation will obtain in which we shall then have, as the Deputy is well aware, master leases which we did not have until last year which are basically, if you like, contracts. This may be more a matter for the legal profession. But there are now master leases available that cover practically every possible angle in so far as leasing between two people is concerned, that is lessor and lessee. We want the law implemented to state the following: that whatever agreement is reached between a lessee and lessor that, as such, will become the law of the land, that they will both be equal trading partners.
I must accept what Deputy Noonan said, that at the end of a lease, a tenant, as such, will have no right. This Bill would not be worth a tráithnín if it happened that a farmer believed that, at the end of a tenancy, a tenant had certain rights enabling him to remain on that farmer's land. At that level the provisions of the Bill are clearcut, in the sense that no farmer in any part of the country who genuinely believed he would be unable to get a tenant off his land at the expiry of a lease would not involve himself in long term leasing. This Bill and its provisions are designed to give categoric assurance to every farmer interested in leasing his land to others, for a medium or long term period, anything above the 11-months conacre system, that he will get his land back at a pre-determined time, as will be stipulated in the lease to be drawn up by the two of them when making the relevant agreement. That is the basic principle of the Bill.
Having regard to what the Minister said in relation to the arrangement between the lessor and the lessee, there is a great danger that during the last two or three years of the leasing period we will get back to the difficulty which has existed in respect of the conacre arrangement which has bedevilled the development of agriculture for many years. There is a temptation to run down the quality of the land by not using the required amount of lime and fertiliser pending the negotiation of a new lease. There is an inherent weakness in the Bill.
I agree with Deputy Kirk. This was the problem with the land which was held by the Land Commission. In my county, land was held for ten years and allowed to run down. The amount of fertiliser used on it was negligible and it was practically useless when it was allocated. In the case of a seven-year lease there will be an incentive to the lessee to build up the fertility of the land during the first few years and to re-seed it to get the maximum benefit. I would fear that the land would be neglected in the latter years of the lease if the lease was not renegotiated in the fifth or sixth year. I hope there will be long-term leasing when the scheme gets going. If the lease is for fewer than seven years very few people will build up the quality of the land in order to achieve maximum productivity.
The Minister referred to master leases but I am sure he will agree that most master leases do not have any standing in law, certainly under this legislation. I am also concerned about whether this legislation will succeed in promoting land leasing in an effective manner. I heard what the Minister said today at another function but time will tell whether what he has promised will come about. As of now we do not have an incentive for the promotion of land leasing.
Earlier this year on Second Stage the Minister referred several times to the new role of the Land Commission. Under the national plan the Land Commission are to be abolished. What vehicle will the Minister now utilise to promote land leasing?
Deputy Kirk and Deputy Leonard asked what was likely to happen towards the expiry of the lease. I am positive that this legislation will be most beneficial and that we will get over the problem of the 11-month system which has impoverished more land than any other system of farming. If the period of a lease is extended and the lessee pays the going rate and has to make a profit, it is safe to assume that if the land is run down when he gets it he will build it up to a very high level of productivity and fertility. The big selling point of medium to long term leasing is the spreading of the fixed cost over a considerable number of years. It makes economic sense.
I hold the view that in the next few years we will see leases of five, six or seven years. There is always a tendency to talk about the ten or 12-year leases but they were not very successful in the early seventies. We should move slowly because there is too big a gap between 11 months and ten or 12 years.
I am certain that under the master leases a certain standard will be expected of the tenant when he is handing back the land. In some leases this can be taken care of. The owner of the land will be very well protected in so far as it is possible to protect a possession like land. I am confident that it is possible to do that.
Deputy Noonan said that the leases would not involve a legal obligation. After the passage of this legislation such a lease will be a binding contract on a man to man basis. Some of the leases which are available are very involved. They certainly cover most of the things that could possibly happen in the duration of the lease and some of them cover some things that are unlikely ever to happen. Under the conditions we are speaking about both the tenant and the owner are very well protected. For this reason I believe the scheme will be very successful.
What would be the position where improvements were carried out by the tenant? What about the possible option to renew the lease? Does the Minister believe that just by repealing legislation land leasing will take off, without any changes in social welfare or tax incentives? He hinted during the Second Stage debate that he might be amenable to proposing some changes in social welfare and taxation to the Government.
Deputy Noonan mentioned the role of the Land Commission. During the Seanad debate last April the Minister of State spoke about the important role of the Land Commission in land leasing but when the Bill came back to the Dáil we had been told that the Land Commission were to be abolished and there was little mention of it in the Minister's speech. We are very concerned when we hear that up to 100 inspectors are to be transferred from the Land Commission on staff release to assess plans for a farm tax. How many inspectors will be taken away from dealing with the important matter of land division?
That does not arise on the section.
I presume some officials will remain with the Land Commission for assessing land tax and so on. In the Seanad the Minister said that some of these officials will be involved in promoting land leasing and I should like to know how many will be dealing with that.
The Minister has assured the House that there will be no difficulty for a farmer who leases land over four or five years, that he can apply at any stage to get the land back to the expiry of the lease. It is important that an absolute assurance is given on that issue. I did not notice any provision in the Bill entitling anybody to renew the lease. I am not advocating that such a right should be conferred on somebody, because that may create fear in the minds of those who may wish to lease land, but there should be a provision giving a greater right to the person who has leased the land over a person applying to lease it for the first time. The owner should certainly have the right to take the land back at the expiry of the lease.
I am concerned that young farmers anxious to lease land under the scheme are given an incentive. Provision must be made to ensure that on going into milk they will not be expected to pay the superlevy from the first day. Under the new taxation system for farmers, the adjustable acreage, who will be responsible, the lessee or the lessor, for the payment of the tax? Has the Minister given any consideration to that?
I wish to deal with the question of the maintenance of the fertility of the land to a certain standard. I am sure the Minister will agree that the original land leasing proposals were intended to get away from the old mould of the conacre system. There is no guarantee under these provisions that the land fertility will be maintained at a certain standard because of the problems mentioned. The Minister has admitted that that deficiency exists but he did not dwell on the matter too long. One way of overcoming the problem would be to establish an annuity repayment to cover the cost of fertiliser to be borne by the lessor. That should be built into the land leasing provision and it would go a long way to eliminate the great deficiency
(Limerick West): I doubt if there is any provision to encourage land leasing. The Bill, strictly, is a legal matter. The problems of land ownership and leasing cannot be examined in isolation. They must be looked at together if we are positively encouraging land leasing. We must consider another aspect, the way farmers live. In this regard one must consider the social welfare system, the income tax code and the availability of credit. Decisions taken, or not taken, in the Departments of Finance and Social Welfare will determine in a big way if this legislation will be successful.
There must be deep regret at the decision to abolish the Land Commission. It would have been ideal had the Land Commission been allowed to continue to administer and monitor the scheme in conjunction with continuing to take over lands and allot it to farmers. Those officials were well versed in the distribution of land and in assessing a farmer's ability to farm land. The provisions in the Bill would have been ideal if they were worked in conjunction with a revamped Land Commission. Many young farmers had hoped to gain security by way of adding to their holding but that is gone. Farmers do not have an incentive to go in on a leasing system now. It would have been better if farmers could hope to obtain land in their district from the Land Commission. This is a backward step and the Land Commission should have been allowed continue with its policy in conjunction with these provisions.
It appears to the Chair that we are engaged in a Second Stage debate all over again. Section 3 simply amends certain enactments to ensure that the tenant cannot rely on those enactments for the continuation of his lease and that he will be bound by the terms of the lease. That is all that is in the section as the Chair sees it. We appear to be having a general debate on this. I should like to remind Members that we are tied to 11 p.m.
I should like to ask the Minister to respond to the suggestion I put.
There are four or five important aspects to be considered. I should like to bring to the notice of the House that we are discussing, as Deputy Noonan pointed out, a legal Bill. It could not have been framed in such a way that it would go any further than that. Many people in agriculture down the years have complained that the problem we are seeking to rectify has been an impediment to progress. We are getting over that impediment by repealing some of the provisions of the old Land Act. I should like to refer to the criticism of the decision to abolish the Land Commission. All the activities and responsibilities of the Land Commission are being transferred to the Department of Agriculture. The only thing worth mentioning is that for obvious reasons there will have to be a change of direction vis-á-vis a land policy. All Deputies have been clamouring for this for years. That change is embodied in the legislation before us. I will give the House a guarantee that personnel will be provided. Last year I gave direction to the Land Commission local offices to promote this scheme to individuals, associations and co-operatives and they have been getting a very good feedback. This will continue.
Deputy Kirk had a novel idea of this annuity. He said a certain amount of the annuity could be withheld as a hedge against the final result to see in what condition the tenant would leave the property. If the lessee and the lessor decide to do that there is no problem. There is nothing to stop them from entering freely into a particular type of arrangement. This Bill is very important because it gives a degree of flexibility which did not exist heretofore.
I must confess that I have a mental block about leasing for mid-terms of about five or six years, but let us not forget tillage where there are three-year rotations. This is very important. In this Bill I have made sure there is no curtailment after a certain number of years because I would like to have the flexibility where the lessor and the lessee could decide these matters for themselves.
Another important question mentioned was young farmers. This scheme will provide an opening which did not exist up to now for young people highly trained in agriculture. I am making representations to the Department of Social Welfare and the Department of Finance for various concessions which in my view will be necessary when this Bill is implemented to make it more attractive. Lest anyone run away with the idea that taxpayers' money should be used to bolster up this scheme to an artificial level, that is not intended. In this stark world reality reigns supreme, and it is very important that the leasing of land be on an economic basis because it suits a particular farmer over a specific number of years to lease the land and it suits the tenant to take on this extra responsibility. I am sure that in the years to come we will see the introduction to Irish agriculture of farmers who will make a living on long-term leased land. This has happened all across Europe. It will be difficult for many young people to do this but this can happen under certain conditions. This is a real opening for trained young landless people to get into agriculture.
My view is that when the initial agreement between the lessor and the lessee is arranged an annuity repayment system should be established to cover the cost of the lime and fertiliser to maintain the land at a certain standard for the duration of the lease and it would be the responsibility of the lessor to meet the repayments rather than the lessee.
If we get involved in this type of situation everything will be more complicated. I would like protection for the person who manages a certain acreage over a four or five-year period and brings the land up a certain level of productivity and if the lessor wishes to continue to lease the land a new lease could be drawn up in his favour. He should have a right to renew the lease over a man who wants to lease the land for the first time because he can see the advantages to be derived from the land which was been managed so well. I see a danger in the extension of long leasing, although I may be wrong, but I think this will perpetuate a form of absentee landlordism. That situation existed before and this fear is now being expressed. I would like to see this fear dispelled by the Minister. I would not like this scheme to be bogged down because people might say we were going back to the nineteenth century with absentee landlords.
The purpose of this Bill is to deal with mobility of land. Everybody agrees with that. I hope every member of the Cabinet has the same feeling because I think it is the Minister's wish that not alone would land be made available for leasing but that land held by older farmers would be made available to their sons through inheritance.
I heard of two incidents in my constituency in the past few months — perhaps the Minister would comment on this — where agreements had been reached between sons and fathers that the farm should be made over to the sons and the fathers would get the old age pension. We should encourage this type of move. It has been said that the average age of a farmer getting land is about 40 and the average age for a farmer to marry is 40. As somebody said, two millstones around his neck in the one year. In the two instances I mentioned the fathers were refused the old age pension even though they had no means. It was said that they had means from the farms because the sons were in part-time work. They had to work part-time to finance the development of the land. That is disgraceful. This was simply because Deputy Barry Desmond——
The Minister.
This is simply because Minister Desmond has no idea of what is going on. This is another attack by the Labour Party on farming and the farmers, the people who provide 50 per cent——
We are dealing with section 3 of the Land Bill. This has nothing to do with the Department of Social Welfare or the Minister, Deputy Desmond. Please confine your remarks to section 3. This is a limited debate and the emphasis is on leasing.
I am talking about land mobility which has been mentioned here on many occasions. The Minister himself referred to young people. I am referring to young people, and the social welfare issue is covered in this. I am saying that the Minister, Deputy Desmond, does not have any idea of what is going on but if he has an interest in the economy he will encourage older farmers to make their land over to their sons. If we do not succeed in doing this, this Bill is a complete sham.
(Limerick West): We do not want to get bogged down on this section because this Bill has to be completed by 11 p.m. In his reply perhaps the Minister would outline what is involved in repealing the Land Acts mentioned in section 3(1)(a), (b), (c), (d) and (e). I agree with the Minister that land leasing is taking off in a very big way across Europe but the situation there is different from here in so far as it is positively promoted by the various governments and they avail of the EC structures and finance to positively promote land leasing. I doubt if the Minister can give any guarantee in that regard. Earlier this year he spoke in the Seanad about guarantees in regard to the Land Commission and that they would have a new role and soon after the Land Commission were abolished. Will certain structures within the EC be availed of in order to promote land leasing in a positive way?
The main purpose of section 3 is to increase land mobility but are there powers in the Bill to protect the lessor or the lessee? I should like the Minister to explain in detail what protection either party has when land is let and whether either party has an option at any time during the lease to withdraw from the lease, because my understanding of a lease is that when it is signed, sealed and delivered there can be no withdrawal by either party although the lease may be disposed of to some other party by the lessee. If a lessor, a single, old age pensioner, leases his land to a young farmer and he dies half way through the term of the lease without making a will and the lessee refuses to leave the land and claims squatter's rights, what is the position? If the lessor dies and leaves his land on date of death to a member of his family and the lessee refuses to vacate the lands, what is the position in regard to the rights of the lessee or the legality of the lease?
Deputy Dowling said that a tenant who looked after the land very well should be given some priority at the expiry of the lease. I cannot accept that because of the fundamental thrust of the Bill. If I were to do that I could not give an undertaking to landowners that they would get their land back without any strings. That is very important and I do not want to leave the House under any illusion in that regard. In so far as this legislation is concerned, it means a very definite end to a particular contract at the end of the lease period. There is no priority written in unless, of course, they arrange something between the two of them at the beginning of the lease. It is a trading agreement between two parties.
Where is this tied up legally in the Bill?
The Deputy is missing the point. If that were the case, unless certain conditions suited, you could not have an agreement between two parties. That is the great flexibility of this scheme. This will give a legal standing to an agreement on long-term leasing between the tenant and the farmer, the lessee and the lessor. If they want to write particular conditions into the contract they are free to do so but, obviously, after signing it, they will be held to what they have signed. That applies to all legal agreements. Deputy Treacy asked about the power to withdraw and referred to squatter's rights but this will not arise because if a lessee or a lessor dies during the term of a lease, it can be written into the lease that there should be some type of compensation. Equally, it can be argued that if all that is not taken into account when the contract is being signed it means that the tenant will be there until the expiry of the lease which he signed originally. However, on the last day of the lease, even if the owner is alive, the tenant should not and will not be there because somebody will claim that land. It is against that background that this legislation is of immense benefit. I am trying to get across the importance of the flexibility which can be inserted in various contracts.
Is the Minister proposing to bring forward a statutory land lease right across the country with inbuilt conditions attached to them?
The Bill has no built-in mechanism to ensure that the fertility of the land will be maintained at a certain level to protect the lessee and the lessor. If the responsibility for the maintenance was on the lessor instead of the lessee by having an annuity repayment system, it would guarantee that at the end of the lease period the fertility of the land would be at an acceptable level.
That is entirely outside the scope of this Bill. Deputy Treacy asked if we had a national lease——
I referred to a statutory standard lease.
There will be no such thing. There are specimen master leases — the first we have ever had — by various bodies who went to the trouble of making them available to the public. They set headlines to cover certain eventualities perhaps in nine or ten years time. They are there to help the lessee and the lessor to come to an agreement and they are not legally binding in themselves. What the lessee and the lessor decide to sign at the commencement of a lease will be legal. The only reason the master leases are on display at present is because they point the way. Of course, many leases will be entered into which will not be nearly as complicated as those which are in existence at present but that is up to the lessee and the lessor. That is the degree of flexibility to which I referred.
Deputy Dewling mentioned landlordism. I categorically assure the House that there will not be a return to landlordism because if we acknowledge the status quo of 97 per cent ownership of Irish farms by the farming population, for obvious reasons if we are enacting legislation here that will ensure that the farmer will get his land back at the expiry of the lease, we will be no worse off in ten years' time. We are making certain that the owner will get his land back. We cannot say enough publicly about the important matter of the contract between the farmer and the tenant. I should like to think that the people involved in such a contract would take note of what Deputy Kirk was talking about. A farmer would like to think that on the expiry of the lease his land will be in a much better condition but there is no way that could be written into the Bill. However, I am sure there will be occasions in the future when it will form part of the agreement between the lessor and the leseee.
With regard to fertilising the land, under the existing 11-months system there is no incentive for the person taking the land to apply the necessary fertiliser because there is always the possibility that the land will not be leased to him after the expiry date. However, where the contract is for seven years it would be in the interest of the person taking the land to ensure that the necessary fertilisers are applied to the land.
All this Bill is doing is repeating the provisions in a number of Acts. The variations the Minister mentioned are legal matters to be dealt with by the solicitors for the parties concerned. Those variations or conditions could be, and probably are, in many leases at the moment where the contract is for two or three years. This Bill is not doing anything new. Deputy Kirk spoke about applying lime and fertiliser to bring the land to an acceptable level of fertility. In the past 20 years a scheme was in operation — I do not know if it has been abolished — where fertilisers and lime were provided on a charge against the annuities. I take it the Minister will recommend that system to ensure that the land is brought quickly to an acceptable level of fertility.
It is precisely in that that I see a danger unless the lessor clearly understands the situation. Sometimes solicitors are not the best people in the world to protect their clients and they make mistakes. Standard leases have been drawn up by the interested organisations and people who are considering the possibility of leasing land should know that there is one safe way of doing that and that there are unsafe ways. If people draw up their own leases there could be certain loopholes. This section clears away some old sections in Acts dating back to the latter half of the last century. By virtue of such measures where land was improved people had the right to renew their leases against the pressure of landlords who tried to increase the rents or to take the land from them. All this section is doing is removing some difficulties. I would advise any farmer or owner who wishes to lease land for a period in excess of the 11-month conacre system to be careful with regard to the form of lease he signs.
If this Bill and if land leasing are to be successful it is vital that a standard statutory land lease be drawn up to be used throughout the country and with open-ended conditions that will allow amendments suitable for local situations. Unless that is done we will not succeed in increasing land mobility. Section 3 (2) is the identical parallel of the situation at the moment with regard to the letting, leasing or renting of land.
We have only 65 minutes left and there are 14 sections that must be dealt with. I remind the Deputies that there are other important aspects of the Bill to be discussed.
For obvious reasons the 11-month conacre system is not an actual contract in the leasing sense. The period was less than a year or less than a full season's crop and this was the people's way around particular legislation.
Many Deputies have queried the master lease and obviously farmers will also have queries about the matter. There is no possibility, nor was it ever intended, that we would legislate here for a particular lease. That is not possible. However, the IFA, the AIB banking group and the ICOS brought out specimen forms that are floating around the country at the moment and they can act as a guideline. Obviously any arrangements between the lessor and the lessee will be a legal matter but the guidelines are clearly signposted. It is essential that we also allow a degree of flexibility. In the years to come other people will decide on master leases that will be more in keeping with the times then but what is important is what happens on the day the lessor and the lessee sign a contract. Deputy Leonard said we were not doing anything new in this Bill but that is not so. This is a complicated Bill and it took a long time to go through the various Land Acts. The point we have reached now is a crucial one.
(Limerick West): Would the Minister elaborate very quickly on paragraphs (b), (c), (d) and (e)? Would he also reply to my question regarding the positive encouragement of land leasing? Would he avail of the aids under EC structures?
Paragraph (d), which refers to sections 7 (3) and 30 (2) of the Land Law (Ireland) Act, 1881 gives the lessee the right to sell his interest in the leasehold. Here, in line with the general thrust of the Bill, the parties themselves should prescrible the terms of the lease, including any provisions regarding sale, subdivision and subletting by the lessee as may be agreed. We have fully covered that. Section 4 of the Landlord (Ireland) Act of 1881 provides that a lessee from whom a lessor demands an increase in rent is entitled to compensation to be fixed by the court in respect of the fall in sale value of the tenancy in consequence of the increased rent. One can imagine the problems if that were the legal situation. There would be mayhem all over Ireland. We must repeal that section.
Again section 13 of the Land Law (Ireland) Act, 1881, permits the lessee to sell his interest within six months of the execution of a decree for possession for non-payment of rent. The intention here is to ensure that the lessor is entitled to regain undisputed possession of his property on termination of the lease for whatever reason. That is the central thrust of what we have been talking about.
Finally, section 22 of the Land Law (Ireland) Act, 1881, renders void an agreement by the tenant to contract out of any rights conferred on him by Statute provided the holding concerned has a PLV not exceeding £150. As the Deputy is well aware, the PLV system was found to be unconstitutional. It is possible that that provision would be no longer operative. It is included here to put the matter beyond doubt. The intention is that the terms of the lease will be those agreed between the parties and will not be subject to any overriding statutory provision.
To come back to the Deputy's point of view on aids for leasing, while these are not contained in the Bill structures are being negotiated this very day in Brussels. We shall have to see what comes out of these deliberations. I am keeping more than a keen eye on the outcome.
(Limerick West): The Minister has made a recommendation, I presume?
There are certain things which I would particularly like to see happening. I have made representations to the Departments of Finance and Social Welfare on certain aspects which I think would help the concept of land leasing.
Question put and agreed to.
SECTION 4.
Question proposed: "That section 4 stand part of the Bill".
(Limerick West): Would the Minister briefly outline the function of the Minister, that he could with the approval of the Minister for Finance, waive, and shall be deemed always to have had power to waive, the payment of any sum of less than £2 and so forth. This is with regard to a purchase annuity, a land reclamation annuity or any other payment to the Land Commission. Are all these annuities being waived in repealing this Act, or what is the position?
The intention there is a sensible one. At present the collection fee on an annuity payment of £2 amounts to £3, so it was time to start waiving such charges and that is what happened as far back as 1977. For the benefit of the House, there were something like 68,500 accounts representing a total collection of £73,000. Those were written off. One could argue that a Bill should have been brought in at that time but because it was not, we are giving legal backing in retrospection to what happened then. It is important to point out that because of inflation and so on, a stage will be reached in the not too distant future when annuities larger than £2 will not be worth collecting. It is also intended to waive these when those circumstances occur.
(Limerick West): With regard to a land reclamation annuity, does the same apply?
It does.
Will this provision allow the Minister at a future date to increase the amount under which such payments can be waived?
The answer is no.
(Limerick West): Section 4 (2) is as follows:
In section 80 of the Building Societies Act, 1976, "prior mortgage", notwithstanding section 2 of that Act, does not include and shall be deemed never to have included, a charge on land to secure payment of—
(a) a purchase,
(b) a land reclamation annuity, or
(c) any other annual payment to the Land Commission not specified in the Building Societies (Amendment) Act, 1983.
Is the same thinking behind that subsection as in subsection (1)?
No. That subsection is not related to the Bill, but we took the opportunity from another Department because of the relevance of mortgage societies with regard to prior mortgages. Heretofore building societies and, I assume, other bodies involved in house loans, in the case of any annuity or annual payment to the Land Commission which was a mortgage on that part of the land, were very slow to grant a mortgage on that ground and, in fact, would not do so. This is a small item, but a very important one for persons wanting to build a house and get a loan from a mortgage society.
As I understand it, the Minister will be empowered under this legislation to very the amount which can be waived. In future years it will merely be a case of placing an order before the House to do so.
If the Exchequer is losing money because of non-collection of annuities, for obvious reasons no Department or Government would allow that to happen. This only applies in the case where it is just not good economics to continue collecting such small sums.
Under section 4 (2), in the event of a charge on an estate by another institution as distinct from a building society — because the Building Societies Act will only cover property up to one acre maximum — if a financial institution has a charge on the estate, perhaps prior to or during the lease, in view of default by the lessor of the leased property could that institution during the lease acquire the property and dispose of it?
The short answer is no. This is in relation to building societies only. Other institutions are not involved in this.
That is the question that I am asking. If they are not covered by this, have they the power to come in, acquire and dispose of the property because the lessor has defaulted in his responsibilities to that institution? The building societies could not cover a farm anyway.
That is not involved in the main thrust of the Bill. It was only put in at the request of another Department. There were problems when there was another charge on a plot of ground, for example, if a person was building a house and using a mortgage from a building society. It is a small but important item.
What about the other institution?
We are not involved as such.
That means they have power to acquire the property if the lessor and lessee are not protected by the Bill.
I am not responsible for that and I cannot answer the question.
(Limerick West): I crave the indulgence of the Chair because I wish to mention the Land Commission. It is mentioned in practically every section of the Bill. If and when the Land Commission are abolished — it is a big if — will all the functions of the Land Commission be taken over by the Department of Agriculture?
That has nothing to do with the Bill as such. It is a matter for another day.
(Limerick West): If the Land Commission is abolished to whom will the annual payments be made?
Arrangements will be entered into with the Department of Agriculture.
(Limerick West): In total?
I did not say that, as regards the activities we are talking about this evening, they will be transferred to the Department of Agriculture.
(Limerick West): I am talking about the activities under section 4 (2). The Land Commission are mentioned there. Will that function be taken over?
Appropriate changes will take place. As the Deputy is aware, it will be necessary to bring in a Bill to abolish the Land Commission. That is a debate for another day.
(Limerick West): What the Minister of State is saying is that some of the functions of the Land Commission may not be handed over to the Department of Agriculture but may be given to other State agencies and Departments.
I appreciate the Deputy's concern but this is not relevant to section 4.
(Limerick West): I bow to the wisdom of the Chair.
Question put and agreed to.
SECTION 5.
Question proposed: "That section 5 stand part of the Bill".
(Limerick West): As regards the purchase annuities fund established under section 12 of the Land Act, 1923 which is being dissolved will the Minister elaborate on that? Who will now acquire these funds?
That has nothing to do with the Bill. What we tried to do was tidy up the legislation.
That is the most that was done.
And I made a good job of it.
We will see.
This section provides for the winding up of the purchase annuities fund. Broadly speaking all sums received and payments in advance made prior to 1933 were made to the British Government and paid into the purchase annuities fund. The original idea was that these sums would be transmitted to the appropriate British authority, in this case the British National Debt Commissioners. The Land Purchase Annuity Act, 1933 provided that the proceeds of the fund be paid into the Irish Exchequer. For accounting convenience and at the suggestion of the Comptroller and Auditor General it is proposed to wind up this fund and have the sums paid to the Exchequer and the land bond fund as appropriate.
The Minister has consistently stated that some of the functions of the Land Commission will be taken over by the Department of Agriculture. Under section 5 (2) money due to the purchase annuities fund will be paid directly to the Exchequer and will be disposed of on the direction of the Minister for Finance on behalf of the Exchequer. Does that mean that Irish agriculture is being asked to underwrite the State's expenditure? If there is a commitment to land leasing, land mobility and agriculture why are these funds not at the discretion of the Minister for Agriculture?
The normal procedure is that the Department of Finance are involved. That is how we do business. What happened was that the finance was paid into the fund and the fund was transferred to the Department of Finance. All this Bill does is cut out the fund. The money will go directly to the Department of Finance.
How much money is involved?
I do not have the exact figure but it is not a great amount.
I view this section with dismay. It is basically dismantling the function of the Land Commission. It removes the fund for land purchases.
It has nothing to do with it.
I came in to protest about the dismantling of the Land Commission.
(Interruptions.)
Sit down.
Deputy Leyden, sit down a moment. We are dealing with section 5 of the Land Bill, 1984. The Land Commission was relevant to section 4 and it is relevant to part of section 5 but the abolition of the Land Commission, as you have described it, is not relevant. We are not discussing that. Confine yourself to the relativity of the Land Commission and to the purchase annuity fund.
It can be discussed under this Bill on Report Stage and I will hold it until Report Stage to express dismay about the dismantling of the Land Commission. The Minister's announcement today is sheer hypocrisy as far as the Land Bill is concerned.
I have great concern about section 5(2). This is giving great power to the Minister for Finance and the Department of Finance. We all know that the civil servants in the Department of Finance are always envious of the amount of money given to Irish agriculture. That has been eroded annually. This is giving total control to the Minister to dispose of funds paid by Irish farmers for Irish lands into the Exchequer. Can the Minister of State give an assurance that when this Bill is concluded there will be in the Bill a guarantee that the money paid into this fund will be expended on Irish agriculture?
No, I can give no such guarantee.
That is very sad. It is a total reneging on agriculture.
Question put and agreed to.
SECTION 6.
Question proposed: "That section 6 stand part of the Bill."
(Limerick West): Section 6 deals with the situation that arises where Land Commission allotees would not be fully registered as owners of their property until the problems that arise with regard to title and so on are sorted out, and this could take time with the Land Registry. At the moment, according to the explanatory notes, the allotees will be paying only interest. As far as I can gather this section is to ensure that the allotees, even though they are not registered owners of the property in question, would be paying the annuities as outlined by the Land Commission from the moment they take up occupation of the land as tenants. Am I correct in assuming that?
Yes, the Deputy is correct.
(Limerick West): In the past the problems arose because interest only was being paid and as a result of that there were arrears of rent and that caused hardship to the tenants.
Because of some possible mix-up in drafting many years ago, until an allotee was vested — many Deputies know that that takes quite a long time — the law as it stood then meant that as far as that farmer was concerned he was paying only interest; he was not paying back the principal. The Land Act, 1936, introduced a device known as listing by which the allotee who signed the purchase agreement was granted the benefit of this sinking fund virtually from the date of allotment and so he began to repay his advance immediately. There was a problem at that time and now we are regularising this.
Question put and agreed to.
SECTION 7.
Question proposed: "That section 7 stand part of the Bill."
(Limerick West): Section 7 has very little to do with land leasing. The Minister might outline to us the meaning of section 7(5), which states:
This section shall come into operation on the 1st day of January, 1985.
Section 7(4) states:
.....in accordance with the directions of the Minister for Finance, for the benefit of, the Exchequer.
This is relevant to what Deputy Treacy said a few moments ago, that it seems as if certain sections of this legislation will be for the purpose of accruing funds for the benefit of the Minister for Finance and subsequently for the Exchequer. Again I ask the Minister to say that this is or is not the case. He might elaborate briefly on what is involved in that section.
This is the system that applied for many years. The proceeds from the Irish Church Temporalities Fund would have been channelled into the Department of Finance. That is a system that we have and there will be no difference in it now. All that this does is that under the provisions of the Irish Church Act, 1869, the temporal property of the established Church, including its revenues, passed to the State. The Act also set up a fund known as the Church Temporalities Fund into which the former revenue of the Church was paid. In 1881 the administration of the fund devolved on the Land Commission. That is the situation we have had ever since then. As was mentioned some moments ago, the same procedure was adopted then as now.
Question put and agreed to.
SECTION 8.
Question proposed: "That section 8 stand part of the Bill."
(Limerick West): Section 8 provides that “Section 63 of the Irish Land Act, 1903, is hereby amended.” Could the Minister elaborate on that?
If the Deputy does not mind and if this suggestion is acceptable to the Opposition, sections 10 and 11 are almost identical to this section. It is the same story.
By agreement, we can discuss sections 8, 10 and 11 together. Is that agreed? We can discuss the three of them and they can be put separately.
It is the same principle. In this section proof of title is involved. As the House is well aware, heretofore it could be a very costly item to be registered. Over the years the moneys were very small. Section 63 (2) of the Irish Land Act, 1903, provides that, if the redemption price exceeds £30 but does not exceed £100, it may be paid to the same person, or to trustees, subject to an undertaking to apply the money as capital. It is now proposed to increase those figures to £1,000 and £3,000 respectively. The Land Commission are bound by stringent statutory requirements before they can pay out moneys due under various provisions of the Land Act. These requirements have to do with proof of title. Where the amounts of money involved have been so small as not to compensate for the legal expense of proving title, there is a statutory provision for payment with less strict proof and, therefore, less expense. The limits on the amounts were last fixed in 1965, the date of the most recent Land Act. The proposal is to update these limits in the interests of both those to whom money is owed and of the Land Commission for accounting purposes. The limits we propose were calculated on the basis of the increase in land prices between 1965 and now. These data are taken from a Foras Talúntais study. It is another item that we are trying to clear up. Because it was very costly to prove title, we are trying, in this Bill to get a less expensive way of doing it to ensure that people can become registered. It is another legal provision.
Is the Minister talking about the legal right of a person to claim ownership of a property——
No.
——and that the person is being referred to as having redemption?
No, that is not correct.
Whom are we talking about?
People who have claims against purchase money and soon. This would not be a modern phenomenon. It goes back a long time. While everything in the Bill is important, these provisions are the least important. They are only a tidying up process, a process that is continued in sections 10 and 11.
These sections confuse me. Am I to assume that the Minister is referring to a situation in which some third party, a landlord or otherwise, has rights to a property that is being used by another person and that in the event of that other person wishing to effect title or claim ownership, he must expend certain moneys in order to discharge the rights of this third party? Is it in this respect that the Minister is proposing to increase the amount from £30 to £1,000?
I admit that the provision is involved but we are talking about money that is owed by Land Commission for various reasons. It might be in respect of land that was purchased many years ago.
Is the Minister referring to the Land Commission having acquired properties of landlords a long time ago?
I am. For one reason or another some of that land was not registered properly at the time of purchase and the cost of registration now would be so immense that to leave the limits as they are would mean that it would not be worth anyone's while to effect registration. We are now trying to regularise that system. There are not many such cases on the books but there are some.
Who will be receiving the £1,000 and who will be paying it? I presume the Minister is talking about the Land Commission paying the money to some third interested party with whom they did a deal in respect of inheritence or whatever.
If the cost involved were to be less than £1,000 the Land Commission would carry that expense out of the fund. The Deputy is on the right track. Legally, nobody could expect to have anything done for £30.
Therefore, we are to assume that if the legal fees being expended in perfecting title on behalf of some party do not exceed £1,000, the Land Commission will pay those fees whereas if the amount exceeds that level, it will be a matter for negotiation between all parties involved, including the Land Commission?
That is correct.
Are there many of these cases?
To my knowledge there are very few but for one reason or another there are some stragglers that go back for years and it is to deal with these that this legislation is necessary.
Question put and agreed to.
SECTION 9.
Question proposed: "That section 9 stand part of the Bill."
(Limerick West): Perhaps for the benefit of the House the Minister will outline what is involved in these exchanges of unregistered land. How did the unregistered land problem arise and why have such lands remained unregistered? Regarding the re-arrangement of such lands, the power to exchange is being expanded to included cases of where an interest has a right to vacant possession. Would the Minister elaborate on that, too?
This is an important section. What we are talking about is the relationship between the interests involved in the potential exchange of regisstered and freehold land. This aspect has become more important in the past 12 to 18 months in the sense that, as the House will be aware, I introduced a new exchange system for farmers who had fragmented land. That was the equivalent exchange plan and it is proving very popular. We encountered a problem which the Land Commission, too, had encountered for a number of years.
(Limerick West): Is this in relation to commonages?
No. There would be other properties that would be unregistered but freehold in the sense that the farmer who owned them could not exchange them. The new legislation will mean that we will be in a position to exchange all land subject, of course, to agreement between the parties involved. I regard this as being a very important aspect of the Bill.
In what respect will these exchanges be involved? Up to now exchanges were with the Land Commission.
The Deputy will be aware that last year I introduced a scheme under the direction of the local Land Commission officials. By reason of that scheme a number of farmers in a particular townland wishing to restructure their farms could do so if they got together an equivalent exchange. The local Land Commission Office would supply them with maps and oversee the procedure or adjust acres and so on. There would be certain limited occasions on which the owners of freehold land could not become involved in that procedure. In this Bill I am proposing to allow a situation to develop whereby it would be possible to exchange all such land.
Will the owners of such lands be in a position to effect exchanges without the assistance of the Land Commission? Up to now the exchanges were effected only on the approval of the Land Commission's officers. Who is to adjudicate on such exchanges in the future?
I do not seem to be able to get it across to the Deputy that the Land Commission's activities will be transferred to the Department of Agriculture. This scheme will become a very important part of land restructuring.
In other words, officials of the Department of Agriculture will operate the scheme?
Yes.
Will this be on the same basis as applied up to now?
For many years — and up to 18 months ago — the Land Commission would not have anything to do with equivalent exchanges unless they had a parcel of land which was part of the rearrangement.
(Limerick West): What is to be the position in regard to land that is not registered, land that is not in the registered ownership of the tenant? In such circumstances can an exchange take place?
Yes, but the only problem is that the new owner would have no greater status vis-à-vis registration than was the case before the exchange.
In other words, he would have rights but no title.
The only status of registration that applied to the land before registration would be the only status that would apply to it afterwards.
What is to happen in the case of land for which there is no title and in respect of which none can be traced?
In that case nobody would be seeking a transfer in the first place.
I am thinking, for instance, of island patches in some farms or on the perimeters of other farms and which are totally unregistered though the farmers owning the registered adjoining land have been using the unregistered land for many years. Even if such a farmer were to build a house on that unregistered patch, he would not be able to effect title. In that type of case what is the position vis-à-vis a lease?
By virtue of the fact that a farmer had farmed, unimpended, for many years a parcel of land, he would have squatter's title and consequently he could exchange the land. Up to now that would not have been possible.
That brings us back to an earlier question. The Minister talks about squatter's title but in the event of a person dying intestate and leaving a property on which there is a tenant who refuses to leave on the basis that he has been there for a certain period, perhaps under some other law he may be in a position to renew his lease. This Bill does not cover that.
I am very definite that the answer to that is no. Whatever was signed between the lessee and the lessor at the commencement of the lease is what holds.
Does the period agreed for the lease have any effect?
No.
Question put and agreed to.
Sections 10 and 11 agreed to.
SECTION 12.
Question proposed: "That section 12 stand part of the Bill."
(Limerick West): Section 12 deals with section 33 of the Land Act, 1936, and section 16 of the Land Act, 1953. It says:
12.—The reference in section 33 of the Land Act, 1936, to the whole of the purchase money of every parcel of untenanted land shall be construed as including a reference to a part of such purchase money and the reference in section 16 of the Land Act, 1953 to the whole of the purchase money of every congested districts holding within the meaning of sections 22 and 23 of the Land Act, 1931, shall be construed as including a reference to a part of such purchase money.
Would the Minister elaborate with regard to what is meant by the use of the term "congested districts"?
Because of an oversight in the drafting of previous legislation it was found that some farmers were given land and were only paying interest up until the time they were vested. A new concept has crept in in recent years where some farmers want to pay half cash and half annuity. It could be argued that people who paid part cash and part annuity were not actually getting credit for the principal involved and they had to wait until they were vested before getting in on the repayments as would normally be the case.
Question put and agreed to.
SECTION 13.
Question proposed: "That section 13 stand part of the Bill".
(Limerick West): Section 13 relates mainly to property allocated to sporting organisations and the appointment of trustees. Will the Minister elaborate on what this section does that is not already there?
As Deputies are aware the Minister for Agriculture has the power to vest any trust lands in the trustees as such and to appoint trustees.
What type of lands?
Sports fields and all that type of thing. There has been a major upsurge of interest in the last 20 years in sports fields and so on. Heretofore trustees had total responsibility for such property and if the trustee died the Minister had power to replace him. Because of a drafting error many years ago when the new trustee was appointed he had responsibility for the management of the trust but he had not the same degree of power as the original trustee. It was important to change this provision. It will not turn the country upside down but the legal people believed that on balance it was important to change this provision.
(Limerick West): If a trustee dies, the successor appointed does not necessarily have the same powers?
Yes, under the existing law. The new trustee had responsibility for the management of the land and could not be removed——
(Limerick West): But he does not have ownership?
That is right. What we are doing now is regularising the situation.
Why was it necessary to introduce this Bill? As far as I am concerned there is little in this to help anybody. This section alone is totally irrelevant. We have survived for the last 65 years without it.
It will be relevant as long as sports fields are managed by trustees.
Question put and agreed to.
Section 14 agreed to.
SCHEDULE.
Question proposed: "That the Schedule be the Schedule to the Bill".
A lot of Acts are covered in the Schedule and it symbolises the whole Bill. This is basically enabling legislation that has been brought before the House to give some air of respectability to the principle of land leasing but I doubt if the Bill protects either the lessor or the lessee to the extent that they need the security of legal protection. Under standard letting agreements signed between farmers and tenants, lessors and lessees and/or their agents heretofore, in order to protect title for the owner of the property incorporated in that agreement was usually a provision that the owner of the property should be responsible for the payment of all rates, tariffs or levies to which this land would be subject, and further on in the agreement would be a provision whereby the tenant would be responsible under Department of Agriculture regulations for the cutting of all abnoxious weeds and so on. There is nothing about them in the Bill and such provisions are very important to show that the lease is legally binding on both parties.
That does not arise from this Bill.
The 1900 Act touches on it. Farmers throughout the country need to be told where they stand in this regard so that they will know the exact position. What will be the position in view of the Government's proposal to have a land tax on adjusted acreages? Who will be responsible for the tax, the lessor or the lessee, under new leasing arrangements? Unless farmers can get this clear I do not think land leasing will be very successful in future, and we do not want to see that happening.
Let me start with the problem about adjusted acres. That is the responsibility of another Minister and it does not concern this Bill at all. It can be argued that it has been given all the publicity necessary for this type of thing but I can tell the Deputy that a contract entered into is a legal document once it is signed properly by the two parties. That is the principal part of the Bill and if the Deputy says otherwise he has been misreading the legislation. We have been asked to identify the aspects of land legislation which acted as impediments. We have done that. I repeat that a contract signed by both parties is a legal document.
When we talk about land mobility and propose to encourage land leasing through legislative authority we must point out clearly in that legislation the conditions incumbent on both parties. Unless both know their responsibilities to the State they will not be prepared to enter into leasing arrangements.
It does not arise on the Schedule.
Question put and agreed to.
Title agreed to.
Bill reported without amendment.
Question proposed: "That the Bill do now pass."
(Limerick West): This Bill goes a certain way towards removing the legal impediments to land leasing, but that is all it does. It does not promote land leasing in any way. The Bill should have been designed to encourage the maximum production from every acre and to provide as much employment as possible on family farms and outfarms. This Bill will not do that and therefore it will fail in its main objective. It is only a poor shadow of what the Minister had promised in his statements and in the preceding publicity. Of course, the Government have no land policy, no plans, and they are merely trotting out the old clichés. There is not a single concrete proposal which would give reasonable access to land to young, ambitious farmers. All the Government are proposing is to abolish the Land Commission without any organisation to put in their place. I agree that the Land Commission need to be revamped——
There is nothing in the Bill about abolishing the Land Commission.
(Limerick West): The Minister has not made any effort to put forward concrete proposals to make aids and financial assistance available to provide a proper land leasing structure. I am not in the least surprised that the Government have proposed the removal of the Land Commission. There is no encouragement for young farmers to acquire land and therefore this Bill will be a dismal failure.
I listened to Deputy Noonan on the Second Stage making a constructive speech but now he has been destructive. The Bill will advance by a considerable degree the land mobility programme as promised by the Minister, who deserves credit from all sides for the work and the thought he has put into this. I welcome the Bill and hope that both sides of the House will ensure that in the near future there will be legislative proposals to provde the financial incentives needed.
As it is now 11 p.m. I must put the question.
Surely I can say——
No. In accordance with an order of the House it is now 11 p.m. and I must put the question: "That the Bill do now pass."
Question put and declared carried.
I am very disappointed that I could not get in.
That is over. A message will be sent to the Seanad acquainting it that the Dáil has passed the Bill without amendment.