I move: "That the Bill be now read a Second time".
The purpose of this very short Bill is to extend the operation of the special ground rents purchase scheme that is administered by the Land Registry under Part III of the Landlord and Tenant (Ground Rents) (No. 2) Act, 1978.
As Minister for Justice I had the pleasure of initiating the Act of 1978 which provided a new method for the purchase of ground rents on dwellinghouses. It had become apparent that the main reason people did not avail themselves to a greater extent of their right to purchase the fee simple under the Ground Rents Act of 1967 was the legal cost of doing so. Under the scheme provided by that Act the purchase is a matter for the parties themselves to arrange, although any dispute or difficulty may be referred to arbitration by the county registrar whose award may be appealed to the Circuit Court. The purchaser is liable for the ground landlord's costs of the transaction and that liability is limited to such costs as are necessary and reasonable. The approach adopted in the 1978 Act is that for a fixed fee the Land Registry undertake the legal work involved in the acquisition of the fee simple. That procedure provides a ready means by which ground rent tenants of dwellinghouses can free themselves of ground rent and I am glad to say that a considerable number of people have availed themselves of that opportunity. The total number of applications received between 1 August, 1978 and 31 May this year is 52,742.
The special purchase scheme originally had a life of five years to 31 July, 1983 and was extended by legislation in 1983 for another year and again in 1984 for a further three years to 31 July, 1987. On both occasions the extension was subject to an increase in the fees and the increases were calculated to cover the cost of administering the scheme.
Following the 1984 legislation all fees may be revised by ministerial order. The scheme is self-financing on the basis of current fees and, accordingly, no increase in fees is called for at present. The vast majority of applications received into the Land Registry are made by persons in occupation of their dwelling house, who have the consent of the ground landlord to the purchase of the fee simple. The current fee in these "consent" cases is £26.
I am proposing in the Bill to extend the life of the scheme indefinitely — a course which I think will be welcomed by Deputies and by those ground rent tenants who will continue to have an optional purchase procedure that is as simple and as inexpensive as possible.
It may be that some aspects of the operation of the special purchase scheme under the existing legislation are capable of being improved. What I have in mind is that since the Land Registry scheme would, by virtue of this legislation, be placed on a permanent footing the scheme should, perhaps, be assimilated more to the ordinary registration functions of the Land Registry. I propose to have this matter examined further.
I would like briefly to mention ground rents payable by local authority tenants. The No. 2 Ground Rents Act of 1978 extended the right to purchase the fee simple to those tenants for the first time. It may be that public sector landlords, such as local authorities, can and should be better enabled to make special arrangements to bring an end to ground rents payable to them, many of which are for nominal amounts payable if demanded, which are not and were never intended to be collected. I am having this question examined to see what can be done and any proposals I may develop to deal with the matter will be announced in the ordinary way in due course.
The scope of the Bill is, as it must be — if we are to get the legislation through before the present scheme expires on 31 July next — confined to repealing the provision of the No. 2 Act of 1978 which limits the period within which applications may be made under Part III of that Act. The Bill therefore is, essentially, a one section Bill. Section 1 proposes the repeal of section 18 (as amended by an Act of 1984) of the No. 2 Act of 1978 and its effect will be to ensure that the Land Registry scheme of ground rents purchase will extend without limitation beyond the date I have mentioned. Section 2 is a standard provision in relation to short title, construction and collective citation.
I commend the Bill to the House.