May I express to you, Senator Linehan, my regret that this Bill of yours has been so often postponed, but it was inevitable because, under the Standing Orders, I have to give precedence to Government Bills.
LAND BILL, 1925—SECOND STAGE.
CATHAOIRLEACH
I beg to move the Second Reading of the Land Bill, 1925. It proposes to amend the Land Act, 1923 in respect of holdings having an actual or potential value as building ground, residential holdings, compounded arrears of rent, and lands held under fee farm grants, leases for lives or years, renewable for ever, or leases for 60 or more years unexpired.
As regards a holding excluded from the 1923 Act in consequence of being building ground in whole or in part, the Bill gives power to the Land Commission to divide the holding and separate the portion having value as building ground from the remainder of the holding, and to the latter part the provisions of the Land Act, 1923 shall apply. If at the expiration of five years from the passing of this Act the landlord has not resumed the part of the holding declared to be building ground and utilised the same for building purposes the Land Commission may order that the Land Act of 1923 shall apply to the whole or part of the said lands, but if the landlord satisfies the Land Commission that he intends forthwith to build he may be granted a further period of time to do so.
The effect of the Bill should be to speed up the erection of buildings where the land is really suitable building ground. Tenants who hold under lease, except a building lease, are at the expiration of the same to be deemed yearly tenants notwithstanding that the lease may not have been existing prior to 1881. Residential holdings are brought under the 1923 Act provided the following conditions exist:—
(1) that the rateable value of the land exceeds that of the dwelling house;
(2) that the tenant's principal or only business is farming;
(3) that the tenant is in bona fide occupation of the dwelling house and works and uses the land as an ordinary agricultural or pastoral farm.
Compounded arrears of rent remaining unpaid or any portion thereof may be added to the purchase money of any holding if the Land Commission so direct. The occupier of land in a non-congested district held under a fee farm grant, lease for years or lives renewable for ever, or lease for 60 or more years, who is in a bona fide occupation and uses and cultivates the land as an ordinary farmer, and where the rent payable is equal to or exceeds a third term judicial rent, may apply to the Land Commission for an order, which they are empowered to make, that the land be vested in them as if it were situate in a congested district under the 1923 Act. A demand for an amendment of the 1923 Act comes from various quarters. The tenants and occupiers of land now excluded from its provisions desire to be included.
The Minister for Finance in a recent speech at Mountrath promised amendment as regards compounded arrears, and the Judicial Commissioner of the Land Commission also expressed the opinion that amendment was desirable in other respects. I submit that this Bill will form the basis for giving relief to these parties. I therefore move the Second Reading of the Bill, and I submit it for the favourable consideration of the Seanad.
I rise to second the motion for the Second Reading of this Bill. When the 1923 Land Act was passing through the Seanad, we were under the impression that it would give complete land purchase for all the farmers and that it would serve to complete land purchase. We now find that there are numbers of farms that do not come under the Act. That is that these lands do not vest in the Land Commission. They do not get the benefit of the arrears under the Land Act. There are two sets of farms of this kind in the county I come from—land held under fee-farm grants and lands held under lease. Now, as I understand it, the reason these two sets of farms were exempted was because it was considered that the rents were small, only 1/- or 2/- an acre. Now, as a matter of fact, I know that land in my county held under fee farm grants is as high as 15/- an acre and, in the case of one farm in the neighbourhood where I live, the rent is 16/- an acre. One hears a great deal about agricultural holdings and the need for tillage. These men till 80 per cent. of their holdings. Many of them have not more than 20 acres each. When they saw this Land Act of 1923 being put through the Oireachtas, they considered that they would come under its operations. But after a few months they found that this was not so. Their landlords asked them to pay up. At that time these men could not conceive that they would be compelled to pay the last penny, when everybody else was getting 5/- in the £, but when they consulted their solicitors they found they had to pay and they paid under protest. It is very hard that these men are exempted while perhaps the grazier with five or six hundred acres of land gets the benefit of the Act.
The other set of men exempted consists of those who held land under lease. I understand it was because lease-holders were considered to be large ranchers that they were exempted from the Act, and it was desired that these ranches would be taken over and distributed. In the counties of Louth and Monaghan there is a very large proportion of agricultural land held under lease. These men till their land in the ordinary way, and they have to pay their full rent up to the present day. They got none of the benefits as the others. If we are to see fair play between these men and the rest of the tenants we should see that they get the same terms. These are the great blots in the Land Act of 1923.
There may be a case put up against this by the Minister for Lands and Agriculture, to this effect, that if the leaseholders were brought in, all the grazing lands in the country could be brought in. I do not think, and I am sure the other members of the Seanad do not think, that these men should be brought in. It could be confined to farmers of 150 acres. That would exclude the ranchers from being brought in.
I myself confess that I have become somewhat of a philosopher over this question of land purchase, having been almost extinguished by the operation of successive Land Acts. Still we have to keep the flag flying to the last, and it is somewhat refreshing to find that this is a Bill where the subject matter has some relation to the fact that this is a land measure. I do not rise to oppose the Bill because probably it will be necessary to have some amendments to the Land Act of 1923, but I do think that these should be considered comprehensively and dealt with by the Government. On the point of these arrears I should like to ask the Government a question, and that is, when are those to whom the arrears are due likely to get paid? I do submit that there is a solemn contractual obligation in this matter, and I do say we would be doing an infinity of harm to two parties if the solemnity of their contract is not recognised. I know there is a popular feeling that only rich men are involved in this transaction. Surely there must be at least one exception. We had yesterday the case of a working man named Lynham who had acquired the possession of lands as a result of his own labours. I presume the tenant who held from him did not recognise his status when it became a question of arrears. And I should be interested to know whether any arrears are due on his land or whether the tenant did recognise the quality of the landlord.
But there are numbers of people in exceedingly needy circumstances depending on these arrears. I submit that there is a claim to be recognised in this way in the case of people who have been born to a certain status of life and who now are reduced to living under conditions of the utmost poverty on a small income. I therefore suggest that the Government should recognise that aspect of the case. I also admit that the tenants and occupiers of land are suffering acutely at the present time. I have obligations and embarrassments to certain association, and I say that the members certainly recognise that fact, and I say that perhaps a certain recognition of that practical economic necessity is due from the Government. That is no excuse for not carrying out the contract between the landlords—the owners of land—and the Government under the Act of 1923. Perhaps the Minister may bear in mind that in this infant State it would be an injury to both parties not to carry out that contract fully.
George Washington at the time when the "greenbacks" issued by the Government were coming into the hands of speculators and when pressure was being brought on him to write down drastically the value of these instruments, said: "I do not care who owns them, they were issued under the credit of the State, and by that credit we will stand and we will discharge our obligations." There is in that a suggestion to this infant State that ought not to be neglected. It is a question of policy. It is open to the Minister to give stock to the value of the cash. The contract is in cash. The contract should be discharged in cash. The owners would be quite willing to accept stock which could be cashed at par value. That can be given by emergency legislation and it should be given forthwith to relieve the acute need that exists, and I know it.
As to the question as to how that is to be dealt with, if the Government did not see fit to ask the tenants to pay for it it could be met out of the general taxes, but I do submit that the question of the credit of the State is involved. There is a solemn contractual obligation under the Act of 1923 under which the landlords made great sacrifices—an Act under which they had to submit to the wiping out of all arrears after a certain date and had further to submit to a reduction of 25 per cent. in the arrears. They contributed their share to the solution of the problem and it is not fair to ask them to contribute any more. By asking that these arrears be added to the purchase money you are asking them to consent to a further reduction, roughly, 10 per cent. on the amount you agreed to pay. I know it is an unpopular thing to stand up in an Irish assembly and make any case for landlords. I make no apology for doing so here. I think the landlords have done more for this country than they got credit for. Roughly speaking, since 1880 they have suffered a loss of from 60 to 70 per cent. of their incomes. It is at least fair that they should now get the full value which the Government contracted to give them under the Land Act of 1923.
I rise to support the Second Reading of this Bill. From my knowledge of the conditions that exist in the country, I know of no better remedy for the grievances that exist than that suggested in the Bill before us. For that reason I think it should get a Second Reading. I do not, for a moment, suggest that the arrangements outlined in the Bill are the best that could be made. I think some amendment would be necessary to make it more acceptable to all parties. I feel that the compounded arrears must be dealt with. There is nothing in the Bill to prevent the arrangement suggested by Senator Keane being made. There is no doubt at all that those in possession of fee farm grants are in a particularly unfortunate position. Some small farmers, forty or fifty years ago, who had a little money, bought their small holdings. I know that in the counties of Limerick and Tipperary there are many holders of that sort, and in all equity they should get the advantage of the Act of 1923. This Bill will make for peace and security in the country, and for that reason it should get a Second Reading. I beg to support it.
I must say that to a great extent I agreed with Senator Keane in this matter. It seems always to be concluded that the landlord, the owner of the land, has to suffer in every case. When you reduce the rents of a certain number of people and there are a few people whose rents have not been reduced, that seems quite sufficient proof that a new Bill should be brought in to reduce the rents, not because it is a just matter, but because the rents of somebody else have been reduced. I think some consideration should be given to those who have been brought almost to starvation point by these wholesale reductions that have been given in the last 50 years. Some regard should be had some time for the landlords. I have not had very much regard for them myself, but there comes a point eventually when one must think of those who suffer.
I agree that the Land Act needs amendment in some particulars. Like Senator Sir John Keane, I have also become a philosopher in regard to land purchase. I realise that it is possibly a recurrent problem and that it is a rather rash statement to say that this, that, or the other is going to be the last Land Act. I think we found out that long ago. It needs amendment in a great many clauses that have not been mentioned here. I will find it necessary to introduce a Land Bill in the Dáil during this session to amend the Act in respect of the section dealing with Land Bank cases. It has been found that land was purchased at a very excessive price in 1920 and that it would be quite impossible, as was contemplated by the Act of 1923, to resell the land at that price. It will also have to be amended in respect of building ground, I agree. I agree that the section of the Land Act, 1923, dealing with building ground has caused a lot of hardship. That is generally agreed, I think now, by the Land Commission and outside by landlords and tenants. It really does not affect the interests of the landlord. You have cases where there is a holding of 200 or 300 acres with, say, about two or three acres abutting on a road, which is potential building ground, and for that reason the whole holding is excluded. That is obviously unfair, and it is a legitimate business grievance that has to be remedied.
We are thinking of introducing a clause in an amending Bill providing that the holding may be sub-divided and that that portion of the holding which is not building ground can be sold to the tenant purchaser. I think that would probably meet with general consent. I am not prepared to express any opinion on the particular sub-sections of the clause of Senator Linehan's Bill which deals with building ground. I am merely setting down the general principles we will go on when drafting our amending Bill. That is all I can say in reference to building ground. I am not prepared to agree or disagree with the other sub-sections of that section. It is the first section, I think. For instance, sub-section (3) and sub-section (4) raise other questions that have to be examined. I am not prepared at present to say what my attitude on that is. All I am prepared to say is that we must introduce a Bill dealing with this question of building ground and that we do admit the principle contained in the first sub-section, namely, that the holding may be sub-divided and that that portion which is not building ground may be sold to the tenant.
As to other amendments, I am considering an amendment giving certain security to farms which are used for the purpose of breeding high-class animals. It may be possible to draft a clause which will meet the requirements of that case and at the same time give the Land Commission power which they consider they should have. In any case that is a point to be considered. There are other questions of detail which I need not go into now, but they must be dealt with urgently by some amendments under the Land Act.
With regard to the question of residential holdings—I have already dealt with building grounds—so far as I am concerned at the moment I do not think we could improve on the system under which we left the question of what is and what is not a residential holding to the Land Judge. Whether it is a residential holding or not depends on a number of questions. It depends on the circumstances under which the holding was let in the first instance. It depends, also, on the terms of the agreement. It depends on the circumstances of the person who got the holding and it depends on the user of the holding when he had it, and the ratio between the value of the house and the land. It depends on 101 other factors, and I suggest that no definition which you could insert in an Act of Parliament could cover all the equities of the case and that any such definition as Senator Linehan suggests would probably exclude some cases and would cause as much hardship from his point of view as is at present the case under the Land Act of 1923.
I am not prepared to agree when you have said all you have to say as regards a residential holding that a holding is not residential whenever the poor law valuation of the house is less than the poor law valuation of the land. With regard to the fee farm grantees a good case could be made in a specific instance where a fee farm grantee and a long leaseholder should purchase. You can nearly make a case for anything by quoting specific instances in connection with legislation which deals in general terms with land purchase, but such a case will be the exception. My point of view can be expressed simply enough. There may be good reasons for dealing with fee-farm grantees, but I think land purchase has gone far enough. I think it should be our aim to limit it. It should apply to all ordinary agricultural tenancies. We all know that there are demands from all quarters, from fee-farm grantees as well as from the holders of long leases, from owners of plots in the very hearts of the cities, from owners of houses, that something should apply to them, comparable to the particular legislation applying to agricultural tenants. These demands are coming constantly upon us, but I suggest to anyone who values the security of property that we must set our face against that tendency somewhere. There were very special reasons for the Land Acts which go back a very long time. There was need for special legislation to deal with the agricultural tenants of the country. Our land legislation is probably the most drastic of any land legislation in Europe, and, as far as I am concerned, I am not anxious to extend its scope. I am anxious to administer the Act so far as it applies to the ordinary agricultural tenants, but I am not prepared to hold that certain people who are not agricultural tenants should get the advantages of agricultural tenants within the Land Act of 1881. We must draw the line somewhere. There is demand from people who own land in the towns and from all sorts and conditions of property owners, that they should become the owners of their holdings. That is going to hold us up if we accede to it, and it has to be stopped at some stage, and I think the stage to stop it is that which we reach by drawing a line for agricultural tenants, as those whose land comes under the Land Acts passed between the year 1881 and the year 1903.
The fee-farm grantees have not, from that point of view, such a tremendous grievance. I do say that a considerable portion of the land of the country acquired for division was held under long leases and in fee-farm. That is a fact. There are a great many people colloquially called landlords, who hold their land under fee-farm grants and long leases, and when I say that I am met with the case, "we are thinking of the ordinary farmers."
What is an ordinary farmer? We cannot deal with persons. We cannot legislate on a standard as to whether a man has black hair or brown hair. We must deal with land, not so much as with persons who occupy it, but with regard to their tenure. With regard to the fee-farm grantees, to meet the plausibe case that they put forward we inserted a clause in the 1923 Act which practically gave them all the rights of tenant purchasers. We allowed them to go to the Land Commission, and we provided that the Treasury should make an advance to enable them to redeem the rent; that is, where the land, in the opinion of the Land Commission, was good security, money would be advanced, the interest on which would bring in the fair rent having regard to the value of the land. That means that a high rent paid under the fee-farm grant becomes less, and is reduced on the same principle that the Land Commission applies. When making advances to new tenant purchasers, they consider whether the value of the land is security for the full redemption money. If the rent is high it is reduced to what is considered the right annuity for sixty-seven-and-a-half years. So far as these people are concerned they will own their holdings at the end of the sixty-seven-and-a-half years, and during that period annuities paid by them, if they are in the same position as tenant purchasers, will be on the same basis. Their rents are reduced if the rents are so high that in the opinion of the Commissioners, the land is not able to bear them. They become absolute owners at the end of the sixty-seven-and-a-half years. So far as these people are concerned, they are in the same position as tenant purchasers.
But there are numbers of fee-farm grantee holders who held under extremely small rents. I do not know whether it is seriously suggested that where land is let at 5/- an acre there should be a reduction of 25 per cent. I think that frequently happens. Occasionally rents under fee-farm grants are fixed under different circumstances. Sometimes the rents are high and sometimes they are far lower than the judicial rents fixed by the Land Commission. But there have been leases for 90 years where the rent was fixed at a half-a-crown or five shillings an acre. Is it seriously suggested that the same principle should apply there as in the case of rents fixed according to the judicial standard on an agricultural holding? That would be an extraordinary and unjust state of affairs. But when the rents are high and beyond what the land will carry, the Judicial Commissioners can come in and decide the redemption value of the rent, and meet the equities of the case. You get a reduction of the amount if the rent is high, and the purchase annuities run on for sixty-seven-and-a-half years.
That is to meet an exigency in a particular class of case, but there is no agreement from my point of view. It is well to draw the line somewhere. I ask people anxious that fee-farm rents should be purchased if they do not think that we must draw the line somewhere, and to consider how far they mean to go and whether we are to adopt the same course in all circumstances. I know the real grievance is this: there is usually a reduction of 25 per cent on the rent until the day of purchase in cases of agricultural holdings. What the fee-farm grantees are thinking of is, that their rents should be reduced immediately by 25 per cent., regardless of circumstances. I do not say that that is the case that Senator Linehan had in mind, but that was the way it was pressed upon me. They were not satisfied with the provisions of the Act; but they quoted the case of what they called the ordinary farmer of 50 acres. He has a judicial rent, and he does not get his reduction, and they say that is the grievance, so far as he is concerned, but in the case of a man with land of 5/- per acre on a long lease, is he to get a reduction also? I put these difficulties to show that I have not made up my mind that we ought to insert a clause for the fee-farm grantees. I have been thinking over it. It is always dangerous to say that you may change your mind because it is taken for granted, if you say that, that you will change your mind. I have considered this matter with an open mind, and I say this here on the merits, and regardless of pressure on one side or the other, that I do not see the other side of the case put up.
With regard to the compounding of arrears, the Land Act of 1923 provided that not more than three years' arrears all round should be collected. That in effect was practically all that could be dealt with. I should say that out of the total rental of £1,000,000 there would not be more than £20,000 to be added for another half-year after the three years. I mean by that that if you said instead of three years, three and a half years, the extra amount yielded by the additional half-year would not be more than £20,000. We, in fact, provided that the arrears should be dealt with, and we provided that one and a half years of the three years was to be added to the purchase money and two years collected. That was in 1923. We are now in 1926. Things were not as prosperous in 1923 as they had been in pre-war days, or as they had been during the war, but we all expected that things would get better. We certainly did not expect that the depression would continue or that prices would decline as steeply as they did in 1924 and in 1925, and we did not expect a further fall in prices for agricultural produce would occur in 1926. But these are the facts, and we find ourselves now, notwithstanding that we have a fairly stringent and drastic enforcement of the law which gives the sheriff powers he had not got pre-Treaty, and that he has been exercising ruthlessly, with considerable arrears of land purchase annuities and rather considerable arrears of rates, and there are considerable debts as between private individuals which have been undischarged.
That is the position, and the prospect is that things will get a little worse before they get better. In that state of affairs I have come to the conclusion that we cannot collect the one and a half year's arrears outstanding. We have collected for one half-year; there are one and a half year's arrears outstanding, and we cannot collect the current annuities, the current payments in lieu of rent and current rate and at the same time collect one and a half year's arrears from people who owe in other respects. That is unfortunately the state of affairs, and it is a precedent I do not like. I make no secret about it. It is a precedent to be avoided. We have got into bad habits. To put it in another way, it is difficult to get away from an example which has always been set to us in that respect. There has been this wiping out of arrears of rent since 1870. We are not too anxious to follow that. For the reasons I have given, we are compelled to come to the conclusion that we have no alternative except to add that one and a half year's arrears to the purchase money, and that is the view of most of the landowners I have discussed the matter with. Is that going to be a hardship? The really important consideration in the matter is the one I have mentioned, that we are coming again to deal with arrears, by way of making people pay them.
As to a point mentioned by Senator Sir John Keane, I would like to say that this one and a half year's arrears would be paid within, I should say, less than a year in bonds which stand at 90. It has not been possible in this country to collect 100 per cent. Ninety-five per cent. has been more like it. Landowners would lose on that five per cent., but they would get their money quicker than they otherwise would. Many landlords with whom I have discussed the matter have admitted it is as broad as it is long.
Senator Sir John Keane stressed the the fact that there are a great many people who are dependent on rents, on their income from lands, and who are by no means well off. He asked me incidentally if I knew anything of the circumstances of the Lynham case. I know nothing of the circumstances of that case. I agree there are large classes of the community who are dependent for their livelihood on the receipts they can get from land, but it should be remembered they are getting their rents, now called payment in lieu of rent, at a time of rather acute depression, reduced, I admit, by 25 per cent., more promptly than they got them for seventy years. There is not a landowner who has not admitted that. You occasionally meet a man who complains, but it is always because it is the question of title. Cases of this sort only represent two per cent. of the total rent. They are getting their rents with regularity for the first time for seventy years. That has to be remembered when people stress the conditions under which poor landowners are living at the moment. Another point on which I want to say a word is that made by Senator Sir John Keane in regard to contractual obligations. The word "contract" has been used. There is always a contract between the occupier of the land and his superior interest. There always was that contract. That is the position in every country in the world.
I have said all I have to say in introducing successive Land Acts. I hope I made my position clear. On the other hand, if there is anything in this contract, then it is applied to the land legislation which has been going on since Parliamentary government commenced in every country in Europe. If there is a contract broken in introducing a new Act dealing with land, then there was a contract broken in 1923, 1903, 1889, 1881, and 1870, and in all the Land Acts behind that time, not only in this country, but in England, Scotland, France and Germany. You can argue there is a contract. Undoubtedly there is a contract between the owner of the superior interest and the occupier, and wherever legislation affects that in any way there is a breach of contract. I protest against the suggestion that Irish land legislation amounts in fact to a breach of contract —some failure to keep your contract, some interference with the credit of the State which apparently does not apply to the land legislation it has been found necessary to pass in every other country in the world since Parliaments began.
Question—"That the Bill be read a Second Time"—put and agreed to.
The Seanad adjourned at 5.20 until 3 o'clock on Wednesday, 3rd March, 1926.