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Seanad Éireann debate -
Tuesday, 6 Apr 1982

Vol. 97 No. 5

Housing (Private Rented Dwellings) Bill, 1982: Second Stage (Resumed).

Question again proposed: "That the Bill be now read a Second Time".

As I indicated earlier, this Bill follows the broad outlines of the Bill that was passed by the Oireachtas last December but part of which was declared unconstitutional by the Supreme Court. A number of important changes have been made in the light of the Supreme Court's judgment and to cater for amendments put down by me during the passage of the earlier Bill through the Dáil, as well as other drafting and consequential changes to that Bill. Apart from the dropping of any arrangement to phase in rent increases and the new formula for determining rents, the most important change in this Bill is the inclusion of a section to enable the Minister for Social Welfare to pay allowances to tenants suffering hardship as a result of rent increases. Normally such a provision would be part of social welfare legislation but, given the urgency of the matter and the time constraints, it was considered necessary to bring forward the provision in this Bill. The details of the scheme of allowances and the regulations under which it will operate will be announced as soon as possible by the Minister for Social Welfare.

A provision of £6 million was provided in the recent budget. This was the same amount as in the January budget and questions as to its adequacy were raised in the Dáil. The change in the formula for fixing rent, compared with the earlier Bill will reduce the subsidy demand and any saving can be set off against the extra cost arising from the omission of the earlier arrangements to phase in rent increases. In any event, I would like to assure Senators that the Government will provide whatever funds are needed to finance the allowances schemes.

The Bill confers on tenants of dwellings previously controlled under the Rent Restrictions Act, 1960 a right to retain possession of the dwelling for their lifetimes. The same right is given to the spouse of the tenant. Members of the family of the present tenant are given a right to possession for 20 years from the commencement of the Act. Where a member of the tenant's family succeeds to the tenancy towards the end of the 20-year period, the member is given an extension of the time so that he is entitled to possession for a minimum of five years. This latter extension is in line with an amendment I proposed when the 1981 Bill was before the Dáil last December. A right to retain possession does not on its own provide the tenant with all the protection he needs. There must also be certain restrictions to safeguard the interests of landlords. A mechanism is required to determine rents in case of dispute and to provide for the normal procedures whereby a landlord can recover possession of the dwelling in certain circumstances.

I have already outlined the reasons for the use of the District Court to determine rents in cases of dispute between the landlord and tenant. The formula for doing so is very different from the 1981 Bill and allows the court to take into account, amongst other things, the nature, character and location of the dwelling, the means of the landlord and the tenant, the date of purchase of the dwelling and the amount paid for it, the length of the tenant's occupancy of the dwelling and so on. This formula takes into account very many more factors that were provided for in the 1981 Bill. Both the landlord and the tenant are given a right at any time to apply to the court to fix the terms of the tenancy but once fixed by the court the terms stay in force for five years. In effect, therefore, rents can be reviewed at five yearly intervals which meets one of the more strident criticisms by the Supreme Court of the old rent restrictions code which provided no basis for a review of rents.

The landlord is given certain rights to recover possession of a dwelling. These are in line with the rights he had under the old Rent Restrictions Acts but he can regain possession only on foot of a court order for certain specified reasons. Where the landlord recovers possession for reasons which involved no fault or failure on the part of the tenant, the tenant may be entitled to substantial compensation — up to three years rent or alternative accommodation plus moving expenses. These compensation provisions are more generous than under the 1981 Bill by reason of an amendment I moved in the Dáil increasing the maximum compensation from two to three years' rent or alternative accommodation.

As I think is widely recognised, this is a very difficult piece of legislation. It has taken more than one attempt since the first Supreme Court decision last July to fill the legislative vacuum created by that decision. It is not to be expected that a Bill such as this will satisfy everybody. The main parties involved, landlords and tenants, have interests which are essentially opposing in nature, and legislative action must seek to balance these within the limits set by the Constitution and successive judgments of the Supreme Court. Both parties cannot expect to get everything they demand. In the light of the decisions of the Supreme Court, tenants cannot continue to enjoy the benefits they formerly had at a landlord's expense. On the other hand, the Government in this Bill must meet their constitutional obligations to safeguard with special care the interests of the weaker sections of the community, among which are many tenants of controlled dwellings. The Bill before the House is a genuine effort to get the right balance as between these conflicting rights. With these objectives in mind, I commend the Bill to the Seanad.

The Bill, introduced as it is in the closing stages of this session of the Seanad, is probably the most important piece of legislation which we have considered since we were convened last August. It is, as other Members have made clear in a debate on the earlier temporary piece of legislation, all the more important because its predecessor, the 1981 Bill, was on reference to the Supreme Court declared to be unconstitutional. It is right that we should consider not only the nature of the content of the Bill in isolation and how it stands up as a piece of legislation, but also that we should view it in the context of the original decision which gave rise to this crisis in the area of housing — specifically the area of what were previously controlled dwellings — and also in the context of the decision of the Supreme Court arising out of the Madigan case. We should also consider it in the context of the decision of the Supreme Court arising out of the reference by the President of the 1981 Bill to test its constitutionality. We should differentiate between what we might like to see as an ideal piece of legislation coming through the House, what we have before us and how we can amend it to bring it as close as possible to what we consider to be ideal while not infringing the Constitution as it is at present and as it is interpreted by the Supreme Court. Whether we like it or not, the Constitution is not what is written on the piece of paper but how it is interpreted by the judges of the Supreme Court. We have now two major judgments as an indication of the criteria which the Supreme Court will apply to any challenge to this Bill or any reference of this Bill by the President to them to test its constitutionality. We can, therefore, say with some degree of accuracy what the view of the Supreme Court would be if they were presented with this piece of legislation. I understand completely the views put forward by the Minister today and sympathise totally with his motivation in bringing this piece of legislation forward. However, the Bill is deficient in many ways and I have the greatest possible fear that it too will be declared unconstitutional. This would, of course, give rise to the problem outlined on the previous piece of legislation except that it would be compounded further. Every time we make an effort to legislate in this area and this effort is not successful we make the resultant continuation Bill that much more difficult to justify and that much more likely to be challenged either by reference by the President or by some citizen who believes his rights have been interfered with.

Therefore, I am not greatly impressed by the requests of the Minister for an urgent examination of this piece of legislation. Whatever the merits and demerits of the temporary legislation which has so recently passed through this House, at least for the purpose of our discussion we have to consider that that temporary legislation will, in fact, be effective. There are ample grounds for optimism in that regard, as at the end of the judgment on the Madigan case which gave rise to this problem, the Supreme Court went out of their way to emphasise that legislation would be expected and that there would be a period of time between the judgment of the court and the enactment of the legislation. Therefore, it is reasonable to assume that the Supreme Court will adopt a more favourable view towards the time which we take for the further consideration of the permanent Bill, that is that they will consider the problems arising from the constitutionality of the temporary Bill more favourably than they will the actual problems which will arise if they once again find that the permanent Bill which we are putting through is unconstitutional.

The Bill which is presented to us fails in a number of ways to tackle the problems which the Madigan judgment gave us. It also fails to tackle the additional problems which were given to us as a result of the judgment which has been handed down on the 1981 Bill. The Minister has been deluded if he thinks that the changes which he has made meet the objections of the Supreme Court. I propose during the course of my Second Stage speech to say why I believe that to be a true statement.

We must first of all understand the nature of the objection which the Supreme Court had to the 1960 legislation, which was declared unconstitutional in the Madigan case, and also in the case of the 1981 Bill, which was also declared unconstitutional. It is very hard to pick one thread out of both judgments and to say exactly what the essence of both judgments is. It is true to say that in the consideration of judgments judges allow their minds to range over many factors. But even allowing their minds to range over many factors, and even mentioning those factors in their judgment, we must be careful to differentiate in our own mind between the asides they are making which are not really the essence of their objection at all and what is, in fact, the essence of their objection. That is what has happened in this regard. The Minister has looked at the judgments which he has, has seen that there is a thread running through those judgments in which the Supreme Court said words to the effect that the differing and individual needs of the landlords and tenants were not taken into account. He then assumed that this was in fact the main source of objection by the Supreme Court, while a reading of their complete judgment in the Madigan case and only a partial reading by me of their judgment in the other case — unfortunately, due to an extraordinary situation that judgment is not easily available — seem to indicate that the essence of the argument there is quite different. The essence of the argument of the Supreme Court is that one category of property owners, one category of owners of rented accommodation, cannot be arbitrarily set up for separate consideration by the Oireachtas and that the Oireachtas must treat all owners of all property which is for renting in a similar fashion.

The Supreme Court are not saying — in so far as I interpreted it — that it is improper to make regulations with regard to the amount of rent which would be paid by people in respect of property and in respect of dwellings. What it is saying is that there is no logical, reasonable and constitutionally sound reason why dwellings in the course of construction on 7 May 1941 should be put into a separate category from other dwellings which were not constructed or were not in the course of construction prior to 7 May 1941 and that two different sets of criteria should apply. The Supreme Court held, in my opinion, that to differentiate between houses which were built prior to 7 May 1941 and those built after that date was unjust and unwarranted. This is the essence of the objection which the Supreme Court has to the 1960 legislation, which it struck down, and is the essence of the objection which it has to the legislation which we passed through this House and which was referred by the President to the Supreme Court.

This is where the Minister has failed to grasp the real objection of the Supreme Court. If the Minister, in the Bill before us today, fails to arrive at a conclusion which satisfies the Supreme Court's view that there should be no difference between the treatment of landlords who owned property which was constructed before or after May 1941, by exactly the same line of reasoning, it is inevitable that the Supreme Court will declare unconstitutional any Bill which fails to meet that test.

It is, therefore, against that background that we should consider the legislation before us. It is for that reason that I find it so difficult to accept its constitutionality. If I might digress for a short while, we find ourselves in a difficult position because we are not really considering whether we would like the Constitution to be something other than it is. We must really consider the Constitution as it is, or must establish a system of rents which is both in conformity with the Constitution, that is, that will pass the test of the Supreme Court if it is referred to it, and that is also as near to our individual view of social justice as we could possibly make it. Unfortunately, it is a fact of life that if there is a conflict between the constitutionality of legislation and social justice, we have no option but to err on the side of constitutionality. That is not something which we like saying or of which I approve, but it is a fact. The Minister is to be commended in so far as he recognises that fact within his Bill by making specific provision for the granting of rent rebates, even though he does not make it clear to us exactly how these are going to operate.

I quote, not extensively, from page 8 of the Supreme Court's judgment, on the reference to Article 26 of the Constitution, with regard to the Housing (Private Rented Dwellings) Bill, 1981, which judgment summarises the arguments by quoting from the earlier legislation, stating that the legislation:

applied only to some houses and dwellings and not to others, that the basis for the selection is not limited to the needs of tenants, to the financial and economic resources of the landlords, or to any established social necessity, and, since the legislation is now not limited in duration, is not associated with any particular or temporary emergency situation.

The Minister has taken the second portion ot that and seems to have come to the conclusion — in my opinion quite erroneously — that if the legislation which he puts before us takes into account the financial and economic resources of the landlord, establishes social necessity and is not limited in duration, his problems are over. He fails to cater adequately for the essence of the argument, which is that the basis of selection is the real problem of the case. The court, in expressing its opinions on the Rent Restrictions Act, 1960, went on to say that the provisions of Part II of the Rent Restrictions Act, 1960 (amended):

restricted the property rights of one group of citizens for the benefit of another group. This is done without compensation and without regard to the financial capacity or the financial needs of either group, in legislation which provides no limitation on the period of restriction, gives no opportunity for review and allows no modification of the operation of the restriction.

There are three essential elements contained in that. In the original Madigan case, the reasons for its being declared unconstitutional were threefold, firstly, that it restricted the property rights of one group of citizens for the benefit of another group; secondly, that it was done without compensation and without regard to the financial capacity or financial needs of either group; thirdly, that it gives no opportunity for review and allows no modification on the operation of the restriction. In the Bill which was before us before Christmas last year the permanent nature of the disability was lifted but that, apparently, did not satisfy the Supreme Court. In addition to lifting the permanent nature of the disability, the Bill now before us goes to the second stage and talks about the financial capacity and financial needs of the individual groups. However, it does not get over the problem that it still restricts the property rights of one group of citizens for the benefit of another group. I continue with the quotation, from page 8 of the recent Supreme Court decision:

These provisions constitute an unjust attack on the property rights of landlords of controlled dwellings and are, therefore, contrary to the provisions of Article 40.3.2 of the Constitution.

It appears that what has happened in this case is that the Supreme Court, having failed to declare a Bill constitutional which got rid of the permanent disability under which landlords of pre-1941 dwellings found themselves, and the Legislature having failed to consider that that went far enough, it is now proposed in this Bill before us that a second step should be taken to see that the financial needs of landlords and tenants should be taken into account. This, however, does not confront the crucial problem in the Bill, which is the question of arbitrary selection of certain dwellings for special consideration and the restriction of the rights of landlords and owners of these properties compared with the rights of landlords and property owners of similar properties which happen to be built after 7 May 1941. In these circumstances, whether it is a good or a bad thing, any Bill which comes before us which does not talk in terms of allowing the fair market rent is bound to fail. The only way of solving this problem is by allowing the court or the tribunal, the appropriate body, to assess the fair market rate but giving to that tribunal or court the view of the Oireachtas as to what is the fair market rent. We can draw on our experience and can indicate what our view on that matter is. I have an amendment down which will cover that problem.

The solution proposed by the Minister is not a solution at all. I want to draw the attention of the House to what the Minister said in his speech when he spoke about the £6 million provided in the budget. He said: "The change in the formula for fixing rent, compared with the earlier Bill, will reduce the subsidy demand". If that is so, how can this Bill improve the rights of the landlord? This is not what I want or not what the Minister wants, but it is what the court want, because the court say that under the previous Bill, these people were not being adequately compensated or fairly treated. Without reference to and without changing what the Supreme Court have done, they said these people are not being treated fairly with reference to other people who do not come within the scope of this legislation at all. The Minister told us that proposed legislation would reduce the amount of rent which the landlords are going to get. This does not in any way change the reference point outside — if it did my argument might not be valid — but will still overcome the constitutional infirmity the first Bill had. It appears a total contradiction that the Minister could say there would be less subsidy required, because his speech will be read as meaning that his view and the view of the Legislature is that the proper interpretation of section 13 is that there should be less money given to landlords than envisaged under the 1981 Bill.

The 1981 Bill was specifically declared unconstitutional because it took five years to reach the fair market rent and because of the effect it would have on the rights of the landlord in years one, two, three, four and five. There were other problems with the Bill which the court did not go on to consider. On page 17 of the judgment it says:

The effect of the rebates permitted by section 9 is that, for a period of five years after the passing of the Bill, landlords are to receive an amount which will be substantially less than the just and proper rent payable in respect of their property. In the absence of any constitutionally permitted justification, this clearly constitutes an unjust attack upon their property rights.

That is justification for what I was saying earlier: that the Supreme Court will not be satisfied with the removal of the permanent nature of the discrimination against landlords and will not be satisfied with what is proposed in this Bill — that the means of the landlord and tenant should be taken into account — but clearly spell out here that a system of rebates which reduces even temporarily the amount which the landlord would receive would be unacceptable. In this legislation before us there is a proposal that the gross rent, that is, the rent which the court will determine will be payable in the absence of agreement:

shall be the rent which, in the opinion of the Court, would be a just and proper rent having regard to the nature, character and location of the dwelling, the other terms of the tenancy, the means of the landlord and the tenant, the date of purchase of the dwelling by the landlord and the amount paid by him therefor, the length of the tenant's occupancy of the dwelling and the number and ages of the tenant's family residing in the dwelling.

I cannot believe that a Supreme Court which struck down a Bill on the basis that it was unconstitutional because it allowed a rebate for five years will allow a Bill to be constitutional which takes into account the number and the ages of the tenant's family residing in the dwelling. It is not believable and is not going to happen. We need a much more fundamental look at the problem, we need to put in the fair market rent and we need to subsidise those tenants who for one reason or another cannot meet that fair market rent; and the sooner we do that the better. For that reason, the fundamental basis of this Bill is flawed.

There are also a number of other problems which we can discuss on Committee Stage and to which I will make passing reference now. The Bill fails to tackle the problem of the overcrowding of the District Court and, in a curious reversal of roles, an amendment by Fianna Fáil in the Seanad on the last occasion this matter was discussed was in favour of a rent tribunal. The Government at the time, supported by me, felt that the urgency of the matter did not permit that to be passed. In view of the commitment of the previous Government and the commitment of this Government, obviously I can only believe that work has been proceeding on that matter in the Department of the Environment and that the technical problems which it would be necessary to overcome in a short space of time have been considered in the meantime. As it was the policy of the last Government to have a rent tribunal, and as it is the policy of this Government to have a rent tribunal, I presume that the consideration of the matter has now reached a stage, and a conclusion, in the Department of the Environment which would enable this matter to be considered quickly. We should take up the suggestion of our Fianna Fáil colleagues on the last occasion and I will be moving an amendment in the same terms as the amendment which was not carried in the Dáil on the question of the establishment of the tribunal.

The other matter to which I would like to refer on Second Stage is the question that arises with regard to the necessity for the continuation of the type of protection which we are giving to the landlord under the heading of recovery of possession. It is not necessary to have a continued protection of the landlord in terms of recovery of possession as if he was no longer getting the full market rent or fair rent for the property, because irrespective of the form of legislation when passed, presumably those who pass it will maintain that the rent established thereunder is a fair rent.

In these circumstances I do not see any justification whatsoever for not giving the tenant a permanence until the end of the relevant period, which permanence, of course, would also be subject to matters like the tenant paying the rent which had been agreed and the place not being used for immoral purposes.

We will move another amendment which will seek to remove from the landlords the power which they would have under this Bill to get possession of the property merely in the interest of good estate management. In most commercial properties the tenant is protected until the end of his tenancy period at which stage he would be entitled to renewal of a tenancy, but at that stage the landlord could plead good estate management and get possession of the property with adequate compensation. In the case of a commercial tenancy there is no provision whereby a landlord in the middle of the tenancy can get possession of the property except by agreement with his tenant. I do not see why we should give additional protection to landlords of dwellings over and above the protection which is given to landlords in a commercial enterprise. If it is necessary, to effect this change, to repeal the appropriate legislation in respect of non-controlled dwellings, then we should take both the former controlled dwellings and the non-controlled dwellings in the same Bill.

Finally, there were very substantial points made in the other House about the whole nature of the approach of this legislation with regard to the problem of assessing the means of the landlord. It was pointed out correctly that the means of the landlord meant nothing if the property happened to be owned by a limited liability company or a partnership or by any other kind of association. What would the means of the landlord be and how would those means be taken into account if the property was owned by the Representative Church Body or any other incorporate body of that kind?

Many of these dwellings have fallen into the ownership of these organisations. Therefore, to talk about taking into account the means of the landlord is taking the judgments of the Supreme Court and extracting from them sufficient to flatter the judges to pass the legislation the next time it goes through, without getting to the essential of the problem. Whether we like it or not, the Supreme Court has found that there cannot be less money paid to a landlord, by reason of the fact that this is a dwelling which was built before 7 May 1941, than is paid to a similar person in a similar house where the house was built after 7 May 1941. It is a failure to grant that essential point that is the real fallacy in this legislation. This is why we have to sit long hours to consider and improve the legislation, confident in the knowledge that the temporary legislation has already gone through the House. I anticipate a full examination of the Bill on Second Stage but an even fuller examination of the Bill on Committee Stage and the consideration of many amendments which I and, I assume, other Members will be tabling. Therefore we should reconcile ourselves to the thought that we will be considering this for a long time to come.

First, because I may not get another opportunity, I should like to make some complimentary remarks about the Cathaoirleach, who, I regret, has just left the Chamber. As this may be the last occasion that the Seanad will sit before the election, I should like to place on record the fact that I have always found him most courteous and impartial and I compliment him on the dignified manner in which he carried out his duties. Second, I should like to welcome the Minister to the House and wish him well in his job and look forward to great achievements on his part. He has my special good wishes.

Regarding the Bill, the Supreme Court recently recognised that a serious and long standing problem exists in the area of rent restriction. It falls to the Oireachtas to find a solution to this problem, a solution which will recognise that there are and have been serious cases of hardship to tenants and in some cases serious cases of hardship to landlords. The type of solution required is a solution that will do justice to both parties and protect people in cases where serious hardships would result, whether the people are landlords or tenants. In order to do this adequately, it seems that the solution proposed in the Bill must take into account a number of things, first that the State protect a tenant in the case of serious hardship by ensuring that he or she cannot be put out on the side of the road because that tenant has been asked to pay a high rent which he or she cannot afford to pay. This protection should be given by way of subsidy where genuinely required.

Second, and I would stress the point as much as possible, I would refer to speculators. By speculators I mean those people who recently bought rent-controlled houses in the hope of making large profits from the tenants or from the State. I suggest they be singled out and dealt with in the Act to prevent this happening.

Third, cases of genuine hardship to landlords also should be dealt with by way of subsidy where appropriate. I would appreciate if the Minister would take those points into account. I believe they are reasonable and serious points and I hope he will honour me by dealing with them in his reply.

I understand it is not strictly in order for the Senator to compliment the Chair. But, if it is in order I will try to convey to the Chair the sentiments conveyed by the Senator in his absence in which I am sure all Members of the House would join. Although it may not be orderly to do so, I would like to thank the Senator for making that point.

This is the fifth Bill to come before this House to try to resolve the problem which has arisen following the Supreme Court judgment in the case Blake and Madigan against the Attorney General which was handed down in June 1981. Before dealing in detail with the proposals in this Bill I would like to welcome the Minister of State on his first visit to the Seanad and I would also like to say that I was pleased to have a contribution from the other side of the House from Senator Hanafin because, although it is the fifth Bill, it is also arguably, as Senator O'Leary has said, the most important of them because it is a serious attempt to try to resolve this very serious difficulty. In view of that, I feel it necessary to do something I have not done in this House since I became a Member in 1969, and that is to draw attention to the fact that there are at the moment three Senators in the House and that we have not had a quorum for most of the afternoon. I therefore draw attention under the Standing Order No. 20, to the fact that the Seanad does not have a quorum.

Notice taken that 12 Members were not present; House counted, and 12 Members being present,

As I said, that is the first time I have ever felt it necessary to draw attention to the very poor attendance in the House. I have very real sympathy for Senators, who have a lot on their minds including their own electoral prospects, and indeed I hesitated before drawing attention to this. But I want to emphasise, as indeed was already emphasised by Senator O'Leary, that this is probably one of the most important pieces of legislation this House has had to deal with for a very long time and that it is the fifth Bill that has come before the Seanad in an attempt to resolve the grave crisis for a number of people which has arisen since the judgment of the Supreme Court in the Blake and Madigan case last June. I feel that, because there is serious concern about the Bill itself and because of the gravity of the social problem and the hardship, anxiety and worry caused to a very vulnerable sector of our community, many of whom are elderly, many of whom are exposed to very serious threat to their home and the security of the little flat they have lived in for perhaps 30 or 40 years, it behoves us, even when we are understandably preoccupied with other matters, to ensure that this Bill gets the attention and consideration which it certainly deserves to have.

When we were considering the other Bill this afternoon, the Rent Restrictions (Temporary Provisions) (Continuance) Bill, 1982, I referred at some length to the reason we had the problem and in particular to the approach and judgment of the Supreme Court in the Blake and Madigan case, because that is an essential background to understanding what the problem is and understanding the way in which we are constrained as a Legislature in seeking to approach the problem. I do not propose to put again on the record of the House the extracts from the judgments of the Supreme Court or my own views, such as they are, on the approach adopted and the constraints which it imposes on us.

But we have to take stock of the situation and to realise that we face a very difficult problem. Although it is in many ways a technical, constitutional and legal problem, it is one which we have to address ourselves to and therefore which we must discuss in sufficient detail to do that.

If I were a member of the Judiciary, which I am not and not likely to be, I would say in relation to a great deal of what Senator O'Leary has already said that I concur to a considerable extent with his approach and with his analysis both of the judgment of the Supreme Court in the case referred under Article 26 and also in his approach and attitude towards this present Bill. But in the best judicial tradition, having concurred, I then shall go on to give my own approach to the Bill.

It is important to understand what the problems were with the predecessor to this Bill, the predecessor being the Bill introduced before Christmas, to deal in a longer term way with the problem caused by the finding by the Supreme Court that the previous legislation on the control of rents, and indeed in relation to the restriction on recovery of possession by landlords, was unconstitutional. It is sufficient to refer to the approach adopted by the Supreme Court and the criteria set out there. I may, to a very small extent, overlap with Senator O'Leary in this, but I think it is probably worth repeating, because what we are doing is clarifying the framework, the limits we have to operate within, and the pitfalls which we must avoid if we are to ensure that we do not pass through these Houses legislation which is ultimately, either by reference or by a challenge in the courts, ruled to be unconstitutional, with the further anxiety and fears that that would impose on so many people affected.

I would like to turn to the portion of the judgment of the Supreme Court delivered on 19 February in relation to the Bill referred to it on 24 December by the President for an opinion as to its constitutionality. The first point I would make is that the court have analysed the broad scheme of that Bill. We had an opportunity of discussing it in this House and it is not necessary to go into it again. Most Senators recall the approach that was adopted in that Bill. At the bottom of page 13 of the Supreme Court judgment the Chief Justice says:

This being the broad scheme of the Bill, it is clear that it varies pre-existing rights (where such exist) of both the tenant and the landlord in respect of controlled dwellings. It has been urged on the Court that in some respects this interference, under the guise of control, amounts to an unjust attack on the property rights of both tenants and landlords. However, the Court notes that the major criticism of the Bill's provisions is directed at those which determine the rent that is to be paid by the particular tenant and accepted by the landlord in respect of each dwelling.

The Court now proposes to examine those particular provisions in the Bill.

I draw attention to that passage because the Supreme Court left open a number of the issues that Senator O'Leary had identified. We are still talking about a particular class of landlord and a particular class of tenant. We are making provision in relation to a particular class of landlord on two fronts, firstly in relation to the rent and, second, in relation to the recovery of possession. The Supreme Court, in a very unusual way, left their view open on some of these issues. The section allowing for phased raising of the rent to the fair market rent over potentially a period of five years, on which the debate focused when the Bill was going through the Dáil and the Seanad, was the section that the Supreme Court in their judgment examined and subsequently ruled was unconstitutional. We must bear in mind that there is a possibility in relation to the provision for recovery of possession, for example, that the measure is not entirely free from potential constitutional defect.

This brings me back to the deeper issues which I raised and which some other Senators, notably Senator Murphy, raised in relation to the first Bill. We still have not pondered sufficiently on the overall problem of the constraints placed on us as a legislature by the interpretation of the Constitution. It is a legislative and tactical mistake by the Government to seek to deal with the problem in the narrow context of this class of landlords and class of tenants because that has very substantially narrowed the possibilities. It has exacerbated the potential legal problems and the problems of constitutional infirmity. It opens up the whole dimension of invidious discrimination against a particular class of landlords or invidious treatment of a particular class of tenants. It would have been much better from a legislative point of view and from the point of view of the approach to the adopted by the Oireachtas, to have broadened the scope of this legislation and made it a general basis for rent control. As legislators we are not only in favour of but would see the necessity for proper controls over the rent and conditions of private rented accommodation.

I have already submitted some amendments as to the proper forum to decide on rent controls. I believe this is better regulated by a tribunal establised for that purpose which would be a forum to which both landlords and tenants could go in a much more relaxed, confident and equal way. It would not have the intimidating attributes which many people find a court has, even a District Court. It would not have the problem of potential delay or overloading which the District Court has even with the provision the Minister has indicated of appointing new district justices and having them sit somewhere — it is not quite clear where — to hear claims under this Bill.

My first general comment on this legislation is that we must be acutely aware of the constitutional and legal constraints. This is the fifth measure which has come before this House trying to resolve the problem. Having analysed those constraints, they would be less of a problem and less inhibiting if this measure had dealt with a broader range, in other words, had dealt with rents in the private sector and had not sought to identify what Senator O'Leary has clearly analysed as a totally arbirtary and artificial class, a class deriving from the date of construction of buildings and other dates when rent was fixed, arbirtary and implacable dates and not related to broader and social conditions. To some extent, an opportunity has been lost for the Legislature, even within the constitutional and legal constraints, to put forward proposals which take into account our perceptions of social justice and our concern to strike a balance and have equity in this situation. Not only have we been inhibited from the point of view of the Legislature carrying through a policy in an important area, but because of the approach adopted by the Government, this Bill is left much more open to the possibility of constitutional challenge or to the possibility that if it is referred to the Supreme Court it will be found to be unconstitutional.

In order to explain my concern that the Bill may suffer from constitutional infirmity, it is necessary to refer to another passage of the court's judgment on the referral to it of the predecessor to this Bill, the judgment given on 19 February last. In the judgment the court referred to the way which was devised for basically fixing rents at a fair market rent taking into account the improvements and so in that assessment and then allowing the five-year phase period, where warranted, in which the tenant would gradually have to pay increasing amounts up to the fair market rent as determined. On the question of the way in which the rents were fixed, and this is really the nub of the Supreme Court's judgment, the Chief Justice stated on behalf of the court:

Having carefully considered the submissions of counsel on both sides of the case, the court is of opinion that the intent of the Bill is that the gross rent to be determined by the District Court under section 6, in accordance with the criteria therein set out, is to be regarded as the just and proper rent. The effect of the rebates permitted by section 9 is that for a period of five years after the passing of the Bill, landlords are to receive an amount which will be substantially less than the just and proper rent payable in respect of their property. In the absence of any constitutionally permitted justification, this clearly constitutes an unjust attack upon their property rights. The Bill offers no such justification for depriving the landlord of part of his or part of her just rent for the period specified in the Bill. This court has already held that the pre-existing rent control constituted an unjust attack upon property rights. In such circumstances, to impose different but no less unjust deprivations upon landlords cannot but be unjust having regard to the provisions of the Constitution. The court has, accordingly, come to the conclusion that the provisions of section 9 in the referred Bill would constitute an unjust attack on the property rights of landlords of controlled dwellings and would accordingly be in contravention of the provision of Article 40.3.2 of the Constitution.

That was in a situation where the model was that the first step would be to fix the fair market rent. The second step would be to allow a phasing in under section 9 of that Bill where the tenant could not be expected to pay the full market rent. When that Bill was debated in the House, some of us were unhappy with that very limited protection to tenants. We would like to have gone further. However, that was the model and we call it model A — fix your fair market rent and allow a period for it to be phased in — declared unconstitutional because it is an unjust attack on the property rights of landlords. It is an unjust attack in the context that it is only a special identified class of landlords who do not get their fair market rent. This is essential to an understanding of the Supreme Court's approach and was an aspect of it properly highlighted by Senator O'Leary.

Now we turn to model B which is the model before us in this Bill. Model B fudges the issue but does not fudge it sufficiently to make it comfortably constitutional. It fudges the issue because it proposes to allow the District Court to determine what the rent will be. Section 13 provides that the District Court will fix the rent. Section 13 (2) says that for the purpose of subsection (1) the gross rent shall be the rent which, in the opinion of the court, would be a just and proper rent having regard to the nature, character and location of the dwelling, the other terms of the tenancy, the means of the landlord and the tenant, the date of purchase of the dwelling by the landlord and the amount paid by the landlord therefor, the length of the tenant's occupancy of the dwelling and the number and ages of the tenant's family residing in the dwelling.

These appear to be very reasonable criteria for any court to take into account in fixing rent, but they are not general criteria, nor are they very clear. They apply only to this identified, specific class of landlords. These are the only landlords whose means are taken into account in fixing the rent. These are the only landlords whose rents will be fixed by the District Court not in accordance with fair market rent. It is not clear how the district justices will approach this problem. I have great admiration for the ingenuity of district justices but I do not envy them when they have a particular problem. As Senator O'Leary said, how will they assess the means of a landlord when the landlord is a limited liability company or is an absentee landlord in some other country? What will be the basis of it? When they do it, what will be the basis for the rent that they fix? Whatever one may say of it, it would appear to be a rent open to exactly the same conclusion if brought before the Supreme Court as the Supreme Court have already reached on model A where a fair market rent was fixed but the landlord did not get it over a phased period because the rebate system was provided under section 9 of the previous Bill. Here the landlord does not get the fair market rent either, because a district justice is fixing a fair rent in accordance with other criteria.

If we were talking about an overall social measure reflecting a legislative approach to the return a landlord should get for his private property we would be on surer ground and more secure because we would, as a Legislature, be taking a decision on the overall approach. We still would need to be much more precise and specific on the guidelines and how they were to be assessed, but the approach would be more secure. However, we are still carrying over this arbitrary classification, this identifiable number of both landlords and tenants who are involved. We are talking about former rent controlled tenants and the landlords of the properties concerned and we are saying in relation to them that a new and different mechanism for fixing the rents will apply, but it will not be a fair market rent.

To refer to an important aspect mentioned by Senator O'Leary, it will not, apparently, be as beneficial to the landlord as was the legislation of the Coalition Government which has been declared to be unconstitutional. The Minister when introducing this Bill made it clear that the money allocated would be £6 million. I will quote what he said:

A provision of £6 million was provided in the recent budget. This was the same amount as in the January budget and questions as to its adequacy were raised in the Dáil. The change in the formula for fixing rent, compared with the earlier Bill will reduce the subsidy demand and any saving can be set off against the extra cost arising from the omission of the earlier arrangements to phase in rent increases. In any event, I would like to assure Senators that the Government will provide whatever funds are needed to finance the allowances schemes.

The Government have given a commitment that they will be prepared to provide further moneys if these are needed.

Nevertheless, the assessment — which presumably has been costed with considerable expertise, both in the Minister's Department and the Department of Finance who are in position to view and assess and conclude on these figures — is that less Government subsidy will be applied to the rent which tenants will have to pay under this Bill than the Coaliton Government committed themselves to through the phased-in mechanism. How reassuring is that to the very vulnerable tenants who have been at such an unjustifiable risk and who are still not secure in their tenancies? How are they to view the situation that the mechanism for fixing rent is much less favourable to them in the sense that less payment will be required from the Government to the landlord? If that is the case, who is to bear it? Will it be the tenants? Is part of the job of the district justice in fixing the rent that, in so far as he can have regard to the means of the landlord and the means of the tenant, that will not be very significant? Basically what he is fixing must approximate to or be somewhere near a fair market rent. What is the situation? I accept that we will tease this out, and we will have to do that at some length on Committee Stage when we come to section 13, but I repeat my questions on it and perhaps the Minister will give some indication when he replies on Second Stage. What exactly would be meant by a just and proper rent, having regard to the issues set out, in particular the means of the landlord and the tenant? Can the Minister give some specific examples when replying on this point? Perhaps he can take examples of fictional tenants in different kinds of former rent-controlled dwellings who have being paying rents.

I find it very difficult to know whether we are talking about the district justice looking at a rent which at the moment is £2 and on the basis of all these criteria putting it up to £4 but the landlord saying, "That is not good enough because if that was under the old system, that of establishing a fair market rent, I would be getting £40." If this system results in a rent being fixed at £4 because of my inability to pay any more than that, if I can pay only £1 extra and the Government come in and pay a subsidy of £1 under the section as a social welfare allowance, a topping-up so to speak, then the landlord could say that that is unconstitutional and there is no doubt about it because he is not getting anything like the increase he should get.

On the other hand, take the case of the tenant paying £2 but the District Court says that in the light of all these criteria the proper rent would be £10. The landlord may say "If I am going on the fair market rent in the sense of demand for this property, I can produce evidence to the District Court that I have at least a couple of other tenants, people working in banking and insurance who can be grouped together and who are anxious to have a centre-city flat like this and they are offering me £60". In such a case will the Government bridge the difference between £10 and £60? If so, and if this is done in relation to 30,000 or 40,000 rent-controlled tenants, surely we are talking about a good deal more than the allocation that is being made. In other words, it is very hard to envisage how this system will work. It is very hard to envisage how the Minister had concluded that a smaller allocation of money is needed to subsidise it than was needed in relation to the Coalition provision.

On Committee Stage we must have an opportunity to get examples from the Minister to illustrate what he envisages the District Court will do. It will not be enough to say that that is a matter for the District Court. It is not a matter for the District Court. It is a matter on which we must be very clear. We must be clear about the job we are asking the district justices to do and we must be clear about the guidelines that we will propose for the district justices in doing their job.

We come back to the problem that a limited class of landlords are still having their rents fixed by a system that does not apply to other landlords and they are not getting their full rent, and a limited class of landlords are still having their right of recovery limited substantially in comparison to other landlords in the private rented sector. We are not doing what very badly needs to be done, which is providing an overall regulation and control of rented accommodation in the private sector, including the proper establishment of a fair rents tribunal to carry out the necessary balancing in that area. We seem to be making the legislation much more prone to attack by continuing to legislate on the basis of a limited class.

It is possible that the Minister may refer to the problem of time and the difficulty of having more far-reaching and broadly based legislation within the time constraints. As I said in relation to the other measure earlier this afternoon, that really is not an acceptable answer. I am not making party political points on that. The issue has been known to us as politicians and to the experts in the Attorney General's office and in the relevant Departments since June 1981. The serious responsibility has been ours since then and we have not measured up to it very well. The kindest word I can apply to the manner of fixing rents in this Bill is that it fudges but does not get over the constitutional and legal difficulty. That is something we will obviously have to come back to.

The predecessor to this Bill when it was being debated in this House also received a good deal of criticism from both sides of the House, particularly because it did not provide for a fair rents tribunal. I recall vividly that the then Leader of the Opposition in the House, Senator Eoin Ryan, called a vote specifically on that issue of the need for a fair rents tribunal. That was in December and now here we are in April of 1982 with this Bill. No doubt the Minister will say, as he did in his Second Stage speech, that there was not time to do it. I would submit that we have a Bill before us and now is the time to do it. We all too often are appeased by and accept ministerial promises, but the record does not justify this, because ministerial promises tend to go very rapidly on the never-never. They do not tend to be promises that are delivered. Senator Eoin Ryan obviously thought so when he called a vote seeking to have a fair rents tribunal introduced into the predecessor. Now we have a new Bill and a new opportunity before this House to introduce the proper method to adjudicate on and balance the interests as between landlords and tenants.

A tribunal develops a kind of expertise and learning experience when it is dealing with a specific problem in a specific area and a specific issue. An extremely important aspect is that it is a body which is much more accessible and much less intimidating to the tenants concerned, who are the vulnerable sector that we must, even at this late stage, seek to contrive to protect.

These are the major points that I feel it necessary to make on this Bill on Second Stage. It is quite a detailed Bill and I would ask that we have an opportunity for a separate Committee Stage. I am aware of time pressures and other constraints, but the text of this Bill as passed by the Dáil has only very recently been available to us. I know there are a number of amendments down and it would be appropriate to have a separate Committee Stage. I have no particular view on the date. I am aware that Senators, particularly in these few days, have on their minds a number of other crucial issues relating to their election and it might be that next week would be appropriate. If we are going to do the job properly on Committee Stage then it will take at least half a day — meaning the normal sitting time of the Seanad. To try to do it in less time would mean that we would not fulfil our responsibility. It is a responsibility which must lie heavily on us since this is our fifth attempt and since we make this attempt in the knowledge that the Bill passed this afternoon is, to say the least, of doubtful constitutionality. We must get this one right if we can and we must spend enough time on it to make sure that we do. We must have time, therefore, to debate in detail the issues which arise. I hope that provision will be made for a separate Committee Stage.

I should like to speak briefly in support of what Senators Robinson and O'Leary have already said. There seem to be two points of some importance emerging. I feel the Minister would be doing a service to the country, to the administration, to the civil service who will have to deal with the consequences of this, and not least to himself, if he were to give some consideration to the request for a separate Committee Stage on this Bill.

There are two points that have stood out very much in the course of this discussion. The first is the question of the fair rents tribunal. I do not intend to speak at length upon that since it has already been dealt with very eloquently by previous speakers. There is a very strong case for having a specialised body dealing with a matter of this kind. The point has already been made that we as public representatives are familiar with the frightening labyrinth of landlord and tenant legislation. It is clear from this debate that there does not yet exist one single Act or piece of legislation that governs these matters. It is a very complex matter. It requires a specialised body and to throw these matters into the District Court, which is failing to cope with the growing problem of law and order, crime on the streets and other matters as well, is to impose far too great a burden on the District Court and also to run the risk that the urgent matters dealt with by this legislation would not be dealt with expeditiously.

The second point is in regard to the constitutionality. I must defer here to the superior knowledge, expertise and wisdom of my colleagues in the legal profession. Even to an uninstructed layman like myself a picture emerges of a piece of legislation which is discriminating between one set of citizens and another, indeed between two separate sets of citizens and the remainder of society. Again I defer to the wisdom of the legal profession, but, even on a common sense basis, it seems to me that we are moving into an area where somebody could at the very least challenge this legislation and say that in discriminating in this way it interferes with the rights of people not covered by this legislation. Consequently I am beginning to fear that this is not the last that we will hear either of this legislation or of legislation that will take its place when and if this legislation is challenged. It seems that there are elements in this legislation which are "dubious", to use Senator Robinson's word. Consequently I believe that the Minister would be doing a service to all of us, to those of us in this House and those outside the House if he were to accede to the suggestion that a prolonged period be given to consideration of Committee Stage of this Bill so that we could co-operate in producing legislation which would be of real benefit and which would produce a substantial improvement in the current situation. I fear that if we attempt to rush this through we will be creating further trouble for ourselves, for this House and for Houses which succeed this one.

May I make good my omission when speaking earlier in that I forgot to pay the usual courtesies to the Minister. I congratulate him on his appointment and wish him well. I believe he is bringing this Bill into the House with very good intention.

I take up the last point made by Senator Maurice O'Connell. Perhaps the reason we are now considering this kind of measure for the fourth or fifth time is that it tends to be hastened through, because it is not given sufficient legislative attention. The increasing tendency for the courts to do the business of the country, to take on an excessively reviewing function in our Constitution and in our laws is because the Legislature does not give due and leisurely consideration to its business, and in this case at least is under pressure to meet a particular deadline, as in the Social Welfare Bill a week ago.

I welcome the Bill and I wish it well. In terms of social justice it tilts the balance in favour of the tenant compared with the previous Bill but for that reason its constitutionality is all the more doubtful. I note that among the bodies which welcome the Bill are the Private Tenants' Action Group and the organisation which is called Threshold. My clear recollection is that when we were discussing a similar measure last July one of the most critical bodies was Threshold. It is of interest that on this occasion, according to a letter in today's Irish Times, this national voluntary housing advisory service, which is how they define themselves, welcome the Bill and point specifically to four or five favourable features of the measure which they see as very much in the tenants' interest.

It is true that they argue strongly for the establishment of a private rented appeals board and propose to issue a publication on this in the near future but their support for the Bill is noteworthy. So is that of the Private Tenants' Action Group who want a fair rents tribunal. They would like to see Article 45 brought within the cognisance of the courts but on the whole they give at least qualified backing for the Bill.

If two organisations who sponsor the tenant interest see this Bill as an improvement on the previous Bill, then it augurs constitutional trouble because the Supreme Court were concerned on the last occasion that the rights of the landlords were being infringed. If these tenant organisations see a considerable improvement in the present Bill then automatically it would mean that the courts would have a priori grounds for seeing the landlord's rights threatened all the more. It seems to me that section 13 of the present Bill is at least as threatening or intrusive on the landlord's property rights as section 9 in the previous Bill.

As Senator O'Leary, Senator Robinson in her lengthy contribution, and other Senators made clear, the major substantive point of unconstitutionality would appear to hinge on the entirely spurious distinction between one set of landlords and another and between one set of tenants and another. Either all property relations must receive the same rigorous investigation, as is envisaged in section 13 of the Bill, or no property relations should be so considered. All tenants have rights to the classic three F's of the rural agitation of 100 years ago — fixity of tenure, free sale or recognition of compensation for improvements, and fair rent. Either all tenants must have these rights or no tenant has these rights. Either all landlords must be accountable or no landlord is accountable. My colleagues have pointed out the nub of the question here. I wish the Bill well but I doubt we are free of the dilemma.

I was interested in the approach of the Minister in his introductory statement. In his speech he stated:

The job of the Oireachtas in these circumstances is to enact legislation which is in conformity with the Constitution and its interpretation by the Supreme Court.

With great respect, but with great conviction, I submit that the job of the Oireachtas in these circumstances is increasingly to consider whether the Constitution is adequate for our view of social relations and for the implementation of social justice.

The Minister said, and I take him to be quite sincere in this, that he wants to establish a "proper and constitutional balance between the rights of property and social justice". I doubt whether this is a real balance. What I mean is that property is always loaded against social justice. The fact that a man has property means that he is powerful and, therefore, he has great odds on the man or woman who has no property. The notion of a just balance between property and tenant rights is in itself vitiated by the fact that property is power.

In the Constitution, property in its 1930s conceptualism was not meant to be an unlimited right to property and the rights of property. What the framer of the Constitution intended was that every man and every woman should have a little piece of property. In this sense the way in which the courts stand over property as the absolute rights of ownership of land, whether they be ground landlords, speculators or landlords of tenancies, is not in accordance with the original concept of property in the Constitution.

The Constitution gives all the privileges to property and it puts the common good and social justice in a secondary place. There is no mandatory power backing the common good or social justice. It is very much a pious aspiration. When the Minister says he wants to establish a balance between the rights of property and the common good, he is not going to succeed for the simple reason that the Constitution itself does not do this. It is high time it did.

I, too, would like to join in welcoming the Minister here today. I wish him well in his period of office. This Seanad will probably not see him very much again, but we hope he will be successful in his period of office.

The Bill raises a number of very difficult questions which have been very difficult for this Government and indeed the previous Government to solve. I appreciate that the Minister is doing his best in bringing this Bill before the House to try to solve these problems. There may be individual difficulties which have been pointed out by various other Senators, but I accept that he is trying to deal with the situation which is a kind of child of history, as it were, in this country. The whole idea of the balance between both private property and the common good, and the balance between the rights of landlords and rights of tenants, raise a number of very difficult questions to be solved.

First, I will deal with the question Senator Murphy dealt with towards the end of his speech, that is, the possibility of whether it would be necessary to change the Constitution to deal with this point. This was also mentioned by a number of Deputies in the Dáil debate. This is a very real problem because, when we think in terms of the common good and private property, we realise that when the Constitution was set up private property was envisaged in terms of the person who owned his individual family home or the small farmer who owned a small amount of land. It was not framed in terms of the large-scale property developer who is enabled to enrich himself by £8 million simple by holding on to a piece of land for a number of years and then passing it on to somebody else without contributing one single bit of work or input of any description to the common good.

We will probably have to look at the constitutional position, but it is not as easy as it might seem. It is easy to say that we should put the common good first and forget about the good of these particular cowboys; but on the other hand, how does one frame an amendment to the Constitution on these lines which will not also open the dangers of an attack on the small property of the small person? In a nation where we have a remarkably high level of personal home ownership, there would be a considerable amount of worry among many people about a constitutional change which would perhaps leave it open to some Government in the future to attack their rights. They feel very strongly about this. What we need is to try to find some kind of formula which will do away with the undoubted exploitation which exists at the present time, the undoubted destruction of the environment in the city of Dublin by these very people, their undoubted unjust self-enrichment, but a formula which at the same time will not threaten the ordinary person in the small property he owns. While private property is not, and should not be, an unlimited right, we need to be very careful about how we define the powers of the Government of the day in relation to the common good, because we cannot always rely on having a Government which will deal with these things in a sensible manner.

With regard to the actual issue of control of rents and the rights and wrongs of it, whether it was right or wrong to start with, it is undoubtedly true that, as it has operated over the long number of years, since the beginning of the First World War, it has created a situation which is very difficult to deal with. It has created this body of vulnerable tenants — very often elderly people or less well-off people who have lived in rent controlled dwellings for a considerable number of years and who would be totally unable to pay a truly economic rent for their housing.

We ought also to remember that it has created a certain body of poor landlords. I, too, have had letters from elderly and less well-off widows who happen to own houses in which there are rent-controlled tenants who are probably well able to pay a great deal more than they are paying. It is not only the body of tenants who are vulnerable; there are also some landlords who are highly vulnerable. They may have had quite a good private income from renting at one stage, but because of the fall in the value of money it has now dwindled to an absolutely derisory level. These are the people who are likely sufferers from the rent control situation.

There are also exploiters on both sides. There is the property developer, the kind of person who will buy a property that has rent-controlled tenants in it, and persecute them and make their lives a misery in order to get rid of them so that he can sell the site for development at an enormous profit — what used to be called Rachmanism in the British situation. Let us be quite sure about it. This happens. People are terrorised, they have undesirable people camped on their doorsteps and so on. On the other side, there are also tenants living in this kind of property who are well able to look after themselves and who should be encouraged to pay an economic rent or to purchase a house to live in themselves.

Part of the historic difficulty is that we have really used rent control and the whole idea of rent-controlled dwellings to house people who should actually have been housed by the local authority. We have used this system to provide cheap dwellings for people who really qualify to be housed as a public responsibility. Now we have inherited this problem and we are having very grave difficulties in dealing with it. Against this background of inherited difficulties there is the Supreme Court judgments, both on the original rent control and on the Bill passed by the previous Government, and we have this Government's and the previous Government's efforts to meet the situation.

In general terms I welcome this Bill. I think the Minister is making a very genuine effort to deal with the matter in terms of balancing a fair rent and social justice. There are areas, as other Senators have mentioned, which may well be unconstitutional yet again, as in section 13. On the whole, however, the aim of trying to meet the needs of protecting the tenants, while at the same time allowing a fair rent to landlords, is reasonably well carried out. There is also the problem particularly in urban areas, of the need for a stock of reasonably-priced housing which can be rented by people. As I said, we have a remarkably high level of home ownership — much higher than in most other EEC countries, for instance. Nevertheless, there is a need for reasonably-priced rented accommodation, particularly for young married couples, elderly people living alone and so on, who do not want to own a whole house for themselves. Therefore, whatever we do, we do not want to create a situation where this kind of accommodation will cease to exist.

I agree with various people, both in the Dáil and here, who suggested that a fair rents tribunal would be a much better way of dealing with this situation than putting the matter into the District Court. I know the Minister has said he will bring this in as soon as possible, but he has also said it is a fairly complex matter and may take some time. I feel very strongly that fair rent tribunals would be a much better way of dealing with this situation. They would not only be more accessible to the tenants but also more accessible to the less well-off landlords. I know two District Courts are to be set up in the Dublin area which would deal specially with this, but the matter will arise in many other areas in the country and the District Courts' lists are already over-burdened and matters have to be dealt with fairly speedily. I do not feel that the District Courts are really suitable forums for dealing with this. Having voted with Senator Eoin Ryan in the last vote when he called for the introduction of fair rents tribunals in this situation, I would like to see the fair rents tribunal brought in now as opposed to a future time. However, on the general lines of the Bill as it comes in I would be pleased to support it and I only hope that it will not create any more constitutional difficulties.

I should like to thank those Senators who have spoken in this debate and I thank those who have expressed their good wishes to myself and to the Minister of State at my Department who was here earlier.

The Bill before the House strives to deal with a difficult and complex problem, as, I think, all Senators will agree. If something on the lines of the Private Rented Dwellings Bill is not enacted the families in about 30,000 dwellings — that is the figure which has been prepared by the Private Tenants Action Group — will be faced with great uncertainty as to the future possession of the dwellings they have for so long occupied. The Government are determined that measures must be taken to avoid the social disruption that would follow. In the legislation we need to achieve a balance which in line with the common good gives reasonable protection to tenants and allows landlords a just and proper return from their dwellings. As well as protecting tenants the provisions in the Bill will redress the injustice landlords have endured over a lengthy period. It was that injustice which led to the Supreme Court's decision.

As with the previous Bill, most serious questions have been raised by Senators regarding the constitutionality of the Bill and this, indeed, has been of major concern to the Government. The Government must legislate within the Constitution and we do not help anybody, least of all the tenants, by producing legislation which has a high probability of being unconstitutional. The advice available to the Government is that the Bill is in conformity with the Constitution. The Bill has been prepared bearing in mind the criticism of the Supreme Court, of particular aspects of the former code and the terms of the court's judgment and the reference to it of the 1981 Act and I firmly believe that it will stand up to the constitutional test.

Senator O'Leary suggested that the essence of the Supreme Court judgment was that the dwellings concerned were arbitrarily chosen in the Rent Restrictions Act while the arbitrary nature of the control was a matter that was raised in the Supreme Court judgment. The February judgment made it clear that it was possible to legislate to deal with those dwellings, the dwellings that are controlled under the 1960 Act.

I quote from the Supreme Court Reference given by Chief Justice O'Higgins and which is to be found at page 10 of the judgment of the court:

The Attorney General has submitted that the basis for the selection of the same category of dwellings to be covered by this Bill derives from this Court's judgment in the Blake and Madigan case and that the necessary rectifying legislation need not go beyond that category. The Court notes this submission and is prepared to accept that it supplies a valid reason for the application of this Bill to the category of rented dwellings and not to others.

I think that covers the point raised both by Senator O'Leary and by Senator Robinson.

Senator O'Leary expressed some optimism that the temporary Bill would be constitutional and quoted certain comments at the end of the Blake and Madigan case in support of his view. We discussed this at great length earlier on when we were discussing the previous Bill and I do not think that we can place undue reliance on what the court said to support the extension of the temporary legislation much longer. This temporary legislation has now been running since July of last year and flying in the face of a Supreme Court decision. I really do not think that the tenants will thank either the Dáil or the Seanad or any public representative involved for leaving them unprotected. What we really need is this Bill that we are debating now.

Senator Hanafin spoke of the necessity for the State to come to the assistance of tenants who would have problems meeting their increased rents and the need to ensure that speculators do not benefit from court decisions. It is natural that there should be concern as to how poorer tenants are to be helped with their rent payments. As I said in opening, I am not in a position to spell out the details of the allowance scheme provided for in the Bill but the Minister for Social Welfare who will administer the scheme will announce the details shortly.

In the normal course of events it would be usual for such subsidisation to be provided for in legislation sponsored by the Minister for Social Welfare. However, time constraints prevented us doing this in the present case. Even though the Government are less than one month in office we have succeeded in including a power to pay subsidy in the Bill, something that we had not got in the former Bill, though when the last Government had the 1981 Bill in the House they had been six months in office.

I agree with Senator Hanafin that it is undesirable that speculators should profit unduly from their purchases of controlled dwellings. This point was made by Senator McGuinness also. The criteria in section 13 go some way towards restraining speculative gains. It should be remembered that the changes in capital gains tax made in the recent budget will also help considerably in this regard.

A number of the Senators once again on this debate mentioned the need for rent tribunals. I want to reiterate here that we as a Government are totally committed to the setting up of rent tribunals. This was a commitment given in the Dáil by myself in December when we discussed the 1981 Act brought in by the Coalition.

In the Dáil last Thursday the Taoiseach confirmed that we will be having discussions immediately after Easter with the main parties, either at party leader level, at Whip level or at Minister for the Environment and Spokesman on the Environment level with a view to introducing legislation in the next session of the Dáil. I accept the concern of Senator Robinson, of Senator McGuinness and of others about that type of ministerial promise. I hope Senators will accept that it is not an empty promise, not a political promise, but a firm commitment——

Will the Minister resign if it does not happen?

Private conversation should never be relayed further into the House.

Is that a half promise?

Will the Senator resign if it does happen?


We will hold you for another 11 in another number of years time. I give this firm commitment to the House, that the discussions will take place between the parties at whatever level is considered appropriate, immediately after the Easter recess and that the legislation will be introduced.

I referred earlier to the constitutional and legal problems involved in tribunals. It is not a simple matter just to set up a tribunal or to accept some of the formulae that have been presented in amendments that were tabled in the Dáil which were a direct "cog" from the employment unfair dismissals tribunal. The situation is that what has to be decided — and it is only right and proper that it should be decided by an all-party discussion — is whether rents tribunals are to deal with only the rents question or whether they should involve themselves in other aspects of the whole relationship between landlord and tenant. The constitutional difficulties and the legal difficulties arise if you extend the terms of reference of the tribunal into other matters of relationship between landlord and tenant.

On the face of it there should be no legal or constitutional difficulties if we relate it only to rents. These are the sort of matters that have to be discussed between the parties and, on an issue of such importance, it is right to get an all-party view of it. I can give this categorical assurance to Senators here this evening that, in the next session of the Dáil, prior to the summer recess, the legislation to set up these tribunals will be introduced. The discussions will commence immediately after Easter.

I accept fully the deficiencies of the District Court, the intimidatory nature of the courts as suggested by myself in December when I discussed this in the Dáil. They have been voiced again by Deputies and Senators. I want to have an interim measure to remove this sense of intimidation from many controlled tenants, people who never had any dealings with the courts, or many controlled landlords, or people such as those mentioned by Senator McGuinness, widows who have inherited property and who now find themselves with tenants who are better off than they are themselves. They will have to go before the courts. We anticipate that the greatest difficulty will arise in the Dublin area.

I want to admit to the Seanad that we do not know exactly how many tenants are involved. The registers which will be available from local authorities will show how many people are involved. Nobody knows the exact number of people involved. The number which has been used on all occasions is the number that was first used by the Private Tenants' Action Group, about 30,000. We anticipate that because of the nature of the city most of the problems will be in the greater Dublin area.

I have given a firm commitment to the Dáil. I gave it to Senators in my opening speech and I give it to them again now. Pending the setting up of the tribunal we will be appointing two temporary District Court justices. They will not sit in the Four Courts building but in the old Dolphin Hotel. This is the building we have in mind at this stage and the Minister for Justice is co-operating very well with us. It is intended that the court will have as informal an atmosphere as possible to remove any sense of intimidation which might arise for tenants or landlords who are getting on in years and who were never before in contact with the courts of the land.

I labour this point with regard to the tribunal because I know that it is a matter of deep concern to many Senators. I appeal to the Seanad and to the Senators generally to allow this Bill in its present form to go through the Seanad. I give a firm commitment that the legislation dealing with the tribunal will be brought before the next Seanad — and I can go no further at this stage.

Much comment was made on the operation of section 13 of the Bill which sets out the criteria by reference to which a rent is to be fixed. It was contended that the rent set, if it is to be in accordance with the Supreme Court judgment, must be a market rent. I do not agree that this necessarily follows from the Supreme Court's judgment. The judgment held that the rent must be the just and proper rent, but what was unconstitutional was the provision which phased in the just and proper rent over a number of years and made the landlord wait some years for the full rent. A reasonable interpretation is, I believe, that there remains some discretion as to what constitutes a just and proper rent. This interpretation is supported, I might add, by the comment by the Supreme Court in its earlier judgment in the Blake-Madigan case, that part of the reason why the 1960 Act was an unjust attack on property rights was that the Act did not take account of the means of the landlord and tenant. This, of course, is a particular feature of the Bill before the House.

Senator O'Leary and Senator Robinson referred to my earlier comment that less subsidy could be required under the formula in section 13 than in the earlier Bill. They argued that this means that the section must be unconstitutional because the landlords will get lower rents. The criteria do not preclude an individual landlord from obtaining a market rent if the respective means and other circumstances warrant it. It is a matter of fact that the majority of tenants are poorly off and it is for this reason, and not because of the criteria themselves, that over all a lower level of rents will be determined by the court. If the relative financial circumstances of the landlord and tenant were reversed, the section would not prevent landlords obtaining full market rent, and this is the justification for the section.

Not surprisingly this Bill attracted a good deal of comment not only in the Oireachtas but also in the media and elsewhere. It was referred to by Senator Murphy in the letter pages of of the newspapers. Representatives of landlords have attacked the Bill on the grounds of the restraints it imposes on them. Spokesmen on the tenants' side — while welcoming the Bill in the main — have taken issue with certain aspects of the Bill which were not to their liking. The approach of the Bill is neither pro-landlord nor protenant. It attempts to strike a balance which takes account of the constitutional advice available to the Government and of the terms of the Supreme Court judgment.

It is manifestly obvious that, in the face of successive court judgments, the benefit so long enjoyed by tenants of controlled dwellings could continue only for a limited period required to enact permanent legislation. Equally the Government have a responsibility, in line with the pledge in the Constitution that the State shall safeguard with special care the interests of the weaker sections of the community, to protect tenants of controlled dwellings, many of whom are amongst the poorest members of our community. The manifestation of the Government's concern in this regard is the provision in section 23 of the Bill for the payment of rent allowance to tenants faced with hardship in paying increased rents, and this I will come to later.

Senator Murphy mentioned the whole constitutional question. I have already referred to the constitutional situation and the best advice we have available. As a Minister, all I can operate on is the best legal advice and the advice of the Attorney General, which is that this Bill will stand up taking into account the two judgments, the referral judgment and the Blake-Madigan judgment. I am grateful to the Private Tenants' Action Group and to Threshold for their welcome for the Bill, but I do not think this automatically means that the Bill is anti-landlord. As I have said, we have tried to get a fair balance.

Senator McGuiness rightly referred to this Bill as being a child of history. It is a very complex problem, as the Senator said. We have tried to get a fair balance between the rights of landlord and tenant. The whole area of housing and the need for rented accommodation are matters to which I am giving considerable thought. We have not had a White Paper on housing since the mid-sixties. I hope to have available for discussion by the end of the year a White Paper on housing generally which will take into account such matters as the provision of adequate rented accommodation and not just the matters that immediately come to mind such as the availability of new houses and reconstructed houses. The whole area of rented accommodation needs considerable thought, and needs to have considerable work done on it. I will be giving considerable thought to it in the White Paper on housing.

To conclude, in this Bill I have striven to achieve a solution to a difficult problem and do so in a way that would be fair to and in the best interests of both landlord and tenant. Given the 25 April deadline and the recent coming into office of the Government, the time available was exceedingly limited. We have to do better than express concern about the plight of the tenants. There must be positive legislative action to protect them and to remove the uncertainties that exist. One cannot be happy while the legislative void continues. The temporary legislation we discussed earlier today does not provide a satisfactory solution to the problem. We should bear in mind that there have been moves by landlords to test the temporary legislation. If that should fail tenants would be left in a very perilous state in the absence of legislation such as the Bill before the House.

Once again I thank the Senators for their contributions.

Question put and agreed to.

I propose that the Committee Stage be taken at 6.30 p.m.

I am grateful for the fact that there will be a break before the Committee Stage is commenced but in the event of the Committee Stage not concluding when is it proposed that it might be concluded? Is it envisaged that there would be time for the various amendments on this Committee Stage to be discussed this evening?

I think we will consider that later on. We will see how we go.

It is just that for those participating it is — as the Seanad will recognise — a very difficult and technical Bill. It is one in respect of which it would not be appropriate to sit on later; that would not be a satisfactory situation. We should either adjourn for a separate Committee Stage or take as much as we can go through this evening and then adjourn at the normal time. Is that acceptable?

I am proposing that we take Committee Stage at 6.30 p.m. and see how we go. If it is quite obvious that we cannot finish this evening then obviously we will have to adjourn. If it was possible by sitting a bit late to finish then I think we would consider doing that.

The amendments will be circulated.

Sitting suspended at 5.45 p.m. and resumed at 6.30 p.m.