Unfortunately, I do not believe that Claudia Beamish’s amendments 305 and 307 would be workable. There are no powers attached to the audit function that her amendments would create, so people would not be under any obligation to provide the TFC with information to enable him or her carry out an audit. More fundamentally, I do not believe that an audit function is necessary, because the bill contains provisions that will ensure that progress in the sector is kept under review and that individual cases can be investigated where there are issues.
Under section 18, the TFC is required to report every year on performance in carrying out his or her functions. Those functions include promoting observance of the codes of practice and inquiring into alleged breaches of the codes, so the TFC is already required to report on the outcomes of exercising those functions. That report must be published and laid before the Parliament.
Under section 27, parties can report breaches of the codes and ask the TFC to inquire into them. The TFC can then conduct an investigation and publish a report setting out his or her determination. If nobody is alleging that a code has been breached, it is difficult to see the justification for the TFC auditing parties’ behaviour.
The TFC is not intended to be an auditor: his or her core function is to promote good relationships in the sector, as we have just discussed with regard to the previous amendments. However, I hope that I have given Claudia Beamish some assurance that the bill already provides for problems to be investigated and reported on, and that she will be persuaded to withdraw amendment 305.
Claudia Beamish’s amendment 147 proposes that any person to whom a code of practice applies has a duty to comply with it. That is a blanket and hugely wide-ranging provision. A person would have to read all the codes before they could know whether they were under a duty to comply with them. It will not be clear to people whether they are actually subject to the duty. If it is not clear to them, it probably will not be clear to the party who wants to hold them to account for breaching the code. Even if they know, the requirements that the codes contain might not apply to everyone in every situation.
To top it all off, amendment 147 is not workable because it does not contain any way in which the duty could be enforced. I invite Claudia Beamish not to move amendment 147.
Jim Hume’s amendments 286 and 287 seek to enable the TFC to impose a monetary penalty for breach of a code of practice. That would have the effect of turning the codes of practice into binding law. I have outlined the reasons why that would not be a sensible approach. I can assure the committee and Jim Hume that we thought long and hard about the issues at the heart of both Jim Hume’s and Claudia Beamish’s amendments before the bill was introduced.
Jim Hume’s amendments would also create the odd situation in which a tenant could be fined for not complying with a code, but could go to the Scottish Land Court and win against the landlord on the issue that underpinned the dispute in the first place. That seems to be quite complicated, to say the least, when the Scottish Land Court is already there to perform the judicial function.
I invite Jim Hume not to move amendments 286 and 287, and ask the committee to reject the amendments if they are moved.
As I have said, the aim is not for the TFC to be another regulator. It is to promote and encourage good relationships and behaviours in the sector, underpinned by codes of practice. We need to give that a chance to work. That is why I lodged amendments 215 and 216 to enable a review of the TFC’s powers and duties to be carried out after three years. We will then be in a position to evaluate how the role of the TFC is working in practice and to decide, based on evidence, whether change is needed at that point.
12:30
I will now talk through the Government’s amendments in the group. The bill states:
“A person may apply to the Tenant Farming Commissioner to inquire into a breach of a code of practice”.
Of course, when someone asks the commissioner to investigate, they do not necessarily know that there has definitely been a breach. They may have very good reason to believe that there has been a breach, but it is for the commissioner to inquire into that and reach a decision.
Amendment 223 modifies the wording slightly to make it absolutely clear that an applicant does not need to know there has been a breach before the investigation into that breach has been carried out. Instead, they are asking the tenant farming commissioner to inquire into an alleged breach of a code of practice. The Community Land Advisory Service suggested that change in its stage 1 evidence. We agree that the change is sensible, so we have lodged amendment 223 to implement it.
Section 28(1)(b) says that the tenant farming commissioner can investigate an alleged breach of the code of practice only if they can satisfy themselves that the application to investigate contains
“the details of each person with an interest in the relevant tenancy”.
The intention behind that was to ensure that the commissioner had all the information that they needed to proceed with their inquiry. However, in its stage 1 evidence, the Community Land Advisory Service made the point that the wording of that section could cause difficulties. The person making an application might not be aware of every individual with an interest in the tenancy and so would not be able to include their details. Similarly, the commissioner might not know of everyone with an interest in the tenancy and so could find it challenging to satisfy themselves that the details of every relevant person were included in the application.
The simplest way to address that concern is to remove section 28(1)(b) from the bill, which is what amendment 224 will do. Section 28(1)(c) requires the commissioner to be satisfied that an application
“contains sufficient information to proceed to an inquiry”.
That will already include the details that the commissioner thinks are necessary on those people who have an interest in the tenancy, so amendment 224 will not compromise the commissioner’s ability to get all the information that is needed for an inquiry.
As the bill stands, there is a double sanction on someone who asks the tenant farming commissioner to investigate a breach of the codes of practice but then does not provide additional information that the commissioner requires. The first sanction is that the commissioner can dismiss their application for an investigation; the second is that the commissioner can fine them up to £1,000.
That doubling up of sanctions was not our intention and is unfair, so amendment 225 removes the financial penalty on applicants who do not provide information that is requested by the commissioner. Under section 29(2), the commissioner will still be able to fine other parties who do not provide the information that they request or who fail to provide a response to the application, but the important difference is that the fine is the only sanction in those cases. Amendment 225 ensures that there is, likewise, only one sanction against applicants who do not comply with the commissioner’s requests.