Charles Flanagan (Laois-Offaly, Fine Gael)

On behalf of the Fine Gael Party, I welcome the Land and Conveyancing Law Reform (Review of Rent in Certain Cases) (Amendment) Bill 2010 and commend my colleague, Deputy Ciaran Lynch, on introducing it. It is not a perfect Bill and I am sure the Deputy will acknowledge that he does not have a monopoly of wisdom on it. Opposition Members do not have available to them the same level of expertise as those on the Government benches. If this Bill is not perfect, let us discuss it in committee so that we can deal with the contentious issues on an all-party basis to ensure we address the problem.

I am keenly aware of the enormous pressures that commercial tenants face. Retail Excellence Ireland and the Grafton Street Tenants Association have done an excellent job in highlighting the dire straits in which many tenants now find themselves. Sadly, in recent times, a number of landmark businesses in Dublin city centre have closed their doors with a loss of jobs and, in some cases, cultural capital where shops that have been part of the fabric of Grafton Street for decades have simply disappeared overnight.

The problem of unsustainable rents is felt in cities and towns around the country, including in my own local towns of Portlaoise and Tullamore. No business is immune from the current economic meltdown and those trapped in commercial leases paying exorbitant rents are in a particularly difficult situation as they struggle for their very survival.

Last year Fine Gael supported section 132 of the Land and Conveyancing (Law Reform) Act 2009 because it reflected our policy to abolish upward-only rents. At the time, the Minister for Justice, Equality and Law Reform, Deputy Dermot Ahern, suggested that the section could not apply to existing leases but that view has been disputed by Professor David Gwynn Morgan, who has argued that in recent decades several laws have been introduced that modified existing landlord and tenant leases. The matter may not be as black and white as the Minister has suggested, therefore. Precedents include the Shirly case, the Landlord and Tenants (Ground Rents) Act 1978, the Landlord and Tenant Act 1931 and the Landlord and Tenant (Amendment) Act 1980, all of which affected existing leases and tenant-landlord relations. I regret the negative tone taken by the Minister, who spoke for 20 minutes but offered nothing.

Notwithstanding constitutional arguments, dialogue is needed at this time. Many landlords have engaged with their commercial tenants because the recognised the writing on the wall and reduced rents to reflect changed times. However, I understand that tenants have had particular difficulties with large commercial landlords and Government intervention is needed in this context. The Minister is in a unique position in that he can call people into Government Buildings to facilitate the resolution of disputes. The ability to bring people together is one of the most powerful aspects of being a Minister. Unfortunately, this Government has been slow to make use of its potential to mediate as we have seen with the Tánaiste and Ryanair. It would be a lost opportunity if the Minister did not dedicate his energies to resolving the upward-only rents crisis, a word which I do not use lightly.

I acknowledge that he has established a working group to examine the adequacy of information available to all parties in the context of commercial rent reviews. While I welcome what at least represents some action, I am somewhat surprised by the group's narrow remit. When the Minister outlined the group's membership, I did not hear him mention a representative from the Grafton Street Tenants Association or Retail Excellence Ireland.

The reality is that commercial leaseholders are the victims of a rare approach to commercial leases that Ireland adopted from the UK. It is time we recognised our place in Europe by adopting international best practice in landlord and tenant law. Within the EU, commercial rents are linked to inflation and leases tend to be for shorter terms and contain break clauses. These regimes are fairer and more reflective of the realities of commercial life. Such a progressive approach is long overdue in Ireland and I am calling on the Minister to consider introducing a new Bill which would consolidate existing landlord and tenant legislation as well as modernising this area of law. The Land and Conveyancing (Law Reform) Act 2009 was only a first step in overhauling the conveyancing and landlord-tenant regime. That Act arose from a seminal report by the Law Reform Commission in 2005 and I believe the commission should be asked by the Attorney General to prioritise a report on consolidating and modernising landlord and tenant law.

Our key focus must be the preservation of jobs. Fine Gael has expressed concern about the lack of competitiveness in the Irish economy and the negative role that high commercial rents are playing in that environment. Ministerial intervention is needed immediately to preserve jobs. The Labour Party's Bill is welcome but it represents a short-term solution. What Fine Gael would like to see is the introduction of new measures that would allow businesses to apply to court for rent reviews in exceptional circumstances. This would afford greater protection to businesses. 9 o'clock

What is certain is that festering sore of upward-only rents can be resolved with political and legislative will. I call on the Minister, Deputy Ahern, to roll up his sleeves and get involved. A solution could be achieved that could benefit all parties and I trust this is what he will decide to do now, as well as taking on board the policy proposals of Fine Gael in this area.

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