Ciarán Lynch (Cork South Central, Labour)
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Question 74: To ask the Minister for Justice, Equality and Law Reform if, in view of the fact that legislation in the public interest has been passed overriding the provisions of Acts, orders, circulars and contractual agreements in order to reduce pay in the public sector, he has sought legal advice as to whether the same overriding provisions are available when it comes to addressing contracts in the private sector including, in particular, contracts for upwards only rent reviews; if so, if he will outline the advice; the reason it is considered possible to breach contracts of employment in the public sector in the public interest but it is not as yet considered possible to breach rental agreements in the private sector in the same public interest; and if he will make a statement on the matter. [10985/10]

Dermot Ahern (Louth, Fianna Fail)
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The provisions in section 132 of the Land and Conveyancing Law Reform Act 2009 now prohibit "upwards only" rent reviews in respect of new commercial leases. However, it should be noted that there is nothing to stop the parties to an existing commercial lease, to which section 132 does not apply, from varying the terms of the contract and from agreeing to reduce the applicable rent, having regard to individual circumstances and the realities of the market.

The rationale and justification for the Financial Measures in the Public Interest Acts 2009 (the FEMPI Acts) include the overriding public interest in controlling public spending, reducing the shortfall between expenditure and revenue and reducing the unsustainable levels of public borrowings. These imperatives do not apply in the case of commercial leases entered into between private parties.

During the course of the debate in the House on section 132 of the Land and Conveyancing Law Reform Act 2009 I identified some of the legal and Constitutional difficulties which could arise if legislation retrospectively amended the provisions of existing commercial leases entered into between private parties. The Deputy will appreciate that the Government is at all times obliged to operate within the appropriate legal and Constitutional framework. However, I can assure him that my Department will, in consultation with the Office of the Attorney General, continue to assess the issues that are involved in this complex matter.

Against that background, I would draw the attention of the Deputy to the fact that I have established a Working Group to look at the issue of commercial rent reviews in the context of the arbitration system which operates at present and the adequacy of the information available to all parties during the rent review process.