Housing (Financial Provisions) (Scotland) Act 1972

• (7) Any right conferred on a tenant by section 63 of the Act of 1971 to recover any amount by deducting it from rent shall be exercisable by deducting it from rent for any rental period beginning after the conversion to the same extent as the right would have been exercisable if the conversion had not taken place.

Phasing of rent increases

37

Schedule 6 to this Act shall have effect for securing that, on first registration of a rent after the conversion of a controlled tenancy into a regulated tenancy by virtue of section 34 of this Act, an increase in rent may, in certain circumstances, be recovered only in stages.

Registration of rent for regulated tenancies

Early application for registration of rent

38

• (1) Subject to the provisions of this section, any application for the registration of a rent under section 40 of the Act of 1971 may be made at a time when the dwelling-house is let on or subject to a controlled tenancy, if the application is made not earlier than six months before the date applicable to the dwelling-house under section 34 of this Act.

• (2) Where an application is made by virtue of this section the regulated tenancy for which the rent is registered shall be assumed to be a tenancy on the same terms (other than terms relating to rent) as the terms applicable to the controlled tenancy.

• (3) Where a rent is registered on an application made by virtue of this section—

• (a) the date from which the registration takes effect under section 44(1) of the Act of 1971 shall not be earlier than the date applicable to the dwelling-house under section 34 of this Act, and

• (b) in a case where the rent is registered before the said applicable date, any reference in this Act, or in the Act of 1971 or in any other enactment to the date of registration shall be deemed to be a reference to the date from which the registration takes effect.

Cancellation of registration of rent

39

In the Act of 1971 after section 44 there shall be inserted the following section—

(44A) (1) Where a rent agreement is made in writing as respects a dwelling-house for which a rent is registered, an application may be made in accordance with this section for the cancellation of the registration. (2) The application shall be made jointly by the landlord and the tenant under the agreement to the rent officer, and the application shall not be entertained before the expiry of three years from the relevant date as defined in section 40(4) of this Act. (3) An application under this section must be in the prescribed form and contain the prescribed particulars, and must be accompanied by a copy of the rent agreement. (4) The Secretary of State may make regulations under section 46 of this Act prescribing the procedure on an application under this section. (5) If the rent officer is satisfied that the rent payable under the rent agreement does not exceed a fair rent for the dwelling-house, he shall, subject to subsection (6) below, cancel the registration, and he shall make an entry in the register of that fact and of the date from which the cancellation takes effect. (6) Where under the terms of the rent agreement the sums payable by the tenant to the landlord include any sums varying according to the cost from time to time of any services provided by the landlord, the rent officer shall not cancel the registration unless he is satisfied that those terms are reasonable. (7) The cancellation of the registration shall be without prejudice to a further registration of a rent at any time after cancellation. (8) The rent officer shall notify the applicants of his decision to grant, or to refuse, any application under this section and, where he grants the application, of the date from which the cancellation takes effect. (9) In this section " rent agreement " means— (a) an agreement increasing the rent payable under a protected tenancy which is a regulated tenancy, or (b) where a regulated tenancy is terminated, and a new regulated tenancy is granted at a rent exceeding the rent under the previous tenancy, the grant of the new tenancy.

Certain amounts to be separately noted on the register

40

Section 43 of the Act of 1971 (amount to be registered as rent) shall have effect as if after subsection (1) there were inserted the following subsections—

(1A) Subject to subsection (1B) below, there shall be noted on the register the amount, if any, of the registered rent which, in the opinion of the rent officer or rent assessment committee, is fairly attributable to the use of furniture or the provision of services or to the use of part of the premises comprised in a dwelling-house as a shop or office or for business, trade or professional purposes. (1B) It shall not be necessary to note on the register under subsection (1A) above any amount which in the opinion of the rent officer or, as the case may be, the rent assessment committee is negligible.

Regulated tenancies where no rent is registered

Repeal of rent limit for contractual periods

41

• (1) Section 19(3) and section 20 of the Act of 1971 (which fix a rent limit for contractual periods of a regulated tenancy where no rent is registered) shall, subject to subsection (2) below, cease to have effect.

• (2) The repeal by this Act of the said sections 19(3) and 20 shall not apply to—

• (a) rent for a rental period beginning before 1st January 1973, or

• (b) rent under a regulated tenancy granted before 1st January 1973 if the rent under the tenancy, as varied by any agreement made before that date, exceeded the rent limit under the said section 19(3) (with any adjustment under the said section 20 or paragraph 3 of Part III of the Schedule to the Fire Precautions Act 1971).

• (3) Paragraph (b) of subsection (2) above shall cease to apply if the landlord and the tenant enter into an agreement complying with the requirements of section 42(3) of this Act which is a rent agreement with a tenant having security of tenure or which provides that the said paragraph is not to apply.

Rent agreements

42

• (1) In this Part of this Act " a rent agreement with a tenant having security of tenure " means—

• (a) an agreement increasing the rent payable under a protected tenancy which is a regulated tenancy, or

• (b) the grant to the tenant under a regulated tenancy, or to any person who might succeed him as a statutory tenant, of another regulated tenancy of the dwelling-house at a rent exceeding the rent under the previous tenancy:

Provided that there shall be disregarded for the purposes of this definition any increase of rent if (where any rates in respect of the dwelling-house are borne by the landlord) the increase is no more than one corresponding to an increase in the rates borne by the landlord in respect of the dwelling-house.

• (2) If a rent agreement with a tenant having security of tenure takes effect on or after 1st January 1973, and at a time when no rent is registered for the dwelling-house under Part IV of the Act of 1971, the requirements of subsection (3) below shall be observed as respects the agreement.

• (3) The said requirements are that—

• (a) the agreement is in writing signed by the landlord and the tenant,

• (b) the agreement contains a statement, in characters not less conspicuous than those used in any other part of the agreement, that the tenant's security of tenure under the Act of 1971 will not be affected if he refuses to enter into the agreement, and that entry into the agreement will not deprive the tenant or the landlord of the right to apply at any time to the rent officer for the registration of a fair rent under Part IV of the Act of 1971, or words to that effect, and

• (c) the statement mentioned in paragraph (b) above is set out at the head of the agreement.

Rent agreements: special provisions following conversion

43

• (1) Subject to subsections (2) and (3) below, this section applies where a rent agreement with a tenant having security of tenure of a dwelling-house is entered into, whether before or after a tenancy becomes a converted tenancy, which is expressed to take effect—

• (a) on or after 1st January 1973 and after the conversion, and

• (b) at a time when no rent is registered for the dwelling-house under Part IV of the Act of 1971.

• (2) This section shall not apply to any agreement where the tenant is neither the person who, at the time of the conversion, was the tenant, nor a person who might succeed the tenant at that time as a statutory tenant, and where this section has applied to any agreement, it shall not apply to any subsequent agreement relating to the dwelling-house which takes effect more than three years after the first such agreement took effect.

• (3) Where a rent is registered for the dwelling-house and the registration is subsequently cancelled, this section shall not apply to the agreement submitted to the rent officer in connection with the cancellation nor to any agreement which takes effect after the cancellation.

• (4) The provisions of this section are without prejudice to the requirements imposed by section 42 of this Act.

• (5) The following requirements shall be observed with respect to any such agreement as is mentioned in subsection (1) above—

• (a) the agreement shall contain the prescribed particulars,

• (b) the agreement, when duly completed, shall be lodged by the landlord with the rent officer, and

• (c) the landlord shall, not later than the date when the agreement is lodged with the rent officer, serve a copy of the agreement on the tenant.

• (6) No such agreement shall take effect earlier than 28 days after it is lodged with the rent officer under subsection (5)(b) above, and it may only take effect on or after that date if the rent officer has not before that date notified both the landlord and the tenant in writing that he proposes to treat the agreement as an application for the registration of a rent for the dwelling-house under Part IV of the Act of 1971 made jointly by the landlord and the tenant.

• (7) The rent officer may treat an agreement as such a joint application as is referred to in subsection (6) above before the conversion if an application for the registration of a rent could have been made by virtue of section 38 of this Act.

• (8) A rent officer may treat an agreement as such a joint application only if he is satisfied that the rent payable under the agreement exceeds a fair rent for the dwelling-house.

• (9) Where an agreement is treated by the rent officer as such a joint application then, subject to subsection (10) below, Schedule 6 to the Act of 1971 (applications for registration of rents) shall apply as if the application had been made to him and as if any reference in that Schedule to the rent specified in the application included a reference to the rent expressed to be payable under the agreement.

• (10) For the purposes of subsection (9) above, paragraph 3(1) of the said Schedule 6 shall have effect as if for the words " he may register that rent without further proceedings " there were substituted the words " he shall notify both the landlord and the tenant in writing that he is no longer treating the agreement as a joint application for the registration of a rent and that the agreement may take effect on or after the date of such notification if that date is later than 28 days after the agreement was lodged with him. "

• (11) The rent officer shall make available for public inspection, without charge, any agreement which has been lodged with him under this section unless the agreement is treated by him as a joint application for the registration of a rent and a rent is subsequently registered in pursuance of such application; and any agreement which is made available for public inspection under this subsection shall be so available for a period of three years from the date which is 28 days after it has been lodged with the rent officer.

• (12) A copy of such an agreement certified by the rent officer or any person duly authorised by him shall be receivable in evidence, and shall be sufficient evidence of the agreement in any court and in any proceedings.

• (13) A person requiring such a certified copy shall be entitled to obtain it on payment of the prescribed fee.

• (14) No stamp duty shall be chargeable on any agreement to which this section applies which contains—

• (a) the statement required by section 42(3)(b) of this Act as read with subsection (4) above, and

• (b) the particulars prescribed pursuant to this section.

Rent agreements: special provisions where grant-aided improvements are carried out

44

• (1) This section applies where a grant under Part II of the Act of 1968 has been approved in respect of works to be carried out in a dwelling-house let on or subject to a regulated tenancy.

• (2) If a rent agreement with a tenant having security of tenure Part V of the dwelling-house takes effect—

• (a) on or after 1st January 1973, and in the period beginning with the time when the tenant's consent to the works was sought by the landlord and ending one year after the completion of the works, and

• (b) at a time when no rent is registered for the dwelling-house under Part IV of the Act of 1971 and the increase of rent effected by the agreement is wholly or partly to take account of the carrying out of the works,

the requirements of subsection (4) below shall be observed as respects the agreement.

• (3) The provisions of this section are without prejudice to the requirements imposed by section 42 above.

• (4) The requirements mentioned in subsection (2) above are that the agreement—

• (a) states that a grant has been approved, and

• (b) explains that, if the grant became payable, and a rent was registered, the rent increase up to the registered rent would be phased as follows, that is—

• (i) if the increase exceeded £1.50 per week, the rent would be increased by three annual increments, each of one-third of the total increase,

• (ii) if it were less than £1.50 per week, the rent would be increased by annual increments of up to £0.50 per week up to the registered rent.

Failure to comply with provisions of rent agreements

45

• (1) If, in the case of a variation of the terms of a regulated tenancy, there is a failure on the part of the landlord to observe any of the requirements of section 42, 43 or 44 of this Act, any excess of the rent payable under the terms as varied over the terms without the variation shall be irrecoverable from the tenant.

• (2) If, in the case of the grant of a tenancy, there is a failure on the part of the landlord to observe any of the requirements of section 42, 43 or 44 of this Act, any excess of the rent payable under the tenancy so granted (for any contractual or any statutory period of the tenancy) over the previous limit shall be irrecoverable from the tenant.

• (3) In subsection (2) above the " previous limit" shall be taken to be the amount which (taking account of any previous operation of this section) was recoverable by way of rent for the last rental period of the previous tenancy of the dwelling-house, or which would have been so recoverable if all notices of increase authorised by the Act of 1971, or by section 36(2) of this Act, had been served.

• (4) A default in complying with subsection (5)(c) of section 43 of this Act shall not apply to rent for any rental period after the default is made good, and, if a rent agreement with a tenant having security of tenure is put into effect earlier than the date when it is provided under section 43 of this Act that it may take effect, such a default shall not affect the rent for any rental period beginning after that date.

• (5) Section 31 of the Act of 1971 (enforcement provisions) shall apply as if any amount made irrecoverable by this section were irrecoverable by virtue of Part III of that Act.

Miscellaneous

Statutory tenants by succession

46

In Schedule 1 to the Act of 1971 after paragraph 7 there shall be inserted the following paragraph:—

(7A) (1) Where after a succession the successor becomes the tenant of the dwelling-house by the grant to him of another tenancy, " the original tenant" and " the first successor " in this Schedule shall, in relation to that other tenancy, mean the persons who were respectively the original tenant and the first successor at the time of the succession, and accordingly— (a) if the successor was the first successor, and immediately before his death he was still the tenant (whether protected or statutory), paragraphs 6 and 7 above shall apply on his death, (b) if the successor was not the first successor, no person shall become a statutory tenant on his death by virtue of this Schedule. (2) Sub-paragraph (1) above applies even if— (a) a successor enters into more than one other tenancy of the dwelling-house, and (b) both the first successor, and the successor on his death, enter into other tenancies of the dwelling-house. (3) This paragraph shall apply— (a) as respects any succession which takes place on or after the date of the coming into force of section 46 of the Housing (Financial Provisions) (Scotland) Act 1972, and (b) as respects a succession which took place before that date if the tenancy granted after the succession, or the first of those tenancies, was granted on or after that date. (4) In this paragraph— - " succession " means the occasion on which a person becomes the statutory tenant of a dwelling-house by virtue of this Schedule and " successor " shall be construed accordingly; - " tenancy " means " regulated tenancy " and " tenancies " shall be construed accordingly."

Amendment of section 35 of Act of 1971

47

Section 35 of the Act of 1971 (regulations) shall have effect as if—

• (a) at the end of subsection (1) there were inserted the following paragraph—

(c) prescribing matters as to which notice is to be given to a tenant of a dwelling-house let on or subject to a regulated tenancy by means of notices inserted in rent books and similar documents and the forms of such notices. and

• (b) at the end there were added the following subsection—

(3) If any rent book or similar document which does not conform to the prescribed requirements is used by or on behalf of any landlord, the landlord shall be liable to a fine not exceeding £50.

Modifications of Part VI of Act of 1971

48

Part VI of the Act of 1971 (rent of dwellings in good repair and provided with standard amenities) shall have effect subject to the modifications set out in Schedule 7 to this Act.

Amendment of Schedules 6 and 12 to Act of 1971

49

• (1) Schedule 6 to the Act of 1971 (application for registration of rents unsupported by certificate of fair rent) shall have effect as if—

• (a) in paragraphs 1 and 2 for the words " seven days " there were substituted the words " 14 days ";

• (b) after paragraph 3 there were inserted the following paragraph—

(3A) Where the rent officer, in carrying out his functions under this Part of this Schedule, inspects a dwelling-house, he shall explain to the tenant or to his spouse, if either is present at the inspection, the procedure upon an application for the registration of a rent under this Part of this Schedule.

• (2) Schedule 12 to the Act of 1971 (applications for registration of rents supported by certificate of fair rent) shall have effect as if in paragraph 7 for the words " 7 days " there were substituted the words " 14 days ".

Interpretation of Part V

50

In this Part of this Act—

• " controlled tenancy " has the same meaning as in section 133(1) of the Act of 1971;

• " conversion " and " converted tenancy " have the meanings respectively assigned to them by section 36(1) of this Act;

• " prescribed " means prescribed by regulations made by the Secretary of State, and section 35 of the Act of 1971 shall apply to such regulations as it applies to regulations made for the purposes of Part III of that Act;

• " protected tenancy " has the same meaning as in section 133(1) of the Act of 1971;

• " a rent agreement with a tenant having security of tenure " has the meaning assigned to it by section 42(1) of this Act;

• " statutory tenant " and " statutory tenancy " have the same meanings as in section 133(1) of the Act of 1971; and other expressions shall be construed as in Part III and Part IV of the Act of 1971.

PART VI — Housing Associations

Subsidies

Introduction of new subsidies for housing associations

51

• (1) The following subsidies shall be payable to housing associations in the circumstances, and subject to the conditions, set out in this Part of this Act, namely—

• (a) the basic residual subsidy ;

• (b) the special residual subsidy ;

• (c) the new building subsidy ;

• (d) the improvement subsidy.

• (2) None of the subsidies may be paid for the year 1971-72, or for an earlier year.

• (3) The subsidies shall be paid by the Secretary of State out of money provided by Parliament.

• (4) Section 13 of this Act shall apply in relation to the payment of subsidies under this Part of this Act as it applies in relation to the payment of subsidies under Part I of this Act to a housing authority.

The basic residual subsidy

52

• (1) This section has effect as to the circumstances in which basic residual subsidy is payable to housing associations and also, subject to section 54 of this Act, as to the amount of basic residual subsidy so payable.

• (2) A housing association shall be entitled to basic residual subsidy for the year 1972-73 if the association's subsidies for the year 1971-72 exceed the withdrawal factor, and the amount of the basic residual subsidy for that year shall be equal to the excess.

• (3) A housing association which is entitled to basic residual subsidy for the year 1972-73 shall also be entitled to the subsidy for any subsequent year for which the amount of basic residual subsidy payable to the association for the immediately preceding year exceeds the withdrawal factor, and the amount of the basic residual subsidy shall for each such year be equal to the amount obtained by deducting the withdrawal factor from the amount of the basic residual subsidy payable to the association for the immediately preceding year.

• (4) In this section the " association's subsidies for the year 1971-72 " means the aggregate of such sums received or to be received by the association as the Secretary of State determines and notifies the association as representing payments made or to be made to the association for the year 1971-72 under or by reference to any of the enactments described in Parts V and VI of Schedule 1 to this Act.

• (5) The withdrawal factor for the purposes of this section shall be determined, in relation to each housing association, by the Secretary of State.

• (6) For the purposes of subsection (5) above, the Secretary of State shall determine the number of houses as at the end of the year 1971-72 in respect of which the association's subsidies for the year 1971-72 are payable.

• (7) For the year 1972-73 the withdrawal factor is the sum produced by multiplying £5 by the number of houses determined under subsection (6) above.

• (8) For each year subsequent to the year 1972-73, the withdrawal factor is the sum produced by multiplying £20 by the number of houses determined under subsection (6) above.

The special residual subsidy

53

• (1) This section has effect as to the circumstances in which special residual subsidy is payable to a housing association and also, subject to section 54 of this Act, as to the amount of special residual subsidy so payable.

• (2) A housing association shall be entitled to special residual subsidy for relevant works approved for subsidy before the coming into force of this Act and completed during the year 1972-73, 1973-74 or 1974-75.

• (3) In this section—

• " approved for subsidy " means approved by the Secretary of State for the purposes of sections 1 to 12 of the Act of 1968;

• " relevant works " means the erection of a house.

• (4) If an association complete any relevant works during any of the three years 1972-73, 1973-74 and 1974-75, being works approved for subsidy before the coming into force of this Act, they shall be entitled for that year to special residual subsidy of such an amount as in the opinion of the Secretary of State represents the financial assistance which would have been given for that year in respect of those works under sections 1 to 12 of the Act of 1968, if those sections had been in force throughout the year.

• (5) For the purpose of calculating the amount of special residual subsidy for the year 1972-73, 1973-74 or 1974-75, the Secretary of State may adopt, after consultation with such bodies representative of housing associations as appear to him to be appropriate, a rate of interest for that year which is to be treated as if it had been specified for that year by an order made under section 2(2) of the Act of 1968 (which relates to the calculation of aggregate cost subsidies).

• (6) An association entitled under subsection (4) above to an amount of special residual subsidy for the year 1972-73 shall, in addition, be entitled—

• (a) for the year 1973-74 to the said amount of subsidy less the reduction factor for houses completed during the year 1972-73, and

• (b) for the year 1974-75 to the amount of subsidy payable to the association under paragraph (a) above less the reduction factor for houses completed during the year 1972-73.

• (7) An association entitled under subsection (4) above to an amount of special residual subsidy for the year 1973-74 shall, in addition, be entitled for the year 1974-75 to the said amount of subsidy less the reduction factor for houses completed during the year 1973-74.

• (8) For the year 1975-76 and subsequent years the amount of an association's special residual subsidy shall be the amount, if any, produced by deducting the reduction factor for houses completed during the three years 1972-73, 1973-74 and 1974-75 from the amount of their special residual subsidy for the immediately preceding year.

• (9) In this section " the reduction factor " for houses completed during any specified year or years means the sum produced by multiplying £20 by the total number of houses the erection of which was approved for subsidy before the coming into force of this Act and which are completed by the association during the year or years.

Residual subsidies-supplementary

54

• (1) If a housing association, by furnishing to the Secretary of State such information as to their financial position as he may require, satisfy him that for the year 1972-73 or for any year subsequent to that year their income from their houses will be inadequate, having regard to their normal sources of income, to meet such expenditure (including loan charges) as in his opinion it would be reasonable for them to incur for that year in the exercise of their housing functions, he may direct that section 52 or section 53 of this Act shall have effect in relation to that association for that year as if for any references to £5 or £20 there were substituted references to such smaller amounts as may be specified in the direction ; and the amounts which may be so substituted shall include zero.

• (2) The Secretary of State may reduce, suspend, or discontinue the payment of basic residual subsidy or special residual subsidy to a housing association if they lease or otherwise dispose of any of their houses in respect of which they are entitled to such a payment.

• (3) If any of the houses of a housing association are leased to or become vested in another housing association or trustees for another housing association, or are leased to or become vested in the Housing Corporation, the Secretary of State may pay to that association or the Corporation the whole or any part of any basic residual subsidy or special residual subsidy which he would otherwise have paid to the former association for any year beginning with the year in which the houses are so leased or come to be so vested.

• (4) For the purposes of this section houses are leased if and only if they are leased for a term exceeding seven years, or for a term not exceeding seven years granted by a lease which confers on the lessee an option for renewal for a term which, together with the original term, exceeds seven years.

The new building subsidy

55

• (1) This section has effect, subject to section 56 of this Act, as to the circumstances in which new building subsidy is payable to a housing association and the amount of new building subsidy so payable.

• (2) A housing association shall be entitled to new building subsidy as provided by the following provisions of this section and section 56 below, in respect of a building scheme approved by the Secretary of State for the purposes of this section if they incur an initial deficit on it.

• (3) In this section and section 56 of this Act " building scheme " means a scheme approved by the Secretary of State for the erection by a housing association of a house or group of houses for the purpose of letting or for any purpose which in the opinion of the Secretary of State is comparable, and also includes the provision of other buildings or land connected with the requirements of the occupiers of the house or houses comprised in the scheme.

• (4) Subject to subsection (11) below, and to subsections (2) and (3) of section 56 of this Act, new building subsidy shall be paid to a housing association for ten years, namely the year of completion of the last or only house comprised in a building scheme (in this section referred to as the " year of completion ") and the nine years immediately following, and the amount of subsidy for a year shall be the percentage of the initial deficit shown for that year in the Table in subsection (6) below.

• (5) For the purposes of this section—

• (a) a housing association incur an initial deficit on a building scheme if their income from the scheme for the year immediately following the year of completion is less than their approved expenditure on the scheme for that year;

• (b) the income from a building scheme for the year immediately following the year of completion is the income which would be obtained for that year from all the buildings and land comprised in the scheme, assuming, subject to subsection (8) below, that every house so comprised were let for the whole of that year at a rent equal to the amount which would be registered as a fair rent for the house under this Part of this Act;

• (c) the approved expenditure on a building scheme for the year immediately following the year of completion is the association's expenditure on loan charges in respect of the expenditure on the scheme and on the maintenance and management of the buildings and land comprised in the scheme.

• (6) The following is the Table referred to in subsection (4) above:—

Year for which subsidy is payable	Percentage of initial deficit to be met by subsidy
Year of completion	100
Second	100
Third	100
Fourth	60
Fifth	60
Sixth	60
Seventh	30
Eighth	30
Ninth	30
Tenth.	10

• (7) Income from and approved expenditure on a building scheme shall be estimated in such manner and on such evidence as the Secretary of State may from time to time direct in the case of associations in general or any individual association or description of associations.

• (8) The Secretary of State may direct under subsection (7) above that paragraph (b) of subsection (5) above shall have effect with the substitution for the assumption specified in that paragraph of such other assumption as may be specified in the direction.

• (9) In any case where a housing association are entitled to new building subsidy but are precluded by their rules or constitution from charging a rent for their houses, the reference in paragraph (b) of subsection (5) above to the amount which would be registered as a fair rent shall be construed, in relation to the association's houses, as a reference to the amount which, in the opinion of the Secretary of State, would be registered as a fair rent if those houses were available for letting at a rent.

• (10) In any case to which subsection (9) above applies the Secretary of State may assume, without prejudice to subsections (7) and (8) above, that the houses would be let on such terms and in such circumstances as he considers appropriate.

• (11) The Secretary of State shall consult with such bodies representative of housing associations as he considers appropriate—

• (a) before giving a general direction as to the method of estimating approved expenditure;

• (b) before determining, in any case to which subsection (9) applies, the assumptions as to letting which are to be made under subsection (10) above.

• (12) If a housing association, by furnishing to the Secretary of State such information as to their financial position as he may require, satisfy him, in relation to a building scheme, that for any year except—

• (a) the year of completion, or

• (b) the second or third year for which new building subsidy is payable,

payment of an amount of subsidy equal to the percentage of the initial deficit shown in the Table will be inadequate, having regard to their normal sources of income, to enable them to meet such expenditure (including loan charges) as in his opinion it would be reasonable for them to incur for that year in the exercise of their housing functions, he may direct that for that year the percentage of the initial deficit to be met by subsidy shall be greater than that shown in the Table but not greater than 90 per cent. or than the percentage met by subsidy for the immediately preceding year, if that was less than 90 per cent.

New building subsidy-supplementary

56

• (1) The Secretary of State may make his approval of a building scheme subject to compliance by the association who apply for that approval with such conditions as he may specify.

• (2) The Secretary of State may make reduced payments of new building subsidy to a housing association in respect of a building scheme, or suspend or discontinue such payments—

• (a) if he made his approval of the building scheme subject to compliance with any conditions and is satisfied that any of those conditions has not been complied with ; or

• (b) if he is satisfied that a house comprised in the scheme—

• (i) has been converted, demolished or destroyed; or

• (ii) is not fit to be used or is not being used for the purpose for which it was intended; or

• (iii) has been sold or leased ; or

• (iv) has ceased for any reason whatsoever to be vested in the association or trustees for the association.

• (3) If any of the houses comprised in a building scheme are leased to or become vested in a housing association or trustees for a housing association other than the association who received approval for the scheme, or are leased to or become vested in the Housing Corporation, the Secretary of State may pay to them the whole or any part of any new building subsidy which he would otherwise have paid for any year beginning with the year in which they are so leased or come to be so vested to the association which received approval for the scheme.

• (4) For the purposes of this section houses are leased if and only if they are leased for a term exceeding seven years, or for a term not exceeding seven years granted by a lease which confers on the lessee an option for renewal for a term which, together with the original term, exceeds seven years.

The improvement subsidy

57

• (1) This section has effect as to the circumstances in which improvement subsidy is payable to a housing association and the amount of improvement subsidy so payable.

• (2) A housing association shall be entitled to improvement subsidy as provided by the following provisions of this section in respect of an improvement scheme approved by the Secretary of State for the purposes of this section if they incur an initial deficit on it.

• (3) In this section " improvement scheme " means a scheme approved by the Secretary of State for the provision of a house or group of houses by a housing association by means of the conversion of houses or other buildings, or for the improvement of a house or group of houses by a housing association, for the purpose of letting or for any purpose which in the opinion of the Secretary of State is comparable.

• (4) Subsections (4) to (12) of section 55, and section 56, of this Act shall apply to improvement subsidy as they apply to new building subsidy except that—

• (a) for any reference to a building scheme there shall be substituted a reference to an improvement scheme;

• (b) in subsection (4) of section 55 after the words " section 56 of this Act", there shall be inserted the words " as applied by section 57 of this Act ";

• (c) in paragraph (b) of section 55(5) for the words " buildings and land " there shall be substituted the word " houses ";

• (d) in paragraph (c) of section 55(5), at the beginning there shall be inserted the words " subject to subsection (5) of section 57 of this Act ", for the words " buildings and land" there shall be substituted the word " houses " and at the end there shall be added the words " and includes any expenditure incurred by the association in acquiring interests in land for the purpose of giving effect to the scheme ".

• (5) Where an exchequer contribution is payable under section 16 or 17 of the Act of 1968, or an improvement grant or a standard grant has been made to a housing association under section 27 or 40 of the Act of 1968 respectively, towards the cost of works of conversion for the provision of a house, or of improvement of a house, comprised in an improvement scheme, then the cost of such works shall not be included in the approved expenditure on the improvement scheme for the purposes of this section.

• (6) Where improvement subsidy is payable to a housing association in respect of a house comprised in an improvement scheme, then no exchequer contribution shall be payable under section 16 or 17 of the Act of 1968, and a local authority shall not approve an application by the housing association for an improvement grant or a standard grant under section 27 or 40 of the Act of 1968 respectively, towards the cost of works of conversion for the provision of such a house or of improvement of such a house.

Housing and subsidy agreements

Housing agreements

58

• (1) Any term of a housing agreement relating to rent payable in respect of a house to which the agreement relates or contributions towards the cost of maintaining such a house shall cease to have effect on 1st January 1973.

• (2) In this section " housing agreement" means any of the following, namely—

• (a) an agreement made between the Secretary of State and a housing association under section 1(1)(d) of the Housing (Scotland) Act 1962 (special arrangements for provision of housing) before this Act comes into force;

• (b) an agreement for a loan or a grant to a housing association under section 152 of the Act of 1966 (loans and grants to housing associations by local authorities);

• (c) an agreement made between a local authority and a housing association under section 153 of that Act (arrangements for provision of housing);

• (d) an agreement made between the Secretary of State and a housing association under section 154 of that Act (arrangements for improvement of housing);

• (e) an agreement made between a housing association and a local authority under section 155 of that Act (arrangements for improvement of housing);

• (f) a scheme under section 157 of that Act (unification of conditions affecting housing associations' houses);

• (g) an agreement made between the Secretary of State and a housing association under section 1(2)(d) of the Act of 1968 (special arrangements for provision of housing) before this Act comes into force ;

• (h) an agreement made between the Secretary of State and a housing association under section 23 of the Act of 1968 (advances by Secretary of State for provision of housing accommodation for letting);

• (i) an agreement for a loan to a housing association by the Housing Corporation under section 2 of the Housing Act 1964.

• (3) Any such term as is mentioned in subsection (1) above included in a housing agreement made under section 152, 153 or 155 of the Act of 1966 after the coming into force of this Act shall be void.

• (4) Subject to subsection (1) above and subsection (5) below, a housing agreement made before the coming into force of this Act shall continue to have effect after this Act comes into force.

• (5) Upon the application of a party to a housing agreement the Secretary of State may, if he thinks fit, direct—

• (a) that the agreement shall have effect with such variations, determined by him or agreed by the parties, as may be specified in the direction ; or

• (b) that the agreement shall be terminated ;

but no variation shall be directed which would have the effect of including in an agreement any term such as is mentioned in subsection (1) above.

Subsidy agreements

59

• (1) Where an agreement in pursuance of which payments are to be made under or by reference to any of the enactments described in Parts IV and VI of Schedule 1 to this Act (hereafter referred to as a " subsidy agreement ") has been made between a local authority and a housing association, the prohibition on the making of payments under or by reference to such an enactment contained in paragraph 1 of Schedule 8 to this Act shall be construed, subject to subsection (2) below, as extending only to the payment of amounts which the authority are obliged to pay by the relevant enactment; and accordingly, where such an agreement provides for the payment of greater amounts, the authority shall continue to pay to the housing association sums equal to the difference between the amounts for the payment of which the agreement provides and the amount which they are obliged to pay by that enactment.

• (2) Upon the application of a party to a subsidy agreement, the Secretary of State may, if he thinks fit, direct—

• (a) that the agreement shall have effect with such variations, determined by him or agreed by the parties, as may be specified in the direction ; or

• (b) that the agreement shall be terminated;

but no variation shall be directed which would have the effect of including in an agreement any term such as is mentioned in section 58(1) above.

Rent limit for dwelling-houses let by housing associations and the Housing Corporation

Tenancies to which sections 60 to 66 apply

60

This section and sections 61 to 66 of this Act apply to a tenancy where—

• (a) the interest of the landlord under that tenancy belongs to a housing association or to the Housing Corporation, and

• (b) the tenancy would be a protected tenancy but for section 5 of the Act of 1971,

and in this section and the said sections 61 to 66 "tenancy" means, unless the context otherwise requires, a tenancy to which those sections apply.

Rents to be registrable under Part IV of the Act of 1971

61

• (1) There shall be a separate part of the register under Part IV of the Act of 1971 in which rents may be registered for dwelling-houses which are let, or are, or are to be, available for letting, under a tenancy to which sections 60 to 66 of this Act apply.

• (2) Sections 39 to 42, section 43 (except subsection (3) thereof) and section 46 of, and Schedules 6 and 7 to, the Act of 1971 shall, in relation to that part of the register, have effect as if for any reference in those provisions to a regulated tenancy there were substituted a reference to a tenancy to which the said sections 60 to 66 apply.

• (3) Subject to section 64 of this Act, registration in the said part of the register shall take effect on the date of registration:

Provided that registration before 1st January 1973 shall be provisional only until that date, and the date of registration shall be 1st January 1973.

• (4) From the date of registration any previous registration of a rent for the dwelling-house shall cease to have effect.

• (5) A rent registered in any part of the register for a dwelling-house, which becomes or ceases to be a dwelling-house under a tenancy to which sections 60 to 66 of this Act apply, shall be as effective as if it were registered in any other part of the register.

• (6) Subject to subsection (5) above, references in the said sections 60 to 66 to registration are, unless the context otherwise requires, references to registration pursuant to this section.

The rent limit

62

• (1) Where the rent payable under a tenancy would exceed the rent limit determined in accordance with sections 60 to 66 of this Act, the amount of the excess shall be irrecoverable from the tenant.

• (2) Where a rent for the dwelling-house is registered, then, subject to sections 63 and 64 of this Act and Part IV of the Schedule to the Fire Precautions Act 1971, the rent limit is the rent so registered:

Provided that where any rates in respect of the dwelling-house are borne by the landlord the amount of those rates for any rental period, ascertained in accordance with Schedule 4 to the Act of 1971, shall be added to the limit imposed by this subsection, and then, subject to subsection (4) below, any reference in sections 60 to 66 of this Act to the rent registered for the dwelling-house shall be taken as a reference to the registered rent plus the amount of rates borne by the landlord.

• (3) Where no rent for the dwelling-house is registered, then, subject to subsection (4) below and Part IV of the Schedule to the Fire Precautions Act 1971, the rent limit shall be determined as follows—

• (a) if the lease or agreement creating the tenancy was made before 1st January 1973, the rent limit is the rent recoverable under the tenancy, as varied by any agreement made before that date (but not as varied by any later agreement),

• (b) if paragraph (a) above does not apply, and, not more than three years before the tenancy began, the dwelling-house was subject to another tenancy (whether before 1973 or later) the rent limit is the rent recoverable under that other tenancy (or, if there was more than one, the last of them) for the last rental period thereof,

• (c) if paragraph (a) and paragraph (b) above do not apply, the rent limit shall be the rent payable under the terms of the lease or agreement creating the tenancy (and not the rent so payable under those terms as varied by any subsequent agreement).

• (4) Where for any period there is a difference between the amount (if any) of the rates borne by the landlord in respect of the dwelling-house and the amount (if any) so borne in the rental period on which the rent limit is based, the rent limit under subsection (3) above or paragraph (a) or (b) of section 63(2), or section 64(4), of this Act shall be increased or decreased by the amount of the difference:

Provided that an increase of rent made solely to reflect an increase in the amount of rates borne by the landlord shall be disregarded for the purposes of section 63(3) or (4) of this Act.

• (5) Section 31 of the Act of 1971 (enforcement provisions) shall apply as if any amount made irrecoverable by virtue of this section were irrecoverable by virtue of Part III of that Act.

• (6) A tenancy commencing (whether before or after this Act comes into force) while there is in operation a condition relating to rent imposed under any of the enactments mentioned in section 40(5) of the Act of 1971 shall be disregarded for the purposes of subsection (3)(b) above in determining the rent limit under any subsequent tenancy of the dwelling-house.

• (7) Section 33 of the Act of 1971 (duty of landlord to supply statement of rent under previous tenancy) shall apply where the rent is subject to the rent limit under subsection (3)(b) above as it applies where rent under a regulated tenancy is subject to the contractual rent limit mentioned in that section.

• (8) This section shall not apply to rent for any rental period beginning before 1st January 1973.

Phasing of progression to registered rent

63

• (1) This section applies where a rent is registered for a dwelling-house (whether it is the first or any subsequent registration) which exceeds the rent limit for the dwelling-house immediately before the date of registration, unless at the date of registration there is no tenant and no person to whom the tenancy has been granted.

• (2) The rent limit shall progress from the rent limit immediately before the date of registration to the registered rent in stages, and, subject to section 62(4) of this Act and paragraph 3 of Part IV of the Schedule to the Fire Precautions Act 1971—

• (a) for any rental period beginning in the first stage, the rent limit shall be the rent limit immediately before the date of registration plus £0.75 per week, or the registered rent, whichever is the less,

• (b) for any rental period beginning in the second or any subsequent stage, the rent limit shall be the rent payable for the first rental period of the last previous stage plus £0.75 per week, or the registered rent, whichever is the less.

• (3) The first stage shall last for 52 weeks from the date of registration, or from the beginning of the first rental period for which the rent is first increased (by any amount) on or after that date, whichever is the later.

• (4) Any subsequent stage shall last for 52 weeks from the end of the last previous stage, or from the beginning of the first rental period for which the rent is first increased (by any amount) after the end of the last previous stage, whichever is the later.

• (5) If a tenancy of the dwelling-house is granted at any time when the rent limit is less than the registered rent, and the tenant is neither the person who, at the time when the previous tenancy (or the last previous tenancy) ended, was the tenant under that tenancy nor a member of that tenant's family who resided with him, the registered rent shall become the rent limit from the beginning of the new tenancy, and the stages by which the rent limit was to progress up to the registered rent shall terminate.

• (6) The registration of a lower or higher rent during the progression from the rent limit in force before the prior registration shall not alter the stages by which the rent limit is to progress, and if a higher rent is registered in the 52 weeks beginning with the first rental period for which the rent is increased up to the rent registered on the prior registration, the first stage in the progression from that rent up to the later registered rent shall not begin until the end of that period of 52 weeks.

Previous rent limit exceeding registered rent: special rent limit

64

• (1) Where the rent limit for a dwelling-house immediately before the date of registration of a rent for that dwelling-house exceeded the rent so registered, the registration shall be provisional only until it takes effect in accordance with this section.

• (2) If—

• (a) no application is made under this section to the Secretary of State before the expiration of a period of 28 days beginning with the date of registration, or

• (b) an application duly made to the Secretary of State under this section is refused,

the registration shall cease to be provisional, and shall take effect as from the date of registration.

• (3) Notwithstanding section 67(2) of this Act, the reference in subsection (2)(a) above to the date of registration shall be construed, in a case where a rent determined by a rent assessment committee is registered in substitution for a rent determined by the rent officer, as a reference to the date on which the rent determined by the rent assessment committee was registered.

• (4) The Secretary of State may, on an application made to him within the said period of 28 days, grant the application and direct that the rent limit for the dwelling-house shall, subject to Part IV of the Schedule to the Fire Precautions Act 1971, be such amount as is specified in the direction, being an amount not more than the said previous rent limit, but more than the rent which is provisionally registered.

The Secretary of State may include in a direction under this subsection such conditions as he thinks fit, and if any condition is not complied with the direction shall cease to have effect.

• (5) The period for which the direction has effect shall begin with the date of the provisional registration, and the date when, subject to subsections (6) and (7) below, that period is to end shall be specified in the direction, being a date not more than three years and six months from the date of the provisional registration.

• (6) The direction shall cease to have effect—

• (a) if on a subsequent application for registration a different rent is registered for the dwelling-house and that rent is equal to or exceeds the rent specified in the direction, or

• (b) the rent assessment committee determine a rent in substitution for the rent registered by the rent officer, and that rent is equal to or exceeds the rent specified in the direction, or

• (c) the applicant ceases to be the landlord of the dwelling-house.

• (7) Subject to subsection (6) above, if on the date specified as the end of the period under subsection (5) above a subsequent application for registration is pending, the direction shall continue in force until that application has been disposed of by the rent officer.

• (8) When the period for which a direction has effect ends, and the provisional registration is not superseded by a new registration under paragraph (a) or paragraph (b) of subsection (6) above, the registration shall cease to be provisional and, except for the purposes of section 40 of the Act of 1971 (right to apply for registration of a new rent after 3 years), shall take effect at the time when the period ends.

• (9) Where a registration is by virtue of this section a provisional registration, the reference in section 40(4)(b) of the Act of 1971 to the date on which the registration of rent took effect shall be construed as a reference to the date of the provisional registration.

• (10) The rent officer shall notify the tenant of any case where a registration is by virtue of this section a provisional registration,

• (11) This section applies whether the registration mentioned in subsection (1) above is the first or any subsequent registration and, in the case of a subsequent registration, whether or not the rent limit immediately before the date of registration was that fixed by a direction under this section.

• (12) A confirmation of a rent by the rent officer shall be treated for the purposes of this section as a registration of a rent which supersedes the registration, whether or not it is a provisional registration, prior to the confirmation.

Special rent limit: procedure on application

65

• (1) An application under the last preceding section shall be in such form as the Secretary of State may direct either generally or in any particular case, and the applicant shall give notice of the application to the rent officer and shall take all reasonable steps to give notice of the application to the tenant Of each dwelling-house which would be affected by a direction given on the application.

• (2) The Secretary of State in entertaining the application—

• (a) shall take into consideration the information about the finances of the applicant given to him on the application, and any further information given by the applicant at his request, and

• (b) shall not give a direction unless he is satisfied that the direction is necessary having regard to the applicant's normal sources of income and to the expenditure (including loan charges) which in his opinion it is reasonable for the applicant to incur in the exercise of housing functions.

• (3) The Secretary of State shall give notice in writing of his decision on the application to the applicant and to the rent officer and, where the decision is to grant the application, the notice shall include particulars of the direction given on the application.

• (4) The rent officer shall note in the register—

• (a) any application notified to him by the applicant, and

• (b) any direction given and the period for which it is effective, and

• (c) any decision of the Secretary of State not to grant an application.

• (5) The applicant shall take all reasonable steps to notify the tenant of each dwelling-house affected of any case where the Secretary of State decides to grant or not to grant an application and, where the decision is to grant the application, the notice shall include particulars of the direction given on the application.

Increase of rent without notice to quit

66

Subsections (1) to (4) of section 62 of the Act of 1969 increase of rents of houses belonging to certain authorities without notice of removal) shall apply to a housing association or the Housing Corporation as they apply to any authority to which that section applies, except that in subsection (4) for the reference to the date of the commencement of that Act there shall be substituted a reference to the date of the coming into force of this Act.

Supplemental to sections 60 to 66

67

• (1) Section 34 of the Act of 1971 (adjustment for differences in lengths of rental periods) shall apply for the purposes of sections 60 to 66 of this Act as it applies for the purposes of Part III of that Act.

• (2) Where a rent determined by a rent assessment committee is registered in substitution for a rent determined by the rent officer, the date of registration shall be deemed for the purposes of sections 60 to 66 of this Act to be the date on which the rent determined by the rent officer was registered:

Provided that a landlord shall not, by virtue of this subsection, be entitled to recover any rent for a rental period beginning before the date when the rent determined by the rent assessment committee was registered.

• (3) The sheriff shall have jurisdiction, either in the course of any proceedings relating to a dwelling-house or on an application made for the purpose by the landlord or the tenant, to determine any question as to the rent limit under the said sections 60 to 66, or as to any matter which is or may become material for determining any such question; and section 123(1) of the Act of 1971 shall apply to any application to the sheriff under this subsection as it applies to any application under any of the provisions mentioned in section 123(3) of that Act.

Interpretation

Interpretation of Part VI

68

• (1) In this Part of this Act, unless the context otherwise requires—

• " housing functions " means constructing, improving or managing or facilitating or encouraging the construction or improvement of houses by conversion and the acquisition of houses, and includes functions which are supplementary or incidental to any of those functions.

• " loan charges " includes any loan charges made by a housing association (including charges for debt management) whether in respect of borrowing from any capital fund kept by the housing association, or in respect of borrowing between accounts kept by the housing association for different functions, or otherwise.

• (2) In this Part of this Act, expressions which are used in this Part of this Act which are also used in Parts III and IV of the Act of 1971 shall, unless the context otherwise requires, have the same meaning as in those Parts.

Part VII — Miscellaneous and General

Miscellaneous

All payments under overspill agreements to be voluntary

69

• (1) No payment shall be made by an exporting authority to a receiving authority under subsection (4)(b) of section 9 of the Housing and Town Development (Scotland) Act 1957 for the year 1972–73 or any subsequent year in pursuance of an overspill agreement; but such an agreement whether made before or after this Act comes into force, may provide with the consent of the Secretary of State, for such payment from the exporting authority to the receiving authority as may be specified in the agreement.

• (2) In consequence of subsection (1) above the said section 9 shall have effect for the year 1972-73 and subsequent years as if—

• (a) subsection (4)(b) were omitted; and

• (b) for subsection (5) there were substituted the following subsection—

(5) An overspill agreement (whether entered into before or after this Act comes into force) may provide, with the consent of the Secretary of State, for the making by the exporting authority to the receiving authority of such payment as may be specified in the agreement.

.

• (3) Nothing in this section shall affect the continuance of any payment being made in pursuance of subsection (5) of the said section 9 immediately before this Act comes into force.

• (4) A receiving authority may abrogate an overspill agreement entered into before this Act comes into force if the Secretary of State is satisfied, on an application made to him by the receiving authority, that, if they were to implement the agreement, an unduly large burden would fall on the authority’s housing revenue account.

Termination of certain existing exchequer contributions and related provisions

70

Schedule 8 to this Act shall have effect as to—

• (a) the termination, for the year 1972-73 and subsequent years, of payments under the enactments described in Schedule 1 to this Act, and

• (b) the termination or modification of certain other provisions about assistance for housing authorities or other persons providing housing accommodation.

Financial assistance towards tenants' removal expenses

71

• (1) A local authority for the purposes of Part VII of the Act of 1966 shall, in the performance of the functions of management of houses conferred on them by section 149(1) of that Act, have power, subject to subsections (2) and (3) below, in every case where a tenant of a house to which the housing revenue account relates moves to another house, whether or not that other house is also owned by the local authority—

• (a) to pay any expenses of the removal ;

• (b) where the tenant is purchasing the house, to pay any expenses incurred by him in connection with the purchase other than the purchase price.

• (2) Paragraph (b) of subsection (1) above shall only apply in a case where a tenant of a house to which the housing revenue account relates moves to another house of the local authority if that house has never been let.

• (3) A local authority may make their payment of expenses in connection with the purchase of a house subject to such conditions as they think fit.

• (4) Nothing in this section shall affect the operation of section 160 of the Act of 1966 (which gives a local authority power in certain circumstances to pay reasonable allowances to persons displaced from buildings).

Default by local authority

72

Section 195 of the Act of 1966 (default powers of Secretary of State in relation to rents) shall have effect as if—

• (a) In subsection (1) for the words from "there has" to " this Act" there were substituted the words

a local authority— (a) have failed effectively to discharge any of their functions under Part II, III or IV of the Housing (Financial Provisions) (Scotland) Act 1972 ; or (b) have failed so to discharge any function conferred on them by that Act or any other enactment as to secure the effective discharge of any of their functions under those Parts of that Act;

• (b) after subsection (4) there were inserted the following subsections—

(4A) Without prejudice to subsection (4) above, where a local authority have failed to comply with any requirement of— (a) a default order within the time specified therein, being a default order in which the Secretary of State has declared the local authority to be in default in respect of a failure such as is mentioned in subsection (1) of this section, but has not directed them to comply with a rents scheme, or (b) a rents scheme to which they have been directed under this section (whether in a default order or in a supplementary order), the Secretary of State may make an order rendering exercisable by him such functions of the local authority under Part II, III or IV of the Housing (Financial Provisions) (Scotland) Act 1972 as are specified in the order and such other functions of the local authority as the Secretary of State considers necessary or expedient for the performance of those functions and as are so specified, and he may direct that the authority shall not during such time as the order is in force perform any function conferred by the order on him. (4B) Section 194 of this Act shall apply for the purposes of subsection (4A) above as it applies for the purposes of section 193 of this Act. (4C) It shall be the duty of a local authority, any of whose functions the Secretary of State is exercising by virtue of an order under subsection (4A) above, and any officer or servant of such an authority, to take all reasonable steps to facilitate the performance of those functions by the Secretary of State.

• (c) after subsection (5) there were inserted the following subsection—

(5A) The Secretary of State may— (a) in a default order in which he has not directed a local authority to comply with a rents scheme made under this section, or (b) in a default order or supplementary order in which he has so directed the local authority, or (c) in an order under subsection (4A) above, require the local authority or, as the case may be, empower himself to treat during such period as may be specified in the order any provision of the Housing (Financial Provisions) (Scotland) Act 1972 so specified— (i) as having effect with such exceptions, adaptations and modifications as may be so specified, (ii) as not having effect.

Power of Secretary of State to reduce, suspend or discontinue housing subsidies

73

Section 58 of the Act of 1968 shall have effect as if—

• (a) in subsection (1) at the end there were added the words " ; and he may, in the circumstances mentioned in paragraph (aa) or (c) of subsection (3) of this section reduce the amount of any subsidy payable under Part I of the Housing (Financial Provisions) (Scotland) Act 1972 or suspend or discontinue the payment of such subsidy or part thereof. " ;

• (b) in subsection (3) after paragraph (a) there were inserted the following paragraph—

(aa) that the subsidy falls to be paid to a local authority and the Secretary of State is satisfied that the authority have failed to discharge any of their functions under Part II, III or IV of the Housing (Financial Provisions) (Scotland) Act 1972 ;

;

• (c) in subsection (3)(c) after the word " made " there were inserted the words " or the subsidy falls to be paid ".

Application of receipts from disposal of certain land

74

Notwithstanding section 168 of the Local Government (Scotland) Act 1947, any money received by a local authority from the disposal of land, being land in respect of which income and expenditure is accounted for in the housing revenue account or the slum clearance revenue account, shall be applied, except where the Secretary of State otherwise approves, for a purpose for which the land which was the subject of the transaction was held.

Adjustment of accounts on appropriation of land

75

• (1) Where after the coming into force of this section land is appropriated by a local authority for the purposes of Part II or Part VII of the Act of 1966 or Part I of the Act of 1969, or on the discontinuance of use for that purpose, such adjustment shall be made in the accounts of the local authority as the Secretary of State may direct.

• (2) Any direction under this section may be either a general direction or a direction for any particular case.

• (3) Where this section applies, section 25 of the Town and Country Planning (Scotland) Act 1959 (which also relates to the adjustment of accounts on appropriation of land) shall not apply.

Tenancies at a rent unalterable over a long period

76

• (1) This section applies to a tenancy of any of the houses to which a local authority's housing revenue account relates (including a tenancy granted before the coming into force of this Act) other than—

• (a) a house for the time being subject to a weekly or other periodical tenancy,

• (b) a house for the time being subject to a tenancy granted, by the authority or any predecessor in title, before 1st August 1971,

• (c) a house which, whether before the coming into force of this Act or later, was acquired by the authority from a person other than another local authority, which when acquired was regarded by the authority as only likely to be available for use as a house for a period not exceeding ten years and which is for the time being subject to a tenancy which was granted before it was so acquired, or

• (d) a house for the time being excluded from this section by a direction of the Secretary of State subject to such conditions, if any, and for such period, as may be specified in the direction, being a general direction, or a direction given on the application of an authority for a particular case,

if, apart from this section, the authority would not have the rights conferred by subsection (2) of this section.

• (2) It shall be an implied term of the tenancy that the authority may increase the rent payable under the tenancy with effect from the beginning of any rental period by a notice given to the tenant not less than four weeks before the beginning of the rental period (or any earlier day on which the payment of rent in respect of that period falls to be made).