New land category contained in bill

Press, 2 July 1979, Page 13

New land category contained in bill

PA Wellington A new rent-fixing procedure tor pastoral leases is contained in the Land Amendment Bill introduced in Parliament. The Minister of Lands (Mr V. S. Young) said that the bil' put into effect the findings of the Land Settlement Board which had reviewed its rent-fixing policy. The bill creates a new category of Crown land called restricted grazing Ian 4 . This comprises land now classified as pastoral land that for any reason, such as vulnerability to erosion, is not suitable for sustained grazing Lessees keep their unqualified rights to renew their existing leases under the same terms and conditions contained in their existing leases. Where a lessee applies for, and wishes to pursue the option to capitalise his future rentals, the Land Settlement Board may require that all “restricted grazing land" be removed from the lease. If any new pastoral leases were issued by the board they would not include “restricted grazing land.”

The first of the existing pastoral leases are due to expire in 1983. Because runhoiders were concerned about the policy adopted by rhe Land Settlement Board in 1974 for fixing future renewal rents, the board had agreed to review its policy. Mr Young said. The policy fixed by the board provided that pastoral rentals would be leased on 3 per cent of the value of the land, exclusive of improvements, with no phase-in provisions. This policy was never implemented by the board. The board has completed a review' of its rental fixing policy and this legislation puts into effect its findings. In the past, annual rentals for pastoral leases were assessed on the basis of the number and classes of stock carried, having regard to the type of land. This bill provides for the annual rental for both new' leases and renewals to be 3 per cent of the rental value with 11-year rental reviews. The rental value is the value of the land exclusive of improvements, plus the value, of any Crow'n improvements.

To prevent any undue hardship to existing pastoral lessees, the new rate w'ill be phased in over 33 years. The reduced rate allowable during the transitional period w'ould remain as a suspended charge against the property, with a maximum term at any one time of 11 years, Mr Young said. This w'ill be achieved by suspending one-half, onethird, and one-sixth respectively of the rent payable during each of the 11 yearly review periods. Provided the lessee does a capital development or maintenance programme approved by the Land Settlement Board, the suspended amounts of rent will be written off each year starting in year 12. This means that the last annual write-off will occur in year 11 of the second renewal term; that is, 44 years after the first suspension. There would more than 11 years’ suspended rent. Should a lessee wish to sell or otherwise deal with the lease, except for direct family transactions, the Land Settlement Board could require the suspended amount as be paid.