Chamber and committees

Yes, we are. We are working on some draft SSIs. It will be after the summer, but we are working at pace on the secondary legislation and doing what we can in the meantime, before we go into purdah next year.

I absolutely understand the frustration. I appreciate it, and the issue of organisations moving away from a year-to-year funding model is brought up with me quite frequently. You will appreciate that the Scottish Government has the same issue; we do not know what we are going to get until the September or October before we have to finalise our budget. However, we recognise the financial uncertainty that that causes.

The Scottish Government is aiming to move away from short-term projects. As part of the 2025-26 programme for government, it has committed to delivering a fairer funding pilot. That will provide multiyear funding to third sector organisations that deliver front-line services and tackle child poverty. It is not for every organisation, and it is only a pilot. However, I am hopeful that if it is a success we can give other organisations multiyear funding.

I totally appreciate your comments, Ms Gosal. It is unacceptable. As we know, people who are fleeing domestic abuse can be some of the most vulnerable in our society. I am pleased, though, that the Regulation of Legal Services (Scotland) Bill was passed last week in Parliament, as that will remove restrictions preventing charities, law centres and citizens’ advice bodies from directly employing solicitors to provide certain legal services to some of our most vulnerable, including those fleeing domestic abuse.

I watched Dr Marsha Scott’s evidence, and she highlighted the issue that someone might take on a case for domestic abuse but then not take on the other issues that the person might need legal assistance with. That is where the bill that was passed last week will make things a lot easier for people who are fleeing domestic abuse.

I take your comments on board. No one disagrees that we need reform in legal aid, and all those issues will be embedded in the heart of how we move forward.

Yes, I absolutely appreciate the frustrations. I will provide bit of clarity on the background. My predecessor invited Martyn Evans to do an independent review. The Scottish Government published its response to that back in November 2018. We then went into the Covid era, so things were delayed. There has been substantial progress on things that were recommended in the Evans review, such as the legal aid remuneration project research analysis group, as part of which extensive work was carried out to agree the scope of potential research, and that work is on-going.

I saw Pat Thom from the Law Society of Scotland, who I know that Mr O’Kane has spoken to about the history of that. For example, £10 million was provided on the understanding that everyone would be on that board, and a lot of work was carried out on that remuneration project. Although we have not made progress on primary legislation, which we will do during the next parliamentary session, we need to get the funding model sorted. The board put the research project that was recommended by the Evans review out to tender twice, and unfortunately we were not able to get anybody to look into it.

Although we have uplifted funding by 25 per cent during the past five years, historically that was not done as much. In future, we need to have stability for the legal profession through an annual funding mechanism that can be reviewed. That is a core part of how we move forward with legal aid reform, because it is a bit disjointed. There are a lot of issues, and it is very complex. However, until we get that sorted, I do not see how we can progress, although I do want to move forward with the legal aid reform.

The provisions in the bill on oral notice by tenants reflect the law as it is at the moment. For those who think that a tenant should give notice in writing, there is flexibility in the bill to provide for that. It is open to the parties to agree a provision in the lease that written notice must be given to terminate it—section 23 allows for that. To be clear, oral notice can be given by the tenant only when the lease is for less than a year, so that will not apply in all cases.

Leases of less than a year in duration tend to be more informal in nature and do not need to be in writing. They are of particular value to businesses that need flexibility because they are involved in temporary activities or are testing new markets, for example by operating concessions or food stands.

Requiring tenants to give written notice in all circumstances would be a significant change in the current law, and the Scottish Law Commission did not consult on it. It could also create a trap for small business people, who might think that, because they have entered into a lease by way of an oral agreement, they can terminate the lease in the same way, but they might find themselves having to continue to let the premises.

We should reflect on the possible unintended consequences that such a change in the law could have, particularly for small businesses when they are starting out.

Good morning. The Leases (Automatic Continuation etc) (Scotland) Bill will implement recommendations that the Scottish Law Commission made in 2022 to reform aspects of the Scots law of commercial leases. This is the fourth SLC bill in the current parliamentary session, and a fifth, which is on contract law, was recently announced in the programme for government, demonstrating our commitment to law reform.

Most businesses, large or small, operate from let premises, at least to some extent, and the relationship between landlord and tenant is crucial to commercial life in this country. It is important that the law that governs that relationship functions effectively, so the bill aims to improve, simplify and update aspects of the Scots law of commercial leases so that it meets the needs of a modern Scottish economy.

The bill’s principal purpose is to reform the current law of tacit relocation. That is the process whereby a lease continues automatically after its termination date unless one party gives notice to the other that it will come to an end or both parties agree at the time that it will come to an end.

I have listened to the evidence of stakeholders, including those who have questioned the need for reform in the area and others who have suggested that the bill might need to be rewritten. I do not agree with the latter view. As far back as 2010, the SLC was approached by practitioners and solicitors in the area who said that the law should be reformed because it was uncertain and was acting as a deterrent to commercial property investment. The SLC’s project sets out clearly that the law of termination of commercial leases is inaccessible, uncertain and outdated and why that is so. Representative bodies of Scottish small businesses and landlords have welcomed the bill and are supportive of it. No doubt we will discuss that further in today’s meeting.

All that aside, however, a number of technical issues have come up during stage 1 evidence. I have worked constructively with the committee on previous SLC bills and I will continue to do so as this bill progresses. I look forward to answering the committee’s questions.

I will pass over to Michael Paparakis or Lori Pidgeon, because that is a technical issue.

We will look into it and I will write to the committee with that information.

The new law is intended to replace the pre-commencement law underlying a lease, including any implied terms. It is not intended to validate or invalidate the arrangements that the parties have expressed in their lease, as paragraphs 8 and 10 of schedule 2 make clear.

Any express lease terms that are carefully negotiated by the parties will be unaffected by any provisions in the bill coming into force. For example, if a lease has an express term providing for a three-week period of notice for a lease that is longer than six months, that period will continue to be valid, notwithstanding the fact that the bill provides for a minimum period of 28 days.

The alternative that has been suggested by some stakeholders is to apply the new law to leases that are entered into after the coming into force of any other provision, but that would mean that one kind of complexity would be replaced by another. For instance, if the new law were to apply only to new leases, then, for many years into the future, the current common law would apply only to old leases, and landlords and tenants could encounter difficulties in the future because they do not understand which legal regime applies to their case.

The provisions of the bill will be commenced by regulations, and I will ensure that there is sufficient lead-in time for legal professionals and interested stakeholders to make sure that they have all their affairs in order with regard to this issue.

It is just a suggestion, and I think that any prudent landlord would normally undertake to do that before entering into a lease.