I wish to make a statement about Government policy on commercial leases and the launch of a new property industry Code of Practice for Leasing Business Premises.

The starting point is the need for a modern, efficient, competitive industry. The UK commercial property industry is acknowledged as one of the foremost and sophisticated in the world, exporting its expertise globally.

However, the Government challenge to the industry is to provide a flexible framework, creating a new partnership between owner and occupier. Our policy is based on careful and thorough research of the property market.

We have had a positive and collaborative response from all sides of the industry—owners, occupiers, small business organisations and the professional bodies. The industry has developed new ways of working, setting up the Owner and Occupiers' Forum and the Property Industry Alliance. Alongside this, Government have been working with business to bring about change.

The outcome has been agreement on a new Code, which I am launching today. This comprises three documents: a Landlord's Code of Practice, an Occupier Guide and Model Heads of Terms. The Landlord's Code is significantly stronger in tone and content than the previous Code, while the occupier guide and model heads of terms are designed to improve business understanding of lease terms, helping them to get more suitable lease terms.

It is essential the industry follows this through, and I welcome plans for wide dissemination of the Code. My challenge to the industry is to ensure that the Code is used in all lease negotiations.

The British Property Federation are introducing an accreditation scheme identifying landlords who are committed to the new Code. This will include an independent complaints procedure. I hope the professional bodies will introduce similar arrangements for their members.

I recognise the considerable changes in commercial leasing practices over recent years, especially the trends towards shorter leases. But I am concerned about continuing elements of inflexibility, particularly the predominant use of upward only provisions in rent review clauses and inflexible provisions for tenants exiting property they no longer need.

We will want to keep a close eye on market practice in these areas. If the market does not deliver, we have identified legislative options. Communities and Local Government will shortly be consulting the bodies that drew up the Code about suitable monitoring arrangements.

Copies of the Code for Leasing Business Premises will be placed in the Libraries of both Houses.