RATING BILL
STANDING COMMITTEE D
OFFICIAL REPORT
Thursday, 27th January, 1966[Sir Leslie Thomas in the Chair]
Clause 1.—(Right to pay rates on dwelling in England or Wales by instalments.)
Amendment proposed—(16th December, 1965)—in page 1, line 12, leave out “mainly” and insert “partly” —[Mr. Murton].
10.30 a.m.
Question again proposed.
The Joint Parliamentary Secretary to the Ministry of Housing and Local Government (Mr. James MacColl)
I was very glad that I persuaded the hon. Member for Poole (Mr. Murton) to deploy the case for this Amendment some weeks ago before we adjourned because I wanted to see the substantial point behind it. Having heard what he said, I think I can make some remarks which, I hope, will make it clear that there is not very much danger of the difficulties he saw arising under the Bill as it is drafted.
I think that the weakness in his argument was a confusion between a physical building and a hereditament. The illustrations he gave were of cases in almost all of which there would be a separate assessment of the different parts. If there were a separate assessment of that sort, of course no problem would arise. The only case which we have to worry about whether or not it is partly or mainly residential is where there is no separate assessment.
The particular case which the hon. Member quoted was of a block of flats on the ground floor of which are situated one or more shops. The block of flats is self-contained and certainly will have an independent assessment. In that case there would be no difficulty. A small flat above a little lock-up shop on the corner of a street, if the shop were really locked up, would have a separate access for the rest of the accommodation. There is every reason to believe that there would be a separate assessment. [column 52]
Then we come to private dwellings which exist in a series over a parade of shops. If it were a series over a block of shops it would normally have a separate assessment. The tenant letting to his assistant is perhaps a more difficult case and the kind of case in which in drafting the Bill we felt there was a problem. That is why we put in the test of whether it was “mainly” occupied. The kind of case where there is a problem is the very small shop with a person living in the back room or just one-up one-down, where there is no separation at all. In order to protect that kind of case it is necessary to have the words which are in the Bill. To say that so long as there was a scintilla of residential accommodation we must be completely free to have the whole thing brought within the Bill is going too far.
Profiting from the leisure of the Recess, I was able to listen in to the reading of “David Copperfield” . My attention was drawn to Mr. Wickfield whose daughter, the Committee will remember, kept house for him upstairs and he and Uriah Heap occupied the solicitor's office downstairs. I immediately leapt out of bed and said “I don't think they would be able to claim to pay by instalments” . That is the kind of case which would be open to abuse because if Mr. Wickfield prospered, the firm would become Wickfield, Heap, Wickfield & Wickfield, and they would have an enormous new luxury block of offices in Victoria Street.
Mr. Boyd-Carpenter
Like the Board of Trade.
Mr. MacColl
I was thinking of Westminster City Council who recently took me over. In that case it would not be within the spirit of the Bill at all—that because one caretaker occupied a small room the whole of the premises came within this provision. I again underline what I have said, which is a very important point to be made on the Clause. There is nothing to stop a local authority being sensible. This is not a restriction of a local authority's discretion.
The provision says that in certain cases local authorities must allow payment by instalments. Any sensible local authority, faced with a highly marginal case where the proportions of residential and commercial occupation could be worked [column 53]out only with a slide-rule to find to three decimal places which was the greater accommodation, would say, “We will give them the benefit of the doubt” . Therefore, I suggest that this use of the word “mainly” is a reasonable compromise. It would cover most of the cases where there might be hardship. It would exclude those cases where there might be an abuse. I hope that the Committee, having explored this matter, will feel that the point is covered.
Mr. Boyd-Carpenter
The Parliamentary Secretary was very reasonable in tone, but of course it follows from what he has said that he accepts that this provision will not cover all the cases of hardship. Using, no doubt, carefully chosen words, he said that it would cover most of them. It therefore follows that it would not cover all. Is that wholly satisfactory as the position in which to leave legislation which, in this respect at any rate, is intended to deal with hardship? The Parliamentary Secretary said that no reasonable local authority would quibble about the wording but would apply common sense and so on. No doubt, that is what the great majority of local authorities would wish to do. On the other hand, when Parliament enacts something of this kind I am afraid it has the effect of making those in administration centrally or locally feel that they should follow the intentions of Parliament as enacted rather than the reasonable observations which a Parliamentary Secretary made in Committee.
If local authorities are to apply this construction of the word “mainly” reasonably, I suppose some might feel at risk, if they construed it very widely, that they were going outside the statute and beyond the intentions of Parliament. What the Parliamentary Secretary said in defence of maintaining the word “mainly” is just as good an argument for the word put forward by my hon. Friend the Member for Poole (Mr. Murton). That at least would express the intention of both sides of the Committee, that we should deal with the cases of hardship by putting local authorities in a position in which they would not feel that they were in breach of the statute when dealing with those cases.
The Parliamentary Secretary accepted that there was a class of case which the [column 54]words of the Statute do not cover. We say that those words should cover it. Why should they not? The Parliamentary Secretary made no argument to the effect that the introduction of the word “partly,” would cause difficulty. He said that “mainly” would not do harm if it were used reasonably. He did not argue that it would bring in more cases.
Mr. MacColl
I am sorry, but the right hon. Member did not follow the point. My argument was that if we put in “partly” it would give a statutory right to any commercial ratepayer where there happens to be a scintilla of residential accommodation to make payment by instalments. That seems rather burden some for local authorities. The sensible thing is to deal with the cases where most of the accommodation is residential and, if there is a genuine case for allowing payment by instalments, local authorities could interpret this liberally.
Mr. Boyd-Carpenter
It is all very well to talk about local authorities interpreting it liberally, but, as the hon. Gentleman accepts, this puts no obligation on local authorities to do so. They may in particular cases do so.
Secondly, there is a point to which the hon. Gentleman has not addressed his mind. Local authorities may well feel that this idea that they can interpret liberally is not an easy or a very proper thing for a local authority to do. The Parliamentary Secretary called in aid the fact that payment by instalments causes administrative expense and trouble. A local authority faced with a statute including the word “mainly” will feel in some difficulty about incurring expense and administrative effort and going beyond what Parliament has laid down. The Parliamentary Secretary has great experience of local government and he knows this is so. He knows the kind of advice which local authorities will give to a relevant committee in such cases. They will say, “You are taking a risk if you go beyond what Parliament has laid down and incur expenditure in that way” .
I do not want to waste the time of the Committee by debating this point. The Parliamentary Secretary has not been prepared to come forward with a proposal to meet the hard cases which he admits will be excluded by the word “mainly” . [column 55-56]He has not promised to consider this matter before the next stage of the Bill. If he stands pat and says, “We shall throw it to the local authorities and hope that they will deal with it liberally” , I imagine my hon. Friend will want to press the Amendment to a Division. But if the hon. Gentleman wants to get on with the Bill and will pay attention to points which have been made and try to find a way, possibly by the use of a third word, to deal with the class of case which he admits is not covered, then no doubt we could get on and save time. If he is not prepared even to go so far as that but is to sit on his brief, I have no doubt that my hon. Friend will feel disposed to press the Amendment.
Mr. MacColl
It is not my brief that I am sitting on.
Mr. Boyd-Carpenter
I think the hon. Gentleman would speak much better if he did so.
Mr. MacColl
I hope that as we proceed with the consideration of the Amendments to this Clause I shall be able to show that my right hon. Friend has left me for the moment with the best intentions of treating any reasonable Amendment sympathetically, but this, I think, is an unreasonable Amendment. This is a case in which I think the right hon. Member for Kingston-upon-Thames (Mr. Boyd-Carpenter) is making a point out of nothing and rather weakening his case. Therefore I could not agree to the change.
Question put, That “mainly” stand part of the Clause.
The Committee divided: Ayes 10, Noes 8. Division No.3.]
Ayes
Finch , Harold (Bedwellty)
Hobden , Dennis (Brighton, K'town)
Mabon , Dr. J. Dickson
MacColl , James
Oakes , Gordon
Rhodes ; Geoffrey
Robertson , John (Paisley)
Silverman , Julius (Aston)
Whitlock , William
Williams , Alan (Swansea, W.)
Noes
Allason , James (Hemel Hempstead)
Boyd-Carpenter , Rt. Hn. J.
Hall-Davis , A. G. F.
Maddan , Martin
Murton , Oscar
Smith , Dudley (Br'ntf'd & Chiswick)
Thatcher, Mrs. Margaret
Woodhouse , Hn. Christopher
10.45 a.m.
Mr. MacColl
I beg to move, in page 1, line 14, to leave out from “of” to “by” in line 16 and to insert:
“arrangements made by virtue of section 11 of the Rating and Valuation Act 1925 or any local Act whereby the payment of rates thereon is made.”
This proposed Amendment does not alter the sense of the Bill at all, but it brings in the cases, of which we think there are still some, where a local Act gives an authority power to make compounding arrangements. Therefore, in order to have them covered in the same way as those who operate under the general law of the 1925 Act, this seems more or less a drafting Amendment.
Mr. Boyd-Carpenter
I am always suspicious of what is described as “more or less a drafting Amendment” . Experience in this House has shown that the emphasis in those circumstances is generally on “less” . But, on the face of it, what the Parliamentary Secretary says is reasonable and I do not think we need take up much time discussing it. However, I would add that in my experience it is unique to have an Amendment moved when the mover expressly says, “This does not alter the effect of the Bill” .
Amendment agreed to.
The Chairman
The next Amendment is No. 6, in page 1, line 16, at end insert:
(ii) any owner of a hereditament which is the subject of such direction or agreement as aforesaid.
Mr. Boyd-Carpenter
This Amendment has been discussed, Sir Leslie. I think you were kind enough to say that you would reserve it for a Division if necessary. I do not propose formally to move it.
The Chairman
I am not calling Amendment No. 27, in page 1, line 16, at end insert:
(ii) any charity not included in Schedule 1 to the Rating and Valuation Act 1961. It is out of order. The next Amendment, therefore, is No. 37 in the name of the Minister.
[column 57]Mr. C. M. Woodhouse
On a point of order. I wonder whether Amendment No. 35, which touches on the same point, is also going to be ruled out of order.
The Chairman
I am going to call Amendment No. 35.
Mr. Boyd-Carpenter
Perhaps on that point of order, Sir Leslie, you could confirm that on Amendment 35 it will be possible for my hon. Friend and others to raise a substantial point.
The Chairman
Yes.
Mr. MacColl
I beg to move Amendment No. 37, in page 2, line 3, after “rates” , to insert:
“in respect of the rate period in which that date falls or any subsequent rate period which are” .
It may help the Committee if I explain how the sentence will now read.
“and, as from the date which under the said subsection (2) is the effective date of that notice until in pursuance of subsection (6) of this section that notice ceases to be in force, any rates in respect of the rate period in which that date falls or any subsequent rate period which are charged on that person in respect of that hereditament shall be payable by instalments accordingly.”
This Clause deals with the question of arrears of rates, and the real principle behind the Amendment is that in starting an instalment scheme one should start with a clean slate. One should not be able to bring into the instalments the arrears from the previous rate period, and then accumulate those and pay instalments on instalments and go on ad infinitum. So this is an improvement to make the position clear, as, otherwise, there would be administrative difficulties for local authorities.
Mr. James Allason
May I ask the Parliamentary Secretary a question? The effect of this Amendment is that a person is entitled to give notice thereupon to start paying his rates by instalments. Does this not conflict with subsection (2), which says that if he gives notice on 1st February or shortly afterwards the notice will not take effect until the following rate period? It seems that there is a contradiction here which may well lead us into grave difficulties.
Mr. MacColl
I think it is clear that the governing date is the beginning of the rate period. The point of having the notice given in advance of the rate period [column 58]is merely to make it easier for everybody to know that this operation is going to take place. It makes it easier for both the ratepayer and the authority to make arrangements accordingly. This Amendment deals with the position of arrears arising. The ratepayer may have defaulted, but it may be that he has acted in perfectly good faith. There may be an appeal on an assessment which has held up their payment. The principle is a clear one, that one starts ones instalments with a clean slate.
Mr. Oscar Murton
The point I wish to make is, perhaps, in many ways a defence of those whose rates have fallen into arrears. The whole object of this Bill is to give assistance to everyone in paying rates, and to make it easier for them to meet their obligations by paying them by instalments. I should like to know when those persons who are in arrears with their rates are going to be able to obtain the facilities offered by this Bill. They must get out of the deep water before they can come into smoother parts and pay by instalments. Can something be done for them to help them out of the deep water? It is my experience in a local authority that there are a fair number of persons who are invariably in this predicament and they are often threatened with eviction. What is going to happen to them is an intractable problem. Are they ever going to meet their obligations? If they cannot have these facilities their position will not be helped in any way, even though others will be paying by instalments.
Mr. MacColl
Again, we come back to the point that this is giving certain rights to the ratepayer—not taking away the rights which he has under existing law. There is already machinery for collecting rates and dealing with people who are in arrears. Subject to the limitations which this Clause places upon their power to enforce the payment of rates, the authority can take the ratepayer to court and the kind of point which the hon. Gentleman raises is precisely the kind of point at which a petty sessions has to look. The court will consider whether this situation is going on for ever, whether there is a reasonable chance that the arrears are going to be paid, and so on. This situation will continue, but what I am saying is that the ratepayer ought not to be able [column 59]to exercise his powers in regard to arrears from the previous rate period. Of course, it is not true that all ratepayers are in arrears because they cannot afford to pay. In many cases they are in arrears because of some delay over the assessments.
Mrs. Margaret Thatcher
May I follow with one point on arrears which arise from the result of an appeal? Perhaps the James MacCollParliamentary Secretary will correct me, but I think that if there is an appeal pending the local authority can only recover the undisputed part of the rate. Often people appeal because the rate assessment is extremely high, and they really cannot afford to pay in a lump sum. They may not have fallen into arrears in the ordinary sense of the word, but they may technically be in arrears if the appeal is confirmed. It seems that this is a different group of people from those who have only fallen behind in husbanding their resources. Would those people be prevented by virtue of this Amendment from paying those technical arrears by instalments, along with the rate due in the current or subsequent year?
Mr. MacColl
If the authority chose to make an arangement, as in most cases they do, then there will be no problem. But those people would have no right to aggregate from the previous period.
Amendment agreed to.
Mr. Murton
I beg to move Amendment No. 35, in page 2, line 4, at the end to insert:
(2) Where the occupier of any hereditament such as is mentioned in subsection (1) of this section, is a charity not listed in Schedule 1 to the Rating and Valuation Act 1961 that subsection shall have effect as if the words “and resides or is usually resident in” were omitted.
The intention of this Amendment is to extend the benefits of Clause 1 of this Bill, as regards the right to pay rates on dwellings in England and Wales by instalments, beyond that of individual occupier, so as to include, also, rateable property held on behalf of a charity by trustees. A charity is defined in Section 45(1) of the Charities Act, 1960, as
“any institution, corporate or not, which is established for charitable purposes and is sub[column 60]ject to the control of the High Court in the exercise of the court's jurisdiction with respect to charities” .
The type of charity which it is envisaged would benefit under this Amendment would be, for example, the village or parish hall, property held by trustees for the benefit of local inhabitants, the hall being let from time to time for local functions and where the income does not greatly exceed the outgoings. We consider that an organisation of this type would benefit very considerably by being allowed to pay their rates by instalments. We see no reason why such an enterprise which is not functioning for gain should not benefit by the provisions of the Bill. 11.0 a.m.
A similar case would be that of a village recreation ground where very much the same considerations obtain, where only a small rent is charged for playing on the ground and where the club responsible for it has quite a rate burden to meet. But the exact types——
The Chairman
Order. I think that the hon. Gentleman is getting a little out of order because his Amendment deals with things such as dwellings. It does not cover such things as village halls.
Mr. Murton
I am sorry, Sir Leslie. I am afraid that I misread the Bill when I was working on the Amendment. I apologise for my ignorance.
Another case which springs readily to mind is almshouses. The question of almshouses is, I hope, a relevant argument because, as is well known, in many towns there is a series of almshouses, many of them on old foundations, whose endowment is probably extremely small and to which the payment of rates, even though the rate may be abated under the Rating and Valuation Act, 1961, may still conceivably be a burden. Cases such as that and other charities which appear on a local authority's index of local charities under Section 10 of the 1961 Act would benefit under the Bill.
Mr. Woodhouse
I support the Amendment for the reasons which my hon. Friend the Member for Poole (Mr. Murton) has given and on which I do not intend to enlarge because I think that they will appear self-evident to all hon. Members. [column 61]
I wish to confine my remarks to the words of the Amendment which correspond to an earlier Amendment of mine which was ruled out of order. The words are the defining words
“not listed in Schedule 1 to the Rating and Valuation Act 1961” .
Schedule 1 of the 1961 Act contains a list of those charities which are not already granted a 50 per cent. rebate on their rates under Section 11 of that Act. Those bodies consist exclusively at present of university institutions, and the list in Schedule 1 includes, if I am not mistaken, all the university institutions in the country with the exception of the colleges of Oxford and Cambridge.
In the case of those charities which are listed in Schedule 1 of the 1961 Act an undertaking was given by the then Minister of Housing at the time that the Measure was introduce that if any increase in their rates was attributable to the abolition of charitable relief it would be compensated by a special grant from the U.G.C.—that is to say, of the taxpayers' money. I must say in parenthesis that it is unclear to me even now whether that undertaking was merely to cover an increase in the rate liability out of the taxpayers' money or whether it was an undertaking to cover the whole of the universities' rate out of the taxpayers' money. I hope that the Minister will be good enough to clear my mind on that point when he replies.
However, in either case the same point of principle arises in the context of the Bill, and it is this. First, it is common ground that the provisions for payment by instalments in the Bill will impose an extra burden on ratepayers generally. While giving relief to certain ratepayers, it will marginally increase the rate liability of the others. Secondly, it is a fact that the rate burden of universities and institutions listed in Schedule 1 of the 1961 Act is already met, either in part or in whole, according to the way in which the Minister answers my question, by the taxpayer.
It therefore follows that unless the Amendment is accepted with the additional words in it for which I claim responsibility, namely,
“not listed in Schedule 1 to the Rating and Valuation Act 1961” ,
[column 62]the effect of the Bill will be to give marginal relief to the taxpayer at the expense of the ratepayer. I am sure that the Minister will follow this argument. I am equally sure that this was not the intention when the Bill was drafted, nor was it the intention of my right hon. and hon. Friends when they drafted the Amendment and put in the words
“not listed in Schedule 1 to the Rating and Valuation Act 1961.”
It is perfectly true that even if the Amendment were to be accepted in its entirety there would still be a residual anomaly arising from the fact that the Oxford and Cambridge colleges are excluded from Schedule 1 to the 1961 Act. But I am sure that the Joint Parliamentary Secretary and the Minister intend to put that anomaly right before long, and I should be glad if, in his reply, the hon. Gentleman could say when.
Mr. MacColl
The narrow scope of the Amendment, to which you have drawn attention, Sir Leslie, indicates some of the difficulties which arise in defining what we are being asked to do. The nonresidential charitable occupations do not come within the terms of the Bill. The field in which this could operate seems to me very narrow. The Committee should remember that in any case there would be a mandatory relief of 50 per cent. under the de-valuation of a charity, and that is a very substantial gesture from the rate fund to charities. Therefore, I should be very reluctant to suggest to my right hon. Friend that we should go beyond that and make a further general concession to charities.
Mr. Woodhouse
Are we to infer from the hon. Gentleman's answer that the Government have no intention in the foreseeable future of revising the 50 per cent. rebate to charities under the Rating and Valuation Act, 1961? I was led to suppose from some past remarks made on behalf of the hon. Gentleman's party that this was its intention.
The Chairman
Order. I hope that interventions will relate entirely to the Bill. What the Government's intentions are in several months' time is another matter. It is not for this Committee.
Mr. Woodhouse
I beg your pardon, Sir Leslie, but what I said related to a remark made by the Minister in his speech.
[column 63]Mr. MacColl
Listening to “ David Copperfield” on the radio reminded me of the character of Mr. Dick and King Charles 's head. I congratulate the hon. Gentleman on finding King Charles 's head even in this Bill, because we are doing nothing in the Bill about colleges and my right hon. Friend, the other Mr. Dick to whom I am responsible, has not indicated to me that New College requires to pay its rates by instalments. I think that the right hon. Member for Kingston-upon-Thames (Mr. Boyd-Carpenter) would agree that another college, rather more worthy and hardworking, would not want to do it either. Colleges do not come into the Bill from the point of view of the payment of rates by instalments, and I do not think that there is a very good case for doing that. As you, Sir Leslie, indicated, the Bill does not deal with the devaluation of charities. We have to consider the Bill in its present context and not anything which may happen in future.
I listened most carefully to what the hon. Member for Poole (Mr. Murton) said because I wanted to discover what he felt was the real problem. He came down to almshouses in the end. In many cases the rateable occupier in the almshouse would be the person living in the accommodation. If there were a tenancy agreement with that person he would be the rateable occupier and all the powers in the Bill would operate. Such a person would have the same rights of claiming as a residential occupier. Therefore, in those cases, I do not think that there would be any difficulty. I do not know how many cases there are, but usually the rateable occupier of the almshouse is not the person living in it but the charity which owns it. Those are the cases which we have to consider to see whether it is wise to make an Amendment.
My position is quite open. My right hon. Friend is reluctant to complicate the Bill any more than it is or to put any more work on local authorities. Therefore, he starts with a presumption against doing this because of the history of this matter, the fact that charities are already derated and that the number of cases involved seems to be very small.
I would not ask the Committee to accept the Amendment in its very wide form, but if between now and a later stage of the Bill we have substantial [column 64]evidence of hardship we shall certainly consider it. My right hon. Friend would look very carefully at the matter because he is reluctant to change the Bill in this respect. One difficulty, which no doubt right hon. and hon. Members opposite who have very skilfully drafted some of their Amendments have encountered, is finding a definition which can deal with this very narrow problem. I sympathise with them in that difficulty. If we can find a firm and strict enough definition, and if we have evidence that this is a real problem, my right hon. Friend will consider the matter, but I do not want for a moment to indicate that he intends to accept an Amendment of this kind.
Mrs. Thatcher
I should like to plead further the case of the charity which is a dwelling which I have particularly in mind, namely an old people's home or home for blind people or for people who are handicapped in one way or another. These are the cases to which theJames MacCollJoint Parliamentary Secretary referred in which the rateable occupier is the charity but the charity itself is substantially a dwelling house for those people. The hon. Gentleman will agree, I think, that, throughout the history of rating, charities of this kind have almost unquestionably warranted special treatment and relief from rates. The hon. Gentleman's reply seemed to indicate that this is the first departure from that basic principle. 11.15 a.m.
In the days before the Local Government Act, 1948, the responsibility for making the valuation list was with the local authority and it was the practice to reduce the rates on charities to what was called in inverted commas, “a charitable level” . That changed with the 1948 Act, when valuation became a national responsibility and, therefore, special provision had to be made in the 1955 Act. However, the principle was the same. This kind of charity covered by the Amendment warranted any relief which was going, and a good deal more besides.
The principle was extended in the 1961 Act whereby, as has already been said, these charities have to have 50 per cent. relief from their rating bill. The local authority, at its discretion, can give greater relief. I am told that very few—very few indeed—do extend that relief. I know of a large number of charities—for example, in Bishop's Avenue, where [column 65]the houses are far too expensive for private people to live in and which have been converted to old people's homes, and one has been converted into a home for the blind—whose rating bill constitutes a high proportion of its expenditure. Most of these charities are living on a shoestring. It would be a tremendous help to them if they could delay the payment of even a part of that bill for a time, as our Amendment will entitle them to do.
I plead with the hon. Member to consider this kind of case very carefully and not to abandon a principle of rating which has stood for a very long time indeed. Perhaps, therefore, he could collect some statistics on what kind of percentage of income is constituted by the rates of a number of charities and make inquiries about them. I believe he will find that they will welcome an Amendment of this kind; indeed, they will be extremely disappointed and feel they have been hardly treated if they are not to have the benefit extended to other ratepayers.
Mr. MacColl
As I have said before, I do not wish to get into a debate on derating charities, because there is no doubt that one of the reasons why local authorities have been reluctant to exercise their discretionary powers of derating is that they do not like mandatory derating. That is nothing to do with the Bill. It is wrong to say that this alters derating of charities in any way at all. The law remains precisely the same. The question is whether in the narrow context of paying by instalments there are enough cases of charities whose financial arrangements and the nature of the work they are doing make this a serious hardship. My right hon. Friend will certainly be open to receive evidence on that matter. I repeat though that his inclination is to be against giving special treatment and adding a further complication to the already difficult rating law about charities. I am sure that if the hon. Lady would be kind enough to write to him about these cases to which she has referred this morning, the right hon. Gentleman would have a look at them.
Mr. Boyd-Carpenter
I think the Parliamentary Secretary a little underrates the importance of the scope and scale [column 66]of this matter. I quite agree with him that it is not appropriate to raise the general difficult question of the derating of charities. I am sure, Sir Leslie, you would stop us if we were to do so. Indeed, my hon. Friend did nothing of the sort. She merely dealt with the question of the old principle of rating which discriminated against charities. This, of course, is what the Bill does in its present form.
The kind of case with which I am concerned—and I think hon. Members on both sides of the Committee will be concerned about this, too—is exemplified by a particular type of activity which I know well in my own constituency. In the Borough of Malden and Coomb; there is a very active old people's welfare committee. Whenever it can raise the funds, it buys one of the old Victorian houses and divides it up into one room flatlets, bedsitting rooms, for old people. As its funds grow, it buys up more of these houses. I have not consulted this body, but it is quite obvious that it would be an advantage to any charity which has to exist by raising funds if it were able to have the same advantage of paying its rates by instalments as this Bill gives to individuals.
That is why I was a little disturbed when the hon. Gentleman said—and I took his words down— “if there is substantial evidence of hardship” . In the first place, no evidence of hardship. I needed under the Bill in respect of an individual. The right to pay by instalments is given regardless of hardship. Why, therefore, bring in the consideration of hardship only in respect of charities? Surely that is precisely the discrimination against them which, as my hon. Friend pointed out, is quite contrary to the well established principles of our rating law.
Secondly, how is hardship established in respect of a charity? If a charity is financially prejudiced, there is no hardship to the charity. It merely means that it can do less good in relieving those whom it exists to help; that is all. As far as I know, that does not put any construction on “hardship” at all. That is why I found the substance of what he had to say very disturbing. In the sense of the word “hardship” , what is established undoubtedly is that it would be an advantage to charities of this sort to be put in no worse a position in respect of [column 67]the payment of rents by instalments than are individuals, however prosperous.
I hope the hon. Gentleman will come a little further than this. No one is in a better position than he to find out—if he takes the trouble—the scope and scale of activities of this kind. Every competent local authority is in touch with its own old people's welfare committee and with the housing trusts and associations set up to help in these cases. The hon. Gentleman could find out perfectly well the number of these premises from the local authorities with whom he is in touch. I can only tell him that they are substantial.
Therefore, why does the hon. Gentleman wish to put on the Opposition the onus of establishing how many institutions of this kind there are? I fully understand his desire not to overcomplicate a Bill which is already complicated. I accept that, of course. However, all we are asking is that where a charity provides residential accommodation—which, surely to goodness, in the matter of old people is almost the most important of all social activities and will continue to be with the rising age composition of this population—why should it be put in a worse position than individuals, however prosperous?
The hon. Gentleman's other argument, apart from over-complication, was the problem of drafting. He very gently and lightly twitted my hon. Friends and myself for the fact that our original draft did not necessarily rise to the high standard which you, Sir Leslie, laid down in this Committee in this respect. Goodness me, the Parliamentary Secretary has the Government's draftsmen at his disposal. Surely a Government whose draftsmen are capable of drafting the Land Commission Bill ought not be put off by any fear of introducing complications! Surely what we want from the hon. Gentleman is an undertaking to secure that charities providing residential accommodation get the advantage which is being given here to individuals. This is not a case where, as on an earlier Amendment, he can say that local authorities will be put to some expense to help commercial enterprise. On the whole, the law as to charities in this country is pretty discriminating. The type of charity which provides residential accommodation is really one of the most valuable socially. Its activities save the [column 68]State a great deal of expenditure which otherwise it would have to incur, such as the provision of Part III accommodation at the expense of the taxpayer.
The hon. Gentleman must move a little bit. He knows as well as I do that if the draftsmen are instructed to take care of this case, they will do it; he knows that perfectly well. I hope he is not going to say that this will make it complicated, and that we, though we have not taken the trouble to find out, do not know the number of these cases. I do not think a single hon. Member in this Committee does not have cases of this kind of charity in his own constituency. I would be very surprised if he did not. This is a sphere of social work which is growing and developing and is actively served by people of all views, ages and classes in this country. Why does not the hon. Gentleman say that he will make the provision that there shall be no discrimination against those who provide those charities compared with the treatment which he is quite properly providing for private individuals?
Mr. A. G. F. Hall-Davis
My remarks will be brief because my right hon. Friend has made many of the points that I wish to make.
I wish to ask the Parliamentary Secretary if he could give the Committee an assurance that he will take a more positive attitude to this question than just to say that he is open to receive evidence. I am sure that there are many of us in this Committee and in the House who can supply him with a very great deal of evidence. In my own constituency, in the Borough of Morecambe, the same charity to which I believe my right hon. Friend referred has opened nine residential homes within the last few years. These form a tremendous element in the social welfare population. This association opens these homes as rapidly as it feels it can provide financial security to ensure it is able to maintain them. Very often these associations are self-supporting from a revenue point of view once they are established. However, there is this need to raise the capital to get them into operation. Therefore, the balance of income and expenditure is important to them because they are paying their way week by week. Therefore, it seems wrong that they should not [column 69]be given the same encouragement and relief as private householders.
Therefore, I ask the Parliamentary Secretary if he can be more positive and not just say he is open to receive evidence but that he, as my right hon. Friend suggested, will examine this question and endeavour to make sure that these charities providing residential accommodation for just the people whom the instalment system is entitled to benefit should not be excluded from the benefit of the new method of operation.
Mr. MacColl
I do not want to give the impression that I was hiding behind the draftsmen. If one is clear about what one is trying to do, the draftsmen can do it. However, the difficulty here is one of definition. I am very sympathetic to the case put forward so persuasively about certain types of homes for handicapped people. Quite clearly, I do not see any case for an Oxford college having a right to pay its rates by instalment, but it is a charity. Therefore, it is necessary to find some definition which states clearly the kind of case to which we are referring. We also need to know about the nature of the occupation because, as I have said, in many cases the occupier will be a rate occupier. In the case of the flatlets to which the right hon. Gentleman referred, I do not know. He said he had not consulted them as to whether or not they have separate lettings which can be separately rated.
Mr. Boyd-Carpenter
The rates are paid by the charity concerned.
Mr. MacColl
The rates may be paid by the charity concerned but it does not follow who the rateable occupier is. It may be that they do this for administrative convenience.
Mr. Boyd-Carpenter
The burden of the rate payment falls on the charity concerned.
Mr. MacColl
I would be very grateful if the right hon. Gentleman would let my right hon. Friend have that sort of evidence. I am sorry that I am being denounced as not being positive enough. As I have said, my right hon. Friend is open for evidence. I would have thought it was a good thing for a Government to be open to receive evidence.
[column 70]Mr. Boyd-Carpenter
Does he accept the proposition that where a charity undertakes the burden of the rates and of other expenditures it should not be discriminated against as compared with the case where an individual pays it? That is the simple principle.
Mr. MacColl
I think it depends on the nature of the charity and the kind of occupation it has. As I say, I will certainly draw my right hon. Friend's attention to this discussion, and we will make such inquiries as we can to find out the size of the problem. It will certainly be very useful to us if the Committee can help in some way.
11.30 a.m.
Mr. Boyd-Carpenter
I must press the Joint Parliamentary Secretary. Why is the size of the problem material? Is he saying that he does not mind inflicting hardship on charities as long as they are limited in number?
Mr. MacColl
I do not want to be subjected to cross-examination by the right hon. Gentleman. I have gone out of my way to try to meet this point in an open way and have said that we are quite prepared to look at it. The right hon. Gentleman's habit of trying to pin people down does not make it easy to try to look at this dispassionately. Obviously I do not wish to prejudice the position by making some general statement of what we are prepared to do. We are prepared to look at it.
Mr. Boyd-Carpenter
I am sorry if the Joint Parliamentary Secretary resent being pinned down. I am sure that he will agree that, when a Minister is giving a Committee an assurance which may affect the action that the Committee takes the one thing to avoid is any possibility of misunderstanding, with the allegations which will naturally then arise of breech of faith. What I do not follow in what the Joint Parliamentary Secretary has said is his demand to know the number of cases—the size of the problem. Why is that material? Why is it material to say that if there is only a limited number, the hon. Gentleman will not give them relief? It would be material only from the point of view of complicating the Bill. The Committee knows that there is an appreciable number of these cases. There is not one member of the Committee who does not know of cases in his [column 71]own constituency. Why, then, does the exact number of these cases matter from the Joint Parliamentary Secretary's point of view?
Is it not sensible to say that, as a matter of principle, charities providing accommodation should be treated no worse than individuals? If the number of charities which exercise this right turns out to be limited, so much the less trouble for local authorities. What is the difficulty from the Government's point of view? Why cannot the Joint Parliamentary Secretary say that at the next stage he will table an Amendment to bring in these cases, few or many?
Mr. MacColl
As to an assurance, I made absolutely clear the limits of my undertaking. I was not giving any undertaking that my right hon. Friend was prepared at a later stage to bring in anything. I made it absolutely clear; I said that we were open to suggestion and would look at the evidence and would try to find out if it is possible to define the kind of case in the Bill. The number of cases, whether there are few or many, is obviously a factor. It is absurd to argue that this is a factor which should not be taken into account when an alteration to the Bill is being considered. If the right hon. Gentleman is not prepared to accept that, he must take whatever steps he wants to.
Mr. Hall-Davis
If I gave the impression of denouncing the Joint Parliamentary Secretary, I reached heights of eloquence which I do not normally attain this time of the morning. I was endeavouring to stimulate the hon. Gentleman into taking more positive action. As to the scale of the problem, the provision of this type of home is a social activity which is growing rapidly. It started comparatively recently. The number of bodies affected will increase, as it should. It is very important, in the wider context of this social provision, that this Committee should appear to give this type of charity every possible encouragement and recognition. The people concerned are working very hard. They know that they are supplementing the provisions made through the State organisations. I should not like it to be thought that the Committee was not prepared to grant them the very greatest recognition, especially as all too often [column 72]they get too little recognition for what they do.
Mr. Julius Silverman
Sir Leslie, without getting out of order and without anticipating what may arise later in our proceedings, may I point out that there is the prospect that Section 8 of the Rating and Valuation Act, 1925, may be applied to this part of the Bill? I understand that there is to be a later Amendment on this. I gather that there is some prospect of the principle of that Amendment being accepted. This means, in substance, that someone who does not want to pay by instalments will get a rebate of 10 per cent. or 15 per cent. of his rates. If this became part of the Bill it would clearly apply to charitable organisations. The consequence would be that most charitable organisations, especially those operating on a shoestring, would take advantage of that provision. Therefore, the benefit which would be obtained by charities arising from this Amendment would apply to very few charities indeed, because, although many of them may operate on a shoe-string, they do not live from hand to mouth in the same way as the individual ratepayer.
Mrs. Thatcher
Did the Julius Silvermanhon. Gentleman refer to a rebate of 10 per cent. or 15 per cent.? Section 8 of the 1925 Act allows a discount only up to 2½ per cent. This makes a good deal of difference to the hon. Gentleman's argument.
Mr. Silverman
It may make a good deal of difference, but I understand that the council itself can make certain provisions. Even 2½ per cent. is something which a charity might go for. I am pointing out how small would be the effect of this Amendment, because it is certain that the poorer charities would rely upon the rebate that they could obtain. Later on we shall be discussing the question of rebates. If hon. Members want a substantial benefit to be granted to charities of this nature, they might urge the Minister to consider how the rebate system could be applied to this type of charity rather than the question of instalments, which would give charities very little advantage indeed.
Mr. Boyd-Carpenter
If the intervention of the hon. Member for Birmingham, Aston (Mr. Julius Silverman) will elicit from the Minister an undertaking that at [column 73]a later stage of the Bill a substantial concession will be made to charities, I quite agree that that would substantially affect our attitude to this matter. So far, however, the Minister has not risen to give that assurance. I think, from the look of the brief in front of him, which I can very nearly read at this range—I do not know whether I come within the Official Secrets Act—there are improbabilities about the hon. Gentleman doing that.
Therefore, with respect to the hon. Member for Birmingham, Aston, we must deal with the issue now before us, which is the one point at the moment on which the Committee must make up its mind, which I hope it will do shortly. This would be a modest help to charities which we all want to help. It would be a mistake to forgo the opportunity of providing that, in the hope, which is I suspect of a vain one, that something even better may be coming a little later on. In any event, I do not altogether agree with what the hon. Member for Aston said as to the advantage of a modest rebate as against an instalment concession in all cases. I think that the hon. Gentleman's argument was founded a little on the misunderstanding which he is obviously under as to the scale of the provision of the 1925 Act.
Further, many of these charities are continually raising their funds throughout the year, and the value of being able to pay their rates by instalments would be very real to them. I am not underrating the other matter. I am all for helping these charities in every way I can, but I think that the hon. Member for Aston misleads himself when he suggests that the right to pay by instalment may not be at least as valuable to a charity which is having a struggle to raise funds as it may be to an individual.
I had hoped that on this issue, which is not in any normal sense a party issue—it is perhaps less of a party issue than [column 74]any we have had so far in this Committee—the Joint Parliamentary Secretary would be prepared to go a good deal further than he has. In his last observations, having declined to be pinned down, to use his own phrase, he said, “I am not promising anything” . In those circumstances, it is plain that we must do our best to put this into the Bill.
Mr. Woodhouse
May I put one more question for information to the Parliamentary Secretary. He was not very forthcoming in answering my earlier question and you, Sir Leslie, indicated that I should be out of order if I pressed him further. I wish to put a quite different question which arises from the hon. Gentleman's obvious intention that the Amendment should be rejected. I ask him to consider the case of tenants of a charity enjoying 50 per cent. relief of its rates. There are a very large number of such tenants in my constituency who rent houses from the Oxford Colleges. Can I have an assurance from the Joint Parliamentary Secretary that, in cases where their rate liability is included within the rent they pay to their college landlord, even though he intends to reject this Amendment such tenants will still be entitled to enjoy the benefit of Clause 1?
Mr. MacColl
Their position will be the same as any other tenant who was paying to a landlord. We discussed at our last sitting some of the complications of the terms under which landlords collect rates with rents, whether it is something they have to do or whether by agreement. There will be no special position for tenants because of the nature of their landlord.
Question put, That those words be there inserted:—
The Committee divided: Ayes 9, Noes 10.
Division No. 4.]
Ayes
Allason , James (Hemel Hempstead)
Boyd-Carpenter , Rt. Hn. J.
Cole , Norman
Hall-Davis , A. G. F.
Maddan , Martin
Murton , Oscar
Smith , Dudley (Br'ntf'd & Chiswick)
Thatcher, Mrs. Margaret
Woodhouse , Hn. Christopher
Noes
Finch , Harold (Bedwellty)
Hobden , Dennis (Brighton, K'town)
Mabon , Dr. J. Dickson
MacColl , James
Oakes , Gordon
Rhodes , Geoffrey
Robertson , John (Paisley)
Silverman , Julius (Aston)
Whitlock , William
Williams , Alan (Swansea, W.) [column 75]
11.45 a.m.
Mrs. Thatcher
I beg to move Amendment No. 47, in page 2, line 5, at the beginning to insert:
“Subject to subsection (2A) of this section” .
The Chairman
It may be convenient to the Committee to consider with this Amendment, Amendment No. 48: In page 2, line 19, at end insert:
(2A) Where under subsection (2) of this section a notice under subsection (1) thereof would fall to be given at a time before the first occasion when rates are levied in respect of the hereditament in question, the notice may be given at any time not later than the fourteenth day after service of the first demand note for such rates, and the effective date of the notice shall not be earlier than the date of the service of that demand note.
Mrs. Thatcher
Amendment No. 47 is a paving Amendment to Amendment No. 48. I have reason to believe that on this Amendment the James MacCollParliamentary Secretary will display more sympathy than he did in discussion of the last. I should have thought that his reading of “David Copperfield” might have led him to accept the case as a whole but I hope that my reading of Ryde on Rating will lead him to accept this Amendment.
As the Bill stands, where an occupier moves into a new house or, for example, a flat which has been newly converted in an existing house, he will have under 28 days in which to give notice of his intention to pay his rates by instalments. Where it is a new rateable hereditament he might not within that 28 days have had a notice of assessment, or indeed the valuation of the flat may not have been determined. By Section 33 of the Local Government Act, 1948 the valuation officer of the Inland Revenue has the duty of making up the list, but information about the new or altered property may not have come to his notice to enable him to make a valuation of that property within 28 days.
By Section 59(2) of the Local Government Act, 1948 it is the duty of the local authority to bring to the notice of the valuation officer any changes which may be required in the valuation list. The authority has to notify him of any change of circumstances discovered in the discharge of its functions which may lead to a change in the valuation. All this process takes some time and in some cases it is a rather hit-or-miss affair. A building inspector will issue a certificate [column 76]saying that a new house or an altered flat is ready for occupation. This means that information has to go to the valuation officer to enable him to establish a value for that new unit. This may well be done within 28 days and so the occupier may know within 28 days of taking up residence of his rateable liability, but it would not leave him very much time to give notice to the local authority. He may have had no communication whatever from either the Inland Revenue or the rating authority within 28 days because the authority might take a considerable time to reach the valuation and then to issue the rate demand.
Clearly, a new occupier should not be prejudiced for reasons which are no fault of his. One often finds that a young married couple moving into a new house have not properly budgeted for their rate demand. They often would be the kind of persons who would want to take advantage of the right to pay by instalment. This Amendment extends the period in which they can give notice to pay by instalment by providing that they can give such notice within 14 days after service of the first demand for rates. The mechanics of the Amendment are to enable these people also to take advantage of the method of payment by instalment. I hope the Parliamentary Secretary will accept the Amendment and will congratulate the draftsman on its drafting.
Mr. MacColl
As the hon. Lady has suggested I have not found anything to quarrel with in the drafting of these two Amendments. I think this is a valid point and I appreciate that the hon. Lady has drawn attention to it by her Amendment which appeared on the Notice Paper earlier. I certainly hope the Committee will accept these two Amendments.
Amendment agreed to.
Mr. Allason
I beg to move Amendment No. 8, in page 2, line 19, at the end to insert:
“and a notice shall be deemed to be given for the purposes of this section upon the date on which it is received by the rating authority” .
Subsection (2) of this Clause is curiously reasonably explicit and almost understandable to the layman. It deals with the giving of a notice that rates may be [column 77]paid by instalments to the rating authority. If it is given between 1st February and 30th April 28 days after qualifying, the effective date of the notice is less than three months before the end of the rating period or otherwise the date of giving the notice. Therefore, the date of giving the notice assumes considerable importance. It appears that it would be advisable to clear up what is the date of giving the notice. If the applicant goes to the town hall and does so personally, there is no query about the date, but it is much more likely that it would be done by post and we are not all that certain about the effect of putting a letter in a pillar box.
Quite recently there has been delivery of a postcard, posted under a Liberal Administration 57 years ago, and it has just been received. So a mere posting is not necessarily the date of giving the notice. Simply in order to lay down something to help in this matter we have put down an Amendment that it should be the date of receipt by the local authority. That may be one day later or three days later, but we hope it will not be 57 years later. The local authority cannot act if it has not received the notice. Therefore it seems better to make the operative date that on which the local authority actually receives it.
Mr. McColl
Section 59 of the Rating and Valuation Act is applied in the Bill, so that is the operative provision dealing with this matter. That in turn applies Section 26 of the Interpretation Act, 1889. I understand the position to be that the time of the notice being served is the date on which the letter would normally be delivered in the ordinary course of the post, if it were sent by post. On the other hand, it is up to the local authority to prove that it has not received it. The presumption is that it arrived by ordinary delivery on that date, but the local authority may prove that it did not receive it.
If the hon. Member for Hemel Hempstead (Mr. Allason) thinks that it should be the other way round and it should be necessary for the person serving the notice to prove that it was received, it would be a little hard on that person. Once one has posted the notice it is up to the local authority to say that it has [column 78]not been received. I think that makes the position clear, although I quite understand that this is a difficult piece of legislation by reference and I understand the hon. Member's difficulty in understanding how it works.
Mr. Boyd-Carpenter
This is a problem which has become very much more acute in recent years, particularly in recent months with the deterioration of the postal services under the present Postmaster-General. What the Parliamentary Secretary said was true of the days when it could be presumed that letters would be delivered on the following day with regularity and punctuality, but all of us have had in our constituencies very severe complaints of the deterioration in post office services which has resulted from a mal-administration by the present Postmaster-General. That is one of the reasons why we have great anxiety as expressed by this Amendment.
Amendment negatived.
Amendment made:
In page 2, line 19, at end insert:
(2A) Where under subsection (2) of this section a notice under subsection (1) thereof would fall to be given at a time before the first occasion when rates are levied in respect of the hereditament in question, the notice may be given at any time not later than the fourteenth day after service of the first demand note for such rates, and the effective date of the notice shall not be earlier than the date of the service of that demand note.—[Mrs. Thatcher.]
Mr. MacColl
I beg to move Amendment No. 33, in page 2, line 20, to leave out from the beginning to “by” in line 23 and to insert:
(3) Where a notice under subsection (1) of this section in respect of any hereditament is duly given to the rating authority.
This Amendment is intended to case some of the complication of the Bill for local authorities. Therefore I think it will commend itself to the whole Committee. Under the Clause as drafted it is provided that
“It shall be the duty of the local authority …” .
That has raised the question of whether it might mean that there has to be a solemn meeting of the council to approve every case. Obviously nobody thinks that is what a sensible local authority would do in a matter of this sort. The proposal is that where notice is given the [column 79]provision shall merely go on to explain the proceeding. It gets away from any suggestion that there has to be a formal act on the part of the local authority as a whole. I think that to some extent will relieve the minds of local government officers.
Sir Anthony Meyer
I think this is the beginning of some glimmerings of common sense coming into the Bill. There are a great many points where the phrasing is quite unnecessarily cumbersome. The prospect of a local authority having to summon a meeting of a committee or sub-committee to deal with each application as it came in was a horrifying one. In addition, the authority in each case had to satisfy itself that the person giving the notice was the person “duly” qualified. The word “duly” is one of the most dispensable words in the whole language. This is one of the cases where delegated powers can be used. We hope the present Bill will make greater use of them, particularly in regard to subsection (5) to deal with essentially perfectly simple problems.
One is tempted to think that in trying to define every single case as closely as the present Bill tries, all the Minister has succeeded in doing is hitting the nail on his thumb. I welcome this Amendment which is one of a series designed to improve this unnecessarily complicated Measure.
Amendment agreed to. 12 noon.
Mrs. Thatcher
I beg to move, in page 3, line 5, at the end to insert:
Provided that all rates payable in respect of a half year, should be paid before the expiry of the rating period.
The Chairman
Would the hon. Lady like to take at the same time Amendment No. 10?
Mrs. Thatcher
With respect, Sir Leslie ThomasSir Leslie, I think it would be easier to dispose of this one separately and first.
The Chairman
Very well.
Mrs. Thatcher
This is by way of a probing Amendment, because the majority of its impact has already been dealt with by the acceptance of Amendments Nos. 47 and 48. The one point which I believe remains is this one. Under sub [column 80]section (4) of Clause 1 the principle of instalments by which the rate is payable is dependent upon the effective date of the notice, but also under that subsection the time when those instalments fall due depends not upon the effective date of the notice, but upon the date when the statement is sent out by the local authority. If there is quite a long lapse of time between the date of giving the notice and the date when the local authority sends out the statement about the instalments to the ratepayer, then it appears that it would be possible for those instalments to be paid after the end of the six months' period, and to be paid in some cases after the end of the rating period.
I understand that what the Bill is trying to do is to give the right to pay by instalments, so that all those instalments are payable and paid within the rating period as a whole. It seems to me that under the two paragraphs of subsection (4) there is a possibility that some of the instalments will not fall due until after the end of the rating period. It is possible that there is some other provision in another Act which would catch this point, but I would be grateful for the advice of the James MacCollParliamentary Secretary.
Mr. MacColl
I think that the hon. Lady has got it right.
Mrs. Thatcher
Do not sound so surprised.
Mr. MacColl
I think she is right in pointing out that, under paragraph (a) of subsection (4), where the notice has been given before the end of the first month of the financial year, then the instalments will all come within the financial year. In the case of paragraph (b), where the notice has been given later, then there are cases where the instalments could spill over. There is a very clear case for saying that they ought to spill over a rating period, because a rating period may be any length of time and may be a very short time. I do not know of any cases where there have been quarterly rating periods, but there could be. Therefore, one could be too stringent in saying that all instalments must be paid off within a short rating period or within six months. The other case is where the instalments spill over not just the rating period but over the financial year, and that could happen. [column 81]
I must say that I see the weight of what the hon. Lady said—that it is undesirable that these payments should hang on, and that the local authority should not know that their money is coming in. On the other hand, it is to some extent the responsibility of the local authority to see that they get their machinery working in time to get the instalments functioning. Therefore, simply to say that, however late the local authority is, they would be allowed to say, “No, the shutter has come down and we will not allow you to pay over a longer period” would be hard on the ratepayer. On balance, we thought that this was the best way of giving this incentive and discipline to the local authority to act with speed when the opportunity comes. But I shall have another look at the matter to see whether there is a more fundamental objection to dealing with the matter in this way.
Mrs. Thatcher
As the event which I was worried about will only arise by reason of the fault of the local authority, I would be quite happy to withdraw the Amendment. I therefore beg to ask leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Mr. Allason
I beg to move Amendment 10, in page 3, line 6, to leave out subsection (5).
Mr. MacColl
On a point of order. It might be helpful if our two Amendments, Nos. 12, in page 3, line 23, leave out “either” and insert “every” , and 38, in page 3, line 23, after “shall” , insert:
“(apart from any rebate under section 3 of this Act)” .
were discussed with Amendment 10. They are all dealing with the same subsection and it might prevent a rather ragged debate if we took them together.
The Chairman
Yes. I was proposing to put the Question in a form which would save the Minister's Amendments. If it is the pleasure of the Committee, I am quite happy that we should take Amendments 10, 12 and 38 together.
Mr. Boyd-Carpenter
We have no objection, Sir Leslie.
Mr. Allason
Very often, this type of Amendment is put down simply in order to draw attention to a subsection and in [column 82]order to gain discussion on it, but I move this quite sincerely. I believe that this subsection is laying down in extreme detail what is in fact, common sense for the local authority to deal with. It would be very much better if we did not start going into extreme details as to exactly what the treasurer ought to do on every conceivable occasion.
I am willing to be corrected, but paragraph (a) and subsection (5) deals with a problem which is upsetting treasurers quite considerably. That is the difficulty that, whilst there is a possibility of a rebate, which is dealt with in later parts of the Bill, there must be variations in the amount charged on instalments. The rebates, of course—I hope I am not out of order in referring to this, but it is a vitally important point—are calculated by the half year, whereas the rates are levied on the whole year. Therefore, when the Treasurer is informed that someone should have a rebate for the first half of the year, he cannot possibly assume that there will be a rebate given for the second half of the year. He then averages out the rates which are to be charged, on the basis of, say, £30 for the first half-year and £60 for the second half-year, making £45 rates for the first half-year to be paid by instalments. I take it that it is not the intention to grant a substantial rebate, which would mean that, although in the first half of the year a person pays £45, for the second half of the year, provided he gets his rebate, he pays only £15.
It appears that paragraph (a) could be read as meaning that the rate instalment depends on the first of the two rate periods. However, I do not know that it means that at all. I rather suspect that it is qualified by paragraph (c), in that the rates must be equal, but that of course, is ruled out by Amendment 38, “apart from any rebate under section 3” , which we are discussing. If there cannot be a possibility of the rebate being allowed for the whole year, at the same time as the rates are worked out for the whole year—and I do not see any Amendment to that effect—it seems that we are bound to meet the difficulty of the treasurer having to calculate the rates for the whole year, on the assumption that there is no rebate being given for the second half of the year, therefore averaging out at a higher rate than is [column 83]desirable. I do not believe that paragraph (a) in fact says that.
When we get to paragraph (b) there are even more complications, because this deals with a statement relating to part of a year, and that part of a year including the whole or part of two or more rate periods. A rate period is usually six months. Does the Parliamentary Secretary wish to say something?
Mr. MacColl
I do not think it is usually six months. It is sometimes six months.
Mr. Allason
I accept that. I would have thought that in most well-regulated organisations six months was the rating period. But here, again, we go right the way through a long rigmarole of instructing the treasurer how to use common sense, and, apart from the problem which I have raised which is not met by subsection (5), we would do very much better without subsection (5). We have the principles laid down in the earlier subsections, and if subsection (5) is left out treasurers will find the Bill much easier to operate.
Mr. MacColl
Paragraphs (a) and (b) of subsection (5) deal with the special problem which arises when there is more than one rate period in the year. Paragraph (c) should deal with all cases and should not be linked with paragraphs (a) and (b), and the object of our Amendment 12 is to separate paragraph (c) from paragraphs (a) and (b). I want to make that clear, because it will then be easier to understand what we are talking about.
The hon. Member for Hemel Hempstead (Mr. Allason) was surprised that I said that most authorities did not have more than one rate period in a year. I understand that about 100 rating authorities use six months, but most of the rest use 12 months; and, of course, there are many more than 100 rating authorities. The rate period can be any period. There is no mystique about making it six months. The difficulty is that at the beginning of the year one starts with two principles; that the instalments over the year should be equal, and that they should be rounded off. But they should not be rounded off in such a way that there is a compensating heavy charge on the last instalment, so the power to round [column 84]off is limited by the subsection. The difficulty is that one must try to anticipate what is going to happen in the second or third rating periods. That is why one must make assumptions about the second period.
The other point, which was raised by the hon. Lady on Second Reading, was about the impact of the rebate on the instalments. The hon. Gentleman said that if rebates were for six months and not 12 months, then one got into difficulties and he asked: Why not have 12 months? I ought not get into discussion on that—I hope that before very long we shall come on to that—but the short answer is that if we are going to keep some control over rebates it is desirable to have them looked at over a shorter period than 12 months. So far as the Bill provides at the moment, the period is six months. Therefore, Amendment 38 deals with the point made by the hon. Lady, suggesting that the instalments should be equal, subject to the rebate. In other words, if in the first half of the year there is a rebate and in the second half there is not a rebate what was paid would be larger than in the first half. But if subsequently another rebate was allowed for the second period the amount might be equal or vary. This Amendment broadly keeps the principle of equal instalments but at the same time allows for the special problem arising from the instalments. I think that subsection (5) will be clearer with the Amendments and will be a useful part of the Bill.
12.15 p.m.
Mr. Hall-Davis
I am encouraged to raise this rather narrow point by the fact that both my hon. Friend the Member for Hemel Hempstead (Mr. Allason) and the Joint Parliamentary Secretary referred to the complexity of the Clause, and it may well be that I have completely misunderstood it. It seems to me that under paragraphs (a) and (b) of subsection (5), if the instalments are fixed in the first rating period and the rate in the £ is higher in the second rating period, there must be some arrears at the end of the year. We have already, I think, decided that arrears cannot be carried forward for payment by instalment and, therefore, they will have to be paid in a lump sum at the end of the year.
It appears to me that this is what is meant by saying that the amount shall be [column 85]fixed on the basis that the amount in the £ of all rates in that year will be that levied in the first of the rate periods. It may be that I have misunderstood what happens when there is more than one rate period. But if there is a different rate poundage in two rate periods—and the Clause implies this—I feel that there must inevitably be rates in arrears at the end of the year.
Mr. MacColl
There need not be a different rate. One may make a rate, but it is the same rate. On the other hand, the amount may go up because the rate poundage has gone up. There might be a change in the rateable value. A number of things may alter the instalments in the two periods. If the authority knows what the new rating will be, it can average out the two rate poundages, but if it does not know that it has to put the burden on the second period.
Mr. Allason
I follow the Joint Parliamentary Secretary's line of argument that subsection (5,a) refers only to a case in which there may be two different rates for two different rating periods. On 1st April the authority levies a rate of 14s. in the £ and then, when the by-election is well and truly over, on 1st October it levies a rate of 17s. in the £ to make good the deficiency. Subsection (5,a) provides that the instalments shall be calculated on the basis that the rates payable for the first six months shall be an average of the rent payable over the whole year.
I understood the Joint Parliamentary Secretary to say that Amendment No. 38 will remove the difficulty to which I have referred, but I do not think it is clear that it will. I should be grateful if he could clear up this point. Does he say that under Amendment No. 38 the treasurer can assume that whatever rebate is granted in the first six months of the year will be granted in the second six months and therefore that he can calculate the proper average and not the improper average which I originally suggested?
Mr. Norman Cole
I should like to revert to what my hon. Friend the Member for Hemel Hempstead (Mr. Allason) said in proposing the deletion of subsection (5). Should not we trust local authorities to deal with something in [column 86]which they themselves are expert, namely, the levying of rates? We have heard some of the complications from the Joint Parliamentary Secretary and others from my hon. Friend. I can think of many more. I can think of the person who after about two or three months of the rating period, suddenly realises that he is entitled to apply under Clause 3 for a rebate because of his financial circumstances. What happens in that case? What happens when a rebate has been granted and then, after further investigation, it is found that there was no justification for it and it has to be paid back? It should be made clear that the rebates must be considered with this Clause.
Most of subsection (5) could well be left out and we could leave the matter to the good common sense of treasurers. It may be that some guidance from the Ministry as to the general rule and pattern is necessary. On the other hand, I can imagine that many treasurers employed by local authorities might have some experience to bring to bear which would be of assistance to the Ministry concerning the best way to implement the Bill. To lay down how two simple provisions are to operate—they are liable to be a little complicated in practice—is unnecessary.
I reiterate what my hon. Friend the Member for Hemel Hempstead said. It would be much better if we were to leave out subsection (5) with the possible exception of putting words somewhere in the Clause to deal with Amendment No. 38. We should let the treasurers wrestle with the complications which will undoubtedly arise under paragraphs (a) and (b) of subsection (5) and let them get on with their job. They are perfectly competent to deal with this matter without all this line-by-line guidance about how to collect the pounds, shillings and pence from the ratepayers.
Mr. MacColl
The hon. Member for Bedfordshire, South (Mr. Cole) is right in saying that the borough treasurers are very competent and are willing and quick to help us with their advice. They are, in fact, helping us and, I suspect, hon. Members with advice on the Bill. But I think that it is wise to retain these provisions in the Bill in order to make the position clear.
May I deal with two points raised by the hon. Member for Hemel Hempstead [column 87](Mr. Allason)? First, the local authority takes the total amount of the rates for the rating period and divides by ten, or whatever the figure is, to arrive at the equal instalments of what one might call the gross rate.
Mr. Silverman
For a yearly period?
Mr. MacColl
If it is a six monthly rate, there is the further complication of having to forecast and average out the amount for the later period. If it is a yearly rate, that problem does not arise.
Having arrived at the gross instalment, there is then deducted from it the rebate for the six months. For the second period there is also deducted from it the rebate for that period. If the rates and the rebates are the same, no problem arises, but if there are variations in the rebate there will be irregular instalments. However, this seems to be a quicker and fairer way to deal with the matter than to try to anticipate what the rebates will be for the second six monthly period.
The last part of subsection (5) provides for adjustments to be made in instalments if they become necessary. That gives the authority flexibility to make the sort of adjustments about which we have been speaking.
Mr. Boyd-Carpenter
What the Joint Parliamentary Secretary has just said—and indeed subsection (5)—casts a rather curious light on his unwillingness to incorporate a perfectly simple Amendment on charities on the ground that it might complicate the Bill. Nothing in that field could conceivably be as complicated as subsection (5). This is a matter of machinery which does not raise issues either of substance or of principle, and as it is the Government's responsibility, not ours, to ensure that the mechanics of the Bill are such that they can be worked properly by local authorities, I should not have thought that this was a matter which we need press. But this is certainly a subsection which will cause a great many headaches among those who will have to administer the Bill.
The Joint Parliamentary Secretary—I am a charitable man—may have mastered the provisions of subsection (5). Omnia praesumuntur rite esse acta, which can be translated as meaning that even Parliamentary Secretaries sometimes read their briefs. But, in all seriousness, I [column 88]hope that an explanation of the intended effect of this provision will be given to those who will have the responsibility of administering it. On the whole the intention seems to be quite sensible, but its wording is very confusing and—I say it again without discourtesy—not wholly pellucid even after the Parliamentary Secretary's reading of his brief.
Sir A. Meyer
May I ask the Joint Parliamentary Secretary whether he received any representations on this matter from the Institute of Municipal Treasurers and Accountants in pressing for these delegated power? There is a perfectly good precedent in previous Rating and Valuation Acts, certainly in the 1955 Act. I believe that the Institute went to the Ministry about this matter, and I am wondering what reaction it received.
Mr. MacColl
We are in fairly steady touch with the treasurers and have their views on the workings of the Bill. I should not like to epitomise in detail and precisely which points they thought were sound, which they thought were tolerable and which they thought were otherwise. But, in the effective way in which our democracy works, we have been in touch with them and the Bill has benefited from the criticisms of those who will administer it.
Amendment negatived.
Amendment proposed: In page 3, line 23, leave out “either” and insert “every” .—[Mr. MacColl.]
Mr. Cole
May I raise a point of order at this stage?
Mr. MacColl
No.
The Chairman
I am putting the Question.
Mr. Cole
Before the Question is put, may I raise a point of order? I thought that you, Sir Leslie, repeated the Question on the Amendment to leave out “either” and insert “every” and did not put the Question on the Amendment to leave out subsection (5). I thought that we were discussing that as the first Amendment.
The Chairman
We have disposed of the Amendment to leave out subsection (5). I am dealing with the next Amendment, which has been moved formally.
Amendment agreed to. [column 89]
Further Amendment made: In page 3, line 23, after “shall” insert:
“(apart from any rebate under section 3 of this Act)” .—[Mr. MacColl.]
12.30 p.m.
Mr. Boyd-Carpenter
I beg to move Amendment 32, in page 3, line 33, at the end to insert:
(6) If the rating authority shall publish upon a written demand for the payment of rates which is sent by general post (within the first ten days of April in any year) to persons chargeable with rates within the area of that authority, a statement specifying the number of instalments (being not less than ten) by which it will accept payment of the rates in the year to which the said demand relates, the respective dates on which those instalments are to become due (which shall be dates at intervals of not less than one month and the first of which shall not be earlier than 30th April in which the demand is sent) and the respective amounts of these instalments, and if the said statement shall otherwise comply with subsections (4) and (5) of this section (so far as the same may be applicable), and if a person under subsection (1) of this section pays to the rating authority the first instalment specified in the said statement on or before 30th April in which the demand was sent, then such payment shall be effective as a notice under subsections (1) and (2) of this section and the said statement shall be effective as a statement under subsections (3), (4) and (5) of this section.
Some Amendments require moving at greater length than others. Some, however, are of such pellucid clarity that any prolonged exposition of them would be an infliction on the tolerance of the Committee and might, indeed, incur your displeasure by being regarded as involving tedious repetition.
The Amendment, of course, relates to the publication of the rating demands. I think it is a reasonable proposal. I would prefer to let it stand for itself. I have no doubt that the Parliamentary Secretary will be able to explain why he is able to accept it.
The Under-Secretary of State for Scotland (Dr. J. Dickson Mabon)
Tedious repetition!
Mr. Murton
The object of the Amendment, although it looks most formidable in its phrasing, is really an attempt on this occasion to help the treasurers of local authorities and also to help to clear the minds of those who are to benefit under the particular scheme in the Act.
It has been pointed out by certain treasurers that the system as envisaged [column 90]in the Bill at the present time is not so much complicated as that it presents a considerable bulk of work which many of them feel to be unnecessary. The onus in the Bill as at present phrased is upon the ratepayer to make the first move, and that, having moved and opted to pay his rates by instalments, the local authority then follows it up by notifying him of the number of instalments which are to be paid.
The suggestion raised in the Amendment is that rather than the onus be put upon the ratepayer, who may not be fully cognisant of the Government's intentions in this respect, however well advertised this may be, the local authority should take the first step. The local authority should notify the ratepayers of the Government's intention and immediately should inform the ratepayer of the number of instalments he would have to pay under the scheme. If the ratepayer feels so inclined to avail himself of this opportunity, he should send his cheque or call in at the rate office and pay the first instalment; this shall be just and sufficient proof that he wishes to accept what is offered to him under the terms of the Bill.
Quite simply, the whole object of this is to do away with a bulk of work. It has been pointed out in the case of my own borough treasurer in the constituency of Poole that a considerable number of extra staff will be required to carry out this work, even in a small local authority of some 92,000 persons. We commend it to the Parliamentary Secretary. We feel that simplification would be very much more suitable in this case to help the work of local authority treasurers.
Mr. MacColl
I would have been very happy to explain to the right hon. Gentleman what would be the effect of the Amendment, but I thought he would then have ticked me off for reading my brief. Therefore, I will assume that he has grasped by now what it is about.
Mr. Boyd-Carpenter
If I have not by now, I doubt whether the next few minutes would help very much!
Mr. MacColl
I think that is very true. I could spend quite a long time picking up drafting points in the Amendment. There are difficulties in it. One could not accept it in its present form. However, I will not go into these points. [column 91]
The general principle behind it—that we want to cut out red tape, and that we do not want local authorities to feel they have to go through a certain ritual every time when they already know what the position is—is very reasonable. However, rather than put anything of this length into the Clause, which is already on the longish side, my right hon. Friend thinks the position would be clarified if it were included in the circular, which the right hon. Gentleman has asked for, to explain how this is going to work. An indication to local authorities could be put in the circular to the effect that where local authorities have the information, they can communicate with the ratepayer saying either that they assume that he will continue on the old basis or that if he wishes to make some alteration he should let the local authority know. In this way, we hope to cut out some of the complications.
Mr. Hall-Davis
I hope the Parliamentary Secretary will forgive me if I now say that I am not sure that he understands the full import of this Amendment. I am moved, therefore, to re-emphasise the points made by my hon. Friend.
The great point of the Amendment is that it shifts the onus of taking the initial action from the ratepayer to the local authority; in other words, it gives the local authority the opportunity to take away from the individual ratepayer the necessity to take the initiative in securing an instalment payment. This is an extremely important suggested provision which could very substantially cut down the burden on the local authorities. When the initiative has to be taken by the ratepayer, as is the case now in the Bill, one can imagine what will happen. The town hall telephone will constantly be ringing. Ratepayers will be asking, first of all, “Am I eligible to pay by instalments?” The fact that the ratepayer must be a householder will not matter. The second question will be, “How do I make my application?” The third one will be “When do I make my application?” , and the last one will be, “Why haven't you replied to my application?” , together with the 27,000 which have been flooding into the town hall during the last week.
If something on the lines of the Amendment could be given statutory power, it would enable the local authority to issue a public statement before the rate demands are issued saying, “We intend [column 92]to give everyone this opportunity of registering for instalment payment by following the procedure which we shall set out in the rate demand” . This will constitute a very major reduction in the amount of paper work going on. I have spoken to one clerk who estimated the need for an increase of one-third in his staff to meet the burden in his rating department. I spoke to another who did not think he would require any additional staff. Opinions obviously vary. Some local authorities feel they will need a very substantial increase in staff. However, I feel that the load of paper involved, as opposed to the question of skilled assessment of rebate claims, will come from the ratepayers putting in their individual applications.
If something on the lines of this Amendment could be incorporated which transfers the initiative from the ratepayer to the local authority—this is the point I am trying to emphasise—then the ratepayer would become a passive participator in the scheme and not the originator of the instalment, and a tremendous amount of work would be cut down. The machinery of publicity, too, would be made easier because the local authority need only say, “If you want to claim instalments, read your rate demand when you get it and act on it immediately.”
Mr. Silverman
Will not the new Amendment do precisely the opposite? Will it not increase the amount of work? In the first place, the local authority has to calculate the amount of instalments on each individual ratepayer, irrespective of whether he is going to use the machinery or not. Obviously that will involve a good deal more work. This will obviously be an incitement to every ratepayer, even if he does not need to use the instalment scheme, to pay by instalments if they are set out in his demand note. My fear is that the new Amendment—whatever city treasurers may think about it—will do the opposite of what is intended; it will increase the amount of work in the treasurer's department.
Mr. Murton
The hon. Member for Birmingham, Aston (Mr. Julius Silverman) says that he considers this will cause additional work. In point of fact, at some later stage the rating authority has to send out this detailed statement. This has got to be done, and I do not see [column 93]that it matters whether it is done early or late. It is not a difficult problem.
Mr. Silverman
Only for those who make an application.
Mr. Murton
The basis of this proposal is that inevitably most people will make an application, and the rating authorities will invite them to avail themselves of the instalment system. I commend this Amendment to the Parliamentary Secretary and ask him to think very carefully about it. It is an eminently sane and sensible Amendment, though I say it myself on behalf of my colleagues. It will basically help the ratepayer and the local authority.
Mr. Cole
Of course, this is nothing new at all. Many local authorities are already carrying out this procedure, and doing it in precisely the way in which the Amendment envisages. The only thing they do not do at the moment—and I have papers at home showing how this is being done—is to give out the yearly instalments. It is a simple matter. As a general rule, there are 10 instalments, and one may pay by equal instalments of so much, providing one notifies the office. The only difference with respect to what the hon. Member for Birmingham, Aston (Mr. Julius Silverman) said is that the 20 to 25 different rateable values mainly concerned have to be worked out. This is a 10 minute or quarter of an hour's job. This information can be put on the back of the notice, and that is that. The rest is left to the ratepayer.
As my hon. Friend has said, the ratepayer will probably put in a note with his first instalment to say that he proposes to adopt this scheme, and this is all right providing it is done by the operative date. If the local authority of its own volition wishes to publish something in addition to this in the paper, as many of them do, concerning the payment of the rate with the footnote that instalments may be instituted if the first one is paid by a certain date, surely this is simplicity itself and must remove a tremendous burden from the local authority.
The only difficulty I can see is that the local authority will not know what the position will be until the operative date. They can only assume by that date that all those who have not paid by instalment [column 94]are going to pay in full. Therefore, they can assess what their money will be for the next six months. This is true whichever way it is done.
This seems to be the simplest way of doing it. Whether it is perfect from the drafting point of view, I do not know. It is ordinary common sense to use the back of the rate notice for the dissemination to the ratepayer of information contained in the Bill, and let him decide whether he wishes to adopt it.
12.45 p.m.
Mr. Boyd-Carpenter
The Joint Parliamentary Secretary was quite helpful in his remarks as regards the merits of the matter, but he did not deal with the effect of the concluding words of the Amendment. This possibly raises a question of law. As I understand the hon. Gentleman, he thinks that the procedure contemplated in the Amendment is reasonable. He said that he would include some recommendation of it in the circular which, in other respects, I was very glad to hear that his right hon. Friend intends to issue to local authorities concerned dealing with this matter.
The concluding lines of the Amendment are:
“then such payment shall be effective as a notice under subsections (1) and (2) of this section and the said statement shall be effective as a statement under subsections (3), (4) and (5) of this section.”
What legal advice has the Joint Parliamentary Secretary received as to the ability of local authorities to operate this system, unless it is provided in the Statute that such action shall be effective as notice under the preceding subsections of this Clause? It is all very well to recommend this to local authorities, but if they act on that recommendation and if, as may well be the case, they are not complying with the preceding subsections of this Clause, that advice will not be very helpful. Surely the advantage of the Amendment is that it puts it beyond doubt.
The hon. Member for Birmingham, Aston (Mr. Julius Silverman) demurred to this procedure on the ground, as I understood him, that it would incite ratepayers to pay by instalments. I do not think that is the experience. On Second Reading and at our last sitting I quoted the experience of the Royal Borough of Kingston-upon-Thames, [column 95]which operates its own scheme very much on this basis, stating on the back of the demand note the alternative methods of payment and indicating that the ratepayer is to act in different ways to avail himself of these different alternative courses. It has not been my borough's experience that this has incited people unnecessarily to take advantage of the instalment system. My recollection is that the system has been taken advantage of by 25 per cent. of the ratepayers, which is an interesting and reasonable proportion. Therefore, I believe that from a practical point of view the hon. Member for Aston is unduly alarmed. It is our object as I understand it is the Government's object, that people should be able to take advantage of the system of payment by instalments if it is convenient and helpful to them to do so. They cannot do so unless they know by a fairly simple procedure what steps to take.
As I see it, the only difference between the Joint Parliamentary Secretary and ourselves is that he wants to do it by circular. We suggest that it should be done by legislation—not, I hasten to say, from any love of adding to the length and complexity of the Bill, but to ensure that the course we all want to take will comply with the Bill when enacted. I have given the Joint Parliamentary Secretary a few moments in which to take advice on the point of law. Can he reassure us on this?
Mr. MacColl
On the question of the local authority taking the initiative, I think that I must stand on the point that I made at our last sitting. This is a right given to the ratepayer. It is not in any sense a limitation of his other rights. It is an additional right which, as the right hon. Gentleman quite sensibly says, he may not want to exercise. He may not need to exercise it. He may already have a working arrangement with which he is quite happy. This is a situation in which he has formal rights which he initiates by serving his notice. Provided that the local authority accepts a more informal arrangement and acts on it and makes the arrangements in the statement about the number of instalments and so on, no harm is done. The local authority cannot in any way get into trouble about anything. It is carrying out powers it has. [column 96]
There must first be an initiative from the ratepayer setting the machinery in train. This is what I gather the Amendment is about. When everybody pretty well knows that he wants to have the instalment system because he has given the notice once, then the local authority should be able to say, “We assume that you want to carry on” or should be able to make alterations if the position has changed in some way. Provided that the local authority does that and that the ratepayer accepts it, there can be no argument about it and there is no need to have any statutory authority to do that, because it is within the terms of the local authority's normal practice.
The wisest way to do this is by circular. I will certainly have another look at it and obtain advice on it. If we find that for some reason which has escaped us at the moment there is a risk in merely doing it by circular, we will try to put something in the Bill. If the alternative is between having an Amendment of this length and putting something in a circular, I think everyone will agree that the sensible thing to do is to try to do it by circular. If we get into difficulties we shall not feel constrained in coming back, probably on Report, to put something in. As at present advised I do not think it is necessary.
Mr. Boyd-Carpenter
I appreciate that without a Law Officer it is a little difficult for the Joint Parliamentary Secretary to answer the question of law which I put to him, although the Amendment was on the Order Paper and he might perhaps have taken steps to equip himself with the answer.
Mr. MacColl
I have answered it.
Mr. Boyd-Carpenter
The hon. Gentleman has said that he will take advice on this. I hope that he will not accuse me again of trying to do what he so much dislikes, namely, to pin him down. I want to get this into precise form.
Mr. MacColl
What I objected to was cross-examination.
Mr. Boyd-Carpenter
I hope that the hon. Gentleman will obtain advice as to whether any legal difficulty would arise in proceeding by circular from the point of view of these actions being treated as the appropriate notices under the preceding subsections. That is the point. If [column 97]the hon. Gentleman will take advice on that and if he will undertake to let us have the effect of that advice at a later stage, I do not know that we need take up further time on this. If that be the hon. Gentleman's undertaking, I think that we can probably take a certain course.
Mr. MacColl
I never object to being pinned down to taking advice. I am constantly open to take advice from anybody. I cannot say that I will certainly table an Amendment. I will certainly let the right hon. Gentleman know the result of our deliberations on this matter. As I am at present advised—and I am advised—I do not think that it is necessary. If we find that that is wrong, I will certainly let the right hon. Gentleman know.
Mr. Cole
It appears to me that there may well be good reasons which have not emerged this morning in regard to why the principle of the initiative being taken by the ratepayer must remain sacrosanct. Even if that is so—and one would respect it—I believe that something of the nature which is envisaged in the Amendment, if it preserved the status quo, with the action having to be taken in a different way by the ratepayer, would still be better than what has been the idea in the past. In other words, unless something of this kind were done by the local authority, even admitting that it is desired to preserve the state of affairs in which the initiative is with the ratepayer to take action in his own behalf, the local authority would indeed be inundated with queries as to how ratepayers could go about this.
Whatever may be the position at law, circular or not, there must be some communication emanating from the local authority, even if it is inhibited from doing it in the way suggested in the Amendment, in order to have self-preservation, even if we preserve all the rights of initiative in every respect. It has clearly emerged this morning that somebody must short circuit the amount of work necessary to inform the ratepayer of what his rights are.
Mr. Boyd-Carpenter
The Joint Parliamentary Secretary has said that he will inform me of the results of the legal advice which he takes on the point. I [column 98]think that he apprehends the point. I myself am a little unhappy about his idea of dealing with this by circular, because I think that it is our common experience that an attempt to mix the statutory with the informal arrangement generally leads to trouble and at least causes those responsible for administration a good deal of worry. However, I am quite prepared to see if the hon. Gentleman can deal with it in that way. It may well be necessary to return to this at another stage, but, in order to allow the Joint Parliamentary Secretary to carry out his undertaking, I beg to ask leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
The Chairman
Amendment No. 46, in page 4, line 11, at end insert:
“the said section 8 shall have effect as if there were inserted after the words ‘every person who’ in subsection (1) the words.
‘(a) being entitled to give notice pursuant to section 1 of the Rating Act 1965 does not do so; or
is not selected.(b) is one of a class of person specified by the rating authority in that behalf and’;” .
The next Amendment is Amendment No. 14. I do not know whether the Committee feels that there is adequate time to move it.
Mr. MacColl
We benefited enormously last time from having a brief explanation of the object of the Amendment. If the hon. Lady the Member for Finchley (Mrs. Thatcher) cared to give us a short explanation, it might help us to say something more helpful next time. I think that we can be helpful on this Amendment.
Mr. Boyd-Carpenter
My hon. Friend the Member for Finchley (Mrs. Thatcher) will, as always, be willing to oblige, I am sure.
Mrs. Thatcher
I beg to move Amendment No. 14, in page 4, line 16, at the end to insert:
(8) Where a person to whom this Act applies does not elect to pay rates by instalments, the rating authority shall apply section 8 of the Rating and Valuation Act 1925 as if in sub-section (1) thereof, the words “shall grant” were substituted for the words “may if they think fit by resolution direct that” .
Sir Leslie ThomasSir Leslie, although Amendment No. 46 has not been selected, would it be in order to refer to the content of it when discussing Amendment No. 14?
[column 99]The Chairman
Yes.
Mrs. Thatcher
I had hoped that the drafting of this Amendment was extremely clear and that its impact would be evident to all who read it. The instalment system may well involve local authorities in some financial difficulty, because a large amount of the rate will come in at a later time than under the present system. Those who can take advantage of the instalment system include the well-off as well as the less well-off. It is to be expected that a large number of people will take advantage of it. This may well involve local authorities in considerable extra borrowing commitments well above those which they already operate. It is believed that it would be very desirable to get in as large an amount of the rate as possible as soon as possible and that, in order to do so, there must be some counter incentive to the instalment system.
At present, the local authority has a discretionary power under Section 8 of the Rating and Valuation Act, 1925, to offer a discount of up to 2½ per cent. for prompt payment of rates. That discretionary power does not discriminate between types of ratepayers, if the local authority offers a discount. It must be offered to all ratepayers, industrial as well as domestic.
The Amendment makes it mandatory upon the local authority to offer a discount for prompt payment in the belief that, unless it does so, it will not get in as much of the rate in the early part of the year as is desirable. I have a few statistics taken from the paper of the Association of Municipal Corporations entitled “The Reform of Rating” , published in July, 1965. Paragraph 64 of [column 100]this paper gives details of the comparatively small number of local authorities which take advantage of the discretionary power. The source of these statistics is the I.M.T.A. return on rate collection 1963–64. It shows that of a sample of 82 county boroughs only 11 gave a discount. Of a sample of 223 non-county boroughs only 19 gave a discount. Of a sample of 212 urban districts only 40 gave a discount. Of a sample of 260 rural district only 53 gave a discount.
Therefore, a comparatively small proportion of local authorities are taking advantage of discretionary powers granted by Section 8. I take the view that, if we are to have a new factor in rating, namely, payment by instalments, there should be a counter incentive to get in early as much as possible and that those who can and are prepared to pay early should be offered the definite incentive of a discount.
The content of Amendment No. 46 is slightly different. That would enable local authorities to give a discount to a particular class of ratepayers, namely, domestic ratepayers, without extending that service to all other ratepayers. It would still leave the choice with the local authority as to whether it gave a discount. It may be that the best course of action would be a combination of the two Amendments. Perhaps I may continue——
It being One o'clock, The Chairman adjourned the Committee, without Question put, pursuant to the Standing Order.
Committee adjourned till Tuesday next, 1st February, 1966, at half-past Ten o'clock.
the Following Members Attended the Committee:
Thomas, Sir Leslie (Chairman)
Allason, Mr.
Boyd-Carpenter, Mr.
Cole, Mr.
Finch, Mr.
Hall-Davis, Mr.
Hendry, Mr.
Hobden, Mr.
Mabon, Dr. Dickson
MacColl, Mr.
Maddan, Mr.
Meyer, Sir A.
Murton, Mr.
Oakes, Mr.
Rhodes, Mr.
Robertson, Mr. John
Silverman, Mr. Julius
Smith, Mr. Dudley
Thatcher, Mrs.
Wellbeloved, Mr.
Whitlock, Mr.
Williams, Mr. Alan
Woodhouse, Mr.