LOCAL GOVERNMENT BILL

HC Deb 24 February 1948 vol 447 cc1787-882

Order for Third Reading read.

3.54 p.m.

The Minister of Health (Mr. Aneurin Bevan)

I beg to move, "That the Bill be now read the Third time."

We reach the last stage in the House of Commons of what has been, on the whole, a fairly amicable passage for a very complicated and important Measure. I should, perhaps, say at the very outset that we were labouring, both in the House itself and in the Committee, under certain difficulties, owing to the fact that, in order to provide the local authorities with the grants in time, and the powers which the Bill proposes to confer upon them, it was necessary to get the Measure through before the precepting date of the local authorities, so that we were, in fact, caught between two fixed dates—the beginning of the Session and the precepting date itself. This meant that the Committee had to work very hard and sit rather more frequently than is ordinarily desirable, and I want, on behalf of myself and the Government, to express my thanks to the Committee for the manner in which hon. Members on all sides cooperated to get the Measure back to the House in time.

The Bill is an exceedingly important one because it revolutionises the financial relationships between the local authorities and the State. For the first time in the history of local government in this country, the Exchequer now becomes, as it were, a ratepayer. The local authority levies rates, not only upon its own ratepayers, but upon the Exchequer itself to the extent that the rateable value in the local authority's area falls below the average for the country as a whole. In order to show to what extent this is taking place in certain areas, the Exchequer will be a ratepayer in Cardigan to the extent of 66 per cent., and, in the Isle of Ely, to the extent of 55 per cent., and there will be variations of these figures in very many parts of the country.

That is the first and most revolutionary act that the Bill does. It places poor local authorities in the position of being able to build up their local government services to the same degree as the better-off authorities. It has an additional advantage, because the local authority's revenues can be obtained from the central funds year by year, instead of having a block grant fixed at the beginning of the quinquennial period, which gets out of date very quickly. The present proposals are so resilient that the local authority is able to attract money from the centre just to the extent that it needs it to maintain and build up its own local services. This element of resilience and adaptability is a very important part indeed of effective local government administration.

Part II of the Bill refers to Scotland, and I will leave that to my right hon. Friend the Secretary of State. Part III is a corollary to Part I, because, if the State is to provide money for local authorities that have less than the average rateable value per head of the country as a whole, it is necessary that valuations should be done in such a fashion as to bring about equality between different local authorities. As the House has already agreed, that could not be left to the rating committee itself; it could not, as it were, be permitted to determine the size of the spoon with which it was going to scoop central cash. Central valuation, therefore —that is, valuation by the Inland Revenue Department itself—is an essential corollary to the provisions of Part I.

Part IV provides a new system for the valuation of dwellinghouses, and that has been microscopically examined by the Committee and now has met with a general measure of support. I know that hon. Members opposite have the gravest doubts about it, because we know they are in the favourable position of being able to prophesy disaster with impunity. If it does not occur, nobody will remember that they prophesied it, and, if it does occur, it will be taken notice of, because only bad news, apparently, is news at all. As that is the position taken up by all Oppositions, we need not be unduly disturbed by the fact that the present Opposition is living up to standard. It is perfectly true that the valuation of small dwellinghouses is a very difficult and complicated question, from which the previous Government ran away. We do not propose to run away; we propose to face up to the difficulties. We believe that we have found a formula which will enable small dwellinghouses to be valued, and yet maintain equitable conditions as between one ratepayer and another.

Part V abolishes the rating of transport and electricity; they have always been anomalous. It has always been very difficult to value services like these and then to break them down into their individual parts for each local authority. The reorganisation of those public utility undertakings provides a convenient opportunity for enabling them to make their contribution to rates out of a central pool. I believe that that provision should commend itself to hon. Members in all parts of the House. It is very much tidier and very much more equitable. It will, I know, cause some misgivings in certain places, because the amount of litigation will not be as great as it was; arbitrators and accountants will not be able to make as much revenue as they formerly did, but, nevertheless, probably in the absence of these old quarrels, new quarrels will arise.

Part VI provides a financial loss allowance, travelling allowances and subsistence allowances for local authority members, following upon the Lindsay Report. This, with proper safeguards, will, in the long run, enormously improve the personnel of local authorities. There are very many good citizens who have been denied an opportunity of serving on local authorities because they have not been able to afford to do so. The Lindsay Committee, of course, made it quite clear—and I think that accords with the general view of the House—that people serving in public positions must be expected to make sacrifices, but those sacrifices should not carry hardship. Certainly they should not be so prohibitive as to deny to large numbers of people an opportunity of serving on local authorities. This will be a great advantage and a step forward, even in urban areas; I believe its effect on rural areas will be even more marked. There are a very large number of people in rural England, Scotland and Wales, who are unable to serve at the present time because they really cannot afford to do so. This will enable people who are now financially inhibited to become politically articulate.

These are the main provisions. One of the consequences of the new financial provisions will already have been seen, because the ratepayers as a whole will be £19 million better off than was forecast in the White Paper published in November, the reason being, largely, because the rates have gone up. Local authorities have levied higher rates, and, in consequence, have at once been able to attract from the Exchequer more money than appeared in the original estimate. There are also, of course, provisions for transitional payments. Some local authorities are above the line, that is to say, they have a rateable value per head of the population higher than the average. Whenever large changes are being made in the relationship between local authorities and the State, it is always desired by the Government carrying them out to enable all local authorities to have some advantage. There is not the slightest logic in that at all.

There is no real reason in this scheme why we should have provided for transitional payments, because, obviously, they will be paid to local authorities who fail to be paid them owing to the fact that they are better off than the other authorities. But, whenever we are putting through changes of this sort, it is always desirable that we should leave no one with even a sense of grievance. Therefore, all local authorities gain by no less than 6d. That, of course, will he reduced year by year, so that, in five years' time, it will be extinguished, and, at the end of the period, this scheme will come into operation in all its pristine purity, without a blemish of this sort. The number of authorities that are above the line is rather less than was originally thought, and the number which will ultimately be in this position will only be seven as against the 20 or so originally estimated.

In the passage of the Bill through Committee and the Report stage, certain important changes were made. I think that hon. Members who were on the Committee will agree that one of the most important of the changes was the third party right of appeal. It was thought at first that the fact that the Inland Revenue officer would now be the valuation officer, would remove any possibility of connivance between him and the ratepaper in any particular locality, and that, therefore, the right of the affected ratepayer to appeal would be sufficient. However, I have taken the view, along with the Committee, that it is desirable that there should be a third party right of appeal, as every ratepayer is interested in every other ratepayer's valuation, because what he has to pay depends entirely on what other persons have to pay. Therefore, there should be a third party right of appeal. This right, of course, will be exercised not only by the individual ratepaper, but by the rating authority, because the rating authority obviously has an interest. This was a very considerable improvement.

There is a further alteration in the Bill as originally introduced. This is in the case of temporary grants by county councils to county districts affected by the abolition from the local rating rule of electricity and transport undertakings, particularly electricity. There, the contribution will be made for 10 years instead of five, by which time there is a reasonable expectation that the county district will have adjusted itself to the changed circumstances.

There is also the new Clause which deals with entertainments, a very important provision indeed, of which, I hope, local authorities will be able to take full advantage. I need not say anything more to commend it, because the Debate is very fresh in our minds. It is, perhaps, unfortunate that, for a little while, until our physical resources are expanded, it will not be possible for local authorities to take full advantage of it. Nevertheless, I believe that, here again, when these powers are able to be exercised in their full panoply, the whole character of local government will change. A fresh lot of people—a different sort of person—will become interested in local government. We shall have, not only those concerned with the pure mechanics, but those concerned with the arts, the theatre, music, exhibitions, paintings, sculpture, and a whole variety of activities. Young people in particular, I believe, will throng into the local authorities in order to try to make the utmost use of these powers, and to diversify the traditional culture of this country. What is as important, if not more important, is that these amenities will be provided in areas which have been denied them, because they have been so monolithic in character, having only single industries upon which to depend. With these new powers, and with this new interest, it ought to be possible to build up a much richer life for our people.

As I said earlier this is an exceedingly important Measure. I believe that when it is fully understood and in operation, it will be welcomed in all parts of the country. It takes its place with the Municipal Corporations Act, 1835, the Local Government Act, 1888, and the Act of 1929. I believe it is of a stature to rival all these, and I commend it to the House.

4.11 p.m.

Lieut.-Colonel Elliot (Scottish Universities)

I think that on this side of the House we would agree with the Minister that this is an exceedingly important Bill and, secondly, that it has been handled, both on the Floor of the House and in Committee, so far as is possible, with a genuine desire to see the great points at issue brought out and to improve the Measure laid before us where possible. I consider that any Measure in this House touching local government, and particularly touching local taxation, is a Measure which the House should scrutinise with the utmost care. After all, local government is the foundation of the whole of our British public life, and local taxation is a subject which is reviewed only at long intervals by this House, although in its incidence it touches individuals and the development of the country in a way quite as intimate as central taxation. I consider that from both these angles it should be scrutinised very closely, and many of us regret the more, as the Minister said, that is was necessary for us to work under a considerable sense of pressure.

I quite agree that we were caught between the Scylla of the opening of the Session and the Charybdis of the precepting date or, perhaps, I should have reversed those two metaphors, because they are not strictly applicable in classical diction, and I was hauled up for a small classical howler on the Committee stage by no less a person than the "Londoner," who, as we now know from the Leader of the House, is one of the Parliamentary authorities to which he pays very great attention indeed. I think it was unnecessary to bind ourselves in these tight trammels. I think we could, with advantage, have carried over the bringing into operation of this great Measure for another year, while the subject was being more closely examined. A temporary Act could easily have been passed with advantage which would have held the existing position, because at the beginning of our proceedings, and during the passage of the Bill, and now at the end, both outside authorities and we in the House have felt a sense of pressure, and, in addition, I have had an uneasy feeling that we have not even yet fully threshed out the important questions before us. For instance, the Minister has mentioned the valuation of small dwellinghouses, to which I shall return. There are also other aspects of the Measure which I think have not received the consideration which they deserve.

It is true that the Minister said he was about to act where other Governments have fled, but the Minister—if I may say so, in no offensive spirit—acted on the ancient and "safety first" line that "He who fights and runs away, may live to fight another day," because the dangerous portions of this Measure do not come into operation for years to come. The Minister himself explained that his transitional grants would run for five years and then, he said, his scheme would appear in all its purity. But it is very unlikely that he will still be occupying his present position at the end of that time. [HON. MEMBERS: "Why not?"] I have seen the Minister's vigorous and, indeed rocket-like rise, and it would be very strange if the graph flattened out suddenly at the point where it is now. I would expect it either to continue to rise or to start to fall. Nothing more unlikely could well be imagined than an absolutely pedestrian level for the next five years in the career of the Minister of Health. If I see him still there five years hence I shall be greatly surprised.

He has done other things. The danger of this valuation, affecting small dwelling-houses, will not be manifest for years to come. He is about to carry out a valuation which, I hope to show in a few minutes, will be of a very far-reaching kind, but nothing will be actually done for a matter of years; in fact, nothing will be done upon it until after the next general election. It was a feature of the 1929 Act that it was also preceded by a Valuation Act, because in those days we did our best to present each separate section of legislation separately to the House of Commons. With great honesty we brought that Measure into operation before the general election and hon. Members who fought that election will remember very well that, at any rate, it did not contribute towards the success of our candidates at the poll. With great strategical skill, the Minister has arranged that the battle which is now being fought will not have its result declared until after the electors have given their verdict, either for or against the Government of which be is so distinguished an ornament and so formidable a buttress.

The Minister advanced several arguments why the Bill should be given a Third Reading, and I would just examine one or two before coming to the few remarks I shall make on this occasion. After a two days' Second Reading and a long stage in Committee, we come to the closing stages of the Bill, and nothing would surprise me more than for one or other of us to convert his opposite number to his own point of view; either for the Minister to hurry across the Floor of the House and say, "My dear fellow, you were perfectly right, this is a bad Bill and should not reach the Statute Book," or that we on this side should hurry into the Government Lobby saying, "We were all wrong and, really, we think this is a very good Bill indeed." We maintain our position on the Bill and we feel it would be a mistake if the House this afternoon were to place it upon the Statute Book.

The discussion will no doubt confine itself, to some extent, to arranging as neatly as possible, as clearly as possible and as objectively as possible, the differences between the two sides. About Part I, the grant proposals, he said that the State, for the first time, steps in as a ratepayer, comes in where rateable value falls below the average. The State is not merely carrying out a methodical advance, however, but a sort of quadrille, because although it steps in at one point it steps out at another. There are many local authorities from which it retreats altogether and the block grant given under the 1929 Act, a considerable proportion of which was given as compensation for de-rating, is withdrawn altogether from certain local authorities. It is withdrawn on the means test which the Minister—changed greatly from his views on other occasions—thinks is the ideal way of operating grants to local authorities.

The richer local authority does not get a grant; the poorer local authority, if it can show a need, does get a grant. This has certain disadvantages. Certainly it has a disadvantage for local authorities previously given a grant in exchange for the derating of many hereditaments within their area, who justly feel they now have a sense of grievance when the grant is withdrawn. Their grievance towards the transitional grant of 6d. of which the Minister spoke is because of the size of the sum, secondly, because of the reasons given by the Minister, and, thirdly, that it will disappear altogether in as short a period as five years.

The Minister, again with great strategical skill, said he would not discuss the Scottish part of the Bill at all. But it is impossible to leave out the Scottish part entirely because the two countries are bound up together in one Measure. The Scottish part will be discussed by my hon. and gallant Friend the Member for Pollok (Commander Galbraith) later, and I understand that the Secretary of State for Scotland is to close the Debate and will, I hope, be able to deal with the specifically Scottish points. It is interesting, however, to find in a Measure in which the two countries are considered, that many of the arguments which the Minister prays in aid for his part of it have the supports knocked from under them by the existence in the same Measure of the other part of the Bill, the part for Scotland.

That is so, for instance, about the point which the Minister made as to the necessity for removing valuation altogether from the local authorities. He said, "Now that this new system of distributing the State's support of local finance is to be adopted, we must remove valuation from the local people altogether." Indeed, some of the arguments used, especially during the Committee stage, so far as we on this side of the House can see, would justify the removal of trial by jury from our legal system; because most of the arguments which were brought against local valuation—that it was amateur, that it was liable to variation from one part of the country to another, that it could better be done by some centralised authority—could also be brought against many of our ancient institutions, of which trial by jury is only one.

What the Minister must grapple with, and what the Secretary of State for Scotland must grapple with, is the question, Is it necessary to destroy in England what it is necessary to retain in Scotland? How is it that the Minister's arguments about local authorities—the local people—doing this valuation, should be so powerful in his mind as to necessitate the sweeping away of the ancient connection of local valuation with local taxation, although that is not necessitated in Scotland? He knows as well as I do that in Scotland valuation is still carried on—and is still to be carried on—by an officer of the local authority, the city assessor. The city assessor, of course, has independent status; but he is not an officer of the Crown: he is an officer of the city paid by the city. I should have thought that the Minister might have been more chary of advancing an argument which, in the same Bill, is to so large an extent disproved.

I shall come in a moment to the criticisms of Part IV, the rating of the small dwellinghouses, but first I want to say something about Part V. Here again the Minister proved too much. He said that we are sweeping away the rating of electricity and transport undertakings; that there are now to be central contributions paid through a central pool; and that this will be a great advantage. Indeed, he mentioned during the Committee stage the case of, I think, a sewer that passes through several adjoining parishes getting larger and larger as it approaches the sea; and the parishes become more and more parasitic upon this public work until, as it seemed to me, at the end the inhabitants of the last parish derived their whole way of living from their close proximity to the sewer—which seemed to us a somewhat exaggerated picture of life as the Minister has encountered it. But he has testified to experience that is his own and it is not for us to contradict it.

But the Minister went on to say that he was derating these things and that this would be a great advantage. Yet in this same Session, at the present moment, the Government have a Bill parallel to Acts covering electricity and transport, the Gas Bill. In the case of the gas undertakings—in fact, it is specifically prescribed in the Measure—they are to remain subject to all local rates. Therefore, the principle of homogeneity that the Minister has prayed so much in aid in a "tidying up process"—a phrase repeatedly used in his arguments—does not seem to extend itself to the third of the great trilogy—to use the Ministerial metaphor—the third of the trio of transport, electricity and gas.

It appeared during the Committee stage that not merely the electricity undertakings themselves could be derated, but shops and showrooms showing, for instance, electrical appliances, and that derated islands of shops would appear in the streets of cities if they were owned by an electricity undertaking. But if a gas undertaking is side by side with an electricity undertaking, if a nationalised gas undertaking shop is cheek by jowl with a nationalised electricity shop displaying appliances for the use of their respective commodities, then the shop displaying electrical appliances will be de-rated, but the shop displaying gas fires and gas cookers will pay—and it is specifically laid down in the Measure—the full rates. Whatever else that is, it is not any attempt to produce uniformity and homogeneity in our local government system or, indeed, in the treatment of nationalised undertakings.

The difficulties of the House in grappling with this Bill are well seen in the fact that on Report stage a totally new subject was brought in, the question of entertainment. On that, I believe, my hon. Friend the junior Burgess for Oxford University (Sir A. Herbert), if he is fortunate enough to catch your eye, Sir, will have something to say. I shall certainly not trespass on that field. It is understood that the Scots have no connection with entertainment, with humour; that that is far divorced from their mental make-up. Therefore, I shall not attempt to make any comment on it, save to say this: that to take away a great constructive enterprise by which the small man learned and felt his way into the fabric of modern industry as a master and not as an employee, and to substitute the supervision of the proposed entertainment concerns does not seem to be a fair exchange.

I think the Minister suggested that public life would be flooded with a number of people who would not have been attracted by the previous conditions of local government, but who will be attracted by the new dispensation. The hon. Member for Cheltenham (Mr. Lipson) said he had sat upon an electricity committee and an entertainments committee, and that he greatly preferred the entertainments committee to the electricity committee; but the hon. Member for Cheltenham had many opportunities of contact both with entertainment and with great electrical undertakings. It is not always the case that the small man in the great industrial cities has any such opportunities. I still maintain that one of the bad things that is being done at present is the removal of great opportunities for self-education, self-education in the most vital facts of our modern industrial life; and that these opportunities are being removed from the smaller man inevitably by the operation of the policy which the Government are pursuing of removing these great things from popularly elected local authorities.

Mr. Lipson (Cheltenham)

Does the right hon. and gallant Gentleman not agree that this Bill does not take away something but does provide something? It is not this Bill which is taking away electricity. It is putting something else in its place.

Lieut.-Colonel Elliot

I was dealing with the argument of the Minister, for it was the Minister who made this argument. The hon. Member can discuss that with the Minister later if he wishes. I was dealing with the argument which the Minister was advancing to the House. He was advancing this as a quid pro quo, and, honestly, I do not think that it is a matter of bargaining. Whether it is a good thing or not, it should be discussed on its merits, and I do not think that the removal of these other opportunities is in any way compensated by the introduction of these new proposals—and all the more since, as the Minister himself said, they will not come into force for many a long day to come. The building programme which was envisaged for the erection of new halls must obviously take second place to housing and other developments which are still greatly needed in this country. In fact, during our discussion on Report stage the mirage of the entertainment Clause rather blinded the House to many of the hard realities of the present day.

The actual proposals before the House will undoubtedly bring new money to the local authorities, although not so much new money as was envisaged by the local authorities, or indeed by the Minister, because the sums which are being brought are diminished by a rising tide of expenditure which, in many cases, has caught them up, or nearly so. I was looking with interest at the newspapers today, and I see that yesterday the Middlesex County Council announced a reduction of 1s. 2d. in the £, Coventry of 1s., and Manchester of 1s. 6d.; when the Hull Council meets next month it is expected to reduce the rate by 2s. 10d. in the £; the Sheffield City Treasurer was not so fortunate, for he, under the headline "Rates are being cut" was merely able to announce that by running very hard they would be able to remain in the same place, because he reported no change in the rate, and said: The Government equalisation grant has allowed us to keep the rate at the present level. Otherwise it would have been increased, for we have to find £110,000 for snow clearance expenditure last year.

Mr. Bevan

It still remains the fact that the average gain is 3s. 4d. in the £.

Lieut.-Colonel Elliot

The Minister ought to put these points more clearly before his public relations officer to have them published in the "Daily Herald," because it is from the "Daily Herald" that I am quoting. The remarkable fact that in Sheffield this largesse has been able to pay only for last year's snowfall ought to be brought out. Doubtless, the Minister will be acquainted with the ballad of the French poet, which seems to have its bearing here: Oú sont les neiges d'antan. As far as Sheffield is concerned, that seems to be the value which they are receiving.

Mr. Bevan

It is necessary to get the facts right here. I am sure the right hon. and gallant Member would be most anxious that nothing but the truth should be known in this matter. The real comparison is with what the rate would have been on local authority expenditure if these helps had not been given. The rates would have been 19s. 1d. in the £; now they will be 15s. 9d.; the average gain is 3s. 4d. Therefore, the real test is: What would the rate have been if this help were not forthcoming?

Lieut.-Colonel Elliot

I am most anxious that nothing but the truth should come out. That is why I ventured to criticise, at a little length, that paragraph in the "Daily Herald." Without a certain amount of assaying and refinement the fact does not always appear at first sight, especially when under the heading, "Rates are being cut." In Sheffield we find that the rate has remained exactly the same. True, other advantages are to be found. I see that in Wales the Parliamentary Secretary to the Ministry of Education has been eloquent about the great advantages which would come from this Bill in regard to the education grant. He wound up with the resounding and eloquent peroration: Nearly 40 years ago Mr. Lloyd George, then Chancellor of the Exchequer, once charmed the electorate with the offer of 9d. for 4d. Through the operation of the equalisation grants the Minister of Health is now improving on this with an offer of £8 million for £2 million—or 8d. for 2d. Again, I think these views are somewhat clumsily and flat-footedly put forward. I look to the Minister to explain these matters with a little more grace, even if with a little more forcefulness against hon. Members on this side of the House.

The most doubtful feature, and to our mind still the major feature, of this Bill—the long-distance feature—is the proposal for the revaluation of the small dwelling house. I do not yet feel that that has been at all satisfactorily explained, and there are still undoubtedly snares about for the future, which are all the more dangerous because they will not become manifest for some years. On Second Reading the Minister explained that he would be able to deal with these matters during Committee, and we left it over till then. But when the Committee stage arrived it appeared that the Minister's pledge would be very difficult of fulfilment. On 18th November the Minister pledged himself thus: I am prepared to consider this, and to explain it in much more detail when we come to the Committee stage."—[OFFICIAL REPORT, 18th November, 1947; Vol. 444, c. 1002.] But when we came to the Committee stage the Minister pointed out that he could not give specific instances against those specific instances which we on this side were prepared to quote, because, he said, it would amount to his valuing a piece of property, which would be constitutionally inadvisable, and impossible in practice. We suggested at the time that some round-table conference, some confidential discussions, might take place at which either side could table the figures which they had to show. However, the Minister was not able to see his way to allow that to take place.

I still say that, in our view of all these matters, the small cottage property will, first of all, be valued under many and diverse headings—and this in the name of uniformity. It will be valued under several separate headings: the pre-1918 house property; the post-1918 house property; the 1938 cost of construction plus the 1938 cost of site; and the 1938 cost of construction minus the current cost of site. It remains a fact that, for one of the fundamental sets of figures upon which a man has to work, the value of his house, there will be widely differing approaches, according to whether the house was built before or after 1918, and the particular circumstances under which the Minister approaches it. That is quite apart from the fact that there will be another set of figures for Scotland. Our figures seem to show that very sharp graduations, and steep rises will take place as a consequence.

Again, the Minister said both in Committee and with more particularity on Second Reading, that our fears were fallacious. He said that matters would not work out like that. That may be, but our figures seem to show that a small pre-1918 house, with a gross value of £32, is likely to go up to a gross value of £50, which is an increase of 56 per cent. As for a small post-1918 house, valued under another system altogether, it is likely to go up from £32 to £40, which is an increase of 25 per cent. The average, so far as we can make out, for all the post-1918 houses is likely to be a 23 per cent. increase, and for the pre-1918 houses 38 per cent. The Minister says that if they all go up, then none go up, because everything is revalued, and it simply means the same sum is to be extracted under a different set of arithmetical scales. That is not so, because houses are not the only rateable—

Mr. Bevan

The right hon. and gallant Gentleman on Third Reading ought not to recapitulate in such a fashion as to make interventions necessary all the time. I always qualified it by saying that special properties would be under a disadvantage. The right hon. and gallant Gentleman will see that there is always that qualification.

Lieut.-Colonel Elliot

It is far from being my intention to misquote the right hon. Gentleman. There is naturally a saving for particular properties, but his contention was that for the great bulk of properties it would, in general, be as broad as it is long, and that if the value was higher, the rate would be less. That seems to us to neglect the fact that there are two sets of house properties, namely, the pre-1918 and post-1918 houses, and, secondly, that there are all the other rated properties. This part of the Bill is really a proposal for the re-rating of cottage properties, and in so far as these properties are re-rated, other properties are de-rated. Furthermore, in so far as they are re-rated differentially, we find that a greater burden is cast on one or another block of properties. If the pre-1918 houses are to average a rise of nearly 40 per cent., and the post-1918 houses 23 per cent., then there is a differential within these two categories.

That fully justifies our criticism on Second Reading, which we repeat, namely, that two citizens, living side by side in two comparable houses, will have different rate burdens placed upon them merely according to the date of construction of their dwellings. I do not wish to continue to quote these examples. The Minister has contended that these examples are fallacious, that we are bringing bogies to the Bar of the House, and the more instances we bring forward, the more he cries "Bogy, bogy"—I hope I have not misrepresented him there, because I think, those were the identical words he used. I do not think that it is so.

It is on this fundamental point, which will be developed by other hon. Members, that we find it necessary to divide against the Third Reading of this Bill. The Minister has laid a delayed-action mine here, which will not go up for some years. We say that it will go up, and go up in the case of the great proportion of dwellinghouses in the country, and that people have no idea what is being prepared for them. We say that there will be a widespread uneasiness and a degree of indignation when this mine finally does go up. We do not hope to do more on this occasion than set forth our grounds of quarrel with the Bill.

We feel it is more important than with other Measures again to deploy the arguments on Third Reading, because the House has never really had a full view of these proposals, and more particularly it has never had a full view of the proposals for re-rating small dwellinghouses. In addition to discharging our duty in this House, we hope that we shall be discharging a useful function for the country in setting forth the grounds on which we disapprove the addition of this Measure to the Statute Book, and for dividing against it on Third Reading.

4.46 p.m.

Mr. W. R. Williams (Heston and Isleworth)

Unlike the Minister and the right hon. and gallant Member for the Scottish Universities (Lieut.-Colonel Elliot), I make no pretence to have any expert knowledge of assessments and rating valuations. Like most Members, I have taken considerable interest in this matter over a number of years. I have taken the opportunity to discuss with experts in the County of Middlesex, and in my local authority at Heston and Isle-worth, and find out what are their views about this Bill. They assure me that this Bill will long remain as a constructive social Measure of which the right hon. Gentleman may be very proud in the years to come. When I think of the important pieces of legislation of a social character which have been introduced by famous compatriots of mine, from Mr. Lloyd-George, as he then was, to the Minister of National Insurance, and not least my right hon. Friend the Minister of Health, I seriously wonder what will happen to this old country of England if, at any time, Wales decides to set up a separate Government.

I am glad to be able to inform the House that, from the point of view of those expert men and women who have spent the best part of their lives in considering this great reform, this Bill is a worthy effort on the part of the Government and the Minister. They all think that the Minister has grappled with this very complex problem with great courage and great knowledge. In the view of these people and of myself, these problems should have been tackled a long time ago. It would have been easier to have tackled them in the years between the wars, when there would not have been the difficulties which are associated with postwar reconstruction. I cannot help feeling rather sorry that the right hon. and gallant Gentleman who complained about the pressure brought to bear upon him during the Committee stage did not, with the Government in which he was so distinguished a member, tackle the problem when there would have been more time to bring about the reforms we so urgently need.

I wish to draw the attention of the Minister to two points in respect of which the Bill might be amended when it goes to another place. My first point is in regard to the operative date which the Minister is empowered to prescribe in accordance with Clause 68. Subsection (1) of Clause 33 states: (a) assessment committees, county valuation committees and the central valuation committee shall cease to exist; and (b) save as hereafter provided … rating authorities shall have no functions in relation to the preparation and amendment of valuation lists. The suggestion I want to put to my right hon. Friend is that he should consider making that date as late as possible, until the new valuation lists are nearly completed. I ask him to do that because it is the view of those who are advising and guiding me on this Bill that anomalies may arise during the transitional period because new valuation officers will, of necessity, have to deal with some of the points and assessments which have already been agreed by assessment committees.

It is regrettable in some respects, but this transitional period is unavoidable. I appreciate that from the point of view of the Minister it is very necessary, but what we are afraid of is that unfairness may creep in as between the two valuations—that by the assessment committees of the local authorities as they are now constituted, and that made by the new valuation officers. I believe that the Minister has made a courageous attempt to solve some of the difficulties which will arise during the transitional period in relation to the new valuation lists which will be operated in 1952, but many of us feel that as, during the four-year period, the basis of valuation will be that laid down under the 1925 Act—that is, rental value—we would like the new valuation officers to have some contact and consultation with local authorities and their assessment committees so that the number of anomalies can be reduced, and any suggestions of unfairness to ratepayers can be avoided.

One of the dangers which I and others see is that it may be the aim of the valuation officer to secure legal correctness rather than what we all desire during the valuation period—a broad sense of common fairness. I therefore ask my right hon. Friend to see that the operative date is brought as near as possible to the date when the new valuation lists have been completed. At the moment, the valuation officers working for assessment committees will have to continue to keep their present lists up to date. I feel sure the Minister will agree that it would be regrettable if, by premature abolition of assessment committees, the present level of assessment became distorted, or any unfairness accrued as between respective ratepayers simply because the new valuation officers must almost of necessity have to have regard to legal correctness.

My second point concerns the right of appeal under Clause 39. We are all glad to see that the principle of appeal is maintained. The Clause provides for the right of appeal against the decision of the local valuation court. In my experience, appeals of any description always entail some expense for the appellants or the respondents. As I understand the existing law, assessment committees have, of necessity, and almost automatically become respondents to appeals made against their decisions. So far as I know, appeals have been properly heard; counsel have been allowed to appear on behalf of the parties and expert witnesses have been called on either side. In most cases the expenses have been borne by the assessment committee. I may be wrong, but as I read the Bill this will not apply from the date of its operation. Ostensibly, the reason is that the new body will be a judicial rather than an administrative body. Under the Bill, if a ratepayer obtains a reduction in his assessment, and the valuation officer desires to appeal to the county court against that reduction, the ratepayer must become the defendant in the action and, therefore, be responsible for the costs of the action, if any.

From that two things flow. First, very severe hardship and an almost impossible burden may be placed on the small ratepayer if he has to face the question of legal costs in an appeal of this kind. Second, even if the ratepayer is able to stand up to the legal costs, he will think several times before appealing because of the element of cost. There is no one in the House who desires more than my right hon. Friend to ensure that any Bill with which he is connected should impose no unnecessary burden on the people of this country, especially the poorer elements. If the argument is that there will be a new valuation body, which is judicial rather than quasi-judicial, which cannot act in the way I am suggesting it should do, I would like the Ministry to consider this point: in the case of appeals to quarter sessions against the decision of licensing justices, the justices are, as a matter of course, normally regarded as respondents in the action, and in a position to defend their own decision, accepting the legal charges and costs that may flow from the action. If that is so in this case, the licensing justices being a judicial body, I would ask why the same procedure cannot apply under this Bill?

Whatever may be the legal position, I believe that ordinary people will not readily appreciate the fine distinction between administrative and judicial bodies. They may take the same view as many of us have taken, which is that an administrative body is one that applies the law in a sensible way, while a judicial body is one that applies the law. Whatever may be the virtue of that attitude I hope that the Minister will be able to give some slight attention and if possible sympathetic consideration to the two points that I have enumerated. I feel sure that the Bill will go down in the history of the House as one of our finest achievements in putting local government upon a sound, sensible and workmanlike basis.

5.1 p.m.

Sir Alan Herbert (Oxford University)

I understand so little of this Bill that I hope that hon. and right hon. Gentlemen who have spoken will forgive me if I do not take up and follow the arguments they have used. Perhaps I should apologise for intervening at this late stage in a discussion upon a Bill upon which hon. Members have expended so much toil and time, but I want to draw special attention to Clause 131, which also came in rather late in the day.

Firstly, may I, in the most helpful and friendly way, raise what I believe to be a point of drafting? I am seriously afraid that the Bill goes much farther than the Minister means it to do. At the bottom of page 91 of the Bill are these words: entertainment of any nature. Hon. Members on this side of the House have already questioned the width of those words, and in Committee they put down Amendments, which were not accepted. But under those words, local authorities, it seems to me, will be able to conduct boxing matches, football matches, racehorse and greyhound racing, and other forms of entertainment which attract Entertainment Tax. "Entertainment" is defined in the Finance (New Duties) Act, 1916, as including any exhibition, performance, amusement, game or sport to which persons are admitted for payment. I do not think it is in the mind of the Minister that local authorities should undertake such activities. In the hope that we might make a verbal Amendment on the Third Reading I have shyly put on the Order Paper an Amendment to insert the word "artistic" before the word "entertainment." That might meet the Minister's point of view, particularly as "artistic" is a word very well understood indeed by everyone—indeed, just now he himself very clearly enumerated the "arts"—

Mr. Deputy - Speaker (Sir Robert Young)

The Amendment to which the hon. Member has referred was out of Order. He therefore cannot discuss it now.

Sir A. Herbert

I was not proposing to do so at all. All I was trying to say was that it might be better if we could correct the Bill—assuming that my point of view is right—rather than have an Amendment when the Bill goes to another place. I hope that the Minister will consult the Law Officers on the point I have raised before the Bill reaches its final stages.

About Clause 131, I agree very largely with my fellow dramatist the hon. Member for Ashford (Mr. E. P. Smith). For those who have been trying for 20 or 30 years to entertain the people publicly, this is a somewhat terrific occasion. After centuries of social and religious taboos, oppressive legislation and penal taxation, at last the rogues and vagabonds, the clowns, columbines and harlequins are declared to be respectable—nay, more than respectable, valuable—so valuable that a Minister of the Crown is asking Parliament to enjoin the local authorities of the land to spread the works and the wares of those entertainers among the citizens, so far as they can. That is a very big change indeed, and I congratulate the Minister upon the spirit of his proposals.

But I was a little alarmed and bewildered when I read some of the expressions used by supporters of the Bill, though not used by the Minister, who has been extremely moderate. I believe that there is room for both public and private enterprise and I should like to see them going hand in. hand, on parallel courses; but that is not the spirit in which these proposals have been commended by some hon. Members on the Government side of the House. Even the Parliamentary Secretary, who made a very graceful, agreeable and on the whole moderate speech, said a few things which made me raise my eyebrows. He said, for instance: Private enterprise in this field of public entertainment, whether lowbrow or highbrow entertainment, has only partly met the public need. It is clear that private enterprise alone is either unable, or unwilling, to deal with the expanding cultural needs of our people It is unfair to say that sort of thing without adding that the State lays a penal tax of 29 per cent. upon the receipts of those unfortunate people. Another hon. Member—I will not mention her name, for she is not here—made an even more astonishing remark. She said: We do not want to see this entertainment provided by private enterprise and vested interests, which will make huge profits out of it."—[OFFICIAL REPORT, 19th February, 1948; Vol. 447, c. 1347 and 1379.] The implication of that comment is that public entertaining is an easy thing to do and that it is only a question of not making a profit. The only question that really matters to me is, "Is it good?" Some people, I know, like the hon. Member, have the idea of driving private enterprise out of the entertainment business altogether; but I hope there are not many of them who want to do that and that that is not the spirit in which the Bill will be administered.

Let me try to analyse and define what this House is trying to do. We have heard a lot of rather vague, idealistic thought, but some of us are uncertain about what the Clause proposes to do. There are two areas of action in which this Clause might be applied. The first is in places where no entertainment is being provided at present. I absolutely agree that if it is not being provided, and can be provided at all, we ought not to care who does it. A great deal of nonsense was talked on this matter. The hon. Lady to whom I have just referred committed herself to this remark: The Clause will enable people in sparsely populated areas—where the nearest theatre is perhaps 10 miles away—to taste joys of drama and music which have hitherto been denied to them."—[OFFICIAL REPORT, 19th February, 1948; Vol. 447, c. 1377.] I do not know what in the world that means, unless it is that Covent Garden, Drury Lane, and the Lyceum Theatre are to be carried about in plain vans across the moors of Yorkshire and Devonshire. Much as I love the theatre, I say, "thank God that in this over-populated island there are still places which are 10 miles from a theatre—yes, and 10 miles from a town hall, too." There are town halls which are 50 miles from a fox, but nobody would propose that the metropolitan boroughs should organise a civic fox hunt. Let us not exaggerate about these matters.

In a less exaggerated form I agree with the suggestion that in small towns which have a cinema, or two perhaps, but no theatre, I should like to see, as a result of the Bill, a theatre brought into existence. But let us realise why there are no theatres in those places now. Private enterprise, with all its faults, goes where the going is good, or as hon. Members who support the Government would say, where the profit is. The simple reason why there are not theatres in the kind of towns which I have in mind is because, alas, there has not been a sufficient demand for the theatre. Most of the people, unlike myself and I think the Minister, still prefer the cinema to the theatre, partly because they have not had the opportunity to appreciate the theatre, although I think the position is improving. The reason why there is no theatre in the towns which I have in mind is because it has not paid and could not pay. The corollary to that is that the municipal enterprises will very often make a loss. Let us face it. I should not mind playing at a loss, so long as it was reasonable, for what would be of great educative benefit, but do not let us go so far as some hon. Members opposite go, and say that we shall not lose anything at all.

So far, I am all with the Minister. Now let us take an area where private enterprise is providing entertainment to the satisfaction of most of the people. Private enterprise, after all, for 300 years, from Shakespeare to Shaw, has been providing entertainment of a fairly high quality. Take a city like Manchester, which has two or three theatres. I have had the honour of being performed there four or five times. Architecturally, no doubt, there is room for a fine new municipal theatre in Manchester.

Let us suppose that when things are easier, the city council will build a new theatre. It is unlikely that they will find that the borough surveyor, all his life, without anybody knowing it, has been a first-class theatrical producer or stage manager. It is unlikely—although it may happen—that the police will find that they have been wasting their time and that they should have been in a corps de ballet. What will happen is that they will go to the Opera House or to the Palace Theatre and say to the manager, "Look here, old boy, we know nothing about this. You come over and help us. We can give you a lot more money than those wretched private enterprise people are giving you. We do not really care how much we lose. We have got the rates behind us. We pay no Income Tax, and we shall pay no Entertainments Tax. Therefore, we can offer you a much bigger salary." The same sort of thing will be said to the stage carpenter, the electrician, and perhaps the conductor of the orchestra, and so on.

Up to a point it may be said that that is a very good thing for the profession. I agree, although it must be remembered that the resources and what is called the "personnel" of the theatrical profession are not unlimited, and we might be robbing Peter to pay Paul. However, let us assume that those difficulties are surmounted. We shall then have this extraordinary position. There may be two theatres wishing to put on plays of the same standard; indeed, it may be the same play. If taxation is continued at its present level, one of the theatres will pay to the State 29 per cent. of its receipts in Entertainments Tax, plus Income Tax and Profits Tax, while the municipal theatre will pay no rates and no Entertainments Tax, and they will not care if they lose, because they will have the rates behind them. When the hon. Member for Cheltenham (Mr. Lipson) says that it is not for Opposition Members to jib against competition, I agree, but it is the right of every man and it is the nature of every man to jib against unfair competition which will damage his industry.

I do not wish to weary the House, but I must relate for the purpose of the record that I was somewhat surprised when I heard the hon. Member for Ashford list among the people who were in favour of this proposal what he called the "commercial" production managers. I prefer to call them professional production managers, because "commercial" is a word of prejudice. We do not talk about commercial publishers, or commercial newspapers, or commercial films, although they all have to pay their bills and make both ends meet. Curiously enough, in spite of the undoubted reforms which His Majesty's Government have introduced, so far as I know there has not been any amendment to the laws of bankruptcy. Therefore, it is very unfair to throw such epithets as "commercial" at anybody merely because he is trying to pay his bills. I was surprised to hear the hon. Member say that the commercial production managers were also warmly in favour of this proposal, because, so far as I know, he has no more authority to speak for managers than I have. He is no more a manager than I am, and he has no more interest in management than I have.

I have received a communication from the Theatres National Committee, which comprises several bodies; they are the Society of West End Theatre Managers, the Theatrical Managers' Association, the Entertainments Protection Association, the Provincial Entertainment Proprietors' and Managers' Association, the Scottish Theatrical Managers' Association, the Association of Circus Proprietors and the Association of Touring and Producing Managers. I do not know what half of them mean, but they are not all "bricks and mortar" men; they comprise the producers and everything. I do not know whether they are right or wrong, but, as a matter of record and of justice, I must tell the House what they say. They say: This Committee takes strong exception to the new Clause tabled by the Minister of Health with regard to the above matter. I shall not read the whole letter. But they go on to say: The theatre managers do not wish to adopt a dog-in-the-manger policy or to discourage the provision of opportunity for theatrical entertainment in places where it is not adequately provided at the present time"— That is the point I have made, and there I am absolutely with the writer of this letter— but they feel that in a matter of this kind considerable care is needed if irreparable damage is not to be done to the best interests of the British theatre in the long run. In other words, we shall not substantially increase the intellectual resources of this country if we drive out Mr. Cochran and substitute the mayor and corporation of Wigan or Swindon.

Mr. Bevan

May I put a point to the hon. Member who is making a most interesting speech? Suppose that in a certain place there is a sufficiency of cinemas, but no theatre; would the hon. Gentleman say that the local authority should be prevented from building a theatre and using it also as a cinema? In that case the local authority would have to carry what undoubtedly would be a loss on the theatre and would deny itself any of the revenues from the cinema. If they constructed a building which could be both a theatre and a cinema, for certain weeks they could run it as a cinema and for other weeks they could run it as a theatre, and avoid a loss, but in that case they would be providing a cinema where there would be a sufficiency of cinema entertainment in the area.

Sir A. Herbert

So far as I follow the right hon. Gentleman, I do not think I should be against that proposition. I am prejudiced in favour of the theatre and I want to see more theatres. What I am saying is that these powers should not be used too automatically. Where there are theatres already in existence and where it seems that the public demand is adequately supplied, there should be consideration and consultation. The managers make suggestions which it would be out of Order, perhaps, for me to mention, but no doubt the right hon. Gentleman is aware of them. I am sure the theatrical managers are not afraid of fair competition. Perhaps the real remedy is for the right hon. Gentleman to say to the Chancellor of the Exchequer, "Let us have no more nonsense about the Entertainments Tax. Take it off and let us have a fair field for everybody." That would go a long way towards satisfying everyone.

Subject to that, I add my humble blessing to this Clause. In many ways, it is a great feather in the cap of the mummers, the long-haired authors, the painted ladies and so on. It is good to know that our works and our wares are appreciated so much. I am glad that so much emphasis has been laid on the theatre, my enthusiasm for which, I believe, is shared by the Minister. I do not care how far the synthetic glories of the radio and the films are developed. They may go on until we have a television set in every bathroom and we can smell the perfume of the beautiful blonde upon the screen, but I swear that even then there will never be such a thrill as the sound of a great orchestra tuning up in the sight of the citizens before a great concert, or, better still perhaps, the lights going down in the theatre as the band begins before the lowered curtain, and there sit the people, socially gathered together—it is the most sociable and civilised of all public entertainment—to hear the speech of living actors in all the plays of the world, while behind in the long corridors is heard that ancient, historic and exciting cry, "Curtain up!" If the right hon. Gentleman can indeed find means of communicating that thrill to thousands of citizens who have never known it, I think that his name may be a thousand times blessed.

5.20 p.m.

Mr. Asterley Jones (Hitchin)

I trust that the hon. Member for Oxford University (Sir A. Herbert) will forgive me if I (10 not follow him in his research into this Clause. I must confess that at times during his speech I was doubtful whether he was for us or against us. I was glad to note from its closing stages that he is a notable convert to the principles of municipal trading generally, if he will forgive the use of the word "trading," and that he will accompany us into the Division Lobby tonight in support of the Bill.

I was disappointed that the right hon. and gallant Member for the Scottish Universities (Lieut.-Colonel Elliot) again brought forward the argument, which has been used on a number of occasions during the discussion of this Bill, that the Minister is somehow taking away from local authorities the general Exchequer contribution which was given to them in 1929 in order to compensate them for the loss incurred by derating. It is true that in 1929 local authorities as a whole incurred losses by derating. It is also true that in 1929 a part of the general Exchequer contribution established by the 1929 Act was to compensate local authorities as a whole for losses incurred by derating.

What the 1929 Act did not do was to apportion that grant in order to compensate individual authorities for their losses. What is even more important is that it did not make provision for prospective losses caused by derating taking place in the intervening period since 1929. While I do not believe that the Bill goes all the way towards curing that, it goes some of the way, because these authorities, which at the moment may regard themselves as losers owing to the operation of derating will receive equalisation grants. Clearly, one of the elements that will make an authority entitled to an equilisation grant is the fact that its rateable value is depressed to some extent by the presence in its area of industrial hereditaments which are derated.

As other hon. Members have said, the Bill as a whole is worthy of a Third Reading. I draw attention to one blemish. I do not say that there are not others, because it is the easiest thing in the world to find blemishes in any Bill. There is, however, one blemish which stands out. The Minister has said that it is necessary to find some new method of valuation of small dwellinghouses. I think we all agree with that statement. It does not very much matter what method we use to value dwelling houses or hereditaments generally, provided it is a uniform method and applies equitably over the whole field. The real point is to have a proper standard of valuation, and, starting from that standard, to apply it over the whole field of properties which have to be valued.

It is suggested by many persons that we should retain the system of valuing by reference to the hypothetical tenant. As the Minister has said the hypothetical tenant is a somewhat elusive person. The Minister has been criticised for putting in the Bill a provision whereby these small dwellinghouses, instead of being valued by reference to the hypothetical tenant, are to be valued by reference to the hypothetical builder. I believe that is an improvement. Whereas, the hypothetical tenant is an elusive person, the hypothetical builder is not quite so elusive, because it is possible by tracing back records of not very long ago to find something definite which will enable the valuers under the Bill to arrive at a reasonable conclusion.

Not only does the hypothetical 1938 cost of construction enter into the valuation of these small dwellinghouses, but the site also has to be taken into consideration, and here, I believe, the Minister has made a very great mistake. I repeat that I do not believe that it is necessary to have a perfect method of valuation, so long as it is a uniform method; but the Minister has contrived to draw a distinction between two different types of houses which should be valued in precisely the same way. He says that the local authority dwellinghouse shall be valued according to the hypothetical 1938 cost of construction—we do not quarrel with that—and also by reference to the hypothetical 1938 cost of the site. When it comes to non-local authority dwelling houses, he says that they shall be valued by reference to the hypothetical 1938 cost of construction—we do not quarrel with that—but that they shall also be valued by reference to the present-day value of the site. The Minister argues that he cannot value the owner-occupied house by reference to the hypothetical 1938 value of the site because of the difficulty of finding any accurate information as to what was the hypothetical 1938 value of the site.

I have no doubt that he is right. I can see his point that it is impossible to value the site of an owner-occupied house by reference to the 1938 value, but what is to stop him valuing local authority sites by reference to their present value? He would thereby bring the local authority house into line with the owner-occupied house instead of bringing the owner-occupier into line with the local authority so far as site valuation is concerned. So far as I can see, there is nothing to stop that being done. If it is possible to use the present site valuation for the owner-occupied house, it must be possible to use the present site valuation for the council house. I suggest to him that he would find it much easier than it would otherwise be to value the site of a council house on that basis.

The Bill contains a number of provisions which the Minister must take into account when finding out what was the hypothetical 1938 site cost. Clause 77 introduces a number of provisions all of which will, in my view, be very difficult to apply. If it were the case that all local authority sites were actually purchased in 1938, there would be no difficulty, but they were not. Many local authority sites were purchased at all times between 1919 and 1939. Therefore, the Minister will be in precisely the same difficulty as with the owner-occupied house in trying to find out how the value has changed between the date when the site was purchased and the relevant date in 1938.

In other words, in valuing the site of the local authority dwelling house as it was in 1938 he will be adding to his difficulty. In valuing the house, he will have to find the hypothetical builder. In valuing the site of the house, he will have to find the hypothetical speculator. In place of the hypothetical tenant, whom we are now abolishing, though not entirely to the outer darkness, because he still lingers around this Bill, the Minister is introducing the hypothetical builder and the hypothetical speculator. Therefore, on purely practical grounds I suggest that the Minister would do well to secure that, in another place, an Amendment is introduced into the Bill to put the valuation of the sites of council houses on a par with the valuation of the sites of owner-occupied houses.

In his speech the Minister said that his object was to leave no one with a sense of grievance. I am sure that he intends that. However, the Bill as it stands, if carried into law, will leave a large number of people with a sense of grievance, because the owner-occupier is bound, not unnaturally, to say, "I am being treated in some ways differently from the tenant of a council house." When there is such an easy way for the Minister to deal at one and the same time with the practical difficulties of valuation and the sense of grievance which exists in the minds of owner-occupiers, I suggest he should make use of it, and I hope that he will not hesitate to introduce in another place the necessary simple Amendment to achieve that end.

5.33 p.m.

Mr. Sidney Marshall (Sutton and Cheam)

This would have been a great Bill if the Minister had not been so much obsessed with the idea of getting it through during the lifetime of the present Government, and because of that, missing out of the Bill a great deal which should have been in it. There will not be gratification among local authorities in this country, who have for several years past been at great pains to improve the standard of assessment throughout their areas, and have now produced a very high and level standard of assessment. Those backward authorities who took no such steps will, of course, be very gratified at the benefits they are now to receive under this new system of Exchequer grants.

This means, of course, that the well-managed and well-run counties will now lose any possible benefits which should come to them in some grants from the Exchequer, for they will lose their grants as a result of these contributions to more backward authorities, who will receive larger grants. Consequently, the Bill will not be received with the gratification which the Minister expects. I hope the right hon. Gentleman will listen sympathetically to the point made by the hon. Member for Heston and Isleworth (Mr. W. R. Williams) with regard to the appeal. My colleagues on this side of the House wish the Minister to give some attention to it because the hardship, which may conceivably fall upon the ratepayer in making the appeal through having to pay the expenses, might be very considerable. He should be relieved from any such contingency.

The Clause in the Bill which seeks to simplify and make more equitable the rating and valuation of smaller houses will in many cases act very harshly on occupiers. Years ago when I was on a local authority the only method of assessment we had was to go round and look at the property. We would estimate fairly well what it contained. We knew how many rooms were in it and what amenities it had. We recognised the site on which it was and we realised, of course, the real rateable value as between ratepayer and ratepayer and between house and house. In a rough and ready fashion we always arrived at a fairly accurate estimate. I cannot think that the Minister under the complicated formula which he is introducing will achieve anything near so accurate an assessment as we did under that rough and ready rule of thumb. I feel sure that the occupiers of these smaller dwellings will not benefit in any measure by the system which he is adopting.

The only other Clause with which I want to deal is 131, with which I dealt on the Recommittal stage. I do not want to reiterate any arguments I used then, but the Minister himself has introduced an entirely new argument today in justifying this Clause. He said that we are now to have in local government an entirely new set of people. No longer are we to have people interested purely in the mechanics of local government, but what connection the theatre, public entertainments and suchlike things may have with producing a new set of local government people I fail to see. I am quite sure the Minister does not suggest for one moment that the people who have borne the burden and heat of the clay for many years are unenlightened and, because of that, backward and living in a darkness, and that he will bring light and understanding now to these local government people by providing them with entertainment which can be subsidised out of the rates.

The junior Burgess for Oxford University (Sir A. Herbert) threw rather a new light on that aspect of the question as did the hon. Member for Ashford (Mr. E. P. Smith). The hon. Member for Ashford desired this Clause, mainly because he thought it was a new subsidy to be given to dramatists; therefore, the producers of one-act plays and suchlike people, who have hitherto been unable to get their plays produced anywhere by any of the so-called commercial concerns, will now have a hope, because they will be able to palm these plays off on any local authority who will produce them out of the rates they will be able to levy. The junior Burgess for Oxford University remarked that he did not think that was a reason why he could commend this Clause; but he rather argued from the point of view of the professional producer, who naturally does not want to see competition from municipal subsidised efforts in the entertainment world. I sympathise with him there and I think he is quite right.

On the other hand, I could not quite follow him when he said that he rather rejoiced that the "mammas" and painted ladies were now to receive recognition out of the rates. I am still adamant in regard to my opposition to Clause 131. There are many blemishes in the Bill, and why on earth the Minister should go out of his way to introduce into a local government Measure opportunities for local authorities to spend rates upon such things as entertainment, I utterly fail to see. It cannot be said that because of the opportunities they will have to study the drama or to go to more cinemas or to take other interest in entertainments, they will become better local government members. I cannot see where any benefit will come to the sparsely populated areas by getting more entertainment because the rural or district council can now provide cinema entertainment in such areas. I do not think those people have suffered in the past because they have not been able to go to the cinema. I am sure that their minds are no more backward and no more unenlightened than those of people in the urban areas who have cinemas at their back doors. In many instances, they are probably better off because they have not been contaminated by many of the pictures now presented in cinemas.

Therefore, I believe that in making provision for local authorities to spend up to a 6d. rate on these rather questionable forms of entertainment, the Minister is doing no service to the people of this country. This Clause will go through today, but I hope it will be many years before it is implemented. It is quite possible that, as in the case of one or two other Clauses, opportunities for amendment may come if not in the lifetime of this Government, in the lifetime of another Government which will be even more enlightened as to the way in which local rates should be spent. I fail to understand why the Minister gets support from his own colleagues. At one time the very mention of a penny being put on the rates for any purpose whatever caused people to hold up their hands in holy horror. Today, a suggestion that we should put shillings on the rates is received with acclamation by the Minister's colleagues. I cannot, for the life of me, understand why that is so. Undoubtedly the Bill will receive the blessing of his own colleagues tonight. The Opposition must vote against it. I hope that we shall have in our minds the reservation that the many blemishes which the Bill contains may eventually be remedied when the opportunity arises.

5.43 p.m.

Mr. Eric Fletcher (Islington, East)

It seems to me that some hon. Members opposite who have announced their intention of going into the Lobby against the Third Reading of this Bill are very lukewarm in their opposition. No wonder. In the years to come this Bill will be regarded, as the Minister said, as in the succession of great Measures of local government reform starting from the Municipal Corporations Act, 1835, and including a number of other similar great Measures which are necessary periodically to bring our whole law and conception of local government up to date in accordance with the changing requirements of the times.

I did not have the good fortune to be a Member of either Standing Committee B or the Scottish Grand Committee and, therefore, have not had the opportunity to follow in any detail the career of this Bill through its Committee stage, but I notice that a number of substantial changes have been made, all, it seems to me, by way of improvement, and I have heard nothing from the benches opposite which alters my opinion, expressed on the Second Reading stage, that this is a bold and imaginative Bill which will be welcomed by both local authorities and ratepayers alike.

Not having followed the Committee stage in detail, I can only speak for a few moments on the main principles of the Bill, which, after all, is really the object in this House of the Third Reading Debate. What does the Bill do? Let us note that although the Opposition are going to divide against it, it is quite obvious from their speeches that they have no quarrel with a great many of the principles contained in this Bill. First of all, the Bill provides immediate relief to ratepayers of £39 million—

Mr. S. Marshall

Some ratepayers.

Mr. E. Fletcher

All ratepayers will get a direct benefit and relief as a result of this Bill—

Mr. S. Marshall

No.

Mr. E. Fletcher

Yes, subject only to one qualification, which may be important. As the Minister pointed out, the first fruits of this Bill are already apparent. A number of municipalities have announced their intention of reducing rates for the next half year. But as the article in today's "Daily Herald," which the right hon. and gallant Gentleman the Member for the Scottish Universities (Lieut.-Colonel Elliot) quoted, pointed out, most municipalities do not announce their rates till the early days of March when we shall find that a great many other municipalities will also be announcing further reductions.

It is very much to be hoped that the benefits of these rate reductions will be passed on to all tenants who are entitled to have them. I mention that for this reason. There are in this country a great many tenants of properties which are governed by the Rent Restriction Acts. Under those Acts the landlord is entitled to put up the rent to a tenant protected by those Acts by an equivalent amount when the rates go up. Most landlords have taken advantage of that provision. On the other hand, when rates come down, tenants who are paying an inclusive rent, will be entitled to have their rent reduced by a corresponding amount. A great many tenants, particularly in parts of London with which I am familiar and, I have no doubt, in other parts of the country, suffer from the fact that the standard rent and the statutory requirements are not written by their landlords in their rent books. I come across a good many tenants who do not know how much out of the total inclusive rent they pay is in respect of basic rent and how much in respect of rates. It is to be hoped that when this Bill becomes operative, as it will very soon, all those tenants who are protected by the Rents Acts will take advantage of this provision and see that their rents are reduced by the amount of rate reduction in their locality.

Another aspect of the matter, which I gather is not challenged by the Opposition although they will vote against the Third Reading, is the provision for the reimbursement to members of local authorities of allowances for travelling and subsistence expenses, as recommended by the Lindsay Committee. That introduces an improvement into our local government law which is long overdue, and the credit for it goes entirely to the Government. For a long time some members of local authorities have suffered considerable hardship and have made considerable sacrifices through being out of pocket as a result of losing time and wages and incurring travelling expenses which they could ill afford while performing their civic duties as members of local authorities. The House will agree with the Minister that this long overdue reform will remove a hardship and will throw open to an ever widening circle of men and women the possibilities and opportunities of rendering service of this kind to the community.

The provisions in the Bill which have been most criticised are those relating to the Exchequer grants, but I did not understand the right hon. and gallant Gentleman or any hon. Members opposite really to defend the existing system under the block grant, with all its anomalies. It is quite easy to criticise any Exchequer grant on points of detail, but I think everyone will agree that the system adopted in this Bill is an immense improvement on the present complicated, anomalous, unjust and inequitable system. In fact, the real gravamen of the attack which the right hon. and gallant Gentleman made was that some of the richer authorities would not get much benefit under the new scheme.

Mr. S. Marshall

It is perfectly true; it is the poor ones.

Mr. Fletcher

All the poor ones will benefit because, as the Minister has pointed out over and over again, the effect of the Bill is to make the Government a ratepayer in all municipal authorities with the exception of a very few of the richer authorities.

Mr. Turton (Thirsk and Malton)

Will the hon. Member explain to the Committee what advantage in the way of Exchequer equalisation grants Bradford will get out of this Bill?

Mr. Fletcher

I do not propose to deal with the case of Bradford or any other place of which I do not know the details. I sit for a London constituency, and though London does not benefit conspicuously under the Bill, I support it because of its inherent fairness. Hon. Members who represent Bradford will be able to deal with the case of Bradford.

To return to the principles of the Bill, the Bill was criticised on Second Reading on the ground that it took certain powers away from local authorities and thereby reduced their efficiency and independence. Since then, we have had that notable addition to the Bill, of the new Clause 131 enabling local authorities to provide entertainments of any nature. I welcome that provision for two reasons. We owe a great deal in this country to the efficiency and to the purity of local government, but the success of local government depends on its ability continuously to adapt itself to the changing requirements of the times. Local government cannot be static either in its functions or its boundaries. As the social conscience of the community is improved, and as in matters like health, education and housing, the central Government lays down certain minimum standards, it is inevitable that there should be a closer co-operation between the central Government in Whitehall and local authorities. The corollary of that must be, not complete control from Whitehall, but some degree of control to ensure that the more backward authorities will fulfil minimum standards. However, while there cannot be complete independence in what are matters of national concern it is encouraging to find that fresh fields of activity are opening up to local authorities. It is esssential that local authorities should always be able to feel that they have a stimulus to local incentive and enterprise, and that local government remains a dynamic system of rendering service.

Thus, it is my belief that Clause 131 gives local authorities scope for pioneering efforts and enables them to fulfil a widely felt need amongst the community today for more local cultural assistance. I think we shall find that, by reason of this new provision, local authorities will not only be able to buy or build halls or theatres, but will be able to extend their library service, and their museum service; they will be able to encourage artistic, sculptural, musical and other cultural activities in their areas—objects which may not necessarily at the outset be paying propositions, but which need encouragement and fostering, and which can be developed by local authorities having the means to make a modest rate contribution for those purposes. In London during the war, as the Holidays at Home campaign developed, we found that there was a considerable demand for municipally-provided entertainment of various kinds; for artistic, athletic and other kinds of entertainment in the parks of London. It is in that sphere that there are all kinds of possibilities which can be developed by local authorities on lines particularly appropriate to them, because they alone are the judges of the local tastes and interests.

In conclusion, may I say that I am sure that hon. Members opposite who vote against this Bill tonight will in time to come regret the part they have played, and will regret that they have opposed instead of participating in the passing of a Measure which will be regarded as a milestone in the road of local government progress.

5.56 p.m.

Commander Galbraith (Glasgow, Pollok)

The hon. Member for East Islington (Mr. E. Fletcher) seems to be in some doubt why the Opposition intends to divide against the Bill tonight. He is perfectly right when he says that we are in agreement with many parts of the Bill which we consider to be an improvement on the present state of affairs, but the primary object of this Bill, as I understand it, is to equalise the rating burden throughout the United Kingdom, and we intend to divide against the Bill because we do not think that it achieves its main purpose. In England and Wales the Bill sets up a uniform valuation system for these two countries, but it leaves the existing valuation system in Scotland still operating. So in the Bill we have a continuation of two different systems of valuation in different parts of the United Kingdom, both parts of which are covered by the Bill. In these circumstances I think there will be great difficulty in obtaining equalisation or uniformity of the rating value, and it is my contention that that equalisation will not be obtained.

For many years now the system of rating existing in Scotland has been under heavy fire. It has been criticised from every side, and I should have thought that any Government dealing with local government reform would have dealt with the whole subject in a comprehensive manner. However, the Government have not taken that course and, as a result, we have had produced for us a piece of patchwork legislation which does not give us a uniform system that would have given justice to ratepayers and to local authorities no matter whether they were situated in the Northern counties of Scotland, or in the valleys of Wales or in the more hospitable regions of the South of England. We get nothing of the kind and, from the Scottish point of view, we find the Bill very disappointing. There is a general feeling that the Bill does not give justice, and that the Secretary of State has allowed to slip through his fingers an opportunity of reshaping a rating system which is not in accordance with modern conditions and which makes little pretence at distributing the rating burden equitably all over the country. It seems to me—I hope I may be wrong—as though the right hon. Gentleman had allowed himself to be dragged at the chariot wheels of that impetuous personality, the Minister of Health.

It is becoming almost universal in this Parliament to assume that when any Scottish Member rises in his place he does it for the purpose of begging some extra financial assistance for Scotland. I want to assure you, Mr. Deputy Speaker, that such is not my purpose this evening. What I want to be assured of is that there is a fair deal between the two countries. Until the two peoples are assured that that position of fairness has been reached, so long will they feel that one is doing better than the other, and that everything ultimately depends upon the personality of the Ministers concerned and their powers of persuasion. That is an unhealthy situation which ought to be remedied.

When the Government decided to retain two separate valuation systems, they got themselves into a dilemma. They recognised quite clearly that rating valuations in Scotland are much higher than they are in England, and they were in a difficulty as to the basis they should choose to make things level. They have chosen as their basis the average rateable value per head of population in England and Wales, with 25 per cent. added for Scotland. I have never yet heard any real justification for that 25 per cent. It may be correct, or it may be too high, or too low, but I think the House require some justification for that figure. We want to be assured that it gives equal justice. We in Scotland do not want anything more than that, but we are not prepared to accept anything less. I should have imagined that before the figure was adopted, as it is a figure of such great importance to local authorities in England as well as in Scotland, that there would have been a thorough fact-finding inquiry, but, so far as I know, no such inquiry has taken place. As a result there is a divergence of opinion between local authorities and the Secretary of State; I do not think there is any wonder that such a divergence of opinion exists.

The figure of 25 per cent. was taken out of legislation passed by this House when conditions were quite different from those which exist today. I believe the Secretary of State is prepared to defend the figure of 25 per cent. and I would like to know his grounds, because, as far as I can ascertain, the expert opinion of 95 per cent. of Scottish assessors puts the figure at 65 per cent., not 25 per cent. It may be that he can produce other experts who would place it below 25 per cent. There is cause to wonder on what grounds the right hon. Gentleman accepted the 25 per cent. figure without a very full inquiry into all the relevant factors.

This is a United Kingdom Bill, which aims at putting Scottish local authorities into more or less the same position as English local authorities. We ask for nothing more nor less than that, but we have very grave doubts whether that is being achieved by this Bill. The doubts are genuine, and are based on figures. I suppose the two most comparable cities in England and Scotland are Glasgow and Birmingham. Their populations are more or less the same—there is a matter of 60,000 between them in over one million—and both are industrial cities. Yet we find that the rateable value of Glasgow is £11,500,000 against £7,500,000 for Birmingham. If we had anything like a comparable system of valuation it could never be contended that that difference could exist. Between the figures there is no, relationship to 25 per cent.; the actual relationship is 53 per cent. The outcome is that Birmingham, which throughout the years of depression, in the 1930's, was an exceedingly prosperous city, receives an equalisation grant of £611,000, and Glasgow, which during those same years was the centre of one of the most depressed areas of the country, is to receive nothing at all. Indeed, at the same time it is having withdrawn from it the Exchequer grant which contained an element of de-rating and which amounts to £950,000.

It is no good the hon. Member for East Islington telling us that it does not matter. He had better not go to Glasgow and repeat that statement there, and the same could be said of the hon. Member for Hitchin (Mr. Asterley Jones). No matter what the Government may say, this House requires a far fuller explanation than has yet been received, and that indeed is demanded by the corporation of Glasgow which, let us not forget, is still controlled by a Socialist majority.

Mr. MeKinlay (Dumbartonshire)

Hear, hear.

Commander Galbraith

That may not be for long, and the hon. Member for Dumbartonshire (Mr. McKinlay) had better not take too much to himself in that matter.

Mr. MeKinlay

It has been so since 1933.

Commander Galbraith

The Minister had said that the average reduction of rates was going to be 3s. 4d. I am told that the figure of 4s. which appears in the White Paper as the reduction in Glasgow will not be 4s. in 1948–49, but is likely to be less; not more than half that amount.

I wish to give another example of the extraordinary way in which the Bill works out. Wales has a population of just half the size of the population in Scotland. Both proportionately suffered an equal measure of sacrifice in the trade depression of the 1930's. Yet the population of Wales is to receive 600,000 more in equalisation grant than the population of Scotland, which is twice as large. I am not for a moment suggesting that Wales is getting too much, but the very fact that a population twice as large is getting less by way of equalisation grant demands that the whole matter should receive much fuller consideration than has yet been given to it.

An allusion has already been made to the fact that this Bill has been rushed, and rushed far too much. The right hon. Gentleman gave reasons for that, but I do not accept those reasons. The Bill could have been put through properly. It is an ill-considered and ill-planned Measure. Instead of being subject to Government inquiry and planning such as the Government pride themselves upon, it has been subject to rule of thumb methods, and those rule of thumb methods happen to be out of date. In Scotland and other parts of the United Kingdom we are not satisfied.

In regard to Scotland the right hon. Gentleman has the means available to dispel the doubts which I have expressed. In Clause 30 he has power to investigate the workings of the Measure in consultation with the associations of local authorities, and with any particular local authority he may choose. I suggest that he should have the date altered in Clause 30, and expedite the investigation, because I do not think Scotland has any reason to fear an investigation. In fact, I think it ought to welcome the fullest and widest investigation, not only into this aspect, but into the circumstances of every Government grant which goes to local authorities. I feel sure it will not be found that Scotland is getting anything in excess of what Scotland needs.

I wish to deal with the effect which this Bill will have on promises which were so solemnly given during the passage of the Hydro-Electric Development (Scotland) Act. Let me remind the Secretary of State that those local authorities which were frightened that their amenities would be destroyed were assured that anything they might lose would be more than made up for by the additional rating value which would come into their areas by the establishment of power stations and other works by the North of Scotland Hydro-Electric Board. It seems to me that these promises have now been dishonoured, that the Bill removes that compensation, because the sum which is to be paid in lieu of rates by the North of Scotland Board is now to be spread over the whole of their area, and will not be in any way confined to those particular localities where works are in course of being erected. I would like the right hon. Gentleman to be sure in his own mind whether or not those promises have been broken.

Will the right hon. Gentleman be good enough, when he replies, to deal with these matters? I would like him in particular to tell us if he can justify or defend the figure of 25 per cent. I hope that in any case he will see that an inquiry into the whole situation is shortly undertaken, because it is necessary for it to be proved for the benefit of every part of the United Kingdom that neither Scotland nor any other part of the United Kingdom is getting an advantage over some other part.

6.11 p.m.

Mr. McKinlay (Dumbartonshire)

I wish, in a word or two, to say "Amen" to one of two things which have been said from the Front Bench on the other side of the House. I do not for one moment wish to say that the Opposition are not themselves at least somewhat to to blame for the losses being incurred by industrial local authorities. The 900,000 referred to by the hon. and gallant Member for Pollok (Commander Galbraith) is the residuum of the Derating Act which was passed by the party opposite.

I do feel that in connection with hydro-electricity I was "sold a pup" in the last Parliament. There was a time when hon. Members of this House were tired of hearing the words "Loch Sloy" mentioned. I wish to be a little reminiscent in connection with this subject; I think it warrants it. I had a Motion of the Order Paper to annul the Loch Sloy development, a project which is in my constituency. An amicable arrangement was arrived at behind Mr. Speaker's Chair, whereby the county of Dumbarton would get the best of the bargain, but it appears that the pop I got on that occasion was somewhat mangy. Of course, one Parliament cannot bind another, but I recall the drama that took place that night, when by arrangement I was not in the Chamber when the Motion was to be called, and the Minister was here with all his papers, after having left me only ten minutes previously. But a part of that arrangement was that the county of Dumbarton was at least to benefit to the extent of almost the equivalent of a 5½d. rate.

I agree that one could not anticipate exactly just what has happened. I repeat that we in this Parliament cannot bind the next Parliament any more than the last Parliament could lay down what was to happen in this one. It should be remembered, however, that if this Bill had been postponed for another 18 months the benefits of the equivalent of almost a 5½d. rate would have been in operation. But the Loch Sloy scheme is not in operation. It has been said to me that we are to get a benefit even better than that. I remember that hon. Gentlemen opposite told us about derating, "It is nothing to what you will get. The benefits of this will not be known for a number of years. It will rescue industry by taking away the burden of rates." At that time most of us were rescued from the workhouse, on and off.

I ask my right hon. Friend whether any provision has been made to take this potential loss into consideration. I am satisfied that those responsible for the formula in connection with this scheme can prove to the satisfaction of everybody that all the local authorities are coming out of this business on the wings of happiness. I want an explanation of why it was necessary to pool the rates from the hydroelectric undertaking and postpone the putting of the colliery rates in the pool. I do not see why this ungodly rush has taken place in relation to hydro-electric development. The chairman of the Hydro-Electric Board, who is not unknown in this House, while not criticising in the least what the Government are doing in connection with this Bill, says "You have taken away a valuable bargaining counter from the Hydro-Electric Board in their dealings with local authorities." It may be that the Board will not now require to negotiate with local authorities. They may be armed with authority to go in and do what they want to do without even discussing it with the local authority. It will take a long time to convince me that this 5½d. rate which we are losing in the county of Dumbarton is really something which is to bring us better benefits in the future. I do not for one moment believe that.

To leave the county of Dumbarton and revert to Glasgow, I feel sore about this equalisation grant of almost £600,000 to Birmingham. It would appear to me that the more highly developed the social services are in a place like Glasgow as compared with Birmingham, and the greater the assets an authority has to hand over, the less it gets. Think of the potential loss to Glasgow's rates from their undertakings, which are being transferred to the State—and we are not opposing the transfer of the undertakings. Again, I will take a lot of convincing about the benefit to Glasgow of taking the railway rates away from Glasgow, the rates of the gas and electricity undertakings, and throwing them into a common pool, and distributing favours over the whole of Scotland, in areas which are not even put to the inconvenience of having huge railway termini in their midst with their smoke, dust, disease and the grime they cause—to take from Glasgow and say to Rothesay "Your big brothers in Glasgow have provided a substantial fund out of which you will get a good portion."

I have one suspicion about this Bill. First, the local authority associations all dived into funk holes. The immediate benefit they are to get has chloroformed them, and instead of being a house united they have in the last fortnight become a house divided. Every local authority which sent representations to Scottish Members of Parliament asking them to get this matter rectified has, with the exception of Glasgow, taken cover. Why? Simply because in the technique pursued in the Special Housing Association in the building of houses in the built-up areas there would be no cost to the ratepayer. The local authorities were divided upon it and they were conquered.

My worst suspicions are roused because there have been no complaints from Edinburgh. The City Chamberlain in Edinburgh is satisfied that Edinburgh is getting a good bargain, even at the expense of Glasgow. That has happened before. There is not a murmur from the lowest rated city with the highest valuation in Scotland. They are quite happy. Despite the good things contained in the Bill, if Edinburgh is happy then I am dissatisfied. I do not say that because of my Glasgow patriotism. I am always suspicious when anything with a financial arrangement pleases Edinburgh. Other local authorities in Scotland can look out. They are getting the sticky end of the stick.

I would ask my right hon. Friend to do me a favour, and to do a favour to all the local authorities which have hydro-electric undertakings in their areas. Please reveal the magic formula and tell us how they are going to benefit by the diversion of a very substantial rate to be thrown into a common pool, and how, by that method, they are going to benefit much more in the future than they would have done had they received an immediate benefit. I would rather have the 5½d. rate in the bag first of all, and then proceed to discuss the benefits to come afterwards. I see that the Parliamentary Secretary to the Ministry of Health is laughing. I do not know whether he would laugh so cheerily if I were speaking on behalf of the poor English ratepayers. He sees the logic in my argument. I would rather have seen that 5½d. rate on the credit side of our ledger, and then we could have discussed the future on an equal footing.

I am quite sure that the Secretary of State for Scotland will be able to convince all the Scottish Members on this side of the House. I do not suppose that he will ever convince the Scottish Members on the other side. He will do his best to convince those of us on this side of the House who have a sense of grievance. This problem would have been simplified if we had started off by dealing with things which were equal. We start off with things which are not equal. I am referring to the valuation methods and the rating systems of the two countries. The rating system in Scotland, with its rate upon rate and its anomalies, is, I quite agree, a preposterous system. Hon. Members on the other side of the House have had ample opportunity to rectify it and have never taken any steps to do so. This would have been an opportunity, at least, to try to start off with an equal method of rating and valuation, but apparently that is postponed to a later date—

Mr. Speaker

We have to discuss what is in the Bill and not what one would like to see in the Bill or how one would have wished to see the Bill started.

Mr. McKinlay

I am very sorry, Mr. Speaker; I did not notice you come in. I must not transgress; I must not defy the Chair. I was merely working up to a rather indifferent peroration, and I hope you will forgive me. I am sure that tonight, at least, the Secretary of State for Scotland will explain to us the mysterious things about which I have been seeking information.

6.25 p.m.

Colonel Wheatley (Dorset, Eastern)

I am sorry that the hon. Member for East Islington (Mr. E. Fletcher) is not in his place. He commented on what he called the lukewarmness of the Opposition in opposing this Bill. I should like to explain to him that it is probably due to a great and grievous disappointment with this Bill which we have been looking forward to with much eagerness. All the local authorities have been looking forward to it, and now they find many blemishes in it. Many hon. Members on his own side of the House have pointed out blemishes which are still in the Bill, though it has been through al] the various stages. There is, in particular, the blemish referred to by the hon. Member for Hitchin (Mr. Asterley Jones) with which I entirely agree. There will be a great grievance felt by all the owner-occupiers over the discrimination in the valuation of their property. I wish the hon. Member for East Islington could have been here. He would have realised why we find that, although we want a new Bill to deal with these subjects of re-valuation and the change in the block grant, we are unable to support this Bill, and must vote against it.

Local authorities all over the country are very dissatisfied owing to the many blemishes that are to be found in the Bill. They see no reason why the present system of valuation should be done away with and a sort of super-department brought in, at a greater cost to the country, and with a greater use of manpower. We can be perfectly certain that the new department will not be satisfied to carry out the work now done by a clerk to the local assessment committee and a typist. Increased staff will be appointed. The local authorities feel that the present set-up could well have carried out the work, and, owing to their present knowledge—which of course the new staff would not have—would be able to carry out the new valuation in a much shorter period than will be possible under the new system. I entirely agree with them.

I listened to the logic of the Minister and his argument was very clever. Although I went with him for a considerable way, I am not convinced that he has the right solution of the difficulty. I do not think he has convinced himself. He has stressed continually, both upstairs and again this afternoon, the complicated difficulties to be overcome in the new system of valuation. He has continually stressed that point, and I sympathise with him. Hon. Members opposite have twitted us on this side of the House on the ground that we have not dealt with this matter before. This is a thing which has grown by degrees. It is now the turn of hon. Gentlemen opposite to try to find a solution. They are finding it extremely difficult to discover a solution which satisfies everyone. This Bill certainly does not satisfy everyone on their own benches. I think that hon. Members opposite will realise that some local authorities are not as happy as the Minister appears to be about this Bill.

I should particularly like to mention the question of sparsity. The population in an area is not usually evenly distributed. We may have a county which has a large part of its population, possibly a quarter or even a third, concentrated in one large town. That means that the rest of the area is extremely sparsely populated. I really do not know how the Minister arrived at his figure of 70 for sparsity weighting. He has never told us. In fact, he has refused to give us any figures. In the Local Government Act, 1929, the figure was 200. In the Act of 1937, the figure was 300. It is very difficult to understand, without any explanation from the Minister, why he has fixed on the figure of 70. This will hit a good many areas in England. In fact, I think it will only help to any degree certain counties in Wales. One can understand why the Minister is pleased with that—not that I accuse him for one moment of doing it on purpose. There are very few, if any, counties in England which will benefit by the sparsity figure of 70. Many of them will lose.

Clause II is another provision which local authorities, particularly rural districts, do not like. They cannot understand why, when boundaries are altered, a burden payment should not be paid. It is all very well for the Minister always to give the answer that this will all be smoothed out by the equalisation grant; but those local authorities which are losing their burden payment do not like it. Those authorities which do not get any equalisation grant at all will be in exactly the same position as they are in today. They will lose very heavily.

Another blemish relates to local authorities which have electricity power stations in their areas. It is all very well for the Minister to say, "Why should these authorities which have power stations in their areas get all the benefits?" He asks why should not the other areas, which may not have the good fortune, as he called it, of having power stations paying heavy rates, receive some benefit when they use as much electricity as the others? But what about all the amenities that are spoiled in the area of these huge power stations, many of which are very ugly? Are the local authorities to have no benefit because of that? They would much sooner have seen a different way of dealing with this matter. However, I am afraid that Mr. Speaker will call me to Order if I suggest ways and means in which we could have got round that position without upsetting the local authorities who must put up with having these vast power stations in their areas.

Finally, I would like to stress one important reason why I do not like this Bill. This Measure deals mainly with revaluation and changes in the block grant system. That, surely, is enough for one Bill. I wish that we could have discussed the matter at much greater length. Throughout the Committee stage, the Minister was hurrying us along all the time. We heard him explain this afternoon why he asked us to hurry and to shorten our discussions on this complicated Measure. His reasons are sound; but why was not this Bill brought in earlier in order to allow more time? It would appear that the Minister of Health is very low down on the priority list of the Chief Whip or the Lord President of the Council, or this Bill would have been brought forward earlier. If we had been allowed more time in which to discuss these provisions, I am certain that we should have improved the Measure out of all knowledge, and that the Minister and hon. Members opposite might well have been proud of a Bill which would really overcome the difficulties. Instead of that, all sorts of minor and extraneous items have been included in this Bill. Many of them might have been dealt with in private Bills. They certainly hold no place in a vastly important Measure dealing with these great and all-important local government and re-valuation problems.

6.37 p.m.

Mr. Carmichael (Glasgow, Bridgeton)

I want to make two points which have been stressed already, but which I think will bear repetition. I support the contention of some Scottish Members against the method of valuation. If this is a United Kingdom Bill, then I say that a very strong case is made out for a complete overhaul of the rating system and the method of valuation. The position of the City of Birmingham in relation to the City of Glasgow has been mentioned. I do not ask for any special advantage for the City of Glasgow, but if this is a United Kingdom Bill, if the desire of the Government is to deal equitably with every authority in the country, and to approach this problem from the point of view of the ratepayers, then we ought to be able to examine the position of Birmingham and Glasgow without difficulty. I suggest to the Secretary of State that it is impossible to indicate clearly the relationship in valuation between Glasgow and Birmingham. I should have thought that if this was an attempt at equalisation, we ought to have known the relative merits of the claims of these cities. One could extend that argument to other fields.

For many years we have been dissatisfied with the rating system in Scotland. One need not go into detail. It has been the constant complaint of every authority that the system of rating was very bad indeed. All the existing authorities in Scotland have expressed dissatisfaction with the method of grants under this Bill. It is quite true, as the hon. Member for Dumbartonshire (Mr. McKinlay) said, that Glasgow is the only authority which has continued to present its case up to the last minute, but I make this prediction. I am thoroughly satisfied that, after the Measure has been in operation for some years, there will be required some form of amending legislation to deal more fairly with some of the towns which I think are being unfairly treated at the moment.

Much play has been made over the innovation of paying members for service on local authorities, but in future they will be allowed payment for loss of time, in addition to which there will be a subsistence and a travelling allowance. I am not so sure that this will be the great boon and blessing which many hon. Members think, it will be, because I have experience of what has happened in certain parts of Scotland where allowances were made for lost time. It is extremely difficult in many occupations to define time lost or remuneration lost. Let me give one case—that of the person who is employed wholly on a commission basis. How are we to calculate the loss to a person of that kind? He cannot honestly and sincerely say, like the wage earner, "I have lost a certain sum of money, and, therefore, I want to be paid." I fear that this provision is open to some abuse. In spite of the criticism I have heard against it, I would rather have a flat rate. The answer to that is the retention of the voluntary system.

There seems to be about this matter a feeling of Puritanism which I have never understood, an idea that, if one serves on a local authority and receives a fixed figure, one has lost one's moral feeling for public service; but apparently if one comes to the House of Commons and is permanently paid for it, there is no such loss of the moral conceptions in public service. I feel that, in the big towns, there will be a very serious handicap to persons giving full-time service. It is argued that many people who are denied the right of serving today will have the opportunity to do so under the new legislation. That also is open to question, because it does not follow that, if the local authority has the power to pay, the employers will grant the concession to the persons concerned who wish to serve on the local authorities. In the engineering shops, I can see, not only the employers objecting strongly, but the men's mates in the shops objecting to a special privilege. I do not think the method of payment is a good one or that it offers freedom to every member of the community, if he so desires, to serve on a local authority.

I come to the point about subsistence. What is the position in regard to subsistence? Persons living three miles away from the council's meeting place will get a subsistence allowance. I can see that actually working out so that the only people to get it will be members of the business community who live in the country and have business premises in the cities. I cannot see members of the council of a large city being able to claim it, because of the three-mile limit.

The last point on the question of payment is in connection with provosts and conveners. I gather that the chairman of a district council in England can have such a payment. If the equalisation principle is applied in Scotland, the provost of a borough or the convener of a county council can have a somewhat similar payment, but there is no mention of a lord mayor or mayor, because already the principle is established in England that an allowance may be made to a lord mayor or mayor to carry out his functions. I submit that, if it is sound—and I have no objection to it—to pay a district council chairman in England in order that he may carry out his duties properly, it is equally sound to make a payment to the convener of a county council, and that this principle should be enlarged upon so far as the large towns are concerned.

I will give only one illustration to press home the point. I submit that, with due regard to the powers of county councils in England, the chairman has responsibilities not nearly as exacting as those of the convener of a committee like the housing committee in the City of Glasgow. I ask my right hon. Friend the Secretary of State to look into these points. I ask him to consider whether provosts should be paid or given an allowance to enable them to carry out their duties, and whether the principle should be extended where it is necessary to do so. I hope, however, that it would not be abused. I think my right hon. Friend will agree that it is not an unfair proposition to submit that the convener of a housing committee or of an education committee in a city like Glasgow, both of them men holding responsibilities more exacting than those of the chairman of a county council, should have extended to them the same right to allowances as is given to other people of that kind. If the Secretary of State finds that this is a reasonable proposition, I hope he may find it possible to amend the Bill in another place.

6.47 p.m.

Mr. Turton (Thirsk and Malton)

The most remarkable feature of this Debate has been the change in attitude in the speeches of hon. Members on the other side since the Debate began. It began with the Bill being welcomed as a boon and a blessing, but speech after speech since then has been touching on the injustices inherent in the Bill. I agree with the speeches of the hon. Members for Bridgeton (Mr. Carmichael) and Dumbartonshire (Mr. McKinlay). This Bill has a hard core of injustice; not only does it not remove injustice, but it will work great injustice to very many poor people in this country.

We start off with the present lack of uniformity in rating throughout the country. What has the Minister done to remove that lack of uniformity? It is quite clear that there are some areas where the assessments bear little or no relation to the rents, and, so long as we have a hypothetical tenant, or something like it, the rent is the basis of the value of the house. In other areas, the authorities have scrupulously carried out their responsibilities and have got their assessments up to the 1938 rental values. Since 1938, nothing very much has been done. The Minister, instead of encouraging the weaker authorities to give an example to the stronger, scraps the whole system, and is going to make a great new bureaucracy which will have to value all property in England and Wales. It seems, therefore, that there will be some five years' delay before anything is done to correct that lack of uniformity.

Next, the Minister makes the problem even more difficult because, instead of allowing this great new bureaucracy to work on some known formula, he has created in this Bill four different kinds of values for dwelling-houses, so that the men who are to be thrust into this work will be faced with the difficulty that the lack of uniformity will be greater by reason of whether or not the house was built before 1918, and whether it was built by or for a local authority or private enterprise. The last way in which he tackles this problem is even worse. In working out his block grant system, which is now called the equalisation grant, he has taken as his formula for the block grant the rateable value—not the rateable value as it may be under the new bureaucracy, but the uniform rateable value of the present day. Therefore, an authority like Bradford, which has no claim to richness will not benefit, while an authority which has been careful in keeping its assessments low will be regarded as a poor authority, and a fitting recipient for the Minister's generosity. That seems to me to be the radical injustice of this Bill.

I would like to deal in a little further detail with those three sides to this Bill, and will take first the one I touched on last because it is first in the Bill. It is the question of an equalisation grant. I would say, in passing, that we are in some considerable difficulty over this because, when the Bill was introduced, the Government went to the expense of publishing a White Paper, Command 7253, which purported to show what would be the grant under this Bill. By the end of January, in answer to a Question in this House, the Government showed that not one calculation in the whole of that White Paper was correct. The House will recall that in HANSARD of 29th January we find an entirely new White Paper showing the effect of these equalisation grants. I can make my point on the injustice of the new block grant by taking it down, not in the realm of the big authorities, but to the actual occupier of a house. It is always difficult to point to similar houses, but I can do so by taking the prefab, because, after all, the prefab has the advantage that it is unique and does not vary from area to area.

I have certain figures showing how prefabs are assessed in different parts of England. The prefab in Sheffield is assessed at a rateable value of £10, and the rate which the occupier pays is £6 18s. 4d. a year. In Merthyr Tydfil, the prefab is assessed at only £7, and the rate paid by the occupier is £5 0s. 4d. At Bradford the prefab is again assessed at £10, and the occupier pays a rate of £8 17s. 6d. a year, while, in Hampshire, the prefab is assessed at £14, and the rate paid by the occupier is £10 6s. od. By the equalisation grant, an entirely different relief for the rates of those four occupiers is given by the Government. Just because the Hampshire assessments are high, Hampshire, of course, gets very little.

If we deduct the amount of the grant from the rates on those four different prefabs, we find that the occupier of the prefab in Sheffield will, in future, have to pay £5 1s. od.; the occupier in Merthyr Tydfil will have to pay £1 13s. 9d. a year, only a quarter of the amount; the occupier in Bradford will pay £8 1s. 6d., and the occupier in Hampshire £9 18s. od. Can anybody, on any side of this House, regard that as a fair result to be achieved by this Bill? We talk of poor and rich authorities. Let us get down to the meat of the matter. The ratepayer is struggling today to pay his rates and his living expenses out of his wages. Why, just because an authority has given him a lower assessment, should he get a greater relief, while the ratepayer of an authority which has higher assessments gets very little relief? That seems to me most demonstrably unjust.

There is one further injustice. In all the previous local government Bills, regard has been had to the widely scattered rural areas where the cost of administration is high, because there are a lot of roads to maintain which are usually travelled on, not by the ratepayers of the county, but by what we in Yorkshire call "foreigners"—people from Scotland or from other counties. In this Bill, the Minister disregards any county where the population per mile is more than 70. As the hon. and gallant Member for East Dorset (Colonel Wheatley) said, what a happy coincidence it is that, as a result of it, Wales benefits, but no county in England benefits at all, and, I believe, very few in Scotland. Counties such as Norfolk, Cornwall, and my own county of the North Riding get not one penny benefit, although we have wild roads through scattered rural areas. Even though it is going to cost some £46,000 a year to bring the children to school, not one penny benefit is derived from this Bill, because there is that particular population weightage. That is why I regard that side of the Bill as unjust.

Let us now turn to the centralised valuation. I would say, first, that, at a time when we are asked to economise in manpower in non-productive tasks, it is quite wrong for the Minister to set up a great new bureaucracy centred in Whitehall, taking over the work, in many cases part-time, done by local authorities. Extra expense is being involved, but, even more important, is that great loss of manpower. This method is going to delay revaluation by 1952. Is that right? Should we not try to break down this lack of uniformity earlier? If we had merely armed the centralised authorities with greater powers with which to secure uniformity, instead of having centralised valuation, we could have had this in one or two years.

I am not going to discuss the alternative but only the fact that not until 1952 or 1953 will that new bureaucracy be able to operate. The weakest part of the Bill is undoubtedly the valuation of dwelling houses. I want to labour this point a little more. I do not think that all hon. Members realise—certainly not those who were not on the Committee—that the effect of these proposals is going to put up the assessments on the small post-1918 dwellinghouses by, in most cases, 40 per cent., and, in some cases, by 50 per cent. I want to know what right this Government or this Parliament has to pass a Measure that is going to put up assessments in that way. It is no good saying that it is all right; that we will put up all assessments, and that it will work out in the end. It will not. The assessment of dwellinghouses, in probably most assessment areas, is something like 65 or 70 per cent. of the total rate income. The rest comes from special properties, and from the rating of businesses. In this Bill, special properties are being stabilised at the existing level. Nationalised undertakings are going to pay a little bit less. Naturally the Government are rather friendly to the nationalised undertakings because they are paying the rates.

The dwellinghouse occupier is to pay a great deal more, especially if he occupies a small post-1918 dwelling house. There is a curious anomaly in this part of the Bill with which I think we must try to deal. If a post-1918 dwelling house was, on 1st April, 1939—a very fitting date—rated higher than £75, it will come in on a different basis of assessment than it would if it were rated at less than £75. If it were less than £75, it is to be assessed on 5 per cent. of the cost of construction and site values; if it were above £75, it is to be assessed on the 1939 rental. That dividing line between these two different assessments will cause a great feeling of burning injustice; for one thing, as we know, a house assessed in 1939 in one area at £75 may have been assessed in another at £70, despite the fact that it was the same type of house. Here the Government are making a dividing line which will cut very harshly.

I would illustrate my point by taking two completely identical houses in Scarborough, which were built about the same time and are both post-1918 dwelling-houses. The first house has 2,595 sq. ft. In 1939 it had a rateable value of £85 and hon. Members will, therefore, realise it will come over the £75 rule. That house was revalued, because since 1939 my county had been revaluing—wisely or unwisely—to a rateable value of £97. In 1939 its rent was £130 per year. Under this Bill, that house will have a rateable value of £105. The value goes up. A few yards away, there is another house, 100 sq. ft. less, of 2,492 sq. ft. In 1939, that house was assessed at £72. Again, it was revalued by the county valuation authority and it was given a rateable value of £80, but as it was less than £75 it comes under the construction cost basis. Under this Bill, that house is rated at £66—some £14 less than our revaluation. Yet the rent of this second house is £150; it is a better house than the first. It has a rateable value of something like £39 less than the first house. Look at the difference between these two houses, similar in character, and a few yards apart. If that first house had been in another area in 1939, where it had been assessed at less than £75, on the construction and cost basis it would be assessed at £70.

For those reasons, I believe this Bill is demonstrably unjust. It penalises those areas which have been scrupulous in carrying out their obligations, and that is really where I believe this Bill is inherently wrong. Who are the wise and who are the foolish? Surely, the foolish were those who tried to carry out the obligations which Parliament had set upon them, and the wise were the negligent and the careless, for to them great profit is coming under this present profligate Minister of Health. For those reasons, because this Bill will create injustice between county and county and between ratepayer and ratepayer, and will raise the rating systems and the rates of the very poor, I shall vote against it.

7.6 p.m.

Mr. Pargiter (Spelthorne)

The hon. Member for Thirsk and Malton (Mr. Turton) has given a number of good illustrations, I think, which make it essential that the rating and valuation system shall be altered. What he has said was more in favour of the alteration than against it, although he quarrelled to some extent with the proposals. During the Committee stage, and at other stages, I followed with interest the various proposals put forward. There has been no alternative concrete suggestion put forward to that advanced by the Minister—I say that quite clearly. We have always been in difficulties on this question of valuation between county and county and between district and district; where the county valuation committee have done their job properly it has been between county and county. The position is no worse in that respect, and cannot possibly be any worse, under the new proposals than it was under the old system, and I am of the opinion that ultimately there should be a very considerable measure of equality as between county and county.

I appreciate the interim period, and I am fully conscious of the differences that will exist during this interim period, as I have already said. In my own county we are penalised to a very considerable extent as a result of the fact that we have been valuing rather high—or I might say, on a proper basis of valuation—as against many other parts of the country. A start has to be made somewhere. At some time, somebody has to say that something must be done. The usual argument which appears to come from the benches opposite is that if a thing is difficult, leave it alone; and the more difficult it becomes, the more certain it is one must leave it alone. That has been their policy not only on this, but with regard to many other matters from time to time. I congratulate the Minister on having the courage to tackle it, because there is no question but that it will be a good time before we get over the basic inequality from which we are at present suffering.

I think one of the points which has been most clearly made is that this Bill is based upon a different conception from any previous Act dealing with this subject. Under the new system, the basis of the assistance rendered by the Government to local authorities is on the need rather than on a general grant for services. If we look at the Bill from that angle—what it proposes to do and the means by which it proposes to do it—I think we can see it in rather better perspective than we have seen it as a result of some speeches we have heard from the opposite benches. I think it will be some time before we get valuation ironed out.

I am sorry that we cannot get new valuation lists at an earlier date. I think proposals merely to widen the powers of the Central Valuation Committee would not fit the Bill at all; I think it has reached the stage when the only possible hope is the centralised valuation system, and I am looking to see it succeed as between my county and many other counties. There is another point. Just as one side of the Bill is to render assistance where it is needed, it has never been argued in this Bill, and it is not proposed to argue, the case which I would like to see presented that valuations, or payment of rates, should necessarily be on a basis of ability to pay. Obviously, what we are all looking forward to—and I think this probably applies to the other side of the House as well—is a really equitable basis as between one person and another on the basis of their ability to contribute towards the cost of the services that have to be run as common services to the public. None of us has yet found the way, but the Minister is getting a little closer in endeavouring to get uniformity of valuation. I hope that, in view of the fact that we have the new procedure now, and a new basis of assistance to be given by the Government, we may arrive at that at a later stage. Certainly, as we are at the present time we are bound to accept it.

Another matter which was raised, and which is rather important, is that of time off and subsistence allowance for members of local authorities. The big problem will be that of the larger authorities, in finding people who will have the time to give to local government service, and of finding employers who will be willing that their workpeople shall have the time off that is necessary to engage in local government. I had hoped that the Bill might have done something about that, despite the difficulties. In spite of all its inequalities, inequalities from which I, coming from one of those highly-rated counties, will have to suffer in county finance for some considerable time, I nevertheless appreciate the principles on which the Bill is based, and I hope that it will be passed, and be worked with the good will of the people who want to see a better system established than has existed in the past.

7.11 p.m.

General Sir George Jeffrey's (Petersfield)

In the first place, I suggest that this Bill should have set an example for other Bills in the way of simplicity of expression and of being easily comprehensible. A Bill of this kind ought to be comprehensible not only by Members of Parliament and officials of the Ministry, but by officials and members of the local authorities who will have to work it, and by the ratepayers. I do not hesitate to say that very few officials or members of local authorities will understand this Bill or anything about it until they have read a good many of the more complicated Clauses several times over, and that very few ratepayers will even begin to understand it, no matter how much they read it. I know very well that "the weighted population" Clause, and the formula for ascertaining the weighted population, are based on the Act of 1929, but they are none the less frightfully complicated and artificial. In introducing a new Bill, the Minister might, surely, have endeavoured to produce something a little more up to date and a little simpler than this Measure.

The equalisation grants which will replace the block grants are to be determined by reference to the average rateable value per head of weighted population. If the rateable value per head of population of the county or the county borough is less than the average in England and Wales, then the deficit in rateable value has to be credited to that county or county borough, and the amount of rates which that credited rateable value would produce if it were actually the rateable value, has to be paid as a grant to the county or county borough in question as the equalisation grant. If the new assessments to be made were already in force and were assessed on the same basis, the equalisation grants might work fairly, and be fair in that way; but there are very great differences, as has been pointed out already by my hon. Friend the Member for Thirsk and Mahon (Mr. Turton), in the levels of assessments in the different areas.

Some authorities—in some cases, I understand, deliberately—have preferred the method of low assessments and high rates in the pound, whilst others have endeavoured correctly to assess all properties in accordance with the existing Rating and Valuation Acts. Such a county can qualify only for a very small equalisation grant; some counties cannot qualify for any. If it has not developed hospital services—which may be the case, not because of any neglect, but because there has been a very good and well established voluntary hospital service—such a county will benefit very little from the transfer of services. I am thinking particularly of my own county of Hampshire, which will be worse off, because it loses more by the withdrawal of the block grant than it gains by the new equalisation grant plus the saving due to the transfer of services to the Government.

Mr. Pargiter

Is it the case that all those services have been so bad in the past that the county gets very little from the transfer?

Sir G. Jeffreys

I do not quite understand what the hon. Member is asking. On the contrary, Hampshire has been, like the county of my hon. Friend the Member for Thirsk and Malton, valued properly and consistently; the values have been kept up to date, and they are consequently higher than those of other counties, and the rates are consequently lower.

Mr. Pargiter

Apparently, I did not make myself clear. The hon. and gallant Gentleman says that the county will gain very little from the transfer of the local services, the hospital and public assistance services. One must assume from that that the county has been at a rather low level of accomplishment in rating.

Sir G. Jeffreys

I can only say that what the hon. Gentleman assumes is not the case. What I endeavoured to explain, though I did not say so in so many words, is that the reason why in Hampshire, and in a good many other counties, the municipal hospital services have not been very largely developed is simply and solely because there have been highly developed and very excellent voluntary hospitals. Many of them have been established for many years, and have been kept up by voluntary subscriptions. In most cases, I would say, those hospitals are of a very much higher class than the county hospitals publicly developed elsewhere.

After taking into account the relief to local expenditure due to the transfer of services—the hospital, education, and poor law services—and due to the new system of the equalisation grant, instead of the former system, there will be assured to each county a minimum gain in 1948 to 1949 of the equivalent of a rate of 6d. in the pound under the transitional grants. The transitional grants are, in effect, consolation prizes—consolation prizes to those counties which have maintained their affairs very well, and which, owing to the working of the new system proposed in this Bill, will not get any appreciable equalisation grant. In some cases, they will get no equalisation grant, but in other cases they will get a small one; they will in many cases be considerably worse off in consequence: they get the transitional grant instead.

The total of the transitional grants in the first year, as given in the Explanatory and Financial Memorandum that accompanied the first copy of the Bill, was originally estimated to be in the neighbourhood of £900,000 for the whole country That estimate has now been reduced to £171,000. Hampshire should receive some £59,000. Only three counties besides Hampshire participate, apart from a certain number of county boroughs. Those counties and county boroughs are naturally not very pleased with their treatment. They think that it would be fair that the amount of transitional grant should not abate by one-fifth in each year, as is proposed. If it is fair that in the first year the transitional grant should be paid to compensate local authorities for charges effected by the Bill, then it is surely fair that the full grant should be continued until property throughout the country has been re-assessed, for I presume that is the real and the only reason for the transitional grant.

That is the thing on which the whole of this Bill is based. When all the properties in the country have been reassessed, this Bill may work with a certain degree of fairness. Until they have been re-assessed—which we are told by the Minister is unlikely to be completed before 1952, and it may be even later, there is an obvious unfairness in applying the principles of this Bill. It is surely fair, too, that the full transitional grant should be continued instead of being reduced by one-fifth, as proposed in the Bill, until all the property has been reassessed.

I cannot think that the valuation provisions in Part IV are sound. The 1938 cost of construction basis, on which a large proportion of the valuations is to be calculated, seems to me unsound, if only because it is completely inelastic. If valuations have to be revised—and obviously they must be—it is very difficult to do so on the basis of the estimated or hypothetical value of 10 years ago, because that hypothetical cost of 10 years ago is, to my mind, artificial and consequently not practical. The Bill provides four different methods of valuation. First, farmhouses are valued on current annual values; secondly, pre-1919 houses which are valued on the comparable rents of 31st August, 1939, or, if no comparable rents are available, are valued on 1938 values; thirdly, the post-1918 private houses, with Rent Restrictions Acts limits, which are valued on the 1938 cost plus, not the 1938, but the current site cost; fourthly, the post-1918 local authority and housing association houses and flats, which are valued on the 1938 cost plus 1938 cost of site. With those different methods of valuation existing alongside one another—some of them hypothetical to a great extent, and out of date—anomalies must result between ratepayers valued on those very different methods—possibly ratepayers very close together in the same neighbourhood.

Those are my two main objections to this Bill as it stands: first, as I have endeavoured to show, the difficulty as regards the equalisation grant and the transitional grant, due very largely to the existing differences of valuation of the same type of hereditaments in different parts of the country; and secondly, what seems to me to be an unsound method of valuation, a method which certainly has not the approval of the best known professional valuers in this country.

7.25 p.m.

Mr. Scott-Elliot (Accrington)

I will not detain the House long in putting a question to the Minister on one specific point. It is a point of some importance in so far as it affects those smaller authorities which in the past have derived a considerable proportion of their income from electricity undertakings which are now coming under public ownership. Throughout the country there are many small local authorities with electricity undertakings, from which they may have obtained 50 per cent, or even more, of their total rateable income. There is such a local authority in my constituency. I do not propose to go into the details of that case; I mention it merely to show that I have an interest in this matter.

As the Bill stood originally, it seemed that such small local authorities would come off rather poorly. However, the Minister of Health has been extremely helpful in this matter, and, in so far as a local authority will be out of pocket to the extent of more than the product of a 2d. rate, Clause 105 provides help for a period of 10 years. I am most grateful to the Minister for what he has done, and I should here like to express my appreciation. But that grant decreases by one-tenth every year, so that at the end of five years the local authority will be getting only half what it receives in 1948–49. That may be—I will not say it will be—a very serious position indeed for a local authority. The question I wish to put to the Minister is: how is Clause 126 likely to work in practice? That Clause gives permission—that is not compulsory—to the county council to make a grant to a local authority which is in difficult circumstances. How is this likely to operate? Normally, is the county council likely to make a grant sufficient to put the local authority in pocket, at any rate so that it will not sustain any appreciable loss over the 2d. rate mentioned in Clause 105?

I make no apology for raising this detailed matter at this stage, because it is a question which affects a large number of small local authorities. Even if the Secretary of State for Scotland is not able tonight to deal with this point of detail, which applies not only to England but to Scotland, I hope that the Minister of Health or his Parliamentary Secretary, who was extremely helpful to a deputation I took to see him some little time ago, will deal with the matter by means of correspondence.

7.28 p.m.

Mr. Challen (Hampstead)

I wish to add a little to the indictment which is being built up from all sides of the House against this Bill. I wish to refer to the way in which London has been treated—perhaps I should say the way in which it has not been treated. I am glad to see present the Minister of Works, who knows much about London, and to whom London has looked so much in the past for protection and support. I hope that even at this late stage perhaps he can persuade the Government to improve the situation in this respect. Why should London be treated in the way it has been under Clause 10, by which a scheme is prepared by the Minister in consultation with the county council, the Common Council of the City of London and other associations, and then given the force of law without any means by which it can be approved or even considered by hon. Members of this House, or by the ratepayers of London who, after all, are primarily interested?

Why should not some means be devised whereby this scheme for London can be laid on the Table of the House and debated by hon. Members? Why should not some means be found by which hon. Members representing London constituencies can get their teeth into consideration of the London scheme and express their opinions on the Floor of the House? I know it may be said that the scheme will probably be satisfactory to the various interests concerned. It may also be said that the Metropolitan Boroughs, the county councils and the various associations are being consulted, and that they will generally concur. But this Clause gives the Minister power to alter, vary and make all other kinds of rearrangements to the scheme at his own sweet will, without any kind of access to this House. I suggest that although the various bodies concerned in London may be generally satisfied with the scheme the Minister may produce, it is not good enough for it to be given the force of law for the vast area covered by the Metropolitan Boroughs without being debated or even considered on the Floor of the House.

It is surely a serious blemish on this Bill that we should have this hypothetical case of London left in the air like this. I make the plea that before this Bill receives the Royal Assent, some means should be devised—and I have made suggestions during the Committee stage, which I thought were very good ones—whereby the Minister can make an order which will be laid upon the Table of the House, which can be debated and considered by the representatives of the ratepayers of London. I make this protest very seriously, because we are dealing here with a very large and important area, and some protest of this nature ought to be made.

The only other point to which I wish to refer is the entertainment Clause. This Clause should not have been introduced at the last moment into a Bill of this nature, which deals with all the intricacies of valuations and rating. To bring a completely new tune into this somewhat drab and dull Measure, does not improve the symphony, but introduces a discordant note. The entertainment Clause is not an embellishment to this Bill. It could much more appropriately have been dealt with on some other occasion, perhaps in some other Measure, or in a Measure by itself, when it could have been debated and properly considered. For the Minister to have sponsored this, in the circumstances which exist today, is rather alarming. I do not share the somewhat flippant attitude which has been adopted towards these cultural activities into which local authorities are to be en- couraged to enter. I do not share the complacency with which it is contemplated that millions of pounds may be invested in this venture by way of capital.

I should have thought that before a Clause of this nature was introduced the Chancellor of the Exchequer and the other Departments concerned would have been consulted and their opinion asked as to whether at the present time this capital expenditure and investment should be lightly included in this Bill. I should have thought that this idea of a 6d. rate to encourage theatres and all the other activities referred to by my hon. Friend the Member for Oxford University (Sir A. Herbert), at vast expense to the ratepayers, was quite indefensible. I do not want to add further to the list of complaints against this Measure. It is a pretty formidable list, which entitles us to go into the Lobby against it.

7.36 p.m.

Mr. Kinley (Bootle)

Members who speak in this House are conscious that they have a dual duty to perform. Firstly, they have a duty to the country as a whole, and from that point of view we must consider what will be the general effect of this Bill on all the local authorities. From that point of view this is a very desirable and much needed Bill, and I am prepared to give it a general welcome. A Member's second duty is to speak as a representative of his constituency, and from that point of view my attitude towards this Bill is bound to be modified. Had I succeeded in taking part earlier in this Debate, I should have made a speech which would not have been very friendly towards my right hon. Friend, because at that point the latest news I had was that this Bill proposed to give my local authority aid to the extent of a 6d. rate on the one hand, and to take away a 10s, rate in the form of the block grant on the other. I was convinced, however, that Bootle, with all its virtues, could not be the only local authority in this situation.

I do not think it right that any local authority which has done its best to comply with all Parliamentary requirements, and to make its area as efficient and as attractive as possible, should find itself under this Bill compelled, if it is to maintain its remaining services at their present level, to impose an additional burden upon its ratepayers. In our case, with the revised estimate of Government help under this Bill, there is no alternative but a heavy increase in the rates. I do not like that, and if it had come from any Government but my own, I should have objected to it very strongly indeed. I am now bound by party ties, and I hope therefore that what I say will be borne in mind, and that attention will be given to the financial position of the poorer local authorities. I hope that the Minister will examine this before the Bill becomes law.

My local authority is a poor local authority. The backbone of our area is the dock labourer, whose basic wage is £4 125. a week. There are thousands of others in the area who are getting even less than that. From every point of view I suggest it is wrong that those with such a low income should have their local taxation increased. At present, it is almost 195. in the £, and there is the prospect of further increases in the near future. We are carrying, at the moment, a poor rate of 6s. in the £. That is the measure of our poverty. In the wiping away of the Poor Law we were justified in anticipating that we should be able to reduce our local rates by that 6s., instead of which we find that we shall now be compelled to continue to levy that amount upon our ratepayers, although it will be called part of the general rate instead of the poor rate. Through the coming into operation of this Bill we stand to lose heavily, as what we receive will be much less than the block grant.

I should like to know why the Minister wants to juggle with the nationalised services? We have felt strongly in the past about the fact that the biggest contributors to our local rates—the Mersey Docks and Harbour Board—have had a preferential rating scheme. The railway companies and canals have a preferential rating scheme, and the gas companies and electrical undertakings also have such a scheme, and they have been able to enforce it by continuous fighting in the courts. This, eventually, gave them great privileges compared with the ordinary ratepayer and shopkeeper, who had to pay up and smile because he could not afford to fight his assessment. Instead of the railway and electrical companies being compelled to submit to a normal and reasonable assessment, and having to pay rates to the local authority upon that assessment, they are now taken out of our control by the Minister.

That is unfair from this point of view: the rating authority, for certain purposes, when ascertaining the product of a penny rate, can count in the rateable value of those railway and electrical undertakings. But for other purposes, which will be decided by the Minister, the rating authority must exclude those undertakings. I would like to know why. Surely, we should be aiming at simplicity; we should be trying to make the finances of local authorities as straightforward and as simple as we can, instead of insisting upon a factor which is not only complicated in itself but remains at the caprice of the Minister.

I should like to know on what ground the Minister wants the rateable value of these services to be calculated and why, on other occasions, the local authorities are to be permitted to exclude them? It does not make sense: it is confusing to the treasurer of a local authority, because until he has the final word from the Minister he never knows what is his actual rateable field. It is unfair that he should be left in that position. In the name of one authority which will lose by this Bill, I appeal to the Minister to look at the finances of local authorities once more, to see whether there is not a new class of local authority which has so far not been mentioned.

Mention has been made of the borderline case, the case which receives no assistance because the authority is too well off, and the local authority which receives assistance because it is below the national standard. But no mention has yet been made of the local authority which, in spite of the assistance it will get from this Bill, will be out of pocket, and which will have to make up the difference by levying higher rates on its ratepayers. If we are to aim at equality of rating let it not be at a high level: let it be at a low level, so that the rating authorities on the lowest scale will be able to carry out their functions in a much better and more efficient manner than hitherto. Let us find some way, if not by this Bill then in some other way, of lightening the load which now presses heavily on the ratepayer who, in the vast majority of cases, is a wage earner. He is the man who has no one else to whom he can "pass the buck." We should be giving him assistance instead of adding to his burden, as we are doing now, and making it still more difficult for his local authority to carry out and extend their duties.

7.48 p.m.

Mr. Cooper-Key (Hastings)

I want to confine my few remarks to the two main fallacies which are inherent in this Bill, and which have not yet been dispelled. The first is the fallacy that equal burdens of rates will fall on ratepayers of equal financial status. This Bill discriminates unfairly and unreasonably between local authorities and also between ratepayers. It does not even grant a reward for honest behaviour. Those authorities who have assessed their properties under the Rating and Valuation Act, 1925, in accordance with the spirit of that Act, are penalised. In effect, the Bill says, "I know that the assessment in one of these two towns is wrong, and that they both cannot be right. I shall, however, pay the grant to the local authority which has fixed its property values low, and I shall not pay grant to the local authority which has fixed them at a higher level."

The Minister has been pleased to divide towns into wealthy towns and poorer towns. This is 50 years out of date, so far as Hastings is concerned. Our treatment, under this Bill, does not take into consideration either our financial needs or our resources now and in the immediate future. No oratorical or mathematical gymnastics can claim that the principle of equal burden between groups of ratepayers or individual ratepayers is established by this Bill. Men whose wages are fixed nationally will bear nothing like an equal burden. It is no consolation to such a ratepayer to learn that because his authority is above the line he has to pay twice as much in rates as someone else in another part of the country has to pay for the same accommodation and amenities.

As an example of how these variations work, here is a set of facts which bring out this point clearly. The rates now paid by the Hastings ratepayer on a three-bedroom non-parlour type of council house with rates at 14s. in the pound, is £11 18s. The rates now paid by the Walsall ratepayer, but with rates at 20s. in the pound, are £10. The rates paid on a similar house by the Hastings ratepayer will, after the coming into operation of the Bill, be £11 12s. 4d. In the case of the Walsall ratepayer, his rates after the operation of the Bill will, for a similar house, be £5 7s. 6d., or about half what they were before.

Further to this fact, a general rate of 16s. 6d. in the pound for the year 1948–49 will be necessary in Hastings, against 14s. during the past year. If the Walsall level of assessment were the same as that of Hastings, our probable new rate of 16s. in the pound would represent, in Walsall, something more than 25s. in the pound, yet Walsall, on its present rate of 20s. in the pound, will receive a substantial grant while we shall receive only a transitional grant equivalent to a 6d. rate, decreasing in five years to nil. The transitional grants were presumably introduced as a partial recognition of the lack of uniformity in rating assessment, but it is a totally inadequate recognition of that fact so far as many towns in the country are concerned, including Hastings.

In regard to the second fallacy, that of a decrease in rates, which is widely accepted in the country as the expected result of the Bill, I should like to point out that, working on the figures for 1946–47, the Minister shows a net saving on the rates of £39 million a year. He removes that burden, but for the year 1948–49, that saving is wiped out by the rising cost of wages, general inflation, the additional cost of the fire services and the working of the Education Act. The Estimates for the coming year wipe out this sum. In my constituency it has beeen necessary to increase the rates this year by 2s.

I should like to say a final word about the points mentioned in an earlier Debate by the hon. Member for the Drake Division of Plymouth (Mr. Medland). Where towns have lost rateable value by bomb damage, I would ask the Minister that they should receive, and should continue to receive, special assistance from his Department.

7.53 p.m.

Brigadier Prior-Palmer (Worthing)

I think we are all in agreement on this side of the House upon the object of the Bill, which is equalisation of the rate burden, so that a ratepayer in one part of the country should not pay at a different level from other ratepayers because he happens to live in that particular place. We object to the Bill because we believe that the methods employed in it will not achieve that object. We are alive to the apparently logical arguments put forward by the Minister at various stages of the Bill, but some of us are unhappy because we think that those arguments will not prove to be valid in two or three years time.

Equalisation of rate burdens can only be achieved under three conditions. The first is equal cost per head for the same service. The second condition is equalisation of rateable value per head. The third is uniformity of valuation for rating. In connection with equalisation for the same service, we are straightaway up against weighting for sparsity. It is clear that a sparsity of lower than 70 persons per mile would increase the cost per head of a local service. Payment of a grant for rates on credited rateable value takes no account whatever of avoidable expenditure due to extravagance or inefficiency. We consider that such a proposal is grossly unjust.

Under the equalisation of rateable value per head, as proposed under the Bill, it is only possible to equalise up to the national average. That will leave seven counties and 28 county boroughs in England above that average. The ratepayers in the latter areas will have a less burden than the ratepayers in the grant-receiving areas. That proposal is not equitable or right. We consider that this situation should not be passed into law without being amended.

The third condition, uniformity of valuation, cannot be achieved until 1952, until when equalisation grants will penalise highly-valued areas, and reward the low-valued areas. Is that equitable? Should that be allowed to go on for four years? I have shown some of the anomalies in the Bill, and I am convinced that in three or four years' time, as a result of the Bill, there will reign a state bordering on chaos. A vast amount of amending legislation will be needed in order to put matters right, owing to the fact that the present Bill has been prepared too hurriedly and to the fact that this is not the time for a Bill to be produced in this form.

Now I should like to say a word about the entertainments Clause. I am in the peculiar position of representing a borough which has most at the advantages which are set out in the Clause, owing to a Private Bill which was put through the House of Commons somewhere about 1922. It may, therefore, be wondered why I make criticisms of the Clause. There are boroughs in the country where local interests, or vested interests if you like to call them that, such as cinemas and theatres, may be in favour of a Clause like this. That would be notably true of seaside and health resorts, because the Clause is to their advantage. When those places approach their local councillor and ask for something of this sort, that is right and proper.

We have heard a great deal of nonsense from the other side of the House about the effect of the Clause in the rural areas. Do hon. Members opposite really think that the Bill will have the effect of erecting theatres in small villages in out-of-the-way rural areas? I shall be very surprised indeed if the Bill has that effect. If it does, I doubt whether 6d. on the rates would be enough to pay for it. I do not give place to anybody in my desire to see art made available to every person in this country at a cheap rate. I was very impressed when I was in Italy at the desire of the greater proportion of our soldiers to see good-class opera. I have seen men walk four miles in slush and snow to hear the Rome Opera Company performing in a small town rather than go to an E.N.S.A. concert in their own camp. That showed me the importance of giving far greater facilities to ballet and opera as well as to constructive films. I do not think it is right or fair that the local interests who are able to provide these amenities, and who probably would be providing them now had it not been for the war, should be compelled, against their will, to subsidise their own competition, through the rates. After all, they are the greatest ratepayers in the town.

It would have been much better to have left the matter as it was. I admit that a certain amount of expense was incurred, but, on the other hand, it acted as a preventive against municipalities or local authorities sending to the House of Commons Bills which had not the backing of the whole of their ratepayers. That is the whole point. Unless the whole of the ratepayers are behind the scheme, it is entirely wrong to give local authorities these powers. The Minister said that the ratepayers could express their views at the local elections. Surely, he cannot mean that seriously? We know that a third of the council is elected every year. Possibly, certain wards in a town may have to wait three years before they are able to express their disapproval of something which the council has done. This matter should be open to a vote, as has been the case in the past in other matters, and if the whole of the area desire it, then it is right and proper. A 6d. rate is a tremendous burden for ratepayers to bear, and it is very much too high.

Having said those few words, I propose to vote against the Third Reading of this Bill for the reasons which I have given. I do not believe it achieves its object, and I think it is a badly-drafted and badly-constructed Bill.

8.3 p.m.

Mr. Peter Freeman (Newport)

I rise to support this Bill which I think will be of great advantage to the community as a whole, and particularly to those authorities which have no suitable entertainment such as some local authorities have. It was my own local authority, the county borough of Newport, which proposed an amendment of the law some years ago and submitted it to the Association of Municipal Authorities in order to secure the provision of reasonable entertainment for their own people. This amendment, which has been accepted by the Minister and is incorporated in the Bill, gives them these powers. Under the circumstances, it seems reasonable that they should provide suitable entertainment with a maximum rate of 6d. Their view is that if a municipal authority has the responsibility for looking after the sewers and drains, it is not unreasonable that they should have equal powers for looking after their amusements and entertainments, as this Bill provides.

The second point to which I wish to call attention concerns Clause 2, which deals with the compensation payable between counties and county boroughs. If only this Clause had been in vogue last year, my own borough would have saved some £200,000 or £300,000 which they have recently had to pay in compensation to the Monmouth County Council as a result of a difference in the transfer of property from one to the other. Therefore, they have asked me to express their pleasure at the incorporation in the Bill of this Clause, which will be of very great advantage in so many directions. For those reasons, I shall have very great pleasure in supporting this Bill when we go to the Division Lobby.

8.5 p.m.

Mr. Oliver Poole (Oswestry)

The Secretary of State for Scotland and I are in the rather remarkable position of having nearly two hours of Parliamentary time of which to avail ourselves. I can assure the House that I have no intention of taking my full share of that time. I wish merely to sum up the reasons which have been put forward by my right hon. and hon. Friends in opposing this Bill.

When introducing this Bill, which one might almost call an omnibus Bill, on Second Reading, the Minister referred to it as a long and complicated Measure. This afternoon he referred to it as a very important Measure indeed. To many of us, although our acquaintance with the Bill is rather more mature than it was on the Second Reading, it still remains as he described it then. I shall deal with only that part of the Bill which relates to England and Wales. I do not know whether the Secretary of State for Scotland, when he winds up, intends to refer to this part of the Bill, or whether he will confine himself to Scotland. My hon. and gallant Friend the Member for Pollok (Commander Galbraith) has dealt with the effect of this Bill on Scotland and he referred particularly to Part II. I am looking forward to the right hon. Gentleman dealing with the question raised by the hon. Member for Dumbartonshire (Mr. McKinlay) in regard to Loch Sloy, particularly in view of the fact that Birmingham has an increase, not of £600,000, but of over £1 million, whereas Glasgow gets nothing. I am looking forward to hearing his explanation on that point.

I would like to turn to the remarks of the hon. Member for East Islington (Mr. E. Fletcher). He said that no one on this side of the House had complained of the principles of the Bill or shown why we disagree with them. If he will read the report of those parts of the Debate which he has not heard, including speeches not only from my hon. Friends but from hon. Members opposite, he will see that there is, in fact, no very great disagreement with the objects of the Bill, nor is there any great disagreement with the necessity for a Measure of this sort. However, if he reads the speeches to which he was unable to listen, and particularly the speech of my hon. Friend. the Member for Thirsk and Malton (Mr. Turton), he will see that specific and definite objections have been put forward. That being the case, I am bound to say that it is quite obvious that my hon. Friends have had to rely on detailed and technical arguments which have not commended themselves to a very wide number of people, but I do not think that they can be said to be less important for all that. It must be emphasised that, in spite of the fact that at this stage of the proceedings only a small number of Members are taking part in the deliberations, it is, as the Minister said this afternoon, a most important Measure which will affect not only every local authority but, what is more important, every ratepayer in the country.

I shall try to sum up briefly the reasons we think this Bill will fail in its objective. The Minister must realise—my hon. and gallant Friend the Member for Worthing (Brigadier Prior-Palmer) has already referred to this—that if the object of this Bill is to be achieved, three conditions are essential: first, the equalisation of costs per head for the same services; secondly, the equalisation of rateable value per head; and thirdly, the uniformity of valuation for rating. We maintain that if the provisions of the Bill are examined closely, we shall see that none of these three conditions is, in fact, achieved. We have argued this point throughout the various stages of the Bill, and the Minister, his Parliamentary Secretary and the right hon. Gentleman who is to wind up, have put forward arguments in reply. The Minister of Health, with all that forensic skill which we admire so much, was apt to sweep us off our feet during the Committee stage. However, on mature reflection, having considered the answers which we have received, I am bound to say that we still remain completely unconvinced.

I would like to deal first with the question of the equalisation of costs per head in the same services, and I wish to emphasise the point which has already been made by my hon. and gallant Friend the Member for Worthing. The Minister has realised that sparsity of population has a definite effect in increasing the cost to the ratepayers. That is inherently admitted in the Bill. But he is determined that only those counties with a population of less than 70 persons per mile of road shall have the advantage of weighting. The Minister of Health supplied me recently, in answer to a Question, with certain figures which show that few counties will qualify for this weighting. There are, however, a number of counties—and Shropshire, part of which I have the honour to represent, is one—which have populations very slightly above the figure of 70, yet they will get no assistance and will have to bear the increased cost of administration over a wide area.

The Bill also provides for the payment of grant in the form of "rates" upon "credited" rateable value. We maintain this can only have the effect of treating as identical the different sets of services provided in each area. It must be apparent to everyone experienced in these matters that these services, conducted by different local authorities, differ enormously as a result, in some cases, of extravagance, in other cases, of inefficiency, and, in many cases, of the fact that they have undertaken voluntarily additional services. Therefore, to treat them as identical seems to be unreasonable. With regard to inefficiency and extravagance, the provisions of Clause 6, which deals with disallowances by the Minister for various reasons, does not meet the case we have put forward.

If we have made out a case, as we think we have, that the Bill does not achieve equalisation of cost per head for the same services, the same applies to equalisation of rateable value per head. The argument has been advanced that this is achieved because of the equalisation grants. The hon. and gallant Member for the Scottish Universities (Lieut.-Colonel Elliot) this afternoon made it clear that this did not take into account those authorities who do not receive grants. I think that the hon. Member for Hitchin (Mr. Asterley Jones), when he referred to this point, overlooked this aspect, that, as the hon. and gallant Member for Worthing pointed out, seven counties and 28 county boroughs in England, as well as others in Scotland, come above the national average.

Therefore, injustice must result to the ratepayer in those areas. I emphasise the ratepayer, because, on Second Reading, the Minister of Health made play with the fact that we were referring to local authorities rather than to ratepayers. I think that the hon. and gallant Member for the Scottish Universities exploded that by saying that they are one and the same. In this case, it is, in fact, the ratepayer in these areas who will suffer. The derating of hereditaments in these areas will be borne by the local ratepayer, whereas in other areas the equalisation grant will be borne, as it should be, by the national taxpayer. The distribution of railway and electricity rate money operates unfairly against them. The abolition of the adjustment of burdens as the result of boundary alterations is illogical where non-grant receiving authorities are concerned. When we pressed that point during the Committee stage, the Minister did not feel able to meet us on it.

Over and above the points which I have made, the provisions of the Bill come into force at once, and do not, therefore, take into account the results of the new valuation and the work of the Local Government Boundary Commission. If the Government had waited for this, the inequalities would have been less, because the Exchequer, which is paying this, would only pay equalisation up to the limit of the national average. I would ask for some explanation or justification for the capitation grant formula in Clause 9, as this does not seem to us to achieve its object or to have any logical basis behind it. It is a complicated matter, and if we can have an explanation it would be of great value.

I think that one of the main points argued from this side and realised by every one who has followed our discussions is that whether this Measure will be a success or otherwise depends on achieving uniformity of valuation. I understand that the hon. Member for Spelthorne (Mr. Pargiter) complained that we had put up no alternatives. I regret that I was not in my place when he was speaking, because I have listened to everything he has said on this Bill with the greatest interest and respect. I suggest that if he looks back to what has been done, he will find that we have put forward a clear and constructive alternative. I think that you would rule me out of Order, Mr. Deputy-Speaker, if I attempted to deal with that now. Therefore, I cannot reply to the taunt of the hon. Gentleman, but I ask him to read what we have set out in other stages of the Bill.

The Bill sets out two new methods to achieve uniformity of valuation. It lays down the procedure for the transfer of the duties of valuation from the rating authorities to the Inland Revenue officials, and also lays down a new law of valuation for dwellinghouses. The hon. Member for Thirsk and Malton has dealt fully with the first matter and the delay of the new valuation until 1952 which can only prolong the present injustice. I take the view, and I think that, on the whole, hon. Members on this side agree with me that one cannot complain against centralised valuation on principle. The fact that it is being removed from the local authority to the Board is not something to which I myself object. But I maintain, for many reasons, that the setting up of this organisation at this time, with the difficulty of obtaining suitable accommodation, and with the vast number of other centralised boards that are being created, with the difficulty of getting staff, and the transfer of staffs from local authorities to the Inland Revenue, makes this quite inopportune.

It is to the valuation of dwellinghouses in Part IV of the Bill that we take the greatest exception. That matter was dealt with fully at the commencement of our proceedings this afternoon by the hon. and gallant Member for the Scottish Universities, and was also referred to by the hon. Member for Hastings (Mr. Cooper-Key) just now. Even if one ignores the inherent difficulty of valuation based on the hypothetical cost of construction, we find that other anomalies will arise. I maintain also that it is quite wrong that the prewar values, done away with in the sphere of compulsory purchase at the time of the Town and Country Planning Act, should be introduced for the first time into rating. That seems very difficult to explain away. In the Second Reading Debate, the Minister of Health made great play with the hypothetical tenant. We maintain that the hypothetical builder may be an even more elusive gentleman. In fact, he has not done away with the hypothetical tenant in spite of all his assurances to the contrary. Under Clauses 81 and 82, the hypothetical tenant still plays his part in this Bill.

In regard to the provisions of this part of the Bill I would urge the Parliamentary Secretary to pay attention to what the hon. Member for Hitchin said. I can tell the House from my own personal experience that it is best to take notice of what the hon. Member said. I spent 18 months of the war doing that. I commend the practice to the Parliamentary Secretary. The hon. Member for Hitchin referred to this particular point, and I hope the Parliamentary Secretary will read it tomorrow. The provisions in this part of the Bill will have the effect that the valuations and rate burdens of dwellinghouses will definitely go up, and, though it will take some time before this becomes apparent, there is no doubt that the rise will be steeper than in any other hereditaments. Especially is that so with small dwellinghouses. Secondly, the occupiers of pre-1918 houses will be harshly treated. Lastly, there will also be anomalies where post-1918 houses are concerned, because some homes now valued below the £75 mark will in future be valued higher in the list than £75. I maintain that it is absolutely wrong that the definition of small dwellinghouses should be based on the present valuation lists, which we are all agreed are so unsatisfactory. I have tried to deal with our objections to the Bill, excluding Part II, with which my hon. and gallant Friend the Member for Pollok (Commander Galbraith) has dealt.

It is, in fact, Parts III and IV to which we take the greatest exception. This is another case where we have no doubt whatever as to the sincerity or, indeed, the necessity of the Government's purpose, but once again we have examined what was produced and we say that it is greatly lacking in uniformity. Parts V, VI, VII, and VIII I intend to deal with quite briefly because it is to the first four parts that we take exception. Part V deals with the rating of transport and electricity authorities. I hope that the right hon. Gentleman who replies will answer the point that was put forward by my right hon. Friend as to why the transport and electricity authority should be relieved of rates while the new gas under- taking is to be rated under a different set of circumstances. That will be listened to with great interest. It is a most complex subject, and we could have spent more time discussing it in Committee. I have only two further things to say under this head. First, there is a risk that at some future date some Government may attempt to relieve the nationalised transport undertaking from rates so as to hide up their losses. The Minister of Health has assured us that this is not only improbable—which we are more or less prepared to accept—but impossible. Having given it careful consideration, I cannot see that it is impossible, and it is a point against which we should guard most strongly.

The second point which I want to make is the effect that this Bill will have on the Railway Freights Rebate Fund. Again I do not know whether the right hon. Gentleman will be able to deal with this, but perhaps he will look at it and, see what effect this Bill will have on the fund. It is a complicated matter and I have not the time to discuss it. Someone connected with the Transport Commission, to whom I mentioned the matter, was unable to explain to me what the effect will be. If it is a matter of a simple answer, I hope to have it cleared up, for it is one of the greatest importance to industry in general.

I said at the beginning of my remarks that this was something of an omnibus Bill, and Parts VI to VIII show that that is so. The Minister of Health and the Secretary of State for Scotland are both like conductors on an omnibus. Early in the journey they filled their bus with the usual customers, leaving a few seats vacant for casual folk along the way. Where they differed from omnibus conductors in general was that they have not taken the first comers who wanted to be picked up but only selected the good lookers on the road, leaving behind those not so attractive or those who will cause trouble on the journey. For instance, they have included in this part of the Bill a Clause dealing with entertainments and payments to local councillors. I must say I was surprised to hear the Minister of Health himself say that the payment of expenses to local councillors would help people at least to become politically articulate. The right hon. Gentleman had long service with local authorities before he came to this House, but no one would say that he was politically inarticulate. We welcome that provision. Then there are those in regard to war memorials, insurance benefits, the votes of members, of Co-operative Society members, and many other things that attracted the eye of the Minister, and which he included in this part of the Bill. When we suggested something of a rather troublesome nature —I could not refer to it in detail because that would be out of Order—we were informed that the bus was full up, and we must wait for another occasion before our point was met.

I should like briefly to refer to this question of entertainments. It was dealt with at some length by the junior Burgess for Oxford University (Sir A. Herbert), my hon. Friend the Member for Sutton and Cheam (Mr. S. Marshall) and other hon. Members. We have spent a considerable amount of our time since this new Clause was introduced in discussing it. In all sincerity, I suggest that that time might well have been spent discussing other parts of this Bill. Those who have followed it carefully know that the main effect of this Bill, which is extremely important and far-reaching, is complicated because these things may or may not have the same effect when taken together.

I was absolutely astonished—and I say this without wishing to cause controversy on either side—as I listened to the Debate and heard the Parliamentary Secretary introduce this Clause, followed by the hon. Member for North Hendon (Mrs. Ayrton Gould). One would have thought that an aesthetic elysium was going to be offered to the people, and that the new world was going to start at once. As I listened to some of my hon. Friends, some of whom feared that every rural district council was going to start State opera, I felt that they were rather exaggerating the whole thing. The fact of the matter is that this particular Clause gives a number of local authorities who want to use it, power which they could have acquired under present provisions. Owing to the present financial crisis and difficulties it will be many years before this will come into effect, and I hope in general that a proper sense of proportion will be kept in relation to this Clause.

We on this side of the House put down a reasoned Amendment on the Second Reading of the Bill. Although the Gov- ernment have accepted many of our Amendments, for which not only we but the local authorities and ratepayers in general are grateful, the Minister has not accepted any Amendment which cleared up the major points that were referred to in that reasoned Amendment. As I said before it will be some time before this Bill takes effect. It may be three or four years. When that time comes what has been said in this Debate will be forgotten, but the impact of this Bill will then fall on almost every ratepayer in the country. It is because we know that when that time comes the provisions will be found to be inoperable, inadequate and unjust that we intend to divide against the Bill tonight.

8.30 p.m.

The Secretary of State for Scotland (Mr. Woodburn)

We have had a most interesting Debate. Many of the matters which have been discussed, however, ought to have been discussed in Committee—and I have no doubt that they were discussed in Committee. It would be almost impertinence on my part to try to explain with greater clarity than I am sure the Minister explained on the Committee stage many of the points which have been raised again on Third Reading. Therefore, since most hon. Members have had very adequate replies to their detailed points, such as those raised by the hon. Member for Oswestry (Mr. O. Poole), I am quite sure they would not want me to repeat them tonight.

After all, the problems facing this country can be reduced roughly to two great problems. The first and greatest is to produce more to distribute among the people and to create more well-being. That is a matter of production which is dealt with in other spheres of the Government's work. The second great problem facing this country—and it has faced it for many years—is that of distributing what is produced, and this Bill alters the distribution of the well-being of the country. What has struck me about the Debate today is the number of hon. Members opposite who have discovered that this Bill creates anomalies. I was at a conference at Prestwick the other day and I was surprised to hear a railwayman—of all persons—among those present raise the question of the noise the aeroplanes make. He is quite unconscious of the noise the railway engines make. Hon. Gentlemen opposite are quite unconscious of the anomalies which have existed; they have only discovered the ones which will exist when the Bill is passed.

This Bill arises because there have been anomalies which have pressed hardly on the people of this country for 100 years and more. The redistribution which is to take place is not a perfect redistribution. The Minister has never claimed, and I do not claim, that this will remove all the anomalies which exist, but this Bill goes in the right direction, For that reason the Bill is justified. We plead guilty immediately to the fact that when this Bill is completed there will still be anomalies to be put right; there will still be anomalies to be put right when most of us are gone, and in two or three hundred years' time. How can it be otherwise? In Scotland people are still living in houses built in the days of Mary Queen of Scots. How can one value a house like that compared with one built last year? We should have to go over hundreds of years of history to assimilate everything into a perfect scheme without anomalies.

The hon. Member for Thirsk and Malton (Mr. Turton) said that this was a redistribution scheme as between the wise people and the profligates. It would be very interesting to hear the opinion of some of the local authorities who are to receive assistance under this scheme of the hon. Member's description of them as profligates. Some places in Scotland will receive considerable benefits. Sutherland-shire has about 13,500 population, but its administration has to cover 1,250,000 acres, and a penny rate raises £200. With all due respect, it could not be very profligate on £200 with 1,250,000 acres to cover. On the other hand, Bognor—the hon. Member for Hastings (Mr. Cooper-Key) might have brought in this as well—has about the same population and a penny rate brings in £1,300 for a very small acreage. Ross and Cromarty, with a population of nearly 50,000, has two million acres, and a penny rate raises £350. Eastbourne, with the same population, raises £3,700 by a penny rate. The hon. Member for Thirsk and Malton has been looking at the wrong tables if he describes those people as profligates and the people of Eastbourne and Bognor as being wise and thrifty. They are the lucky people of the world, the people who in some cases have nothing to do but amuse themselves while the other people of the world work to keep them in Eastbourne and Bognor.

The problem we have to face is whether these country areas—the constituency of the hon. Member for Thirsk and Malton, the Highlands, Yorkshire and other parts of the country—are to be inhabited or not. If they are to be inhabited—and they must be inhabited if even London is to subsist—the people of those areas are entitled to some of the amenities which the nation can provide. If that is so, we have to redistribute those amenities in a different way from that in which they have been distributed in the past. I remember that a discussion went on about the Charing Cross Bridge. It was pointed out that it could be economically justified because it was in London. Because London has about seven million population, it can get a bridge. If the Forth Road Bridge is under discussion, it is pointed out that it cannot be economically justified; but the point is that it can be justified socially. If the rest of the country is to exist, it must have the facilities for transport. Transport is much more necessary in cases like that than sometimes in the head office of the nation which is situated in London.

Mr. Cook (Dundee)

That is the case with the Tay Road Bridge as well.

Mr. Woodburn

Those of us who have been in industry know that the people in the office always have the most comfortable existence. If one is on the management side—and I was—one always has a much more comfortable existence than the people in the workshop. It is the same with the nation. The people in the head office—in London—get all the privileges, the advantages of the theatres, operas and everything else, and the people in the outposts have to do the suffering. This Bill is an endeavour to readjust some of the anomalies which have existed and which have passed unnoticed to a great extent by all Governments up to date. I must admit that in 1929 some attempt was made to adjust some of the difficulties which arose in connection with the unemployed. I do not want to be unjust in the slightest to those who have done something to change these things in the past.

Among the anomalies are those of valuation. I am quite sure that after listening to the anomalies existing in England, which were described by the hon. Member for Thirsk and Malton, the hon. and gallant Member for Pollok (Commander Galbraith) will realise how hopeless it is to ask me to explain these anomalies or relate them to our own anomalies in Scotland. It cannot be done. I therefore do not propose to waste the time of the House tonight even in making an attempt. It is a matter which would require a far greater investigation than could possibly be carried out under the cover of a Bill of this kind. Similarly, the rating system has been condemned. Everybody has condemned the rating system, especially in Scotland, for the last 30 years; but nobody has done anything about it for the simple reason that nobody knows what to do about it. If the hon. and gallant Member for Pollok or anybody else can suggest any way which will be acceptable to the people of this country, the Government will give consideration to it. Clearly, it is not so easy to remove these anomalies, though we admit they exist. Such matters will require much more investigation and much more study, and a great deal of common consent on the part of the people before they can be removed.

Several hon. Members have raised points about difficulties. I have always noticed that if one gives a lecture on the problems to be faced and what is to be done about them and indicates some of the difficulties, almost certainly when discussion starts people will point out more difficulties that one had not noticed. That has happened today. Everybody has pointed out all the other difficulties which the Minister is supposed to have overlooked. Believe me, if we were to list all the difficulties in the way of progress, it would require an endless and inexhaustible tabulation. Clearly, we are not concerned with all the difficulties; we are concerned about the ones we are tackling. The hon. Member for Oswestry asked whether the losses of the railways would be covered by relieving them of rates, and inherent in his talk about the losses of the railways was the suggestion that such losses would be a condemnation of nationalised railways. That was the inference, and it arises continually about losses of nationalised industries.

Mr. O. Poole

I am not at all sure that I do not think that is so, but in my remarks there was not that inference in any way.

Mr. Woodburn

Then there was no point in the hon. Gentleman putting forward the point.

Mr. Poole

Yes, there was.

Mr. Woodburn

The State can make as big a profit as it likes on the Post Office by simply raising the charges. It can make a loss by reducing the charges. It is a matter of expediency as to whether it is better to give the postal services cheaply, as a subsidy from the nation, or subsidise some of our other services by charging more dearly for the postal services—

Commander Galbraith

Surely the right hon. Gentleman is not giving an indication that that is the intention with regard to the nationalised industries?

Mr. Deputy-Speaker (Sir Robert Young)

The right hon. Gentleman is getting out of Order, and the hon. and gallant Gentleman must not encourage him to go further.

Mr. Woodburn

The hon. and gallant Member might have allowed me to finish my sentence. It is not a test of the efficiency of any service whether it makes a loss or a profit, because the question is not decided in that way. I recognise, Mr. Deputy-Speaker, that I am not in Order, but that point was made for the purpose of having a dig at the nationalised services.

Mr. Poole

May I interrupt? I made no dig at nationalisation, and what I said was entirely in Order. I asked the specific question whether it would be possible to use the term "derated services" to hide losses on the part of railways

Mr. Woodburn

The hon. Member knows the answer to his question as well as I do—

Mr. Poole

No.

Mr. Woodburn

—and he should not ask it.

Mr. Poole

What is the answer?

Mr. Woodburn

Several other hon. Members, including the hon. Member for Accrington (Mr. Scott-Elliot) asked questions in regard to the county contributions to district councils. He has had a satisfactory answer already from the Minister. It is impossible to say how the arrangement will work, because it will depend on how the county interprets its duty.

The hon. and gallant Member for Pollok raised the question of the 25 per cent. and 50 per cent—or 65 per cent. as he termed it. It is not possible for me to produce any figures which would justify either the 25 per cent. or the 50 per cent. since figures could be produced which would justify either. But as he will recognise from the complications in the valuation system in England, the difference between one place and another is so great that even if, by comparing Birmingham and Glasgow, one found that an increase in the percentage was justified, one might find another comparison that led to exactly the opposite conclusion. Therefore, that matter cannot be discussed by picking out isolated instances, and it clearly requires a long investigation.

I recognise, of course, that Glasgow is still dissatisfied on the matter. I met the Associations of Local Authorities and we discussed it, but they were not able to produce any conclusive evidence proving that the 25 per cent. was wrong, though Glasgow claimed that it did produce such figures. Needless to say, at this time it is impossible to verify these figures, and I gave Glasgow a pledge, and I give the hon. and gallant Member a pledge, that we will have these figures examined and try to make some investigation into this matter to see if we can come to a conclusion as to the relative merits of the 25 per cent. or some other percentage.

Commander Galbraith

The right hon. Gentleman has made an important statement. As I understood it, we are taking the 25 per cent. absolutely blind—[HON. MEMBERS: "Oh."] We have no justification for it one way or the other, and, therefore, I hope that the right hon. Gentleman at an early date will make a serious examination into the position.

Mr. Woodburn

We have not taken it blind. We inherited it from the hon. and gallant Gentleman's own party.

Commander Galbraith

That was 27 years ago.

Mr. Woodburn

Yes, 27 years ago, and it was never changed and it was embodied in Bills during all the period since. Therefore, since nobody on that side objected to it while it was being done, it seems rather strange that they have discovered the anomaly now.

Commander Galbraith

Surely the right hon. Gentleman will agree that, when we have a Bill which we are told by the Minister of Health absolutely revolutionises the position between the local authorities and the Exchequer, something like this should have been looked into much more fully than it has been?

Mr. Woodburn

There is only one reply to that. When you build a revolutionary aeroplane, you do not make a revolutionary fuselage and a revolutionary engine at the same time; you test out the engine first and then the fuselage before you combine them. You do not want too many revolutions at the same time.

Mr. McKinlay

May I ask my right hon. Friend whether he would propose to go up in the fuselage without an engine?

Mr. Woodburn

We may all go up in smoke some day, but we will wait until that day comes. The hon. Member for Bridgeton (Mr. Carmichael) raised a question on the payment of town councillors, but I think he rather misread the Bill in this respect. No subsistence and no fares are paid to town councillors for duties in Glasgow under this Bill.

On the question of the distribution of rates from the Hydro-Electric Development (Scotland) Act and from the railway services and the other services, there were two points raised. I will answer first the one about gas, which was raised by the right hon. and gallant Member for the Scottish Universities (Lieut.-Colonel Elliot) and the hon. Member for Oswestry. Gas is very different from electricity and railways in this respect, that gas is largely locally manufactured and much more local in its distribution and general working, whereas railways are more concentrated, in great blocks, in cities like Glasgow, Liverpool, London, Manchester, Birmingham, and so on. That means that the rate from these is concentrated to a far greater degree than in the case of gas, which is dispersed all over the country. The same applies to the great electricity stations which will be concentrated in certain districts and, therefore, will be brought into the pool and distributed in that way.

The question also arose whether in the case of, say, the Hydro-Electric Development (Scotland) Act counties would actually lose—

Lieut.-Colonel Elliot

If the right hon. Gentleman is passing from the gas undertakings, surely he heard his hon. and right hon. Friends maintaining that in the case of gas they hoped to get a gas main which would run all the way down to the South Coast? Furthermore, how does he deal with the subject of the derating of the electricity shop on the one side and the rating of the gas shop, with the gas appliances, on the other?

Mr. Woodburn

My right hon. Friend dealt with this during the Committee stage and, therefore, it is unnecessary for me to deal with it again. The answer to the question whether the distribution of the contribution made by electricity to local rates benefits the county when it is made from the pool or on the present system, is not clear until all the figures are published; but, so far as my investigations go, it will be greatly for the benefit of the counties who are getting the pooled rate. They will get more by the new system under the Bill than under the old system. Dumbartonshire, for example, have now a rateable value from the railways of £865. They have a rateable value from the electricity undertakings of £24,536, which makes a total of £25,401. At 15s. in the pound, that gives them rates of about £19,000. Under the Bill, on 1947–48 expenditure, the contributions from the railways and electricity pools will be £20,723. That is a greater sum than they are at present getting from the existing rating. In addition, the equalisation grant is another £52,736. I think that what happens in Dumbartonshire will probably happen in most other places and will bring about an advantage.

Commander Galbraith

If the right hon. Gentleman will allow me, I asked his opinion as to what is going to happen in the North of Scotland Hydro-Electric Board's area, as definite promises were given when that Measure was passing through the House.

Mr. Woodburn

Part of Dumbartonshire is in the area of the North of Scotland Hydro-Electric Board. It includes the Loch Sloy scheme. Although they seem to be losing, under the new Bill they will actually gain. They expected a 5½d. rate, but because there is a change, one must not assume that there is going to be a loss.

My hon. Friend the Member for Heston and Isleworth (Mr. W. R. Williams) asked about the date of the new English valuation. That will begin to operate at a time to be determined by the Minister having regard to the speed with which the new organisation can be set up. Local experts on present valuation committees will probably be taken over, and continuity of service will be preserved. He also raised a question about an appeal, and seemed to suggest that a valuation court could appeal. Appellants can appeal, but the court itself is not a party to a case and, therefore, cannot appeal. My hon. Friend the Member for Hitchin (Mr. Asterley Jones) raised some interesting points, of which the Minister has taken note, about the cost of sites, and he will take steps to deal with them whore that is possible. [Interruption.] It is not always possible to deal with these things.

The hon. Member for Sutton and Cheam (Mr. S. Marshall) challenged the Minister in dealing with the question of the change of people on local authorities and did not seem to understand that the coming of a new service such as entertainments would bring new types of people into the county councils. Quite obviously he has not realised the great change which has taken place in county councils and town councils over the last few years. The history of local authorities is that of the growth from the Poor Law of 100 and more years ago, and it has been steadily changing from a Poor Law administration into a constructive organisation of society.

At first the Poor Law was its main activity. It was dealing with the effects of disease, crime, dirt and insanitary conditions. People who went on to the local authorities in those days had the one main purpose of keeping down the rates. They went on to local authorities to negative anything that would increase the rates; but they found that one of the causes of high rates was that people died of epidemics, and to prevent epidemics they had to isolate people in hospitals. So hospitals were established to deal with smallpox and other infectious diseases. They also found that if the wage-earner died, frequently the whole family came on to the rates, and they had to investigate the causes of epidemics which they found arose from dirt and insanitary conditions. So we had the development of the sanitary service in order to keep down the rates. We even got street lighting to keep down crime. Policemen and all kinds of services have come from the fact that people went on to the local authorities to do nothing but keep down the rates. The whole history of local government and the development of these services can be traced to that one factor, and I challenge anyone to show anything different.

There was a gradual change. What is most interesting is that the people who went on to these local authorities to keep down the rates often became enthusiastic municipal and local government administrators. My predecessor, my right hon. Friend the Member for Stirling and Falkirk Burghs (Mr. Westwood), when he was on the Fife County Council, was considered to be a revolutionary so far as extravagance in education was concerned. The farmers on one occasion sent a man, whom I came to know in later years, on to the county council to keep down the extravagance of my right hon. Friend. After he became a member of the council he became even more enthusiastic about education than was my right hon. Friend.

In Glasgow, where people went on to the local authority to keep down the rates, there was a development of municipal enterprise that anticipated all the entertainments Clauses of this Bill. Many years ago they pioneered the provision of clinics and of entertainments in the parks. I can remember over 40 years ago free entertainments in the parks in Glasgow provided by theatrical companies of various kinds. Many people, once they got on to the local authorities, became enthusiastic, and the idea of public service in this country has to a large extent grown up under that beneficent development. Hastings and Southport have shown a development of municipal Socialism that is envied by many other places throughout the country.

This Bill has reached its final stage in this House, and we propose to send it on its way. It recognises the fact that it is socially desirable that all parts of the country should be inhabited, and that therefore the amenities of life which people are to enjoy should depend upon the standards which we can afford as a nation, and not upon those which a locality in itself can afford. Economic justifications would bring nearly the whole of industry to London and its vicinity. Prior to the war the drift to London from Scotland and the northern counties of England was fast becoming a menace both to the security and well being of this country.

This Bill is a further step towards the ideal of planning our national life according to our best intelligence instead of leaving ourselves to the mercy of economic momentum. Local government in this country developed mainly, as I have said, out of its responsibilities in administering the Poor Law. As in the case of war with external enemies, so in the war against disease, poverty and insecurity, the nation as a whole is accepting responsibility for looking after the casualties. More and more the central Government of this country is undertaking to look after the casualties of the country in respect of industry, disease and of other defects in our civilisation.

The local authorities are now being given back responsibility for the constructive side of life. The change taking place is that, instead of being merely an ambulance man, the local authorities are now becoming a constructive part of the nation, building up the social life of the people and developing the well being of the community as a whole. What are their duties? They now have to plan development; they provide healthy homes; they care for the children; they prevent disease by sanitation and clean food; they prevent crime. Even the police have changed from dealing with crime to safeguarding children crossing the streets, and are responsible for traffic direction, and do so many of the things which are part of a well-run community. Local authorities deal with education, from babycraft to citizenship; and here, of course, the great mistake in this matter of theatricals or entertainments is to fail to recognise the development that has taken place and the fact that education does not stop now in the 14th or 15th year, but goes on through the whole of life.

Every one of these subjects, the drama, music and culture, is now a part of the national education, and the Clause which we have inserted in the Bill is no more than an understanding of the difficulties of local authorities in trying to carry education right through a person's life. Therefore, as regards amenities, parks, concerts and all the culture that we can think of are now within the power of the local authority to provide for the population.

They also have the care of the aged, and we are giving them the opportunity of guiding and directing their people to a wider and fuller life. Here is a great field for the creative development of local initiative, good will and the creative genius of our people. It is a travesty to suggest that local government is being robbed of its interest by these changes. Actually, it is being given a better interest than ever it had before, and, therefore, I say to the hon. Member for Sutton and Cheam that it will bring in different people and people who are not chosen with a view to trying to keep down the well-being of the community, but people who will come in and utilise the powers of the local authorities to develop all sides of the community nearer to the hearts' desire. Today, that is impossible, because, to some extent, our country is divided into agricultural and industrial areas, into civic areas like

London and country areas like the North of Scotland. Therefore, only a small step can be taken to try to level up these inequalities, but this Bill takes very great power to relieve the people who are the hard workers of the country from the difficulties which they have had to face because of the inequalities in municipal and local government enterprise.

It is a proud day for this Government to see this Bill pass on to the Statute Book, and I hope hon. Members will rise above their petty feelings about the rates and little anomalies, and will realise, as one of my hon. Friends has said, that this is not one Clause about entertainments but a great Bill that is redistributing our well being in a way that can be justified to every honest and decent citizen. I therefore ask the House to pass the Bill.

Question put, "That the Bill be now read the Third time."

The House divided: Ayes, 250; Noes, 94.

Division No. 89.]	AYES.	[9.4 p.m.
Adams, Richard (Balham)	Collindridge, F.	Griffiths, D. (Rother Valley)
Allen, Scholefield (Crewe)	Collins, V. J.	Guest, Dr. L. Haden
Alpass, J. H.	Colman, Miss G. M.	Guy, W. H.
Anderson, A. (Motherwell)	Comyns, Dr. L.	Haire, John E. (Wycombe)
Attewell, H. C.	Cook, T. F.	Hale, Leslie
Austin, H. Lewis	Cooper, Wing-Comdr. G.	Hamilton, Lieut.-Col. R
Ayrton Gould, Mrs. B.	Corbet, Mrs. F. K. (Camb'well, N.W.)	Hannan, W. (Maryhill)
Bacon, Miss A	Corlett, Dr. J.	Hardy, E. A.
Baird, J.	Daines, P.	Harrison, J.
Balfour, A.	Davies, Harold (Leek)	Hastings, Dr. Somerville
Barstow, P. G.	Davies, Haydn (St. Pancras. S. W.)	Haworth, J.
Battley, J. R.	Davies, S. O. (Merthyr)	Henderson, Joseph (Ardwick)
Bechervaise, A. E.	Deer, G.	Herbison, Miss M.
Benson, G.	de Freitas, Geoffrey	Hewitson, Capt. M
Berry, H.	Delargy, H. J.	Hobson, C. R.
Beswick, F.	Diamond, J.	Holman, P.
Bevan, Rt. Hon. A. (Ebbw Vale)	Dobbie, W.	Holmes, H. E. (Hemsworth)
Binns, J.	Dodds, N. N.	House, G.
Blackburn, A. R.	Driberg, T. E. N.	Hoy, J.
Blyton, W. R.	Dumpleton, C. W.	Hudson, J. H. (Eating, W.)
Boardman, H.	Dye, S.	Hughes, Emrys (S. Ayr)
Bottomley, A. G.	Ede, Rt. Hon. J. C.	Hughes, Hector (Aberdeen, N.)
Bowden, Flg.-Offr. H. W.	Edwards, Rt. Hon. Sir C. (Bedwellty)	Hynd, H. (Hackney, C.)
Bowen, R.	Edwards, John (Blackburn)	Irving, W. J. (Tottenham, N.)
Braddock, Mrs. E. M. (L'pl, Exch'ge)	Edwards, N. (Caerphilly)	Jeger, G. (Winchester)
Braddock, T. (Mitcham)	Evans, Albert (Islington, W.)	Jones, D. T. (Hartlepool)
Bramall, E. A.	Evans, E. (Lowestoft)	Jones, Elwyn (Plaistow)
Brook, D. (Halifax)	Evans, S. N. (Wednesbury)	Jones, P. Asterley (Hitchin)
Brooks, T. J. (Rothwell)	Ewart, R.	Keenan, W.
Brown, George (Belper)	Farthing, W. J.	Kenyon, C.
Brown, T. J. (Ince)	Fletcher, E. G. M. (Islington, E.)	Key, G. W.
Bruce, Maj. D. W. T.	Follick, M.	King, E. M.
Buchanan, Rt. Hon. G.	Forman, J. C.	Kinghorn, Sqn.-Ldr. E.
Burden, T. W.	Freeman, Peter (Newport)	Kinley, J.
Burke, W. A.	Gaitskell, Rt. Hon. H. T. N.	Lawson, Rt. Hon. J. J.
Carmichael, James	George, Lady M. Lloyd (Anglesey)	Lee, F. (Hulme)
Chamberlain, R. A.	Gibbins, J.	Leslie, J. R.
Champion, A. J.	Gibson, C. W.	Levy, B. W.
Chater, D.	Gilzean, A.	Lewis, A. W. J. (Upton)
Chetwynd, G. R.	Glanville, J. E. (Consett)	Lewis, T. (Southampton)
Cluse, W. S.	Gooch, E. G.	Lindgren, G. S.
Cobb, F. A.	Greenwood, A. W. J. (Heywood)	Lipton, Lt.-Col. M.
Cocks, F. S.	Grenfell, D. R.	Longden, F.
Coldrick, W.	Grey, C. F.	Lyne, A. W.
Collick, P.	Grierson, E.	McAdam, W.
McEntee, V. La T.	Porter, E. (Warrington)	Taylor, R. J. (Morpeth)
McGhee, H. G.	Porter, G. (Leeds)	Taylor, Dr. S. (Barnet)
Mackay, R. W. G. (Hull, N.W.)	Price, M. Philips	Thomas, D. E. (Aberdare)
McKinlay, A. S.	Pritt, D. N.	Thomas, Ivor (Keighley)
Maclean, N. (Govan)	Proctor, W. T.	Thomas, I. O. (Wrekin)
McLeavy, F.	Pryde, D. J.	Thomas, John R. (Dover)
MacMillan, M. K. (Western Isles)	Pursey, Cmdr. H.	Thomas, George (Cardiff)
Macpherson, T. (Romford)	Randall, H. E.	Thorneycroft, Harry (Clayton)
Mallalieu, J. P. W.	Ranger, J.	Thurtle, Ernest
Mann, Mrs. J.	Rankin, J.	Timmons, J.
Manning, C. (Camberwell, N.)	Reeves, J.	Titterington, M. F.
Manning, Mrs. L. (Epping)	Reid, T. (Swindon)	Tolley, L.
Marshall, F. (Brightside)	Richards, R.	Tomlinson, Rt. Hon. G.
Mathers, Rt. Hon. George	Ridealgh, Mrs. M	Ungood-Thomas, L.
Middleton, Mrs. L	Robens, A.	Vernon, Maj. W. F.
Mikardo, Ian	Roberts, Goronwy (Caernarvonshire)	Walkden, E.
Mitchison, G. R.	Roberts, W. (Cumberland, N.)	Walker, G. H.
Moody, A. S.	Robertson, J. J. (Berwick)	Warbey, W. N.
Morgan, Dr. H. B.	Rogers, G. H. R.	Watkins, T. E.
Morris, Lt.-Col. H. (Sheffield, C.)	Sargood, R.	Watson, W. M.
Morris, P. (Swansea, W.)	Scott-Elliot, W.	Webb, M. (Bradford, C.)
Moyle, A.	Sharp, Granville	Wells, W. T. (Walsall)
Murray, J. D.	Shawcross, C. N. (Widnes)	West, D. G.
Nally, W.	Shurmer, P.	Wheatley, John (Edinburgh, E.)
Neal, H. (Claycross)	Silverman, S. S. (Nelson)	Whiteley, Rt. Hon. W.
Nichol, Mrs. M. E. (Bradford, N.)	Simmons, C. J.	Wigg, George
Oldfield, W. H.	Skinnard, F. W.	Wilcock, Group-Capt. C. A. R.
Oliver, G. H.	Smith, C. (Colchester)	Wilkins, W. A.
Orbach, M.	Smith, Ellis (Stoke)	Willey, F. T. (Sutherland)
Paget, R. T.	Smith, H. N. (Nottingham, S.)	Williams, D. J. (Neath)
Paling, Rt. Hon. Wilfred (Wentworth)	Smith, S. H. (Hull, S.W.)	Williams, J. L. (Kelvingrove)
Paling, Will T. (Dewsbury)	Soskice, Sir Frank	Williams, W. R. (Heston)
Palmer, A. M. F.	Stamford, W.	Willis, E.
Pargiter, G. A.	Steele, T.	Wilson, Rt. Hon. J. H.
Parker, J.	Stewart, Michael (Fulham, E.)	Woodburn, A.
Parkin, B. T.	Stross, Dr. B.
Paton, Mrs. F. (Rushcliffe)	Swingler, S.	TELLERS FOR THE AYES:
Paton, J. (Norwich)	Sylvester, G. O.	Mr. Popplewell and
Pearson, A.	Symonds, A. L.	Mr. G. Wallace.
Perrins, W.	Taylor, H. B. (Mansfield)
NOES.
Agnew, Cmdr. P. G.	Jarvis, Sir J.	Raikes, H. V.
Baldwin, A. E.	Jeffreys, General Sir G	Ramsay, Maj. S.
Boles, Lt.-Col. D. C. (Wells)	Jennings, R.	Roberts, P. G. (Ecclesall)
Bower, N.	Joynson-Hicks, Hon. L W	Ropner, Col. L.
Boyd-Carpenter, J. A.	Keeling, E. H.	Scott, Lord W.
Bromley-Davenport, Lt.-Col. W.	Kerr, Sir J. Graham	Shephard, S. (Newark)
Buchan-Hepburn, P. G. T.	Lambert, Hon. G.	Shepherd, W. S. (Bucklow)
Carson, E.	Lancaster, Col. C. G.	Smiles, Lt.-Col. Sir W.
Challen, C.	Langford-Holt, J.	Snadden, W. M.
Channon, H.	Law, Rt. Hon. R. K.	Spence, H. R.
Clifton-Browne, Lt.-Col. G.	Legge-Boarke, Maj. E. A. H.	Stoddart-Scott, Col. M.
Conant, Maj. R. J. E.	Lennox-Boyd, A. T.	Strauss, H. G. (English Universities)
Cooper-Key, E. M.	Lloyd, Selwyn (Wirral)	Sutcliffe, H.
Corbett, Lieut.-Col. U. (Ludlow)	Low, A. R. W.	Taylor, C. S. (Eastbourne)
Crosthwaite-Eyre, Col. O. E.	Lucas-Tooth, Sir H.	Teeling, William
Crowder, Capt. John E.	MacAndrew, Col. Sir C.	Thomas, J. P. L. (Hereford)
Cuthbert, W. N.	Macdonald, Sir P. (I. of Wight)	Thorp, Brigadier, R. A. F.
Davidson, Viscountess	Maitland, Comdr. J. W.	Touche, G. C.
Digby, S. W.	Manningham-Buller, R. E.	Turton, R. H.
Dower, Col. A. V. G. (Penrith)	Marples, A. E.	Vane, W. M. F.
Drayson, G. B.	Marshall, D. (Bodmin)	Wakefield, Sir W. W.
Dugdale, Maj. Sir T. (Richmond)	Molson, A. H. E.	Walker-Smith, D.
Duthie, W. S.	Mott-Radclyffe, C. E.	Wheatley, Colonel M. J. (Dorset, E.)
Elliot, Lieut.-Col., Rt. Hon. W.	Neill, W. F. (Belfast, N.)	White, J. B. (Canterbury)
Fleming, Sqn.-Ldr. E. L.	Neven-Spence, Sir B.	Williams, Gerald (Tonbridge)
Galbraith, Cmdr. T. D.	Odey, G. W.	Willoughby de Eresby, Lord
George, Maj. Rt. Hn. G. Lloyd (P'ke)	Orr-Ewing, I. L	York, C.
Grimston, R. V.	Osborne, C.	Young, Sir A. S. L. (Partick)
Hannon, Sir P. (Moseley)	Pickthorn, K.
Headlam, Lieut.-Col. Rt. Hon. Sir C.	Poole, O. B. S. (Oswestry)	TELLERS FOR THE NOES:
Hope, Lord J.	Prescott, Stanley	Mr. Studholme and
Hurd, A.	Price-White, Lt.-Col. D.	Brigadier Mackeson.
Hutchison, Lt.-Cm. Clark (E'b'rgh W.)	Prior-Palmer, Brig. O.

Question put, and agreed to.

Bill accordingly read the Third time, and passed.