§ Order for Second Reading read.
§ (4.45.) MR. MUNRO FERGUSON (Leith, &c.)
Mr. Speaker, I regret that this measure should have come on so unexpectedly and at so late an hour. The subject was discussed at a recent Sitting on a Motion by the hon. Member for Dumfries, which received a very large measure of support. I can speak with some confidence on the subject to which I have given some attention, and having, as a landowner, had to deal with questions raised by the expansions of towns, when land becomes valuable, and when no redress frequently can be obtained from the landowners, whose 923 property surrounds the growing community. In nearly every ease of a large town you find it rapidly expanding, and that the inhabitants are obliged to pay whatever price for the land they require that it may suit the landowner to ask. That Constitutes in Scotland a very considerable public grievance, and I doubt whether many questions excite more interest than that of the ability of the inhabitants of large towns to acquire the land necessary for their requirements at reasonable prices. The Bill has three purposes. The first is the power of compulsory purchase. Under the machinery of the Bill it is provided that a valuation should be made of the land required for the town. This Bill does not deal with the wider question of taking land compulsorily for agricultural purposes; it simply deals with the question of obtaining land for the building purposes of towns. The second purpose is to deal with the question of unearned increment. We recognise in this Bill that you cannot deal with unearned increment which has accrued in the past, but provision is made for dealing with it as it may arise in the future. All existing interests are entirely safeguarded in the Bill; there is nothing which will convey any suspicion of confiscation in regard to anything that is proposed. The third purpose is that the land should be rated according to the actual value. That was one of the recommendations of the Housing of the Working Classes Commission, but no practical steps are now being taken to put chat into force. This Bill has been reviewed in no hostile spirit by the Society of Solicitors, and there have been Petitions in its favour from a large number of persons, and I believe myself that it has the support of public opinion in Scotland. Speaking as a landowner, I feel satisfied that landowners will have nothing to complain of if this Bill be carried into law.
§ Motion made, and Question proposed, "That the Bill be now read a second time."
§ *(4.50.) MR. HALDANE (Haddington)
Mr. Speaker, I rise for the purpose of supporting the Motion for the Second Reading of this Bill, and, in doing so, I desire to explain two points of novelty which occur in it, and which I think are 924 entirely new to the House. Machinery is for the first time provided for intercepting the unearned increment—a difficult problem, which is awaiting settlement throughout the country. Cases are constantly occurring in which, owing to the growth of a community, the owner of land finds the value of his land increased from 10 to a hundredfold without any effort of his own, and he puts this increased value into his pocket. The machinery of the Bill provides that the Local Authority shall be empowered to have lands valued with a view to subsequent purchase, and to purchase at any time within 20 years on the basis of their actual market value minus so much as is ascertained on the basis of the first valuation to represent the special increment due to the growth of the adjacent town. The increased value of such lands, due to the growth of the community, will thus be secured to the Municipality. The second point of novelty in the Bill has reference to the rating of unoccupied building land. It is unfair—and this point has been endorsed by the right hon. Gentleman the Member for West Birmingham— that building land should be rated at its actual yield—the owner meanwhile biding his time till its value is so increased by the growth of the community as to make it worth his while to sell. The Bill proposes that the land shall be estimated at its capital value for building purposes and assessed at 4 per cent. of that value. The owner, however, is given the alternative of having the capital value assessed on the actual yield, and being assessed on 4 per cent. of that capital value, with the condition that the Local Authority shall, if it think fit, be entitled to purchase the land at such capital value so ascertained. These provisions seem to me equitable, and are calculated to meet the various cases of hardship which occur in Scotland. There is the case of the town of Cumnock, and other cases with which Members of this House are familiar. We have confined the provisions of the Bill to Scotland, because the drafting of the measure was matter of considerable difficulty, but still the machinery of the Bill, with alterations in detail, would be made applicable to England. The Bill is, I venture to submit, absolutely devoid 925 of anything like confiscation, and, in view of the growing pressure af this enormous land question with which we are being brought face to face more and more every day, the Government would do well to assent to what, in principle is a reasonable proposition, rather than wait till the pressure of outside opinion and a sense of injustice shall make it impossible to deal with the landowners.
§ (4.55.) THE SOLICITOR GENERAL FOE SCOTLAND (Mr. M. T. S. DARLING,) Edinburgh and Aberdeen Universities
Mr. Speaker, the speech of the hon. Gentleman who moved the Second Reading of this Bill might have led the House to suppose that it is a very simple and innocent measure, but the hon. and learned Gentleman who has just sat down has pretty well disclosed the principles to which this House is invited to give its adhesion by affirming the Motion for the Second Reading. The hon. Gentleman who moved the Bill represented that it had three main purposes in view. The first is to allow of the compulsory purchase of land at the discretion of either the Town or the County Council. Whatever may be the views of the House as to the policy of giving such power, under limitation, I shall only point out that this Bill provides no limitations at all upon the amount of land that may be acquired by the Local Authority. They may buy a whole county if they are so minded, and have the means to do it. And the purpose for which they buy the land is in no way limited. They may lease it or sell it; in short, there is nothing in the Bill to prevent them embarking upon a course of land speculation. The Bill provides, no doubt, for control by a local tribunal, consisting of a Judge and a Surveyor, who are to be satisfied that the purchase is in the public interest; still, I think, the House will see that there is practically no limit to the discretion which the Town Council or the County Council may exercise, so long as they are able to satisfy the local Judge and the local Surveyor that what they are proposing to do is in the public interest. They may become large landowners, and lease out farms. That may be in the public interest, but it may be done without any sort of communication with Parliament, and it is to be left to 926 the arbitrament of the local Judge what is in the public interest. I think it is a most unfair duty to cast on the local Judge, because you bring him into conflict with the Local Authority, which is most undesirable. So much for the first purpose of the Bill. The purpose of the second part of the Bill is still more surprising. It is to enable Local Authorities to have a valuation made on any land within their area, with a view to ultimate acquisition, and the extraordinary part of the proposal is that, within 20 years of the valuation, the Local Authority is to be empowered to buy the land, not at its value at the time being, but at the reduced value if the land falls in value, and at the valuation if the land rises in value. Clause 12 of the Bill proposes that the price payable for land shall be the value of the land as between willing buyer and seller, less any increased value ascertained to be due to the increase or movement of population, or to industrial or other developments. Let it be supposed that a movement of population takes place within an area of a Local Authority, the effect of which is to raise the value of land in one part and to diminish it in another, and that a man owns property in both parts. Within the 20 years the Local Authority may come down upon him and claim land in the part in which the value has fallen at the reduced rate, while for land in that part in which the value has risen he will get no share of the risen value. He is, in fact, made to suffer for a fall in values which is due to industrial or other movements, but yet he will be prevented from reaping the benefit of an increase in value. Can anything be more unfair than that? Surely, it is in itself sufficient to justify the rejection of the Bill. I will not enter into a discussion on the doctrine of the unearned increment. It has never yet received the sanction of Parliament, and I do not think it is likely to receive Parliamentary sanction when introduced in this insidious manner in a measure which purports to have a different prime object. With regard to the third purpose of the Bill, I will only say a word or two. The object is to take hold of any portion of land near a town which could, in the opinion of the Local 927 Assessor, be said to have a certain value as building land. The Local Assessor is to be the sole arbiter under the Bill, and the moment he finds land of value for building purposes, he is to ascertain its capital value, whether prospective or otherwise, and the unfortunate landowner is again to take all the disadvantage. There is one very formidable objection to this part of the Bill, and that is, that it proposes to affirm a principle which is now under the consideration of the Select Committee on Town Holdings. It seems to mo that it would be a very strange thing for the House to appoint a Committee to consider a principle, and, pending its determination, to affirm that principle. Now, the Town Holdings Committee, of which I have the honour to be a member, has been appointed to inquire into the question of imposing a direct system of taxation on ground rents, and on the increased value imparted to land by building operations. The reference to the Committee is, perhaps, not quite so wide as it would have been had the questions raised in this Bill been specially referred to it, but hon. Members of the Committee will bear me out in saying that we have given a very wide interpretation to the reference, and we are taking evidence on the point whether ground suitable for building ought not to be rated at more than its actual value. I think it would be most inconvenient to read this Bill a second time before the Committee has reported, and, for the reasons I have stated, it is impossible for the Government to assent to the Second Reading Motion.
(5.10.) MR. J. B. BALFOUR (Clackmannan)
There are many questions of great importance involved in this Bill, and it is, therefore, unfortunate that the Debate on it should have come on at so late an hour as not to afford sufficient time for the full consideration of the question. But I have a suggestion to make which those who have brought the Bill forward are, I believe, prepared to accept. It is that the Bill be referred to a Select Committee. One can quite see from the present condition of public business that hardly any opportunity is likely to be obtained in this House for the consideration of the many proposals contained in the Bill. A great many of the objections raised by 928 my hon. Friend the Solicitor General for Scotland to the purposes of the Bill were rather in the nature of criticisms, which might be considered in Committee with a view to rectification. For instance, the question as to the limit of the powers to be conferred on Local Authorities is eminently one for consideration in Committee. No doubt some of the general questions involved in the Bill are fresh in the minds of hon. Gentlemen, inasmuch as there was lately a discussion on the Motion of my hon. and learned Friend the Member for Dumfries, in which they were fully considered. The fact of this Bill having been introduced prevented, I believe, the case of Scotland being specially entered on in that Debate, but still several general principles were affirmed, and the Motion was only defeated by the small majority of 15. I think that where there is such a division of opinion in the House this Bill might very well be sent to a Select Committee for consideration. I hold that the third point raised by my hon. and learned Friend is one which could not very well be argued out on a Second Reading Debate, that a Select Committee would be much more qualified to deal with all these points, because, even if it did not take evidence, it might be allowed access to the evidence given before the Town Holdings Committee. On the understanding that the Bill goes to a Select Committee I shall support the Motion for the Second Reading.
§ *(5.15.) MR. MARK J. STEWART (Kirkcudbright)
The Bill has come on very unexpectedly, and, consequently, the Scotch Members are taken somewhat by surprise. And it is not the first surprise this House has had to-day. The Bill deals with very important questions, and it is impossible to discuss it adequately at this hour. Still, if it passes the Second Reading I shall hail with pleasure its being referred to a Select Committee. There are many points likely to be raised which would not appear from a mere perusal of the measure. There is, for instance, the question whether one of the effects of the Bill would not be to prevent owners from improving their land, seeing that if they did so the Local Authority alone would reap the benefit. I venture to think the Bill would stop all improvements. Again, gross injustice might be done by means of the 929 powers it is proposed to give the Authorities over waste lands in the neighbourhood of towns—lands which are increasing in value every year. The compulsory taking of land might engender bitterness, and possibly strife, which would not pass away for generations. Again, there is the proposal as to unearned increment, which requires very careful consideration. On all these grounds I hope the Government will not assent to the Motion for Second Reading—at any rate if they do, that the Bill will be sent to a Select Committee.
§ *(5.20.) MR. J. A. CAMPBELL (Glasgow and Aberdeen Universities)
I agree with what my hon. Friend has said as to the impossibility of properly discussing this Bill in the short time at our disposal, and I, therefore, beg to move the adjournment of the Debate.
§ Motion made, and Question proposed,?' That the Debate be now adjourned."
§ The House divided:—Ayes 210; Noes 168.—(Div. List, No. 84.)
§ Debate to be resumed To-morrow.