HC Deb 14 July 1913 vol 55 cc983-93

Order for consideration, as amended, read.

Motion made, and Question proposed, "That the Bill be now considered."—[Mr. Maclean.]


I beg to move, as an Amendment, to leave out the word "now," and at the end of the Question to add the words "upon this day three months."

I ought to explain to the House the somewhat peculiar circumstances in which this Bill comes before it. It is a Bill which seeks to give power to the London County Council to borrow large sums of money. Year by year the London County Council have to come to this House to get authority to borrow sums for its capital expenditure. In the case of any provincial city or borough the municipal authority has to make out a case before an inspector of the Local Government Board, but the position of the London County Council is unique in the respect that it has no such duty upon it, and that it comes direct to this House. It promotes, year by year, a Bill, and as a general rule, the Bill goes through unopposed. From time to time, somebody in the House makes a Motion such as I am making to-night, for the purpose of getting an explanation as to certain sums for which the London County Council ask power to borrow. I have had the privilege on four or five previous occasions of making similar Motions and asking questions as to the powers the London County Council seek at the hands of this House. It is not an interesting question, but it is a question which the House ought to consider carefully before it authorises such large expenditure as is provided for in this Bill, and we ought to be satisfied that the powers are necessary and for the good of the public at large. There was, in 1909, not in consequence of my intervention, a gratifying drop in the amount for which power to borrow was asked. This year, unfortunately, the figures have risen, and the county council are now asking power from this House to borrow a sum of £5,332,475. That is a larger sum than they have sought to borrow for the great number of years, certainly since 1907 or 1908, and it is quite apart from the sum they propose to borrow, £78,000,000, for loans to various borough. The sum in which I am particularly interested is the £5,332,475, the details of which are included in the Schedule, and as to the more important items I am going to ask the representative of the county council to give us some explanation.

The first point is a minor matter about which I have asked before. It is No. 25 and relates to the erection of buildings and incidental expenditure in connection with the new County Hall, for which they ask power to borrow £301,000. As long ago as 1905 or 1906 I asked in this House whether the county council had any estimate of the amount they were going to spend upon this hall. At that time they had not got one. I do not know whether they have one now. At that time we voted a considerable sum of money to enable them to make preparations for building the County Hall, and, as I understand it, this is the first sum we have been asked to vote for the actual building of the hall. I should like the hon. Gentleman in charge of the Bill what the county council expects the total expenditure upon this hall will be. I understand that the £301,000 is merely an instalment. We ought to go very carefully before we vote an instalment, and inquire what sum the county council intend to spend upon what may be a necessary building, but which may be looked upon rather as a luxury. My second point, which probably has the most public importance, is item No. 28, "Provision of schools and other purposes." The county council ask this year in that connection for the extraordinarily large sum of £1,000,000. Nothing like that has been asked for before. I have the figures here, but the House may take it from me that the amount asked for in previous years has been nothing like £1,000,000. I gather that this extraordinary demand is largely in respect of alterations to buildings which are necessary owing to requests made by the Board of Education, and it may be that the county council are not entirely to blame for it. If that is so, the House should consider the matter carefully before this vast expenditure is made by the county council. If the Board of Education regulations make the London County Council pay something like £1,000,000 in one year for the alteration of buildings for the purpose of making classes smaller, probably we shall afterwards be asked to authorise the enlargement of playgrounds in the City of London, where land is of great value. If this sum were required in order to pay more to the teachers, I should be the last person to object, because I believe it would increase the benefits of education and be for the good of the teachers in many cases. But this is a capital sum, which has nothing to do with the salaries of teachers. They come from year to year out of the rates or Grants. This £1,000,000 is to be borrowed simply for the purpose of bricks and mortar, or, more correctly, for the purpose of altering existing bricks and mortar, by sub-dividing class-rooms and altering them in various ways. I submit that is a very severe tax upon the community, and I ask that the hon. Member should give some explanation of this large increase before it is passed.

I should like an explanation upon two other points in the Bill. In regard to one, there is a very great increase—that is, the sum of £500,000, which the county council propose to borrow for purposes connected with the Metropolis Management Acts, 1855 and 1862, and contributions to local improvements and expenditure upon improvements and work authorised by various Acts. I should like some explanation why that figure has gone up to £500,000. Turning to a very small point, an old friend with which I have often troubled the House, item No. 32, "Thames River Steamboat Service Act, 1904," I may say that I am an interested party in this particular point, because I once held a very few shares in an unfortunate company which was run off the river by the competition of the London County Council. The item provides for the partial reconstruction of Greenwich Pier, for which power to borrow £2,200 is asked in the coming year. Will the hon. Member in charge of the Bill explain why that work is still necessary. I understood that Greenwich Pier had been repaired or rebuilt some little time ago.

I want to impress on the House the importance of our getting a check on this expenditure. It has always been important, but it is more important this year than it has been in other years. Every other year when the County Councils Money Bill has come before the House it has had to put in it what powers it was to have as to borrowing, as to repayment, and also as to the use of the sinking fund. Many great financiers have criticised these provisions from time to time in the House, and last year, possibly to avoid the difficulties occasioned by these criticisms or for the sake of convenience, they carried through a Consolidation Bill which was not, therefore discussed in the House, and which put them in an extraordinarily strong position from their point of view, and with reference to these very large borrowings they are proposing to make this year they have power, with the consent of the Treasury, to defer repaying any of these sums over a period of sixty years. They have greater power now than they have had in any previous year when this Bill has come before the House.

It is important for this reason. It is a dangerous power to give any local authority when it comes to such a large sum of money, as, for instance, the figure of £1,000,000 for building and repairing board schools, because with the present constant changing of Orders from the Board of Education, if we are to have a succession of these somewhat irritating Orders which do not assist education, but increase the burden on those who are trying to educate the people at large, the life of a school is not likely to be fifty years, and the very schools which are being altered this year, I imagine, will none of them attain to that happy age of longevity, and they have probably all been built during the last ten or fifteen yea's. When you come to borrowing money for the purpose of building schools and repairing old schools and spread it over fifty years, that is a very considerable financial advantage to the municipal authority which is borrowing, and one which I am not quite sure the House is justified in passing without some explanation. It is a matter of importance that sums of this magnitude should be checked by someone, and in the peculiar position of the London County Council there is no one who can check them, it is no one's duty to go into them, to raise any objection or to ask for any explanation, except this House. That is my excuse for bringing the matter before the House.


I beg to second the Amendment.


I am sure every Member of the London County Council and every ex-member, indeed, I think every ratepayer in London, must regard with pride and satisfaction the intelligent and inquisitive interest which my hon. and learned Friend takes in the expenditure of the London County Council. The mere fact that the London County Council have to come to Parliament for all its capital expenditure, whether borrowed for its own use or for the use of other local bodies, which is controlled and regulated by the House of Commons, makes it impossible for anybody to complain of any criticism which may be passed by the House of Commons upon that expenditure, because the House of Commons, having to regulate and control it, must undertake a certain amount of responsibility for it. I have no complaint whatever to make of the criticism of my hon. and learned Friend. Indeed, the questions he asked were most apposite and most pertinent and, probably, as one who is rated himself with this expenditure, he has every right to know what is the ground for it and whether or not it is justified. I hope to prove that it is justified and I hope to allay any alarm he may feel as to the excessive nature of the expenditure as it appears in this Money Bill. The Bill, in asking for an expenditure for a total borrowing power of £6,565,475, is a little misleading, because from that sum we ought to deduct the powers given last year which were never used. They could have spent to the amount of £3,794,930, so that the net aggregate new borrowing powers are £2,770,545. I should like to assure my hon. and learned Friend that there is a great deal of check and a good deal of criticism in the county council itself. There was a time when the criticism and the check and control of the finance committee of the county council was not very substantial and not very real, but that control now is very complete indeed. Estimates are submitted by the various spending departments to the Finance Committe, and they are thoroughly overhauled by the Finance Committee from the point of view of what the council can really afford to spend. Days are set up in the county council, just as in the House of Commons in Supply, in which all the great terns, both of capital expenditure and revenue expenditure, can be and are very fully discussed. So that there is a great deal of criticism within the council itself.

The House must recollect that, after all, this great spending authority has to submit itself for re-election once every three years, and the elections are fought most strenuously and every particle of expenditure during those three years, and the policy which dictates expenditure, is very minutely examined by the electors and by the ratepayers themselves. I agree with my hon and learned Friend that there was a drop, and a long drop, in 1908–9 in the amount of money which the council sought power to borrow. I am rather proud of that fact, because it was the first time the London Municipal Reformers obtained possession of the county council, and they set to work to see whether they could not borrow less money and make their actual estimates of expenditure approximate more nearly to the actual expenditure from year to year. No doubt there was a fault in that direction, and the county council had got into the habit of asking for power to raise larger sums of money than it was ever likely to spend. During the last few years undoubtedly the estimates for capital expenditure have approximated much more nearly to the actual amount which is to be spent, but still for all that, they cannot approximate very nearly, because under the rules and regulations which govern expenditure in the county council you cannot shift expenditure from one head to another, and therefore it is obligatory on those who are responsible for the policy and expenditure of the county council to ask under each head for more money than they are likely to spend. If it were possible to shift the expenditure from one head to another, I have no doubt that these estimates would be more approximately accurate. There has been a little criticism by my hon. and learned Friend because this year the county council is asking rather more money than it asked in the years 1908 and 1909. After all, it is quite impossible to make a comparison of one year with another. A fair estimate would be to compare one quinquennial or decennial period with another similar period.

My hon. and learned Friend first of all asked information as to the money to be expended on improvements under the Metropolitan Management Act of 1855. He asked why we want so large arum as £681,145. It is impossible to regulate this expenditure so that one year tallies with another year. Some years, it is obvious, you must carry out greater works in the way of road improvements than in other years. One year you may have a favourable opportunity for purchasing property at a better price than in other years. This year we are looking to the carrying out of one or two important improvements. The widening of Kingsland Road and Ball's Pond Road will cost £186,000. That is the contribution for this year. That is an improvement which is very much needed. We contemplate spending £150,000 on the widening of the Strand, which, again, is very much needed. These are items of expenditure which have been very thoroughly canvassed by the committees of the county council, and thoroughly overhauled by the county council itself. I do not think there is an item to which, if my hon. and learned Friend had intimate knowledge of these matters, he would offer any objection at all. He would say, "All that is perfectly legitimate expenditure by the county council as the successors of the old Metropolitan Board of Works." No body like the London County Council could possibly exist if it did not carry out from year to year large Metropolitan improvements, such as the widening of roads and streets, and generally making traffic in London more easy than it is at present.

The hon. and learned Gentleman asked a question in regard to Greenwich Pier, upon which it is proposed to spend £2,200. When the river steamboat service was given up on account of the enormous annual loss to the ratepayers, which we did not think justified the expenditure, the piers which had been bought from the Thames Conservancy reverted to the Thames Conservancy—or rather, its successors, the London Port Authority—but the piers which the county council itself had wholly or partly erected, or bought from another authority, did not revert to the Port of London Authority. They remained in the hands of the council. This particular pier is going to wreck and ruin, and can be of no use to the county council which cannot hope to earn toll by the users of this pier unless a considerable sum of money is spent on repairs. The county council receives a fair amount from coasting steamers for the use of the pier. We are proposing to put it into a state of repair, and continue the charge for that service, but the pier will not be of use if it is not repaired. I hope that this explanation will be satisfactory to my hon. and learned Friend, and that it will show there is no intention to revive the old Thames steamboat service which caused such a serious loss to the ratepayers. As to the expenditure on the London County Hall, the hon. and learned Gentleman asked whether there has been any estimate. I can assure him that there has been an estimate which has occupied a very great deal of time and attention on the part of the Establishment Committee to which that expenditure is entrusted. It has also occupied a great deal of time and attention from the Finance Committee. The total estimated cost of the whole scheme, that is to say, the site, the buildings which are to be put upon that site, the reclaiming of the river, and everything connected with it, is £1,770,376. It is obvious that after you have got your foundations in and reclaimed the river, the expenditure proceeds more rapidly. That accounts for the fact that we are asking to borrow a considerably larger sum this year than last year, and it is only reasonable to surmise that next year and the year after the amount will be very much larger, because it is obviously in the interest of everybody to get this building up as soon as possible, and more especially when we realise that the council is paying for the rents of different buildings £40,000. The inconvenience to the council's work is enormous through having buildings scattered in almost every direction, and connected by telephone. Undoubtedly we shall be capable of much more efficient and effective work when we get all the different departments, or most of them, under one roof, where all our servants will work with one another.

I do not think any person ever supposed that you could get a county hall for much less than it is now proposed to expend. I thought that £1,500,000 would be quite sufficient, but, after all, the House must recollect that new duties are constantly being imposed on the London County Council, and that, therefore, the staff must be enlarged in order to undertake these duties. What would have sufficed seven years ago would not suffice to-day, because of the new duties and the additional staff. I hope I have satisfied my hon. and learned Friend. He may think that we are rather too extravagant, but I am sure he will agree that it was absolutely necessary for the county council to have a new County Hall in which to cencentrate all the staff. After all, these matters are all criticised in the most vigorous way by the two parties in the London County Council, and the electors themselves recently had an opportunity of saying whether or not they approved of the general policy carried out by the county council. The hon. and learned Gentleman also asked information as to the large expenditure on schools and school buildings. He said he would not object at all to a large expenditure on the salaries of teachers, but that he did rather object to, or, at all events, he thought he ought to criticise, the large expenditure on bricks and mortar. Let me tell him that the teaching staff in London are very well paid compared with the teaching staff anywhere else. There is a pension scheme, which I do not think any other local education authority has set up—at all events on the same scale. Nobody can say that the London education authority is in any way mean or niggardly in its treatment of its teachers. As regards buildings in London, we have to pay a large price for school buildings. The cost of the buildings is due to the expensive charges for building materials, which, as everybody knows, have been and are still going up. Again, I say I do not think this is an excessive sum if the House considers what the Department of Education demands on the part of education authorities. I do not say that we should have spent all this money on our own initiative. A certain amount has to be spent on schools for physically and mentally deficient children, and a certain amount on training colleges, but the great bulk of the expenditure is occasioned by the policy of the Board of Education in gradually bringing pressure to bear so that the local education authorities, certainly the London education authority, have to adopt the policy of reducing the size of their classes. When that policy was first introduced, the London County Council asked for time to consider its full effect. After much deliberation and controversy, the London County Council agreed gradually to bring about a policy by which every class for infants would be reduced to forty-eight, and every class for children other than infants would be reduced to forty.

That is going to cost a great deal of money. I do not say that I grudge it. I think that no teacher, certainly in the higher classes, can teach efficiently more than forty. It will cost altogether over £5,000,000, spread over fifteen years. That alone will mean something like a 4½d. rate. That is the cause of asking such a very large sum this year, because though the scheme will be spread over fifteen years the Board of Education will insist on a very large amount of work during the next two years. We must pull down some schools and rebuild others, and, altogether, they hasten the rate at which we should otherwise have been willing to spend our money. I think if we can afford it, it is a good thing. It is a question of what we can afford. The education rate in London is very high. We are looking forward to a time when part of it may be borne by the taxpayers, who ought to bear it, and not by the ratepayers. While I admit that we are borrowing a great deal of money, yet it is satisfactory that every year we are borrowing less money than we pay back, and both the borough councils and the county councils are in this respect setting a good example to provincial bodies. The net debt of the London County Council on the 31st March, 1911, was £51,832,845. On the 31st March, 1912, it was £51,809,784, and on the 31st March, 1913, it was £51,398,842, so that the net debt of London is gradually decreasing notwithstanding the very large sums of money which are being spent on what are, after all, in the main, useful purposes. I hope that that will satisfy my hon. and learned Friend and the ratepayer, that the money is being well expended, that we are not lavish in our expenditure, but are spending our money well and wisely, and that the whole financial position of the London County Council at the present moment is sound and healthy, and redounds to the credit of all those governing this great expenditure and administering this money which is placed at their disposal.


I thank my right hon. Friend for the spirit in which he has received the criticisms which I have made. I hope that he will not expect me to accept everything which he has said. The local debt the last time that I referred to the matter was £49,000,000. It has certainly gone up since then, but I hope that it will now gradually be reduced. I do not suppose there is anything to be gained by dividing the House, and I ask leave to withdraw my Amendment.

Amendment, by leave, withdrawn.

Main Question put, and agreed to.

Bill, as amended, considered.


I beg to move, "That Standing Orders, 223 and 243, be suspended, and that the Bill be now read the third time."


May I ask what that means?


The Standing Orders referred to relate to the time within which the later stage of the Bill must be taken. It is customary at this stage of the Session to move that these Standing Orders be suspended, and the Motion is in accordance with that custom.

Question put, and agreed to.

Bill accordingly read the third time, and passed.