HC Deb 14 August 1916 vol 85 cc1581-8

  1. (1) Where the Board acquires land on lease under the provisions of this Act the annual rent thereof shall in no case exceed the annual value thereof as adopted for rating purposes at the time of such acquisition.
  2. (2) Where the Board acquires land by purchase under the provisions of this Act the price shall in no case exceed the gross value of the land as denned and ascertained under Part I. of the Finance (1909–1910) Act, 1910, or twenty-five times the annual value of the land as adopted for rating purposes at the time of such acquisition, whichever be the greater.
  3. (3) Where the land acquired under the provisions of this Act forms part of a larger unit of valuation, the Board shall apply for an apportionment and revision of the valuation as between the acquired portion and the portion not acquired, and this section shall apply accordingly.—[Commander Wedgwood.]

Clause brought up, and read the first time.

Motion made, and Question proposed, "That the Clause be read a second time."

Commander WEDGWOOD

Where land is acquired on lease we desire that the rent shall not be higher than the annual value as adopted for rating purposes. I hope in this proposition I shall have the support of hon. Members who are so jealously enthusiastic for a lower rate of interest on the capital invested in these small holdings. I would like particularly to have with me the hon. Member for Ince (Mr. Walsh) on account of his sober and sound policy. If he will support me in this Amendment with the energy he has devoted to other Amendments directed towards the development of small holdings, I assure him he will have a great deal more logic and economics, because this Amendment is directly aimed at securing for the small holder cheaper land, less rent and sound leases, instead of dearer land and unsound leases. What has been seen all over England in the cases where the Small Holdings Act has been brought into operation—I speak from experience on the Small Holdings Committee of the Staffordshire County Council—has been the perpetual leasing of land. County councils are going in even more for the leasing of land than the purchasing of it. They arrange holdings, and then let the small holding in place of the whole farm, and over and over again the rents at which they have let them are three times the original rating charged upon that particular farm. You cannot have any sounder line of demarcation than to say that the rating basis shall be the basis for leasing purposes. This rules out immediately all the people who are trying to foist land upon the authorities at a big price, for you could say that you were prohibited by Act of Parliament from offering more than the equivalent of the present rateable value. The land you would have to acquire would be the land of chose people who were genuinely anxious to assist the Government in their experiments. It would be well if you got people who were willing to let the Government have land, say 2,000 or 3,000 acres, on a 33 years or 99 years lease on reasonable terms, with reasonable sale or reversion, and with a rental not in excess of the rateable value of the land. You would then be quite certain that the Government had, at any rate, made a fair bargain with a landlord who was genuinely anxious to make the scheme work well, and push it to a satisfactory conclusion. That is my main argument in favour of the first sub-section of the proposed new Clause.

Now comes the question of the land that is purchased. In this case it is even more important to have an automatic check upon the price to be paid by the Board than it is in the case of the leased land. In the case of the leased land there is always the power of comparing the previous rental. But in the case of buying land, especially in war time, or at war prices, it is very advisable that there should be some guidance before the Board, so that they may see what price not to exceed, and so as not to be landed with a fancy price. My Amendment says:—

"Where the Board acquires land by purchase under the provisions of this Act the price shall in no ease exceed the gross value of the land as denned and ascertained under Part I. of the Finance (1909–10) Act, 1910,"—

I do not want to be too pedantic—

"or twenty-five times the annual value of the land as adopted for rating purposes at the time of such acquisition, whichever be the greater."

Give the landlords the benefit of the doubt, but do put down the maximum, so that you cannot have land speculation on the part of the man who is anxious to sell his land to the Government to the detriment of the small holders, so that the rates are forced up and the small holders are driven into the bankruptcy court. Immediately this Bill becomes an Act, the Board of Agriculture will be deluged with offers of land, and they will send round a man to inspect the land and bargain about the price. I submit that it will facilitate their labours, as well as cheapen the land, if they say at the outset, before these offers come in, "We cannot pay you more than twenty-five times the annual value of the land, or the value under the Finance Act. 1909–10." If they say that, they will get the land at a reasonable price; but if they submit to bargaining with people; if they have their local agent recommending a price; if they have, as they have at the present time, to compete with the county council in these matters, they will find that the price they have to pay is enormously in excess of twenty-five years' purchase, and more like thirty years' purchase. In that case you will saddle the wounded soldier who has gone on to a small holding with rent he cannot pay. The argument as to cheap money applies even more to cheap land, because if you get land cheap private individuals will be able to get their land cheap and start this experiment.

My hon. Friend the Member for North-West Durham started a very large number of co-operative housing schemes. If the Government is going to buy up land at high prices it will absolutely stop societies entering upon co-operative smallholding schemes, because the private society cannot compete. The third part of my Clause provides that where the land acquired forms part of a larger unit assessed for rating purposes, the Board shall be able to apply for an apportionment and revision of the valuation as between the acquired portion and the portion not acquired. The two main parts of the Clause are therefore that there should be some automatic check upon the price paid by the Board. The whole of this Clause has been drafted so as to prevent the strangling of small holdings at their birth. Under the cloak of charity to our wounded soldiers they are doing a good thing for the British landlord. This is what naturally would be expected, but at the same time this is a test case, and if you do mean to do your duty by the wounded soldier, and to help these people to become self-respecting, self-supporting small holders, you will accept this Clause. If you do not, it will be in accordance with the rest of the Bill.


I do not think my hon. and gallant Friend will expect me to deal with this Clause at any length, because he has explained it so fully. It would, of course, kill the Bill, and I think was meant to. My hon. and gallant Friend made it quite clear that that is his purpose, and he would succeed perfectly well if this Clause were added to the Bill. That is clear enough if we look at the first Sub-section. There is, of course, much land that could be made into excellent land for colonists, if taken at its present—

Commander WEDGWOOD

We thought you were to get land given you free.


I never said so. I said I hoped somebody might come forward and make the sort of offer in England which has been made in Scotland. There is land which would make excellent colonies if it were taken over at its present rent. It may be cultivated as large farms, and when it is divided into smaller farms the rent works out at something which we can quite well afford to pay, but my hon. and gallant Friend would make it impossible that any land of that kind could be taken. We should not be able to go to anyone, however good the land might be, and say, "We are willing to continue the rent which you have hitherto been obtaining. We will not give you any more, but we can reasonably ask you to accept the same rent." That may be, and I believe it will be, a perfectly good thing to do with certain Crown lands which happen to be rented low and which has been offered to us at the present rent. If this Clause were accepted, we should not be able to do that; we should not be able to look at it, because the hon. Member says that it must not be taken at any price greater than its rateable value. Being a great expert on the whole law of rating, he knows that rating is not now based on the full value of the land.

Commander WEDGWOOD



I am perfectly certain that is true. I doubt if there is a single Member of this House occupying any land or house the rateable value of which is as high as the rent. It is an absolutely established principle among rating authorities to put the rateable value lower than the rent that is paid, and therefore his proposal comes to this, that the rent which he admits it might be reasonable for us to pay could never exceed the rateable value, although, as a matter of fact, in all cases that I know it is assessed so as to be less than the full rent. A proposal of that kind that the whole shall be equal to a part is, as we know, absurd in Euclid, and it is rather absurd in this Bill. We should not be able to accept any land, however reasonable the rent was, and pay the present rent, because the rateable value would be lower. It would deprive us of the opportunity of taking some of the best land that could be offered at reasonable terms, and I do not think that he can reasonably ask us to accept it, except of course with the object of destroying the Bill. The second part of the Clause is really covered by the machinery of the Bill. The Board of Agriculture, I was going to say, are not such fools as the hon. Member would seem to suppose. We do not wish, to use the hon. Member's own phrase, "to strangle all these small holdings in their conception, so as to prevent them coming to birth," and we are not likely to take highly expensive land for the purpose of defeating our own scheme. Everything that we do has to be subject to Treasury approval, and the Treasury is so anxious not to spend more money than they can help that they have kept down the scope of this Bill more than the majority of people like. That sort of safeguard with regard to the public purse is sufficient, particularly, if I may quote the hon. Member's own words used a few days ago, as Ministers in charge of proposals of this kind will always be subject to account by question and comment in this House day by day. I took down those words thinking that they might be useful, and those words upon which he laid such emphasis in another connection ought to be sufficient to obviate the necessity for this part of his Clause. The third sub-section of this Clause followed automatically. There will be, of course, a reapportionment of the rates when the land comes under a fresh occupier.


I am sorry that the right hon. Gentleman has met the Amendment in the way that he has done. I have much sympathy with his new Clause, because it really embodies in a practical sense an object I have followed in this House again and again, namely, that we should try to establish some sort of parity between the valuation on which the landowner contributes to the rates and that on which the people purchase from the landowner. It is on that general principle that I support this Clause. I would like to remind my right hon. Friend that whatever deductions are made the rateable value is based on the actual rent or on the rent which might be supposed to be obtainable for the property if it were in fact rented to someone other than the owner. I think that he will agree with that proposition. In these circumstances, it may perhaps be too much to ask, as my hon. friend does in his Amendment, that the annual rent shall in no case exceed the annual value adopted for rating purposes, but if my hon. and gallant Friend is willing to add 10 per cent., or 20 per cent.

Commander WEDGWOOD

Or even 25 per cent.


Or 25 per cent., will the right hon. Gentleman be willing to accept the Amendment? I want to establish some standard. The one criticism that the right hon. Gentleman has put forward is that the rating value is too low a value. Supposing we advanced 25 per cent, on the rating value, would my right hon. Friend accept that? Similarly, it may be that twenty-five times the rating value is too little. I made some inquiries some time back in this House as to prices that were paid for land obtained under similar conditions to these. Some exceeded 100 years' purchase of the rateable value, one exceeded 500 years' purchase, and another exceeded 700 years' purchase. I remember one case which should be borne in mind now in view of the necessities of the time. Some land was purchased for a torpedo-boat depot in Scotland near Greenock. That land was rated at £11 2s. 0d., and the taxpayer had to pay more than £2,700 for it; in fact, more than 2,100 years' purchase. That is the sort of thing which we want to stop. I quite agree with the right hon. Gentleman that the actual proposal as it stands may be too low. It may be that twenty-five years' purchase is too little. I ask him frankly: What will be taken? Will he take thirty years' purchase? Will he take forty years' purchase? Will he take fifty years' purchase? If he will take anything in reason, I will ask my hon. and gallant Friend to meet him by amending his Clause. We want to establish some parity between the two valuations. When the Bill was introduced, we were told of the generosity of many landowners who were willing to let us have suitable land, either freely or at something very much below its market value. My right hon. Friend has repeated the latter point tonight. The House has been induced to proceed so far with this Bill under that general impression, but now all we hear is that the right hon. Gentleman hopes that it will be so. I may remind my right hon. Friend, who is a student of Adam Smith, that Adam Smith in his great "Wealth of Nations" drew a very definite distinction between a gold mine and a project for a gold mine. In the same way, I draw a distinction between getting a firm offer of land on the terms that the House was generally led to expect and the hope that a firm offer will come at some time or other. Having got so far, it is very important that we should see that we put some limit to the amount of money that we are going to lay out; and the second fact that makes this important is the statement the right hon. Gentleman made on an Amendment not so long ago on the question of subsidies from the Treasury in aid of these. I do want to put it that if these are to be subsidised, and if the country is going to subsidise the building and equipment and so on, it is necessary both in the interest of the holder and in the interest of the taxpayer that you should certainly not go out of your way to subsidise the landlord as well. In these circumstances, I ask the right hon. Gentleman to see if he cannot accept this Amendment. I frankly admit that there is something in the criticism he has passed. Would not he accept the first sub-section if twenty, thirty, or even fifty per cent. were added to the valuation for rating, and accept the second sub-section if, instead of twenty-five times the annual rating value, it were made thirty, forty, or fifty times? These are the suggestions I venture to make.

I would like to dissociate myself from my hon. and gallant Friend who said, I think a little in haste, that the object of the Bill was rather to assist the landlord. I do not think that for a moment, and I am sure that on reflection my hon. and gallant Friend will agree that the right hon. Gentleman and those responsible for this Bill are animated by the sincerest and highest motives. We all agree on that, and the only question is whether the method is right. I suggest that my hon. and gallant Friend's Clause should be accepted, and I would ask the right hon. Gentleman to accept the modifications I have suggested if he is willing to do so.


The right hon. Gentle man stated that if this Clause were adopted it would kill the Bill. So far as I personally am concerned, and I think I speak for my Friends, I have no desire whatever to kill the Bill, but might I say to the right hon. Gentleman, in all sincerity, that if he refuses to meet us in any way in this matter, not merely to accept the exact words of my hon. and gallant Friend to which, I have no doubt, he is not specially attached, but if he refuses to have put in any limit to the amount that the landlord can secure as a result of land monopoly for the land that is to be acquired for this purpose, then he may save his Bill in his view, but he kills, the wider scheme of which we were told this Bill was to form a part. It is now perfectly clear, as a result of the discussions we have had, that if the right hon. Gentleman refuses to put a limit of that kind it does mean that the monopolist may be able to secure a price far in excess of the reasonable market price for his land.

It then follows that the right hon. Gentleman, in view of the statement that he has made earlier in the day, admits that it is his intention to charge the tenant less than the market rent. Of course, he says he does not do that to relieve the landlord, he is doing that because of the excessive war prices of building and of interest. But the net result is that there is an annual loss which falls on the Exchequer, and that loss is caused, not because of the reasons of which we have been told, but because the right hon. Gentleman and the Government dare not meet the land monopoly.

The CHAIRMAN (Mr. Whitley)

I have complained of repetition before. I would suggest that this is a repetition of the same thing, and I cannot allow it.

Bill reported; as amended, to be considered to-morrow (Tuesday), and to be printed. [Bill 92.]