HC Deb 17 October 1918 vol 110 cc348-74

(2) Every education authority shall annually ascertain the amount of such deficiency, and, unless and until Parliament otherwise determine in any statute amending the law of rating in Scotland, shall allocate and apportion the same among the parishes comprised in the education area, according to their respective valuations in the valuation roll, and shall, not later than the twelfth day of June in each year, certify to the parish council of each such parish the amount so allocated and apportioned thereupon, and the parish council may and shall impose, levy, and collect the same within such parish, under the name of "education rate," in the manner prescribed by Section thirty-four of the Poor Law (Scotland) Act, 1845, with respect to the poor rate, and along with, but as a separate assessment from that rate, and shall from time to time as they collect it, pay over the amount collected to the education authority, without any deductions on account of the cost of levying and collecting the same; and the laws applicable for the time being to the imposition, collection and recovery of the poor rate shall be applicable to the education rate.

Provided that in parishes where no poor rate is levied, or where the poor rate is imposed otherwise than in the manner prescribed by Section thirty-four of the Poor Law (Scotland) Act, 1845, the education rate shall nevertheless be imposed, levied, and collected by the parish council in the manner prescribed by that Section.


I beg to move to leave out Sub-section (2), and to insert instead thereof the words, (2) Each education authority shall annually ascertain the amount of such deficiency and, in the case of the scheduled burghs shall certify to the town council of each such burgh the amount thereof, and, in the case of other areas, shall apportion and allocate the same among the burghs and county or counties constituting an education area, according to their respective valuations in the valuation roll, and shall not later than the twelfth day of June in each year certify to the town council of each burgh and the county council of each county the amount of such deficiency, and the town council and county council shall impose, levy, and collect the same within such burgh or county, respectively, under the name of education rate, and shall from time to time as they collect it pay over the amount collected to the local education authority without any deduction on account of the cost of levying and collecting the same:

  1. (a) In a county, excluding a burgh, the education rate shall be imposed, levied, and collected by the county council in like manner and under the like powers as, but as a separate assessment from, and without the limit applicable to the public health general assessment:
  2. 349
  3. (b) In every burgh the education rate shall be imposed, levied, and collected in like manner and under the like powers as, but as a separate assessment from and without the limit or abatements applicable to the public health general assessment."
4.0 P.M.

I think it will be for the advantage of the House if I explain very simply what the proposal in the Bill is, and what the effect of my Amendment, if adopted, will be. The proposal in the Bill relates to the method of rating for the purpose of meeting what is called the deficiency of the Education Fund. As it stands it is proposed that each education authority should ascertain the amount of the deficiency annually, and should apportion that deficiency between the various parishes in their area in proportion to the gross valuation, and when this apportionment has been made it will be the duty of the parish to levy and impose the rate upon the basis of the assessable rental in the parish. In other words, the allocation is made on the basis of gross valuation, with the effect that the rates themselves are levied on the assessable rental in the same way as the poor rate. The proposal in the Amendment is to substitute for this machinery the basis of the county rate for the purposes of the levy of the rate. The local education authority would report the amount of the deficiency to the county authority, and to the burghs within their areas, and it would then be the duty of the county authority to levy the rate on the basis of the general county rate as at the present time levied. It would also be the duty of the burghs in the areas to levy the rate on the basis on which the public health rate is levied. That is I think in a general way the effect which my Amendment would have.

There are a large number of practical as well as theoretical reasons why I believe the Government should adopt this course. I hold, in the first place, that the scheme of the Amendment is preferable to that in the Bill, because it is fair and equal in its incidence—it is uniform, and at the same time it is in accordance with the principle of the Bill itself. The Government has accepted the county as the administrative unit, and it is surely, therefore, appropriate that the county should also be the unit for rating purposes. One of the strongest arguments for taking the county as the unit for administrative purposes was the existing inequality in respect of rates among the parishes in the different parts of the same centres. If the Government adhere to the scheme in the Bill, while it is true you will, to a large extent, diminish the inequalities and disparities which at present exist, you will still retain very considerable inequalities, which I do not think my right hon. Friend, the Secretary for Scotland, is in a position to justify. These inequalities are inequalities both in relation to different parishes, and as regards different subjects and different classes of ratepayers.

I have not been able, of course, to ascertain the effect of the two proposals on the whole of Scotland, but the Lanarkshire County Council has made a very complete investigation in relation to all the parishes in their area and they show that while, if the system in the Amendment were adopted there would be a uniform rate for the whole county of 10⅝d. on occupiers and owners alike, on the other hand, under the system whereby each parish levies the rate, you will have very extensive variation in the amount of the rate in different parishes throughout the county. I think the variation amounts to something like 6d. or 7d. in the £. Not only will you have these variations in respect of the parish, but it also affects the question of the rate as regards the different classes of ratepayers. It will be found on a general survey that if the scheme of my Amendment is adopted ratepayers who are occupiers of houses and ratepayers who are occupiers of shops, and in the great majority of cases those who pay rates in respect of manufactories, mines, and agricultural land, will all be benefited by the change, and that the only class of property which will be prejudically affected will be the railways and tramways. The Lanark County Council has gone very fully into the various cases in which a change in the position would be brought about by the adoption of the Amendment, and the result of their inquiry dealing with the valuation as a whole is that in 12,723 cases, which all come under the heads I have mentioned, the difference is in favour of the county system of levying the rates, while on the other hand the difference in favour of the parish system only applies in 3,895 cases, and these are exclusively railways, tramways, and similar undertakings. It seems to me in these circumstances there is a strong case not only on logical, but also on practical grounds for adopting the system which I suggest.

With regard to this proposal to take the county as the rating unit and thus get rid of the inequalities which I have mentioned in respect of locality and different classes of ratepayers, I may remind the House that on the Committee stage my right hon. Friend the Lord Advocate supported the scheme of the Bill on the ground that the alternative proposal would press unfairly upon industry. I think that by the investigations that have been made in probably the most important industrial area—Lanarkshire—the result of which I have quoted, it is made quite clear that that general contention of my right hon. Friend is unsound. I notice that the right hon. Gentleman dissents. I can only say that I shall be glad to hear any evidence which he has to support his contention, and I may add that undoubtedly in respect of Lanark the only industrial undertakings which are really prejudiced are the railways and the tramways, and except in the case of a small minority of manufacturing undertakings all the other cases are not prejudically affected. Under these circumstances I think the House will require very cogent reasons before it consents to a system which is devised apparently solely in the interests of one set of undertakings. The undertakings which will benefit are four—the North British Railway Company, the Caledonian Railway Company, the Glasgow Corporation Tramways, and the Lanarkshire Tramways, and these will benefit to a very considerable extent. I think the amount by which they will benefit is something like 5d. or 6d. in the £ in the rate, and that arises very much from the abatements which are allowed to these undertakings in their assessments for poor relief. I can well understand that those interested in these undertakings are very anxious that the Government proposal should be adhered to and that my Amendment should be rejected. I wish to remind the House that in support of this Amendment we have the combined authority of the County Councils Association, the School Boards, the Convention of Royal Burghs, and I may add the School Board also of the City of Glasgow, and this is an array of authorities which I think the Government would do well not to neglect or ignore.

In these times of stress it is extremely difficult to ascertain what the public view is on any particular question, owing to the supersession of the ordinary means of expressing that opinion. When you have an opinion so united on the part of all these representative institutions, I think it is the duty of the Government to give heed to that opinion. I would remind the Lord Advocate, further, of a very interesting precedent which I think should affect his mind on this matter. In 1889, when certain public health functions were taken over by the county councils, the method of rating adopted by the Local Government Act of that year was precisely that which the Government has adopted in this Bill. But later on, when the law had been amended, in 1897, the Government of that day decided that the system ought to be abandoned, and that it should no longer be left to the parish to impose rates on the basis of the poor rate, but that the rates should be imposed on the county basis in accordance with the system under the Roads and Bridges Act, 1878. So that in support of this Amendment you have the practical grounds which I have set forth—grounds of justice and equality between the individual ratepayers and between the different localities in the same county area. You have the logical ground of securing uniformity under the Bill and agreement with the general principle of it. You have the precedent which I have quoted, which would seem to indicate that where you have the county as the administrative unit it is most convenient that it should be the unit for rating purposes. I think that my right hon. Friend the Secretary for Scotland should at the same time be faithful to himself, because in last year's Bill he adopted the principle of the Amendment which I am now proposing, and if in the circumstances of last year's Bill the principle was a sound principle, and an equitable principle, it should surely be equally sound and equitable for the purposes of the present Bill. I hope, therefore, in view of all these considerations that the right hon. Gentleman will accept my Amendment.


I did not know until I came to the House that the Bill was to be recommitted in respect of this Clause. I assume that the Amendment of my hon. and learned Friend, which was on the Paper last night, is in the same terms as it then appeared. For myself, I think that the proposal of the Amendment was seen to be a very serious change to introduce on the Report stage of the Bill, and no doubt it is satisfactory to my hon. and learned Friend, owing to another Clause having been recommitted, to reintroduce this matter, in the very interesting and admirable speech to which we have just listened, and which we had in Committee upstairs. The only question is whether such a large change as that proposed ought to be made in an Education Bill of this kind. I do not think it ought to be put into the Bill. The argument was used by the hon. Member that the Secretary for Scotland had departed from his original intention, but that is not an argument which really applies in this case, the right hon. Gentleman having reverted to the parish system of rating which has been practised throughout Scotland in the whole matter of education. If that were to be altered now, it would make a very serious difference to very many people. As to the public health rate, which in counties is levied on the gross valuation, that is a small matter to the parish. It raises no acute question of difference in payments by the individuals.

But it is wholly different with regard to education, the rate for which is likely to be very heavy in the future; it is heavy enough in all conscience now, but it will be very much heavier. I would point out that in many counties now the rates have to be collected by the parish council, to whom they are remitted for the purpose of collection, as, no doubt, my hon. and learned Friend knows perfectly well. I need not go into the argument at great length a great deal is to be said for the assimilation in the system of rating. There has been, for a long time, promise of a measure to deal with the whole question of local rating in Scotland, and it is surely time enough when that measure is brought in to deal with this very important question. It goes without saying that, in certain cases, if the hon. Member's proposal were accepted, and if the rating in Scotland were reconsidered, probably special arrangements would have to be made with regard to particular properties where there are running rights. But the hon. Member's Amendment entirely alters the burghial system of rating, and it is incredible that such a change should be made in a Bill of this kind. He has asked the House to adopt a particular kind of rating system, and he sweeps away the burghal system of rating, which has been considered perfectly fair and quite equitable. In a Bill of this kind it is neither desirable nor fair to introduce so great a change as that proposed by the Amendment, and it should not be considered, I submit, until the whole system of rating comes to be dealt with.


The hon. Baronet who has just sat down complained of a change of this character being made in an Education Bill, but may I remind him and the House that the proposal to which he now takes exception was exactly the proposal made by my right hon. Friend in the first Education Bill? My hon. Friend says that no doubt the county council would have been the rating authority, but, although that has been given up, the county area remains as the rating area, and that at once raises the question as to the area in which the rating takes place. I submit with great confidence, in a matter of this kind, when you are dealing with a county area itself, that it is perfectly obvious and only fair that the system should be a system of county rating. My hon. and learned Friend who moved this Amendment has gone into considerable details, but let me give one or two illustrations to make clear the tremendous variations that are going to arise in the Bill as it now stands. Take, for example, the county of Lanarkshire, which contains thirty-seven parishes and in each parish you would have a different rate, both for the owner and occupier under the proposal of the Bill. Can the right hon. Gentleman justify that for a moment? Surely uniformity in matters of rating is of the very highest importance, when you come to deal with rating of this kind. But my hon. and learned Friend's Amendment would put in place of these tremendous variations uniformity throughout the whole of the county of Lanarkshire, and the rate would amount to from 10d. to 10.69d., and that uniformity would be obtained throughout all the counties that are very much in the same position.

Under the Bill, you give an unfair advantage to certain kinds of undertakings, and there is no doubt that it is the railway companies who stand to gain—there may be one or two other interests—by the proposal which is in the Bill. My right hon. Friend during the Debates in Committee, laid very great stress on the opinion of the counties; he particularly instanced Lanarkshire, and when I introduced an Amendment to alter the area of Lanarkshire, he adduced that county as one of the strongest points against me. The County Councils' Association, the Royal Burghs, and a great many other important associations, are now identified with my hon. and learned Friend's proposal. The right hon. Gentleman shakes his head. Is it not the case that the County Councils' Association, and the Convention of Royal Burghs and the School Boards' Association and others have adopted resolutions. That being so there is a very large body of opinion on the point. I submit that the case really depends upon a common-sense view of what system of rating you are to apply to the county areas which are now established as a result of the Bill. Surely yon are not going to suggest that while retaining the county as the area that the parish is to be the particular rating area. I submit that the reason given in support of this Amendment are of the very strongest character, and the fact that it was only defeated by two in the Committee upstairs, will I hope be kept in view in dealing with this matter. I hope we shall have the support of English members who may not have sat on the Grand Committee in accepting the view which is now placed before the Committees, and that they will treat the matter from a broad and common-sense point of view, and will go into the Lobby against us.


I desire very briefly to support the Amendment proposed by my hon. and learned Friend (Mr. Pringle). This Amendment, as the Committee knows, was excluded on an important technical point yesterday, and as a supporter, I desire to express my appreciation of the way in which the Secretary for Scotland has agreed to the matter being opened for discussion now. The point is whether the system of rating by the new educational authorities should be as proposed in the Bill on the net valuation by parishes or whether it should be on what is known as the gross valuation. In other words, whether it should follow the analogy of most of the county rates and also of the public health rates in burghs, and be on what is called the gross valuation. The method proposed by the Bill is, of course, the method by which education rates have been raised in the past when education was upon the Poor Law parochial basis. That was the basis then, but it seems to me to be no longer the natural basis now, when the educational system is put upon the county basis. In fact, the county basis may be looked upon as the more modern, because the parochial basis was the basis for the old Poor Law, and the other is the basis adopted under the Act, which created the county councils, and under more modern Statutes. As regards the merits of the matter which have been dealt with by my hon. and learned Friend (Mr. Millar), I need not say anything, but it is important to bear in mind that not only is the system of rating on gross valuation more consistent with the county system and adopted in the recent Acts, but the Secretary for Scotland had actually adopted it in the previous edition of this Bill. One knows, of course, that the previous edition of the Bill made the county council the authority, but it is not a question of the particular authority; it is a question of area, and when the county is held to be the area it seems to me very appropriate that what may roughly be called the county system of rating should be adopted.

On the merits it seems to me a fairly clear case, and I cannot understand why the hon. Member for Ayr Burghs (Sir G. Younger) should have said that it was a monstrous proposal, in view of the fact that it is in keeping with the county arrangements generally, and that the Secretary for Scotland had it in the previous edition of the Bill. It must also be remembered that the adoption of the Poor Law system by parishes is not only appropriate when education is put upon the county basis, but it has a further disadvantage. I speak with some diffidence because I know that the details of these rating questions are apt to be a little technical; but I understand that the allowances which are made in parishes under Poor Law rating are, to a very considerable extent, at the discretion of the parochial authorities. They are not absolutely fixed by Statutes, and the parochial authority has a very considerable discretion as to what allowance should be made in or by the net valuation. Therefore it is not a matter of so much importance if the parish itself is the unit, but where there are a number of parishes in the county unit it becomes of very great importance, because the amount that may be apportioned to the different parishes depends on the valuation, which in its turn may depend to some extent on the amount of allowances which it is decided to make in the area. That seems to me to be an additional reason for setting aside the parish Poor Law rating and adopting the wider system. This Amendment is by no means a paper scheme. Besides being in the previous edition of the Bill it was put forward in Committee upstairs, and, as has been pointed out, it was lost only by two votes. It has, I understand, the general assent of the Association of County Councils in Scotland and it has also the assent of the Convention of Royal Burghs, and in these circumstances I do hope that my right hon. Friend will see his way to give it further consideration and to accept the Amendment.


I rise to support the Amendment as I supported it in Committee. I think there are very strong reasons in favour of dealing with rating on the county basis if you are going to make that your educational area. I would point out, in regard to the appeal of my hon. and learned Friend (Mr. Millar) to English Members, that we are asking my right hon. Friend to do exactly what was done when the English Education Act was passed which abolished the school boards and created the county area. In that case the cost of education is put upon the same basis as the other county rates. Why a different course should be adopted in the case of Scotland I do not think any English Member will be able to explain. They will not be able to explain what my right hon. Friend, with all his ingenuity, was not able to explain in Committee. I hope the fact that my right hon. Friend with great fairness has allowed this subject to be reconsidered by recommitting the Bill upon this Clause as well as the Clause upon which he had an Amendment, means that he has an open mind and that he is prepared to consider this question upon its merits. I do not think that those who advocate this Amendment should despair of convincing him upon a subject in regard to which he is very familiar.

If you are going to have the advantages in administration which will accrue from having a larger area it is very foolish to lose an opportunity of getting the advantage of equalisation of rates. It is perfectly plain that it is an advantage to have equalisation of rates in regard to education. I do not think anybody will dispute that. I take that as axiomatic. In the provisions of the Bill you are not obtaining that amount of equalisation which you could very easily obtain. One point has been raised in the Debate which I should like to put clearly before the Committee. It has been represented by one hon. Member that it is an unreasonable thing to press this Amendment, because you are altering the system of rating for education in an Education Bill. Whether that is so or not, that argument is not based upon a fact. The Bill itself, whether you accept the rating Clause as it appears in the Bill or you go back to the previous Bill, equally makes a change in the incidence of the education rate. The very fact that you alter the area and introduce the provision which my right hon. Friend has introduced alters the basis of rating. People will not be paying the same education rates in Scotland as they were paying before the introduction of this Bill. I do not think anyone will question that simple point. Therefore it is not a case of altering the rating by the Amendment and leaving it alone in the Bill. You alter it anyway, whether you accept my right hon. Friend's system or whether you accept the system of my hon. and learned Friend (Mr. Pringle).

If you adopt the system of the Bill you get all sorts of absurdities and anomalies. You will have, for example, in Glasgow, in the great county area, parishes side by side paying a great variety of education rates, whereas if you adopt the system of the county basis all the parishes in the county will pay the same rate. It is not merely that you get differences between parishes, but you get differences, and very curious differences, between the incidence of owner and occupier. I have here a list which has been drawn up, I understand, by the Burghs and County Councils Association. In the case of Crawfordjohn the owner's rate will be close upon 10¾d. and the occupier's rate will be 1s. 8½d. In the case of Rutherglen the owner's and occupier's rate will be almost the same—both just under 1s. 1d. If you adopt the county rate basis, you will get none of these curious anomalies, and you will have made a great step forward towards what we must all desire—namely, equalisation of rating. The disparity of rates in Scotland is positively scandalous, and I agree with my hon. and learned Friend opposite that it is very desirable that we should have a reform of rating altogether. I think it would be a good thing if this discussion leads my right hon. Friends to put their hands to that task. There is no reason why, having to alter the education rate, you should alter it on a bad system when you can alter it on a much better system. I do not want to go into the various technical questions, which were very clearly put before the House by my hon. and learned Friend opposite. The broad point is this, that you are making a change in the education rate. The Amendment asks you to make the change upon a simpler, a better, and a fairer basis than the change which is made in the Bill as it stands.


I am far from regretting that the course taken by my right hon. Friend in regard to the Amendment and the Motion which he made at the beginning of to-day's sitting has resulted in giving further opportunity for discussion of this question, which is very nearly but not quite the same question as was raised in Committee upstairs. The question is an important one. It is concerned with a point connected with the infinitely complicated question of local rating, about which it is very easy indeed to create or fall into misconceptions. I notice that one hon. Member after another who has spoken on this Amendment to-day—and, I think, not even excluding the Mover of the Amendment himself—has dealt with the proposition as if the Committee was put to the choice between maintaining for the education rate the system at present in force—namely, the parish rate—and the system of the county rate. That is not so. It is very necessary and very important to look at that in the first instance. The proposal which was made upstairs, I think, by my hon. and learned Friend was to make an election between these two alternatives. And he contended that the better way would be to adopt the county system and reject the parish system; in other words, to make a completely new departure and to get rid of the parish system which hitherto has governed the raising of the education rate entirely and substitute for it a county rating system, like the Public Health Assessment, for example. That is not what is proposed in the Amendment before the Committee to-day. The proposal before the Committee to-day is to take neither of these systems, but to invent a new one. The proposal is to discard the parish system and to substitute for it the county rate, in the county areas, where applicable to the public health assessment, but not to apply the public health assessment in burghs but to make a new rate for the burgh.

This is very important. The public health assessment is assessed under the Burgh Police Act of 1882. Uuder that Act, wherever you have a burgh not merely with railways and tramways, which undoubtedly fill the minds of my hon. Friends above, but bridges and ferries and other undertakings, including salmon fisheries, for there are many, or land within burgh areas which is either arable, meadow, or woodland, nurseries, market gardens—in short, any ground used for agricultural purposes—all these are liable to public health assessment, not on the full valuation, but only on one-fourth of it. It is one thing to ask the Committee to choose between the public health assessment that exists and the present system. But it is quite a different tiling to say, "Adopt neither, but let us tinker up a special system." Of course it is quite true that if the field were open for us to do it, far and away the best thing to do would be to get a perfectly uniform system of rating. That is the strong point on which my right hon. Friend opposite stands, and it is perfectly solid ground. But the public health assessment would not give it, because of this very large qualification in the case of burghs. Therefore I suppose that he is driven to what I call, with all respect, tinkering up a new system for the burghs.


It will apply the old county system to all the counties in Scotland. The places to which my right hon. Friend's remarks apply are the excepted burghs, the scheduled burghs as they are called. Of course they are very large areas. They include Glasgow, and so on. But that does not affect the question of the rates for all the rural parts of Scotland and all the small towns of Scotland.


I quite agree, so far as any county area is concerned—


With the argument.


As to the matter of uniform rate—yes.


I was merely trying to see if we could not come to an agreement.


So far as the county areas are concerned the point is perfectly good. You obtain an absolutely uniform rate. But my point is this. If you ask for an alternative between two possible alternative systems, that is one thing, especially if there are certain advantages to be gained by it. It is quite a different thing if what you are asked to do to get the advantage is not to make a choice but to go on tinkering up one of the two alternatives. Why I think that is objectionable I will explain in a moment. That is the proposal before the Committee at the moment. If we had the field open to us, obviously the right thing to do would be to get these rates, as well as all rates, upon a perfectly equal and uniform basis. That cannot be done unless and until we tackle the Augean stables of the existing system of rating, with all its complications, its inequalities, and its imperfections. If what you do is to add one more to the already too numerous systems of rating in Scotland you will merely add to the confusion which at present exists. We are going to leave the raising of the rate under the parish system exactly as it has been ever since there has been a school board. So far as raising the burden of rate upon the parish is concerned, we leave the matter as between the owner and occupier between house property and industries exactly as it is.


The important thing to the individual is how much rates he pays. He does not care about a change in form, but he cares a great deal if he has to pay twice as much as he paid before. The simple broad fact is that the rates which the individual in Scotland will pay are being altered. Under the new system he will not pay the same rate as he paid under the whole school board system, or anything like it.


I am sure that the right hon. Gentleman means to introduce clarity into the discussion, but I do not think that he has succeeded. Of course, it is perfectly true that nobody can guarantee that the amount of deficiency which a particular parish will have to raise under the new system, and therefore the rate exigible from the individual in that area will be the same under the new Act as it was under the old. Nobody can tell. I think, if one may express one's opinion, that in all probability the burdens of education will increase very materially, but the proportions in which these will be paid—and that is the important thing; not the amount, but the proportion—within the parish by the individual owner of occupier, of land or of household property, or the industrial owner or occupier, will remain unchanged under the Bill, whereas under the Amendment you are going to revolutionise them. There is no doubt about it. The education rate as it stands is divided up between owners as a class and occupiers as a class. The proposal in the Amendment changes that, and makes, on the contrary, a division between the two classes in the case of each property. What is the use of talking about maintaining the existing burden when you are going to make a change of this kind? Again, every person who owns a shop or a house is allowed in some parishes, almost in all, a certain deduction—about 20 per cent.—to cover the cost of repairs, etc. You propose in the Amendment to take that from them.


Yes, but it varies in different parishes.


It is not uniform all over the country. But it is not uniform at present, and the proportions according to which the burden is borne at present are subject to that qualification. If you had your way under this Amendment you would disturb this. Everybody would like to have these local government rates of all kinds imposed upon some perfectly equal system all over the country. But the question is, whether you can take any effective step in that direction by remedying the existing system piecemeal, and, above all, by adding another to the hundred and one systems of local rating which are in operation at the present moment. I do not think so. The controversy which then springs into one's vision is unfortunately an old controversy now. It is the question whether you shall raise your equal rating on the basis of the gross rent or the net rent. That is the crux that underlies the whole affair.

It is true that in 1889, as the hon. Member for Tradeston says, a large proportion of the county rates was put on gross rental. At that very time, either the second or third Commission which had been appointed by Parliament to consider the question of whether the basis for a general system should be the gross rent or the net rent, was sitting. There had always been one or two Commissions which had reported that the only fair system was the net rent system. In 1889 the Act was passed before the Commission then sitting had reported, and the gross rent was taken. But that very Commission reported, three years afterwards I think, to the effect that the only fair system was the net rent system, and undoubtedly, if these expressions of opinion, after elaborate inquiry and consideration, are worth anything, when we do achieve a uniform system of rating in Scotland it will have to be on the basis of the net rent and not of the gross. And the very fact that in the Local Government Act of 1889 you had to abandon the gross rent in the borough and adopt the valuation of industrial property, and a great deal more at only 25 per cent. is the best evidence you can get that, whatever system you possess; this system of the gross rent is not quite a general system. I will press it a little bit further. It has been suggested by more than one hon. Member who has spoken, that to use the net rent as the basis for assessment by the parishes, is a thing which is in the interests of certain capital undertakings in the form of railway companies, and so on.


They are all here.

5.0 P.M.


From my point of view all interests have to be considered equally, and the first thing that strikes one is that the biggest interest in the matter is not the railway interest or even the tramway interest. The biggest deductions are for some of the industrial companies, and, if you think of it, it is very obvious. There are certain industrial concerns of which the cost of repairs is enormous. Take the case of Scottish oil companies, for example, which deal with an enormous amount of plant that is exposed constantly to the action of liquids and vapours which are highly detrimental to the permanency of the material through which they have to be passed. The deductions which those people get are very large, but in justice it is exceedingly difficult to say that they are not fairly made. Again, the system of net vent has enabled justice to be done, not only to what you may call perhaps a special case like that, but to all cases. It is a great mistake to imagine that net rent and the deductions consequent upon it are limited to works of that kind. I find, for instance, that in the case of a very large electrical concern in Glasgow the deductions amount actually to a percentage of 45, which, it you compare it with the railway companies, is greater than 2 out of 3. The deduction in the case of the Glasgow Corporation Tramways amounts to 36 per cent. and the Glasgow and the South Western is 42. One need not pursue that. It applies equally to shops and to dwelling-houses. It is graded again when you get to mere land, where the cost of repairs is either nothing at all or very trifling. But the result is that something very like real distributive justice is done by that system, and, although it may be attended with some inequalities when you compare parish with parish, it is the system on which the education rate in Scotland has been raised since 1872. When in all probability we are greatly increasing the weight of the burden and creating a very considerable shock accordingly to the people on whom we are putting it, ought we to completely upset the system which ever since 1872 has determined the share in which that burden is borne by various kinds of people?


Did you not propose that in your first Bill?


I do not know if the hon. Member was here at the beginning of my remarks when I pointed out that the proposal in the original Bill was to adopt the county rate pure and simple, which is not the proposal in this Amendment. As the Bill originally stood the county council was to be the education authority. You would have added new confusion if you told the county council that it was to rate on some different system from that adopted at present, whether you approve of it or not. The long and the short of it really is this, that if it were open to us to do it the right thing undoubtedly is to tackle our whole rating system and get something like equality. If we are not going to do that, we must select, the best we can get and the most suitable for the raising of our new rate. Is there any doubt about that? Is it not wisest to take the same rate as that which has afforded the principle for raising the education fund in Scotland since 1872?

Lastly, one of the difficulties about the parish rate system is that you have no security that the deductions between parish and parish are made on the same principle. In point of fact they are not. There are variations between parish and parish, and I have no doubt that is in the mind of some hon. Members as another reason why we should endeavour to get some other system applied. Hon. Members may say it is pis aller if they like—I should not object—but I rather look at it from a different point of view. These differences, such as they are, have prevailed all these years while the education rate has been raised. You do not want once more to bring an undue shock upon the ratepayer. You had better leave these things as they are until the whole system can be put upon a reasonable and a rational basis. In short I think, as the choices between us lie, the wisest and the most practical system is to stick to the method by which the education rate has been raised in the past but to keep clearly before us—and no one does that more than I do myself—the desirability, if and when opportunity shall arise, of sweeping away the whole of the inequalities by a comprehensive measure and getting something like an equal system, and, on the other hand, of refusing resolutely—and this is, indeed, what I am doing—to add to the confusion already existing by attempting to tinker with any existing methods; in other words, to add one more to the far too many methods of local rating which are already in force. For these reasons we were unable to see our way to accept the proposal which was made upstairs, and we are still unable to see our way to accept the proposal which is made here. Speaking for myself, at any rate, I am perfectly aware of the imperfections which attach to this method—or, indeed, to any method, which you can introduce into this Bill from any existing system of rating, but obviously an Education Act is not the place in which to attempt to establish a new system which shall be free from the objections which may be taken to any of them.


As you, Sir, and everyone else knows by this time, I am a railway director. Not an opportunity has been lost of informing the Committee of that fact. Therefore anything I might say with regard to railways is prejudiced. But I will say a few words about railways to show why they really do not count so very much in this matter. The estimated total capital of the railways of the United Kingdom at the pre-war prices of stock was round about £1,250,000,000. The Board of Trade and the Government have put upon the railways since the War began £48,000,000 in wages. It does not require a great arithmetician to find out that that is very nearly 4 per cent. upon the whole of the railway capital. There are other charges, but that is enough. Is the Committee aware that that £48,000,000 wipes off half the stocks of the railways in Great Britain? Have you thought that out?


Stocks have gone up!


Calculate it out. It means that a half of the stock of the railway companies, unless the Government intervene, is wiped clean out, and I will challenge any man to refute that statement. In fact, there is no escape from the Government taking over the railways.


I must ask the hon. Member to come to the Amendment. So far he has not reached it.


As this is a Government affair so far as railways are concerned, I leave them out. Now I come to the crux of the thing—gross or net value. My hon. Friend (Mr. Pringle) is too much engaged with high politics to worry himself about details, but here is a letter I have received this morning from the shipbuilders and engineers on this Amendment, and they say they object to altering the present established practice in Scotland and to transferring part of the present assessment from other subjects to industrial establishments and place an increased burden on the industries of the country at a time when they should be fostered and not handicapped. It is the same with all the other industries. Before you arrive at the net value of a private house you would deduct 5 per cent., or something like that, but when you arrive at the net value of manufacturing premises, where engines, fixed plant, the whole of it, is part of the freehold, they allow anything from 40, 45, or 50 per cent., because of the cost of upkeep. Machines are constantly wearing out, and even the hard-hearted Income Tax assessor is now allowing them 10 or 15 per cent., and the Ministry of Munitions has allowed 30, 40, or even 50 per cent. Is it not the grossest injustice to say, "We will charge yon the gross value, when in the case of a house you only deduct 5 per cent., and where you have been hitherto deducting in the case of manufacturing premises 25 or 30 per cent.? It does not commend itself to the most elementary judgment. It may be said parishes differ from parishes with regard to the allowances to be made to the landlords and so forth, and to other people. They will be sure to make the same allowance in the gross rental, and the only remedy for that is some proper system of rating. I dare say it will come to this, that instead of having local assessors you will have some Governmental assessors who will go round about and do justice between all the parishes. After all, who benefits most by education? It is the inhabitants of the houses, and you are going to let them off with the gross rental, when you only allow them 5 per cent., and you are going to penalise all the factories and manufacturing premises, shipbuilders, and engineers throughout Scotland by disallowing the ordinary deductions which they have made for wear and tear and for upkeep, and put them all on the same level. I appeal to my hon. Friend, who must have some sense of justice in his mind, to consider this. There is no justice in it. It is an elementary attempt to make a very gross breach of all the elements of justice that we have been accustomed to.


The Government proposed it last year.


The Government has done a good many unjust things, I dare say. I am not here to whitewash them. I appeal to hon. Members who know. Is it a fair thing that an engineer's shop should be rated at the gross and a private dwelling-house also rated at the gross, when the upkeep of a private house is really a matter of 5 or 6 per cent., while the upkeep of a machine shop is more like 25 or 30 per cent., particularly now, when, owing to the high prices of things, you could not replace them even at that. That is the appeal I make. I appeal with the greatest confidence. I do not care how the Government may move from point to point; it is the privilege of a man to change his opinions. They have only gone back to what has been the rate since 1872. I appeal to them to stand firm by this. To do anything else would be a great injustice to the industries, and would fasten them with an enormous addition to their expenses at a time when the very reverse ought to be the case. My right hon. Friend there wants industries to be taxed. Surely he forgets that any additional tax you put on an industry is so much grit in the wheel. It must be. Therefore, I appeal with the greatest confidence to the right hon. Gentleman to adhere to the Bill as it now stands.


I feel that I must intervene in the Debate after the statements made by the hon. Member for West Aberdeen (Mr. Henderson). He has been asking several very pertinent questions in the course of that remarkable speech of his, and one of his statements was that it was the inhabitants of the houses who were to get the chief benefit of education. Surely he has not been watching the trend of events in the last three or four years when he makes that statement. We have been told of the great necessity that exists for keeping our place as a manufacturing nation and that we must have an educated people. Then surely capital should bear its full share of the cost. He makes a further remarkable statement when he says that the more you increase the rates you simply throw sand in the wheels of the industrial concerns of this country. Surely that is a most remarkable statement. If we are to keep our place as a manufacturing community—and I hope we will, and will take every step to do so, for I agree with many statements made in the course of these Debates, that we need to extend our system of education and to have a higher standard generally and technically—then capital must bear its fair share of the cost of education. Will that be sand in the wheel? I think it will be well-spent money as far as they are concerned.


I do not say that they decline. I object to an unfair proportion.


The question of unfair proportion is very much a matter of opinion. I am very strongly of opinion that the working classes of the country have borne an unfair proportion of certain forms of taxation and that certain big industrial concerns have escaped paying their fair proportion. The Amendment that we are considering now asks us to readjust the proportion of taxation in such a way as to cause some of the industrial concerns to bear a fairer proportion than they have done up to the present. Surely that is not an injustice especially if it is done for the purpose as we all agree of keeping our place in the industrial world.


I was greatly impressed by the point the Lord Advocate made as to the departure I make from the scheme as put forward last year. It is true the latter part of my Amendment makes a departure from the existing position, and as that was the only valid argument in his speech I am prepared to meet my right hon. Friend on that point and to have the Public Health assessment in the burghs, and I imagine that will be secured by the omission of the words "or abatements." If that is done, I think the Government may fairly meet us. The Lord Advocate with all his ingenuity never endeavoured to show that it was a wrong thing they proposed to do in the Bill. His only argument was that then we were dealing with a county council and we are now having an ad hoc authority. But if it is just with the county council it is just with an ad hoc authority. I do not think the Government can escape from their position. I am quite willing to show my fidelity to the right hon. Gentleman by being faithful to him after he has ceased to be faithful to himself. Here is an opportunity of restoring his consistency and that must be a dear thing to a member of the present Government. I think my right hon. Friend will be meeting the wishes of the majority of those interested in local government in Scotland if he does this. I quite admit that he will, of course, displease my hon. Friend the Member for West Aberdeen (Mr. Henderson), but we have all of us with great sorrow and great reluctance to do that. He stands in the ancient ways and holds to his old views with great force and great geniality, and we can always disagree with him with the greatest of pleasure, and it is in the sporting spirit we associate with a youthful man like himself. I think in the circumstances the Government need have no hesitation in meeting what is obviously the general wish of the Scottish Members. I may remind my right hon. Friend that upstairs when the Division was taken it was 17 to 15, and that was only because the Government threw its weight into the scales against the Amendment. There were four members of the Government, I think, voting in the majority of seventeen, and one was a Private Secretary. I think one or two hon. Members voted with the Government simply because the Government had made it a test question. I think, in view of the case the right hon. Gentleman has put, he might very well assent to the fair and reasonable proposal I have made. It would simply crown the whole course of conciliation the Secretary for Scotland has pursued in this matter, and we should all part happily with this Bill and say with one accord that he was the most courteous and skilful of pilots.


The hon. Member for Lanark (Mr. Pringle) has adopted a course which undoubtedly has been suggested by that ingenuity he always shows in the Debates of this House, but I am not sure it has not over-reached itself on this occasion. The moment he makes this change and cuts out the exclusion of the special burgh expenses granted under the statutory Government assessment, that moment he deprives his proposal of its one merit he said it possessed, of establishing an absolutely equal rate. He cannot expect me to accept that. He might appeal if he had a successful method of getting an equal rate, but if he proceeds to say, "No, but in order to meet your views I will alter my Amendment so as to make it impossible to have an equal rate under it," then he appeals to me in vain. The net is spread in vain before the bird. I cannot possibly walk into that. What we must do, I am afraid, is to adhere to the same method that has prevailed since '72 in regard to the collection of this rate.


I was disappointed to hear the reply of my right hon. Friend, and I really have great difficulty in understanding his attitude. This is a proposal deliberately and after due consideration put forward by the Government itself, and how anybody can maintain that the proposal in the Bill tends to equalisation in anything like the same degree as the proposal of my hon. Friend, I cannot for the life of me understand. Just look at the position we should be in. I am a Glasgow Member. What shall we have in Glasgow? One educational area, one education authority, and something like fourteen different rates in one city. I am not quite sure how many parishes or parts of parishes there are in Glasgow, but as far as I can make out, after consulting those who know, there are something like seven. As there is a separate rate under this system for occupier and owner, it means you have fourteen different rates for one service in one city. Could there be anything more ridiculous? When you take the county of Lanarkshire you have again one educational area and one authority, and you have thirty-seven different rating areas and seventy-four possible different rates. I do appeal to my right hon. Friend the Secretary for Scotland to have some regard for his own Bill. He knows I have supported him sometimes when I did not agree with him. I have supported him throughout because I believe his Bill contains valuable provisions. I am extremely sorry to see it going to the world and put into operation with a patent blur on it like this, with perfectly absurd rating provisions of a kind that everybody will understand. Here are two people on different sides of the street paying different rates for education and sending their children to the same school. They happen now to be under different educational authorities but they are to be under the same, and how you are going to explain that I am at a loss to understand. I hope my right hon. Friend will feel it his duty to meet the wishes of the great majority of Scottish Members, and the wishes, let me remind the hon. Member for Aberdeen (Mr. Henderson) of the County Councils' Association and the Association of Royal Burghs and all the public authorities who are interested in this matter in Scotland.


I must point out that practically the whole agitation reduces itself to one county. Apart from that, the whole of the parish councils are opposed, and as far as I am aware—I am not perfectly sure, of my ground—the Association of Royal Burghs has never expressed an opinion except through one area.


I understood that the Convention of Royal Burghs did express an opinion, and that it is certainly the view of the great bulk of the bodies But the real point of the thing is not who supports it, but is this a reasonable proposal. I cannot see how the House of Commons can pass a proposal which would have such a ridiculous result as to create one education area and at the same time levy fourteen different rates from the people in that education area.

Colonel GREIG

I should not have intervened at all had it not been for an observation that the majority of those interested in local government in Scotland are in favour of this Amendment. The Lord Advocate has made a brief statement with regard to one body. May I point out that all the parish councils of Scotland, who have levied this rate up to the present time, and in whose hands it will be under the Clause as now in the Bill, acting through their association, are unanimously of opinion that the Clause should be retained in the Bill. They express that opinion mainly on the ground of the increase in the cost of the levying of the rate which would be effected otherwise, and amongst other reasons they say that the question is one to be dealt with after the War as a whole and not merely in an Education Bill.


I regret very much that the Government have not seen their way to accept the Amendment. I appeal to the Lord Advocate and Secretary for Scotland to remove their Whips in the Division, and that Members vote freely. In the Division upstairs the figures were 17 to 15, and we may take it that at least two of those who voted were influenced against their better judgment to vote with the Government. I think it is not going too far to say that. That being so, let us have a free vote on this occasion. It is quite noticeable that the Whips are going about like perturbed spirits, marching back and fro like the ghost of Hamlet's father. We may infer from that that their men are not here. If the Secretary for Scotland removes the Whips the life of the Government will be saved if the Amendment is carried in that way.


I am extremely sorry that the Government have not seen their way to accept the compromise I suggested. The effect of the Government proposal as compared with mine is to lay the burden upon the occupiers of small house property and shops and also of a number of manufacturing businesses. All that is being done to relieve the railways, which are so ably and persistently represented by my hon. Friend the Member for Aberdeenshire West (Mr. Henderson), of from 5d. to 10d. in the £1 of their rateable value, and railways which have now a guaranteed dividend. We have had a great many distressful eases brought forward by the Lord Advocate. There was mention of oil companies who do not know what to do to escape excess profits, and we have the munition people, who have been rolling in wealth. They must be relieved; they are hard cases which melt the hearts of the Government. They do not consider how the rates will fall on the occupiers of small houses and of shops, both in the towns and villages. It is because of these injustices I intend to carry my Amendment to a Division.

Question put, "That the words proposed to be left out stand part of the Clause."

The Committee divided: Ayes, 130; Noes, 75.

Division No. 83.] AYES. [5.37 p.m.
Agg-Gardner, Sir James Tynte Gilmour, Lieut.-Col John Norman, Rt. Hon. Major Sir H.
Anderson, G. K. Goulding, Rt. Hon. Sir Edward Alfred Norton-Griffiths, Sir J.
Anstruther-Gray, Lieut.-Col. William Greig, Colonel J. W. Orde-Powiett, Hon. W. G. A.
Archdale, Lieut. E. M. Guinness, Hon. Rupert (Essex, S.E.) Palmer, Goufrey Mark
Baird, John Lawrence Hanson, Charles Augustin Parker, James (Halifax)
Baldwin, Stanley Hardy, Rt. Hon. Laurence Pearce, Sir Robert (Staffs, Leek)
Balfour, Sir Robert (Lanark) Harmsworth, Cecil (Luton, Beds.) Pennefather, De Fonblanque
Banbury, Rt. Hon. Sir F. G. Harris, Parcy A. (Leicester, S.) Perkins, Walter F.
Barnett, Captain R. W. Haslam, Lewis Peto, Basil Edward
Barnston, Major Harry Havelock-Allan, Sir Henry Philipps, Sir Owen (Chester)
Barrie, H. T. Hayward, Evan Pratt, J. W.
Beale, Sir William Phipson Henderson, John M. (Aberdeen, W.) Randles, Sir John S.
Beauchamp, Sir Edward Hickman, Brig.-Gen. Thomas E. Rees, G. C. (Carnarvon, Arton)
Bellairs, Commander C. W. Hoare, Sir Samuel John Gurney Rees, Sir J. D. (Nottingham, E.)
Bigland, Alfred Hope, Harry (Bute) Roberts, Sir S. (Sheffield, Ecclesall)
Bird, Alfred Hope, Lt.-Col. Sir J. (Midlothian) Rutherford, Col. Sir J. (Lancs., Darwen)
Boyton, Sir James Illingworth, Rt. Hon. Albert H. Samuels, Arthur W.
Brace, Rt. Hon. William Ingleby, Holcombe Sharman-Crawford, Col. R. G.
Bridgeman, William Clive Jackson, Lieut.-Col. Hon. F. S. (York) Shortt, Edward
Brunner, John F. L. Jardine, Ernest (Somerset, East) Smith, Rt. Hon. Sir F. E. (Walton)
Burn, Colonel C. R. Jones, J. Towyn (Carmarthen, East) Spear, Sir John W.
Butcher, Sir John George Kellaway, Frederick George Stanton, Charles Butt
Carew, C. R. S. Kinloch-Cooke, Sir Clement Staveley-Hill, Lieut.-Col. Henry
Carnegie, Lieut.-Col. Douglas G. Law, Rt. Hon. A. Bonar (Bootle) Stewart, Gershom
Cator, John Levy, Sir Maurice Strauss, Edward A. (Southwark, West)
Cecil, Rt. Hon. Evelyn (Aston Manor) Lloyd, George Buller (Shrewsbury) Terrell, George (Wilts, N.W.)
Cheyne, Sir W. W. Lonsdale, James R. Walker, Colonel William Hall
Clyde, J. Avon Loyd, Archie Kirkman Walsh, Stephen (Lancs., Ince)
Cornwall, Sir Edwin A. MacCaw, Wiliam J. MacGeagh Ward, W. Dudley (Southampton)
Cory, James Herbert (Cardiff) Macleod, John Mackintosh Wardle, George J.
Craig, Charles Curtis (Antrim, S.) Macnamara, Rt. Hon. Dr. T. J. Watson, Hon. W. (Lanark, S.)
Craig, Colonel Sir J. (Down, E.) McNeill, Ronald (Kent, St. Augustine's) Weigall, Lieut.-Col. William E. G. A.
Craig, Norman (Kent, Thanet) Macpherson, Rt. Hon. James Ian White, Col. G. D. (Lancs., Southport)
Craik, Rt. Hon. Sir Henry Maden, Sir John Henry Whiteley, Sir H. J.
Currie, George W. Magnus, Sir Philip Whittaker, Rt. Hon. Sir Thomas P.
Denman, Hon. Richard Douglas Marks, Sir George Croydon Williams, Thomas J. (Swansea)
Denniss, E. R. B. Molteno, Percy Alport Wilson-Fox, Henry
Dougherty, Rt. Hon. Sir J. B. Mond, Rt. Hon. Sir Alfred Wolmer, Viscount
Fisher, Rt. Hon. H. A. L. (Hallam) Moore, Sir J. N. Wood, Hon. E. F. L. (Yorks, Ripon)
Fisher, Rt. Hon. W. Hayes (Fulham) Morgan, George Hay Yate, Col. C. E.
Flannery, Sir J. Fortescue Morton, Sir Alpheus Cleophas Younger, Sir George
Fleming, Sir John Mount, William Arthur
Foster, Philip Staveley Munro, Rt. Hon. Robert TELLERS FOR THE AYES.—Capt.
Ganzoni, Francis John C. Newman, Sir Robert (Exeter) Guest and Col. Sanders
Gibbs, Col. George Abraham
Adamson, Rt. Hon. William Harbison, T. J. S. Outhwaite, R. L.
Allen, Arthur A. (Dumbartonshire) Harcourt, Robert V. (Montrose) Partington, Hon. Oswald
Anderson, W. C. Hazleton, Richard Peel, Major Hon. G. (Spalding)
Birrell, Rt. Hon. Augustine Hearn, Michael Louis Raffan, Peter Wilson
Boland, John Plus Henderson, Rt. Hon. Arthur (Durham) Rea, Walter Russell
Booth, Frederick Handel Hogge, John Myles Richardson, Thomas (Whitehaven)
Bowerman, Rt. Hon. C. W. Holmes, Daniel Turner Robertson, Rt. Hon. J. M.
Boyle, Daniel (Mayo, North) Howard, Hon. Geoffrey Rowlands, James
Brady, Patrick Joseph Jones, Rt. Hon. Leif (Notts, Rushcliffe) Rowntree, Arnold
Bryce, J. Annan Keating, Matthew Runciman, Sir Walter (Hartlepool)
Byrne, Alfred Kenyon, Barnet Sheehy, David
Chancellor, Henry George King, Joseph Smith, Albert (Lancs., Clitheroe)
Clough, William Lambert, Richard (Wilts, Cricklade) Smyth, Thomas (Leitrim, S.)
Collins, Sir Stephen (Lambeth) Lundon, Thomas Watt, Henry A.
Condon, Thomas Joseph Macdonald, Rt. Hon. J. M. (Falk, B'ghs) While, J. Dundas (Glasgow, Tradeston)
Crumley, Patrick Macdonald, J. Ramsay (Leicester) Whitehouse, John Howard
Dalrymple, Hon. H. H. McGhee, Richard Whitty, Patrick Joseph
Dillon, John Marshall, Sir Arthur Harold Wilkie, Alexander
Doris, William Meehan, Francis E. (Leitrim, N.) Williams, John (Glamorgan)
Duffy, William Millar, James Duncan Wilson, W. T. (Westhoughton)
Esmonde, Capt. John (Tipperary, N.) Mooney, John J. Wing, Thomas Edward
Firench, Peter Muldoon, John Wood, Rt. Hon. T. McKinnon (Glasgow)
Field, William Nolan, Joseph Yoxall, Sir James Henry
Finney, Samuel Nugent, J. D. (College Green)
Flavin, Michael Joseph Nuttall, Harry TELLERS FOR THE NOES.—Mr.
Gilmour, Lieut.-Col. John O'Connor, T. P. (Liverpool) Pringle and Mr. Shaw.
Gulland, Rt. Hon. John William

Question put, and agreed to.

Clause ordered to stand part of the Bill.