§ Order for Second Beading read.
§ The Minister of HEALTH (Mr. Chamberlain)
I beg to move, "That the Bill be now read a Second time."
The House has devoted so much time during the last three years to the discussion of this technical and, I am afraid, somewhat tedious subject of rating, that I am sure hon. Members in all parts of the House will rejoice that this Bill does not introduce any alterations in the principles of the existing law. The Bill is, in fact, confined to one purpose only, and that is to anticipate by six months the granting of rate relief to agricultural land and buildings, which was undertaken in the Local Government Act which we recently passed. In these circumstances, and in view of the fact that I understand the Second Reading of the Bill is not to be opposed, I do not think it would be appropriate for me to argue over again the merits of de-rating; nor do I think it necessary that I should repeat the reasons why we think it is desirable that the rate relief to agriculture should be expedited. Indeed, I think the desirability of that course is recognised on all hands. Therefore I propose to devote myself entirely to an examination and explanation of the methods by which we propose to carry this purpose into effect.
In order that I may make clear the reasons for the several Clauses in the Bill, I ought to remind hon. Members what is the procedure at present in order to carry into operation the relief already afforded. Under the Rating and Valuation (Apportionment) Act, the rating authorities were directed to proceed by four different stages. The first stage was the preparation of what is called a preliminary draft special list, that is a list in which were to be entered all the various properties which, either in the opinion of the rating authority or in the opinion of the occupier who made a claim in respect of them, were properly to be considered as agricultural hereditaments. Having compiled that preliminary draft special list, the rating authority sends it to the Revenue Officer, and he examines 538 it, and where he does not agree with the provisional conclusion arrived at by the rating authority, consultation takes place immediately. If as a result of that consultation there is still disagreement the special list is deposited, with a note of the properties in respect of which this disagreement arises, and it then becomes the draft special list and enters upon the second stage. It then goes to the assessment committee, and the assessment committee hears objections.
Finally the assessment committee approves the draft special list and it becomes the special list. But still that is not the conclusion of the matter. There is then an appeal possible from the decisions of the assessment committee. A final determination is not made until October, when the special list is embodied in the final valuation list, except—this is the last stage—in the case of objections, lodged before that date, which have not been determined by them. In so far as any properties are subject to such objections they remain unsettled until the final decision upon the objections. The House will see, therefore, that while we have already got provisional information as to the identity of the hereditaments which are to be considered as agricultural hereditaments and therefore exempted from rates, in a very large number of cases we have not and cannot have final information about them until at least the 1st of October, and in some cases later than that.
Therefore, what we have to do in anticipating the relief is to take that provisional information and work on that in the first instance, reserving the ultimate liability until a final determination is made as to the actual status of any particular property in the final valuation list. We have proceded in this Bill on the principle of giving in every case the benefit of the doubt to the occupier, so that if there is any doubt as to whether he has or has not the right to claim the status of an agricultural hereditament he gets the benefit of that doubt.
Let me refer hon. Members to the first Clause of the Bill. The first Sub-section grants complete exemption from rates to the occupier of any agricultural hereditament during the current half-year. Subsection (2) provides for the withholding of rates or the repayment of rates if they have not already been paid by the occupier on any hereditament which is shown 539 to be an agricultural hereditament in either the draft special list or the special list, in respect of the current half-year or any part of it. But it will be seen that there are words which reserve the ultimate liability of the occupier, and provide that if in the end the provisional information is not confirmed he will have to pay those rates from which he has been exempted provisionally. It will be seen that on page 2 there is a short paragraph which deals with the case where there is a difference of opinion between the rating authority and the revenue officer in the case of the draft special list. Whichever of them comes to the conclusion that the hereditament is an agricultural hereditament, that is taken as the one to determine the provisional exemption.
Under Sub-section (3) a right of recovery is given to the occupier to get back from the rating authority any sums which he may have paid in respect of the hereditament, even though he was not entered in the provisional list as an agricultural occupier. The nature of the occupation may have changed since the beginning of the year and become an agricultural hereditament after the circumstances were taken into account by the rating authority in the first instance, and this gives him power to recover, if ultimately he comes to be exempted.
Sub-section (4) deals with the user of the hereditament during the current half-year, and it will be seen that where the hereditament is shown in the final valuation list as an agricultural hereditament then it is deemed or presumed to have been so during the whole of the current half-year, but, if the rating authority or the revenue officer wish to question that presumption, they are given power under paragraph (a) to apply to the assessment committee, and if the assessment committee, after a hearing, is satisfied, they may give a certificate that during any part of the current half-year the hereditament was not an agricultural hereditament, and that of course will determine the proportion of rates ultimately to be paid. Paragraph (b) deals with the converse case, that is a case where the hereditament is not shown in the final list as agricultural. There it is the occupier who desires, perhaps, to make the case that, in fact, during part of the current half-year the hereditament was agricultural, and so he 540 is given the opportunity of applying to the assessment committee and the assessment committee may give him a similar certificate, and it will be seen that the occupier is allowed one month in which to make his application. Paragraph (c) deals with the case where an objection has been lodged to the determination of a particular hereditament before 1st October, but the amendment is made after the 1st October, and it provides that in that case the amendment shall have the same effect as if made before 1st October. Sub-section (5) makes these certificates given by the assessment committee subject to the same appeal and the same procedure as a decision on an objection to the special list.
I come to Clause 2, which deals with the necessary recoupment of the rating authorities for the loss of rates which is brought about by this anticipation of relief. This Clause follows, in all its essentials, Section 112 of the Local Government Act, Sub-section (2), which deals with the transitory provisions for the period between 30th September this year, and 1st April, 1930. This Clause proceeds in the same way, and it will be seen that the loss of rates is to be made up to the local authorities out of the Rating Relief Suspense Account which is established by Section 24 of the Finance Act of 1928, and, as to which, it is provided that it shall be disposed of as Parliament may from time to time direct. Of course, it will not be possible to ascertain the exact amount which has to be repaid to the rating authority until after the end of the half-year, but, as hon. Members will see, this Clause says that the money is to be paid at such times and in such manner as the Treasury may direct, and what is intended is that estimates shall be made beforehand on returns which will be called for as soon as the Bill becomes law; that those estimates will form the subject of examination, and that advances will be made to local authorities, from time to time, by the Treasury of sufficient amount to enable them to meet their current liabilities. The proviso is identical with the proviso in Section 112 of the Local Government Act.
Clause 3 is really a machinery provision that these drafts are to be taken as though they were rates, for the purpose of calculating rates or precepts 541 or apportionments which are to be calculated and founded upon rates. Obviously, if you are going to assess the liability of two different districts, let us say, for a common rate which is to be levied on both, you must not go deducting the relief which is given by this Bill from the amount which the rate would produce, because it might be different in the two different districts. Therefore, this means that for all these purposes of calculation you treat the matter as though this Bill did not in fact exist. Clause 4 gives power to the Minister to bring in the necessary regulations which will not only guide the manner in which the grants are to be calculated under Clause 2, but will also provide the form of certificate to be given by the assessment committee, and the various entries to be made in the valuation lists or records, and such modifications as are to be made in the demand notes.
As far as the demand notes are concerned, they are at different stages in different districts in the country. In some cases, they have been issued; in other cases, they have been prepared but not issued; in other cases, they have not even been prepared. It is desirable that we should impose as little additional work as possible on the rating authorities, and it is equally desirable that the occupiers who are being relieved from a certain portion of their rates should know exactly and as soon as possible what their rate liability is. I think it will conduce very much to both these desirable objects if we can specify in the form of regulations from the Minister of Health what modifications shall be made in the demand notes where they have gone out, and what alterations should be made where they have not gone out. It may be necessary to send some supplementary circular perhaps to occupiers to explain what their liabilities are. Subsection (2) is the common form of dealing with regulations of this kind. Clause 5 is the Definition Clause, and Clause 6 states the short title and extent. That concludes my exposition of this Bill. It is a short and non-controversial Measure, and I content myself by commending its provisions to hon. Members. If anything has been left obscure, I am sure my right hon. Friend the Parliamentary Secretary will be able, in due course, to illuminate it.
§ Mr. RAMSAY MacDONALD
Whatever may be said about this Bill, we cannot complain about the lucidity of the explanation which the right hon. Gentleman has just made of its provisions. He began by reminding us of the large amount of time that has been taken up this Session and previous ones in discussing the question of de-rating. He himself, if I may say so, showed one of the benefits—I am not at all sure it is the only benefit—of those discussions. That is the remarkable and enviable facility which he showed in surmounting that most terrible obstacle in words, the word "hereditament" On my less practised tongue, it does not come out quite so smoothly. I find myself rather in the position of one of the riders in the Grand National who has to surmount almost fatal obstacles in his course. Having got over it once with, perhaps, a good deal of hesitation and difficulty, I shall endeavour not to use the word again. This is, of course, a foot-note to the Budget, and the House has already accepted the principle by a majority having passed the principal Act of which this Bill is an amendment and extension. But I am going to make a more orthodox Second Reading speech, because once again we have to examine this Bill, not on the details which the right hon. Gentleman and his office appear to have worked out with great skill, but upon what is going to be its effect upon the agricultural situation.
What is the value of the Bill as a contribution to rural districts, which are a concern to every party in this House and to every reflecting section of the community outside? There can be no national unity unless the interests of town and country have been united. The great problem that we all have to face, and to face perhaps with more energy, with more courage, and with a closer examination of the fundamental economic laws and facts than have been shown hitherto, is this single question of how, in building up national prosperity, the countryside may be co-ordinated into the scheme and may share in the advantages of our labours. The contribution to that problem which has been made in the principal Act, and now in this supplementary Bill, is of the nature of rating relief. The fundamental assumption of the Government is that, if the State pays money 543 to agriculture, without definition, except the definitions that have been given in the previous Acts—not the process of agriculture, not the problem of agriculture, not a specific point in agricultural experiment and experience or failure, but agriculture—that if the State pays money to agriculture in the form of a relief of rates, then, somehow or other, that is going to benefit agriculture as an industry.
I do not think the right hon. Gentleman will find that that is going to happen. At the present moment, agriculture is relieved of 75 per cent. of its rates, and it has been relieved of that for some years. What has been the effect? The deputations which the Leaders of the three parties have been receiving within the last month from agriculture are just as woeful and mournful in their picturing of the outlook as they would have been before the 75 per cent. was taken off the rates. The figures of the tillage, the figures of the use of land, the figures of the population employed upon agriculture, both absolutely and relatively to the population, give us no hope whatever that by simply and only a relief of rates has the decline, which unfortunately has been observable in agriculture for a very considerable period of years—leaving out the special statistics that were created by war conditions and the conditions that immediately followed the War, but that general decline which is observable in any sort of curve that one may plot to indicate what is the tendency of agriculture in this country—been appreciably delayed or reduced by the answer to the agricultural needs, "We will relieve you of rates."
Now the reason is this—and this will have to be faced—that when money is given to agriculture in this general way, it is put, as it were, upon a sieve. The moment that it is placed there, there is a certain pile that remains there, but every time the sieve is shifted or moved, every time that any change takes place, it not only interferes with and hampers it, but in actual experience that pile tends to go down through the sieve and to find a final settlement in some other resting place. That resting place is not with the operating agriculturist, but it is with the landowner. This is not a question at all of party; it is a question of 544 the examination of the tendency, first, and then the effect, of very well-established economic laws. The effect is in the main twofold. It first of all increases the value of land, not as a subject of cultivation, but as a subject of ownership, and that is an exceedingly important guiding truth to everybody, whether Conservative, Liberal or Labour, who faces the economic problem presented by the decline of agriculture during the last generation.
I am not going to make a detailed speech, but, if I had such an intention, I could give case after case of what the effect of the principal Act has been on the price of land. I was talking the other day to a friend of mine who conducts very large transactions of that kind, and he said that on a general survey of the movement of land prices—not the letting of farms, but the sale of land itself—the tendency is quite clearly shown of an increase in the price of land on account of the de-rating scheme. The other tendency is, in the case of tenancies, to keep up rents, and neither effect is going to benefit agriculture from the point of view that we have in mind now, the point of view of the arrest of the decline of agriculture as part of the great industry of the country.
There is another point. Whatever economic relief we give to agriculture must enter as capital into agricultural processes; otherwise, it is not going to help agriculture at all. There are two or three ways in which credit or monetary help might be useful to agriculture-Agriculture might be helped by grants which enabled it to transform its methods of agriculture—that is one way—just in the same way as it has been suggested, in another part of the Budget, that State credit might be put at the disposal of the decaying industries in order to enable them to recondition themselves. If the money is put into that, and it is kept to that and not allowed to be drained out of that, then I am the very last person to say that good could not result. There are also such questions as the re-organisation of markets, the re-equipment of agricultural machinery, using the term not merely in the form of tractors and so on, but the whole mechanism of agricultural production, distribution, and marketing. There are the questions of drainage, of fencing, of the equipping 545 adequately and efficiently of buildings in connection with farms, and of marketing organisations. If money were put into those, if State credit and State help were to be put behind agriculture for those specific things, and given in such a way that it would remain in the development of those things, I am not going to say that such a policy would not result in a re-invigoration and re-establishment of the agricultural industry, but it is not going to be done by this general distribution of money to what is called agriculture.
None of these things will flow either from the principal Act or from the supplementing of the principal Act by this Bill which we are now considering, and what is very important is that the tenant farmers know it. There is one class of agriculturist who is not only a farmer, not only a cultivator, but also an owner. I do not know so much from my personal experience of the English conditions, but in some of the Northern and North-Eastern districts of Scotland that type of occupier has multiplied very considerably since the War.
Large estates have been sold, and the first offer has been made, quite properly, to old tenants who have been practically settled as tenants upon the land. What happend was that those sales were made at the time when agricultural values were absurdly inflated on account of legislation such as the Corn Production Act, and before the value of land as an agricultural instrument had fallen to what was the normal national economic level of prices. The sales took place, and farmers who had been substantial men, quite prosperous, whether they liked it or not had to buy their farms, and had to pay prices which were absolutely uneconomic and unjust to them. This Bill will help them, because they combine the economic position of owner with the industrial position of cultivator, but it is perfectly well known to every banker in the country that these men, in spite of the great skill which many of them are putting into agriculture, the fine, stout, hopeful hearts with which they have worked during the last few years—those men are in an exceedingly tight financial position, and any help that can be given to them within the lines of sound financial policy ought to be given 546 to them. They are quite worthy to receive it.
Let us make no mistake about it. In so far as this does help them, it is a State subsidy. It is a subsidy either from the rates paid by their fellow-ratepayers in the rating area to which they belong, or, if the right hon. Gentleman's calculations and contentions are sound, and as a matter of fact this de-rating provision will not, to any extent, fall upon the beneficiaries' neighbours, then it is a subsidy from the taxpayer of the country. This aid cannot come from any other source. It is a subsidy from rates or a subsidy from the taxpayer, and I repeat, an order to make this part of my argument complete in itself, that if this country is going to embark upon a policy of subsidy, the subsidy must be for a specific aim. It must not be a general contribution to an industry. A theoretical illustration of subsidy is given in the case of the subsidy for beet-growing. That was not a sort of seed spread broadcast over every farm in the country, but the argument was put up to us by farmers: "We can grow beet. Other countries have had such an advantage, such a long start in the growing and handling of beet, that, unless we get some assistance, we cannot by our own private enterprise and private initiative overtake it." If that contention be proved, if the possibilities are there, if the soil be suitable, I think everybody who is interested in agriculture would agree that the encouragement of beet and the putting it upon a sound, independent agricultural foundation would be enormously to the benefit of this country.
There, theoretically, you have your case for a consideration, at any rate, of the subsidy, and tested in that way this Bill is quite useless. Will this Bill add one field to the arable cultivation of the country? I do not believe it will. I do not believe that a very careful scientific investigation—I am not aware whether it exists or not—but a really careful, scientific investigation of the changes in agriculture since the 75 per cent. aid was given, an examination into what has been its actual proveable effect, not merely by the use of figures which mean one thing in one column and another thing in another column, but figures the meaning of which has been sifted, analysed 547 and traced down to actuality and reality—I do not believe that it would be found that it has kept a single field in arable cultivation that otherwise would have gone out of such cultivation.
There is another specific point which has to be considered. The great farming complaint now is that it cannot compete in price with the foreign and imperial producers of certain main lines of agricultural production. There, again, you have a case, at any rate, for an inquiry, but a subsidy to deal with prices on the model of the Corn Production Act is certainly not of the economic nature of a relief of rates. The two things as economic experiments, as expressions of an economic policy, are as different from each other as black is different from white. I am perfectly sure that this Bill in experience will be found absolutely ineffective for the purpose with which I began my remarks, namely, the profound desire, the determination to face the agricultural economic problem and put it on a sound footing. This method is an indication of lazy mentality rather than of a careful examination of the detailed problems under which agriculture is going on. But there it is. The majority opposite have decided that that is the way they are going to help agriculture, and the only opposition to it, especially after the decision which had been taken previously both on the Budget and on the principal Act, would be the setting up of a completely different policy by which the problem is to be handled. That is quite out of the question now. If we tried to do it, you, Mr. Speaker, would quite properly refuse to allow us to do so.
It is not a negation that is now wanted; it is a positive policy, constructive, on a totally different foundation, and approaching agricultural problems with a closeness and sense of reality which is not even shadowed in the decisions of this House up to now, and in the drafting of this Bill. We believe that this Bill will give no relief to agriculture, and that, consequently, things will just go on as they are. Two years, three years from now, farmers will come to us, deputation after deputation, saying that they are coming closer and closer to bankruptcy, telling us that they cannot keep their fields under the plough and that they 548 cannot recondition their labourers' cottages, telling us that the economic condition of agriculture is precisely in the same position as it was at the beginning of last year or at this present time. What I have said will be proved, I am certain, by experience. The experience of the years when the agricultural industry was enjoying the reduction of 75 per cent of their rates is not going to be changed by an extra 25 per cent relief. If the 75 per cent had thrown some glimmering of hope across our minds, and across the mind of agriculture, the Minister would have been justified; but it has not, and I am quite certain that somebody will have to come in with a sense of reality and with a practical business mind to face this problem of agriculture, and, when that is done, the effect of this legislation, supplemented even as it is now, will be found to be practically nil. There, as the circumstances of Debate are such, and the limits of the Amendment are so exceedingly narrow, I am perfectly content to leave it.
§ Colonel Sir GEORGE COURTHOPE
I welcome the opportunity to say a very heartfelt "thank you" to my right hon. Friend and the Government generally for ante-dating by six months our expectation of relief, to which we farmers attach very great importance. I say "we farmers" because when, in a few moments, I shall attempt to deal with one or two of the matters referred to by the Leader of the Opposition in the very interesting speech which he has made, I shall approach the subject as a farmer. I am not, perhaps, one of the class which the right hon. Gentleman has in his mind, but I am an occupying owner farming a considerable extent of my land, and I approach the matter from that point of view. First, I want to say, what has not been mentioned yet in the Debate, that, quite apart from the benefit which the farming community confidently expect to receive from this little Bill, my right hon. Friend has succeeded in removing what would be a very annoying and troublesome bit of business from the local rating authorities, who would, but for this Bill, have had to make special adjustments in their rating arrangements for the short period of half-a-year. Owing to the fact that the extension of what is commonly known as the three-quarters relief from agricultural 549 land to buildings in most districts would have come into effect only at the beginning of this month, there would have been a special adjustment for half-a-year before the complete relief on both land and buildings came into operation next October. It would have been a petty nuisance to every rural rating authority, and I am glad to see that that has been removed.
Let me come to the speech which we have just heard. The right hon. Gentleman the Leader of the Opposition has stated that he doubts whether this relief will be of any benefit to agriculture, and that it is a subsidy, and that, if the subsidy be of benefit to anyone, it will benefit the landowner. Let me deal with these matters. We farmers regard this as a long-deferred removal of an unjust burden. We have claimed, rightly or wrongly, for it is a matter of opinion to some extent, that our land, the land from which we have to make our living, is the raw material of our industry, and that as such it has been most unjust that it should have been burdened more heavily than the raw material of any other industry for the purpose of local taxation. For many years that has been the unfailing complaint of the agricultural community, and consequently we welcome the prospect of the complete relief of agricultural land and buildings from this burden most of all.
We believe the relief will be of material assistance to the profit and loss account of every farmer. I do not say it will be sufficient to turn heavy losses into profits, or anything of that kind, but it is an assistance which averages out at something like 2s. per acre per annum, and it will certainly help the slow restoration of prosperity to agriculture. I say the restoration of prosperity to agriculture deliberately, because I am firmly convinced that in most districts and most branches of agriculture a very definite recovery is going on to-day. That does not apply everywhere, though I believe it to be true of most districts; but the recovery must necessarily be a slow one, because the depression has been very severe, and there is no doubt whatever, I fear, that as a result of that depression a very considerable section of the agricultural community is not really solvent to-day. I think insolvency shows itself more slowly in agriculture than in any 550 other industry, but I am afraid that in the case of a large proportion of the farms in this country if it were necessary for the farmer or his family to close down and balance up, it would be found that the business was not really solvent. Consequently, recovery must be slow, but anything which gives relief to the farmer's annual profit and loss account is an assistance towards this slow recovery and is an assistance which we welcome.
Whether or not this relief, or the antedating of this relief by six months, will add an acre to the land under the plough, if I may quote the exact words of the right hon. Gentleman, I do not know; probably it will not; but it will help the very difficult process of maintaining the acreage of land which is now under the plough, and that is our problem. How does that problem arise? Why is it so necessary that the State should take steps to assist agriculture? In the main it is because Parliament, in its wisdom—and I think Parliament was right—laid it down that a minimum wage shall apply in agriculture, but has since withdrawn the accompanying conditions which were introduced at the same time to ensure that the farmer should be able to pay that minimum wage. There is an old saying among agriculturists that the weekly wage which the farmer can afford to pay to the labourers is the price of a sack of corn. That works out very accurately. The selling price of a sack of wheat is economically about the figure which an arable farmer can afford to pay his unskilled labour, but to-day there is a difference of many shillings between the selling price of a sack of wheat and the minimum wage the farmer has to pay—and I think quite rightly has to pay—to his labourers. That fact is the cause, very largely, of the serious depression we have gone through, and the reason why that depression has been specially acute in the purely arable districts, because in those districts wages form a higher proportion of the total cost of production than in any other districts and those wages are fixed not by economic considerations, by what I may call "the sack of corn consideration," but by statutory regulation.
I do not think any of us can foresee what may be the future of wheat growing in this country. I hope the establishment of the beet sugar industry on a firmer 551 foundation will help, to a great extent, to maintain wheat cultivation, because one of the main functions of a crop like sugar beet in the rotation system is to clean the land. The cleaning of the land is most essential in corn production, and sugar beet provides a substitute crop in place of the old-fashioned fallowing process, which was merely a burden upon the cost of the production of wheat. Anything we can do to assist the profit and loss account in the rotation years will help to maintain the production of wheat and barley and the other cereal crops. I apologise for digressing from my subject, but I think the digression is justified, because the essence of the whole of this question is that for farming to prosper the farmer's profit and loss account must be so adjusted that the price of wheat becomes an economic one and not an artificial one, and we shall not have secured that until the farmer is able to obtain for his sack of corn as much as he has to pay for a labourer's wage per week.
Let me turn to the very interesting argument of the Leader of the Opposition with regard to the position of the landowner. It is no doubt true that in those districts where agriculture is showing a tendency to revive the price of land is tending to rise. It is inevitable that that should be so. Anything that helps that recovery, whether it be the removal of the burden of rates or anything else, must naturally, I admit it at once, tend to effect an improvement in the ordinary average selling price of land. But the right hon. Gentleman forgot to tell the House, or refrained from telling the House, that even assuming there is a tendency for an improvement in the value of land owing to relief such as this, that relief cannot be taken by even the most grasping landowner from his existing tenants. The rental value, the market value, of land in vacant possession is governed simply and solely by demand and supply. It is quite true that anything which increases the profits of farming, or tends to improve the prospects of farming, naturally tends to increase the demand for land and to that extent ultimately—
§ Sir G. COURTHOPE
Oh, yes, I have been frank about it. Why should it not be so? But under the restrictions of the 552 existing statutes there is no possibility of even the most grasping landowner extracting from his existing tenants any benefit they receive from this relief. There is one other point as to the value of land brought to my mind by the right hon. Gentleman's speech. Everybody who has studied the question admits, I think, that the selling price of agricultural land is affected by other considerations than the net cash receipts received from it. The net rental of agricultural land is very small. I have never yet found a purely rural estate of which the net rentals showed a 2 per cent. return on the ordinary market value, and that is one of the reasons why, short of confiscation, nationalisation of the land is going to be so ruinous for the nation. The individual owner has in his mind considerations to which he attaches value, but which can be of no value to the State or a municipal body. That fact must always be borne in mind in considering the benefit which a relief such as the proposed relief of 2s. per acre per annum, which we hope this scheme of de-rating will afford, will have upon the purchase price. It would primarily have effect only on the rental value of land in vacant possession, and the effect would be very indirect indeed upon the market price of land. I say again, in conclusion, that we farmers do not regard this de-rating as a subsidy but as the long-deferred removal of a burden. We welcome it and we welcome particularly its advancement by six months. We believe it will be of real assistance to us, and we cordially thank the Minister and the Government for giving us the assistance for which we have asked so long.
§ Mr. MORRIS
The Bill we are now discussing is a very interesting one. Scarcely had the Local Government Act received the Royal Assent before another Bill had to be brought in to amend it. The necessity for this Bill was urged upon the Government when the Local Government Bill was before the House. Now it has been discovered that the relief provided for the farmers under the Local Government Act is not satisfactory, and we observe that the Farmers' Union has been denouncing it as anathema, declaring that the Government have done nothing for the farming interest, and consequently it has been decided to bring in this Bill in view of the approaching General Election. The hon. 553 Member for Eye (Sir G. Courthope) has thanked the Government for this small amount which is now being given to the farming industry. I also wish to thank the Government for it, but I do not thank them for the manner in which the relief has been provided, because the course which has been adopted is a thoroughly bad way of doing it, and it does not do anything which the Government professes that it does.
The Minister of Health, in the Debate on the Second Reading of the Local Government Bill, said that the main object of dealing with agricultural rating was to remove the hotch-potch state of affairs which existed as far as agricultural rating was concerned. The Parliamentary Secretary to the Ministry of Health admitted that the Local Government Act did nothing to remove the hotch-potch state of things which was then in existence, and it was afterwards decided to ante-date the relief given by six months. It is true that the Act of 1896 dealing with this subject appears in the Schedule of the Local Government Act as one that is repealed, but the methods of payment under that Act, have been re-enacted, and they are also dealt with under this Bill.
§ Mr. MORRIS
The Minister of Health shakes his head. Does the right hon. Gentleman say that the total rates on land and buildings have been abolished? Does he say that the Treasury is going to pay the full amount? The right hon. Gentleman gives no answer to that question. As a matter of fact, the full rate upon agricultural land and buildings is not going to be paid by the Treasury, but it is going to be dealt with on the basis of the Act of 1896. It is all the more extraordinary that, when the Government are ante-dating the relief to 1st April, it has not been considered relevant to examine this question as far as the buildings themselves are concerned. The Bating and Valuation Act of 1923 derated three-fourths of the rates on agricultural buildings, and that loss fell entirely upon the local authority without any compensation from the Treasury. That loss fell for the first time on the local authority in that year, and there is no provision in this Bill for compensation 554 in respect of that loss, which still falls upon the local authority. That loss upon agricultural land still remains, and it is a very substantial one which has been estimated under the present assessment to amount to about £6,000,000. That loss falls upon the farmer and the rural ratepayer. Who is going to pay it? There will have to be paid in the future, not only the actual loss on buildings under the present assessment, but also the loss which may be incurred under the new services, some of which are outside the purview of the Local Government Act. Those losses will have to be borne by the farmer and smallholder. If the smallholder builds a new house, it will be subject to a higher rate of assessment than the land, and the result will be that he will find himself in a worse position than before. Speaking on this question, the Chancellor of the Exchequer, in his Budget statement for 1928, said:The farmer will continue, of course, to pay rates on his residence in the ordinary way; but so far as agricultural production is concerned he will be entirely free. There will be no chance of rates being raised upon him for any cause or in any district. The whole business of assessment and re-assessment, as far as he is concerned, comes to a final end. Out's out. To him after the middle of next year, the rates are dead and as the poet said, 'Stone dead hath no fellow.'"—[OFFICIAL REPORT, 24th April, 1928, col. 865, vol. 216.]Any farmer who is a member of a local authority acting upon the Chancellor of the Exchequer's advice will find himself in a difficulty, because the rates and assessments are not dead as far as he is concerned, and they will have to be kept intact in order to find out what is the liability of the Treasury. They become material when there is an increase in the assessment or an increase in the rates which is bound to follow. That will increase the burden upon the farmhouse. The rates are not dead by any means as far as the farmer is concerned under this Bill. It is interesting to note that the Conservative party has never changed its method of rating. In 1896, Mr. Chaplin said in the House of Commons:—One result of this new assessment, it may be hoped, will be to give a wholesale stimulus to economy in local expenditure…because the annual amount of the grants being fixed by the Bill, houses and buildings will gain or lose according as there is an increase or decrease in the local expenditure in the future. If there is an increase, the burden of the increase will be 555 borne by houses and buildings in larger proportion than by the land. If on the other hand there is a decrease and consequently a surplus in the annual grant, that surplus will go in relief of rates generally and houses and buildings will benefit in proportion.That is what Mr. Chaplin envisaged in 1896. What has been the result? I think I can say with safety that the local authorities cannot be charged with being spendthrifts, and at any rate the members of county councils who belong to the farming class are not usually spendthrifts. What has been the result? Far from the result envisaged by Mr. Chaplin, the expenditure of our local authorities has increased and has been multiplied I do not know how many times, probably ten times what it was in 1896. The local authorities have been less careful than Mr. Chaplin desired them to be, and additional burdens have been placed on all local authorities by almost every Act of Parliament which has been passed during the intervening period. Additional burdens have been thrown upon the county councils, and these causes are responsible for the deficiency under the Act. The Minister of Health says that this is a relief to the agriculturist, but I think the result I have described will be precisely the same in the future. Parliament will go on passing legislation according to the tendency of the times, and there will be a tendency to increase the burdens of the local authorities. We have not heard what the effect of the new policy will be with regard to education, but the chances are that that will increase the burden of the local authorities. That will increase the burden on the farmer in respect of this deficiency. The Government had an opportunity in this Bill of dealing with the hotch-potch, but they have left the hotch-potch alone. The hotch-potch remains, and the farmer is still liable, and will be further liable in the future. This is not the method in which relief for the farmer should be dealt with. The farmer does not ask for it. Why should he be relieved of rates? He does not ask for it, and it is not going to assist him.
§ Mr. MORRIS
In 1896 the farmer was relieved of half his rates. There have been various periods of agricultural depression since 1896; how much did that relief assist the farmer? It gave him practically no assistance at all. He was relieved of another quarter of his rates in 1923, but agricultural depression still persisted. The real position is that agriculture cannot be isolated from other industries. In the case of the farmers in my Division, unless they can market their produce in the coalfield of South Wales at a price which is profitable to them, it is no use their producing at all; but they cannot market their produce at a profit in that district, because there is no coal trade in South Wales. It is necessary to connect agriculture with all other industries. This relief is not going to bring people back to the land, and that is the real crux of the situation—to bring back prosperity to the agricultural industry.
The hon. and gallant Member for Rye has said that the benefit of this will accrue to the landlord. I am not very much interested in that point, but it is perfectly true. These words were not spoken by a wicked Liberal or a wicked Socialist opposed to the beneficent provisions of a benevolent Government:If rates increase, rents decrease; if rates decrease, rents increase.Those words were spoken by Mr. Chaplin, a very distinguished leader of the Conservative party and a Tory landowner; they are not the words of a Liberal or a Socialist. It is perfectly true that the benefit will go to the landlord; it is bound to add to the value of the land. I am not complaining so much about that, but am warning the agricultural community throughout this country that, although they may be thankful for this small relief, to which they are clearly entitled if other industries upon which they are dependent are going to be safeguarded, they are severely misguided if they are under the impression that it is going to add to their prosperity, or that in, say, the next 10 years, they will be better off even as far as rates are concerned, for they will find that very little relief has been given under the provisions of this Bill.
§ Mr. SMITH-CARINGTON
I should like to add my word of welcome to this Bill, which I think will be particularly acceptable in the agricultural districts. 557 Despite what we have heard to the contrary, there has been a very clamant cry from the National Farmers' Union, and from others who are not members of that Union, for relief from rates, and we have received very real expressions of their gratitude since this Measure has been proposed. One of the criticisms directed against the Bill, though not in this House to-day, has been in consequence of the preferential position in which agriculture is placed as compared with other industries, and I would like to say just a word or two on that point, and, in particular, to suggest to the critics that they should not regard this Measure as a complete picture in itself, but as a small part of a large canvas showing just a little bit of silver lining underneath an extremely black cloud which spreads over a very wide landscape.
The hon. Member for Cardigan (Mr. Morris) reminded us that we cannot isolate agriculture from other industries. I agree with him, but, unfortunately, it has very often happened, where the interests of agriculture have been somewhat in conflict with the interests of other industries, that agriculture has been sacrificed. I am not exactly complaining of that; I think it is almost inevitable in a highly industrialised country like ours that the agricultural industry should be subordinated; but history has been very unkind to us. Examples in the past could be found in the abolition of the Corn Laws, and, as regards the more immediate present, we have not very long memories if we cannot recall the rather light-hearted way in which the Agriculture Act of 1920 was passed, guaranteeing prices. As a result of that, it was found before very long by other interests and other industries that the burden upon them was higher than had been anticipated, and that Act was ruthlessly scrapped within a very few months. In passing, one might reflect that one large political party to-day is advocating the stabilisation of prices. I have only one criticism to make of that, but I think it is a criticism which goes right to the root of the matter. Unless prices are stabilised at a figure which is profitable, it will not be of any help, and, if they are stabilised at a high figure, I feel sure—
§ Mr. SMITH-CARINGTON
I apologise Mr. Speaker; I will not pursue that particular matter. What I was trying to put before the House was that the agricultural interest has often been subordinated to the interests of the nation at large or of other industries. I have given examples of that, and the only further one that I would mention is the return to the gold standard. That led to lower prices, and in that respect was an advantage to the nation as a whole, but, owing to the great lag that there is between expenditure and receipts in the agricultural industry, that again has proved to be a heavier burden upon agriculture than upon other industries. The point of these remarks is that, if we take into account the whole history of the treatment of agriculture, vis-à-vis other interests in the country, we might quite reasonably put forward a claim, I will not say exactly for compensation, but at any rate a claim for very favourable consideration from the nation whenever and wherever it is possible to grant it. That is why I welcome in particular the work that the present Government have done in easing this burden in various ways, and I welcome this Measure as one further instalment of the good work in that direction.
§ Mr. SHEPPERSON
I would like to refer to a speech of the late Minister of Agriculture in which he adduced the argument that this relief from rating will go back eventually to the landlord. The experience of every agriculturist in the past has been that such relief does not go to the landlord, and, as regards the present Bill, I fail to see how, when a farmer gets, as he will, a demand for rates, and when he refuses to pay, as he can do, and tears up the demand note, it is possible that the amount from the payment of which he is relieved under this Bill can go back to the landlord. There is a certain section of hon. members opposite who infer that, whenever anything is given to the farming community, it must eventually find its way into the pocket of the landlord; and there is another section of agricultural thought which says that any benefit to the farmer will eventually find its way into the labourer's pocket. The poor farmer, therefore, cannot get anything in any circumstances. There is some reason 559 for thinking it more likely that any such benefit will go into the pocket of the labourer than into the pocket of the landlord, because the farmer to-day is often in the position of having work to do, like hedging, ditching, and so on, but not having the money with which to do it. When this concession is given, he will have a little more money, and will be more likely to pay that to the labourer for doing the essential work that requires to be done.
Hon. Members opposite are rather inclined to look at agriculture from an urban point of view. In the urban point of view the landlord is a nonentity. He simply collects the rent. From the urban point of view, the employer simply employs labour and knows nothing of the conditions of labour. In agriculture, it is a vastly different thing. The landlord, the farmer, and the labourers are partners in a common industry. I am not concerned as to whether this relief shall go into the pocket of one partner or the other. I want it to go into the industry as a whole. The landlord has his functions. He has an interest in the land. He is more concerned with the land than the landlord in a town, and the labourer himself is an actual partner in the industry to this extent, that he is himself interested immediately in the prosperity of the farmer and the farmer himself is interested in his own labourers. If there are two labourers working for a farmer, an elderly man with a family and a young man who is more efficient, when there is unemployment, the farmer knows the conditions of his men, and when he discharges a man he will rather discharge the more efficient younger man and keep the elderly man, because he has a consideration for the children. Any line of thought that proposes to remove those sympathetic conditions which ought to exist between the three partners in agriculture does harm to the industry. I am not concerned as to whose pocket the relief goes into. I accept the Bill in the interest of the industry as a whole.
§ Mr. MacLAREN
We have listened to the hon. Member's speech with a certain amount of admiration, because, though we may differ from him, we give him credit for being very sincere in the views he holds, despite the fact that he is a little innocent as yet. He says that he 560 is not very much concerned as to whose pocket the relief may ultimately percolate into. That is just the point. I can assure him that if he had a greater flow of Scottish blood in his veins he would be much more concerned as to where the money finally goes than he seems to be. May I recall to his mind a little incident that took place—I want the Minister of Health to pay particular attention to this little interlude—during the Debate on the Scottish Derating Bill. I said on that occasion, and I say again, that in that Debate we seemed to get down to the economic laws underlying the ramifications of man-made law more than we seemed to do when discussing the English Bill. I asked the Lord Advocate whether he agreed that the full benefit under the Bill would finally go into the landlord's pocket. He said he did not wish me to misrepresent him, and went on:I made it quite clear that I thought there could be no difference between us as to the first point, because the tenant comes and goes and the landlord is the only permanent person; he is the owner of the property, therefore, it is perfectly true to say that the benefit which follows or the land must come back to the landlord.There was no statement in all the prolonged and very useless Debates on the English Derating Bill and no statement made even in the Scottish Debates more significant than that. There were these great, hefty, complicated Measures to give relief to the industry and to keep back the brake of rates, which were always holding back the wheels of production, giving an impetus to the industry, and so keen were they to give the basic industry of agriculture an impetus forward that indeed, as the Chancellor said, they were going to wipe them out entirely. Here comes along the Lord Advocate and says the entire relief, attaching itself, as it must do, to the land, will go into the landlord's pocket and not to the industry itself. I attribute much of this trouble to the Rating and Valuation (Apportionment) Bill. I mentioned all this before, and I am going back on it now. I suggested that in their valuation roll under that Bill there should have been a separation so that we could clearly define in this ambiguous thing called a hereditament which has never been defined in law, as far as I know, 561 but which seems to be slipping about the House with great facility. The value of improvements and equipment—
§ Mr. MacLAREN
I am sure you will appreciate my point, Sir. I am correlating it to the point under discussion. I am coming back to what I consider to be the original cause of the trouble now arising. That was, that in the valuation under the Rating and Valuation (Apportionment) Bill the composite subject stood as one whole, and there was no distinction between the value of the improvement and the value that may have been attached to the site.
§ Mr. SPEAKER
That has nothing to do with this Bill; the principle has already been accepted by the House. The hon. Member cannot go into that question again.
§ Mr. MacLAREN
I quite agree, but as the ground I am coming back to has been covered this morning I want to correlate what I am saying to what has already proceeded in this discussion. The point before the House now, which has surely been emphasised on both sides of the House, is that this is to give relief to agriculture. The Leader of the Opposition said he was in favour of doing anything that was possible to help the industrial side of agriculture, but not in any way to allow public money to float into the other side of agriculture, namely, anything that would tend to inflate rent. I am trying to argue that the difficulty which is there and is genuine would not have arisen if, under the Eating and Valuation (Apportionment) Act there had been a clear distinction in the valuation between the two items.
§ Mr. SPEAKER
It is too late to do that. That has been already decided under the Rating and Valuation (Apportionment) Act.
§ Mr. MacLAREN
I will not pursue the argument as far as to lay it at the door of the Government as a form of indictment for not having been more scientific in the valuations under that Act because now they come along with a relief to agriculture, and it is a scientific fact—it is not a thing you can sit and 562 laugh at or make sentimental speeches about—that the relief you are giving to agriculture cannot help passing into the rent. That is our main charge against it. I have quoted the language of one of your responsible Ministers to prove it, and that could have been obviated, I am submitting, if a different valuation had been made. The argument could have been enhanced by quotations from responsible Conservative Ministers who have sat in the House, but the Ruling is such that one cannot go into a wide field. It is a sort of supplemental fallacy to the vicious fallacy pursued in the original Act.
It would be interesting to find out what was the real cause of the institution of this anticipated relief. I have been waiting to hear how far the Liberal party was in opposition to the Government. If I recollect the speeches that were delivered in the House during the course of the discussion on the Local Government Bill, I gather from the Liberal benches that they are in favour of abolishing rates on agriculture altogether. As far as the Debate has gone this morning, one is not quite clear on that point, but the hon. Gentleman the Member for Cardigan (Mr. Morris) was quite correct in his analysis of what is going to happen. The farmers will find increased rates falling upon the houses. They will also find that at the end of leases they will have to pay increased rentals for their land. The Act is nothing more than a mitigation of the consequences of a vicious rating system, and it will not be long, as the hon. Member said, before the farmers come back to this House again and plead for more relief. It is difficult to keep within your strict ruling, Mr. Speaker, and really challenge the Government on the policy which they are pursuing this morning.
The Leader of the Opposition said that he was anxious—and I am sure that every Member on this side of the House will be anxious—to do all that was possible and reasonable to help the real development of agriculture as such. But under our present land system we cannot, as I have said, escape the fact that every penny of public money used to help in the development of agriculture does not help agriculture as an industry but flows into the pockets of the monopolists. 563 There is nothing in the De-rating Act and nothing that this Government have done in their four years' term of office that in any way extracts from the over-swollen coffers of monopoly some tribute back to the national Exchequer. Their policy during these four years, consummated in this Act, has been one of inflating the monopoly prices of land, and no doubt outside this House to-day the landowners of England will be delighted to know that their gifts under the Act are to be ante-dated.
One cannot help wondering what passes through the mind of the Cabinet. I excuse the Minister of Health, born and bred in Birmingham, with the mind of a born Fabian with no sense of what human liberty ever meant. He is indeed a meticulous administrator who is desirous of putting numbers on the community and thereby giving no one the liberty to have a name. But, if we turn to his colleague in the Cabinet, one wonders what he thinks this morning in regard to the passage of this Bill. I would like to quote these words to him, though I know that they will not affect him very much.It does not matter where you look or what examples you select, you will see that every form of enterprise, every step in material progress, is only undertaken after the land monopolist has skimmed the cream off for himself.These are the words of the Chancellor of the Exchequer, and they are quite pertinent this morning. The gifts which the Government are to make under their little supplementary Bill this morning will again go into the pockets of the landlords. Restricted as I am by your Ruling, Mr. Speaker, I am limited in what I should like to say, but it will be said often in the country and said with considerable force. The Government have ended up by their little present this morning, but we shall not be slow in making the position clear to the country outside. The value of the land in the urban areas will go up, and under the provisions of this Bill we find accommodation made for the gentlemen who have got the land. Under this Measure, a man can say, "Oh, this is agricultural land," and escape his rates altogether, while at the same time he may be holding up his land against the local authorities who desire to secure it for housing for which the right hon. Gentleman the Minister of Health seems 564 so anxious. This and other little devices can operate under this Bill. We on this side are anxious to help agriculture and will do all that we can to help agriculture on one condition, namely, that the hemorrhage of rent shall be stopped from flowing into the pockets of the land monopolists.
§ Colonel APPLIN
I do not often speak in this House as I dislike to speak for the sake of controversy. Still I am rather pleased to be able to agree with what the right hon. Gentleman the member for Aberavon (Mr. MacDonald) said. He made one mistake, possibly purposely-He inferred that this Bill was the main relief of agriculture, whereas it is the last and smallest possible of all the many reliefs that we have brought in during our term of office in this Parliament. Although it is the last and the least, it is one of the most welcome, particularly because we are bringing the relief into force six months before the time expected.
I rise to ask the Minister, in the interests of the farming community, to see that under Clause 4 any forms which the farmers have to fill up and any returns which they have to make will be put into the very plainest of language, and that the forms will be as limited in number as possible. We are suffering in this country from a plethora of forms and returns and papers, and these things are generally so worded that the ordinary plain man cannot understand what they mean. I am sure my right hon. Friend will remember that the farming community are perhaps the least capable of dealing with Government forms and the wording which so often appear. I do beg of him to see that the forms that may be issued are the fewest possible consistent with efficiency and that the wording they contain is the simplest and plainest possible.
§ The PARLIAMENTARY SECRETARY to the MINISTRY of HEALTH (Sir Kingsley Wood)
I am sure that my first statement can be an assurance on behalf of my right hon. Friend in regard to the request which has been made by my hon. and gallant Friend the Member for En-field (Colonel Applin). It has been a distinguishing feature of my right hon. Friend's administration at the Ministry of Health, that although we have had to issue a large number of forms, we have 565 certainly endeavoured—and I think in a good many cases with success—to make them as plain and distinct to the ordinary man and woman as possible. We shall certainly continue to do that, especially in connection with these particular proposals, and I am very much obliged to my hon. and gallant Friend for bringing the matter before the House to-day.
There is little necessity for me to add very many words after the explanation of this Measure which has been given by my right hon. Friend. I should like, on his behalf, to thank hon. Members in so many parts of the House for what they have said concerning these proposals, and I have no doubt that the expressions of thankfulness for this Measure of relief will be re-echoed all over the country. I really only rose out of courtesy to the right hon. Gentleman the Member for Aberavon (Mr. MacDonald), who has for the first time, I think, intervened in our rating Debates. I notice that he said that in his judgment this, one of many rating problems with which my right hon. Friend has had to deal in the course of many months, indicated to his mind a great deal of lazy mentality. I suppose that that is his contribution to our rating Debates, and I should think, if one is to be challenged by the right hon. Gentleman, that this really arises because of the fact that he has not perhaps followed the course of these proceedings and because this is his first appearance in connection with them. The right hon. Member for Aberavon and the hon. Member for Cardigan (Mr. Morris), who spoke for the Liberal party, provide a rather amusing comedy by their attitude towards the proposal in the Bill. As I understand the position of the Socialist party and the Liberal party towards this extension of relief to a very deserving class of the community, they object strongly to the principle and the method of the relief, but they are afraid to vote against the proposal. That, I suppose, is why the right hon. Member for Aberavon, who is certainly an expert at speeches not particularly candid, has been chosen to come down to the House to-day to speak for his party.
§ Mr. NOEL BUXTON
On a point of Order. May I ask whether it is in order for the right hon. Gentleman to make a direct charge of that kind?
§ Sir K. WOOD
If anyone feels any sensitiveness about it, I will substitute some other term. I should have liked to have heard an expert like the right hon. Member for Norfolk North (Mr. Buxton) on these proposals, because he has very firm and fixed views on the matter. I am surprised that this afternoon, apparently, the right hon. Gentleman proposes to allow the Bill to go unchallenged so far as the Division Lobby is concerned.
§ Sir K. WOOD
I suppose the hon. Member will have the support of other hon. Members opposite, so that we may have a vote and that we may see where we stand, and whether the Socialists are or are not in favour of ante-dating this relief so far as agriculture is concerned. The hon. Member for Hillsborough (Mr. A. V. Alexander), whom we associate with a very large co-operative institution in this country, is present. If he thinks that this relief will go to the landlords, and agrees on that point with other hon. Members opposite, and if there is any hon. Member opposite who has the courage and the firmness of his opinions to challenge a Division, I am sure that the hon. Member for Hillsborough will join in making two tellers against the Bill. In that way we should obtain what many of us desire on this side of the House, namely a Division on this particular proposal.
It has been suggested by the right hon. Member for Aberavon that the proposal will bring no benefit to agriculture. I noticed that he was very careful not to use some of the arguments which have been used by many of his hon. Friends in our debates. When this relief was first opposed by the hon. Member for Nelson and Colne (Mr. Greenwood), he gave three reasons why it should not be given. I suppose those reasons will apply equally to-day when we are proposing that the relief should come into operation at an earlier date. He said (1) that he did not believe for a moment that a good many of the farmers were in any difficulty, (2) that, as a test, some law should be 567 brought into operation whereby the farmers should make returns as to their income, and (3) he expressed a view, which I think gives a clearer indication of Socialist ideas concerning our proposal, that so far from giving relief in rates to agriculture, agriculture had been underrated for a good many years. That is a very much more solid and candid exposition of the Socialist view concerning the proposal, than those we have heard this morning.
The right hon. Member for Aberavon made some practical suggestions, which I have heard before, in regard to helping agriculture, such as marketing and matters of that kind, but he failed to mention the Socialist remedy for agriculture which, as I understand it, is nationalisation. He took the view that our proposal is a further example of what he described as a State subsidy for agriculture. That is a curious way to refer to the proposal in this Measure or to our rating proposals generally. The proposal in this Bill, which is but a continuation of the proposals in the Act which we passed a few months ago, represents a great reform as far as rating is concerned, and in the opinion of my right hon. Friend the Minister of Health and the Government is simply bringing justice, for the first time, to the agriculturalists of the country. So far from this relief being in the nature of a subsidy, it is a rating reform which has been long overdue.
§ Sir K. WOOD
When the right hon. Member for Aberavon came to weigh up whether this relief will bring any advantage to agriculture, he overlooked the fact that the relief of agricultural buildings which is conferred by the Rating and Valuation Act, 1925, does not come into operation until after the first new valuation lists come into force, and in the great majority of rating areas the date of the operation of the first new list is April, 1929. Therefore, he could hardly estimate what is the value of the relief in that connection. I am very glad to think that the right hon. Gentleman, not for the first time, did not put forward the views of the ex-Chancellor of the Exchequer, the right hon. Member for 568 Colne Valley (Mr. Snowden), who said, in regard to this relief, that agriculture had been going to the bad with every relief of rates that has been given to it.
§ Sir K. WOOD
A follower who shares his views. We are content to place these proposals before the House and we believe, as the Minister of Health has stated, and as the Chancellor of the Exchequer stated in his Budget Speech, that they will bring some measure of justice to the agriculturists. The right hon. Member for Aberavon and hon. Members who sit behind him are very eager to state that this relief is really no relief. With all due respect and courtesy to them, I prefer to accept the verdict of the agriculturists, and we must turn in their direction rather than to the Socialist Benches to discover whether or not this relief will be of assistance. There can be not the slightest doubt about it. I invite hon. Members who have spoken this morning and during the last few months on this subject, to go down to agricultural constituencies and make the statements that they have made in this House, and see what sort of reception they will get.
§ Sir K. WOOD
There can be no doubt that in a very large number of cases already there has been a considerable amount of gratitude expressed by agriculturists at the relief that will be given. I commend the Bill to the House, with confidence. I would call attention to the attitude of hon. Members opposite, and I would ask that those who believe in our proposals should support them in the Division Lobby, should a Division be called.
§ Mr. HARDIE
The Parliamentary Secretary was present when the Leader of the Opposition spoke on this Measure. I was also present, and perhaps I paid more attention to what the right hon. Member for Aberavon (Mr. MacDonald) said than he did. The reference he has 569 made to the speech of my right hon. Friend shows that he was not listening to his remarks. We are accustomed to that kind of interpretation by the Parliamentary Secretary of speeches made on this side of the House, but when the Government are directly challenged as to whether this relief will not go to the landlords there is no reply. On the Scottish Bill the Lord Advocate made a statement to the effect that since the land-owner was the continuous occupant all that came to agriculture in the form of relief was bound to become the property of the continuous owner of the land.
§ The LORD ADVOCATE (Mr. William Watson)
A half quotation is very often grossly misleading. What I said was that if a landlord ceases to have a tenant the benefit goes to the landlord. The point on which we were not agreed is whether a new tenant gets the benefit or not. Our view is that he will.
§ Mr. HARDIE
The Lord Advocate knows that tenants come and go, and his words were—I made it quite clear that I thought there could be no difference between us as to the first point, because the tenant comes and goes and the landlord is the only permanent person; he is the owner of the property. Therefore, it is perfectly true to say that the benefit which follows on the land must come back to the landowner. But I also said that the later stage is the interesting stage; as to whether or not when a fresh tenant comes that fresh tenant gets any benefit out of it. It is there that the hon. Member is not quite fair to my argu-gent."—[OFFICIAL REPORT, 20th February, 1929; col. 1249, Vol. 225.]1 p.m.
During the Recess I spoke to some farmers in Scotland. This question was being discussed by a few of them who met me, and already these farmers had been told that because of his agitation, based on our arguments in the House, he will not be required as a tenant of the landlord any more. The hon. Member for Leominster (Mr. Shepperson) has made a very clear statement this morning. He says that as far as he is concerned, and I believe he was honestly stating what he believed ought to be done, this relief should be utilised in improving drains and so improving the land. The hon. Member forgets that this relief is given by the community, and if it is used for making and improving drains then the 570 land becomes more valuable. The values so created by money provided by the community becomes a lasting asset, and is the property of the landlord all the time. It is a permanent increase in value due to the expenditure of public money; and it goes into the landlord's pocket. Fresh rentals will spring up on it all the time. This increased value will enable the landlord to increase rent. Hon. Members opposite cannot get rid of that position, and I challenge them to deny the fact that this money will ultimately find itself in the landlord's pocket.
This Bill is to bring forward to an earlier date something which is supposed to help the agricultural industry. On a Friday morning, with beautiful flowers of speech, a kind of dedication service, the Government are trying to get this Bill through this House, and all the time the landlords stand behind knowing that the money will go into their coffers. The community is making this gift; that is what this Bill means. This dole, taken from the community and given to the landlords, is made just before a general election. The community will be made to understand before the 10th May exactly what this means. As far as Scotland is concerned the statement of the Lord Advocate will be one of the real issues as far as the agricultural areas are concerned. I met several farmers from Perthshire during the election. They all had a copy of the OFFICIAL REPORT, and asked me whether it was really the statement made by the Lord Advocate. I said that the OFFICIAL REPORT is looked upon as being a definite record of what is said in Parliament. If that is so, they said, it means that the Lord Advocate admits that this benefit ultimately goes to the landlords.
I could give thousands of instances dating back to my boyhood, of farmers having at their own expense made improvements and the landlord having come around and said "We will put another pound or two on your rent." Those were Scottish landlords, but nationality makes no difference and all landlords are the same. A farmer spends money on behalf of the landlord to prevent deterioration of land or material and the landlord comes along and puts up the rent. The gag that is used by the Government all the time 571 is, "We are going to do something for the agricultural industry." That gag is trotted out just before the General Election. The whole of this business of rating relief, in its application to agriculture, is a brass-faced and bare-faced attempt by the Government, before going out of office, to give all they can to their friends the landlords.
§ Mr. SPENCER
I wish to support the action of the Government in the interests of the farmers of the country. I have just been helping an Independent candidate at Boston who is the owner or part-owner of 8,000 acres of land. Anything that is given by this Bill will go to that man himself as farmer. Last year, he lost £40,000, although his land is some of the best to be found in the country. If a man in such a position loses £40,000 when he has cultivated his land to the best of his ability, when he has not stinted putting the best fertilisers into his land, and when he has marketed to the best advantage, what is likely to be the position of those farmers who have not land of the same high standard? More than 500 farmers went into bankruptcy last year. I do not care from what party relief to agriculture comes, for I hold that it is of vital importance to every section of the community that we should have a prosperous agricultural industry.
The basis of all prosperity is in the soil, directly or indirectly. If you have a decaying agricultural industry with a declining agricultural population, sooner or later the results will be reflected in the standard of prosperity of all industries in the country. One reason why we have so much distress in manufacturing industries to-day is that as a country we have not given to agriculture that constant attention which we ought to have given. If every one of us had paid more attention to agriculture, instead of looking upon it as an industry to be neglected because it has not the value that other industries have from the voting point of view, if each one of us had endeavoured to foster an agricultural policy which would bring and keep in constant working order the best and the worst land of the country that was rich enough to occupy British labour, then instead of being in the deplorable position in which we are to-day we should have an agricultural 572 population teeming into the towns at the week-ends with money that would eventually help other British industries. Not until we adopt a policy which will give security to the farmer and guarantee him a reasonable return for his labour, shall we get the farmer to cultivate his land as he ought to cultivate it.
I would like to draw attention for a moment to the 500 men who went into bankruptcy last year. Do my hon. Friends think for one moment that those 500 men were what we term "capitalists?" Undoubtedly amongst those 500 there were men who had been farm labourers, who had saved a bit of money, who during the War had taken small holdings and, having been successful, launched out on to farms. They have not measured their attention to their work by seven or eight hours a day. They have risen before the sun and they have worked when the sun has set. They have had anxiety and trouble, and the reward of all their enterprise has been failure and bankruptcy. When a Government—I do not care whether it is a Conservative Government—comes along to help such men who are in distress, we find among the Labour party those who would oppose the proposal because they think that some of the dregs of the money will percolate into the pocket of the landowner. There may be little bits here and there, but I am certain that when this Bill has passed its benefits will go into the pockets mainly of the farmers and the farm labourers. I hope that some other Government will do more for the British farmer than has been done. Not until we have a united policy in this country, to give British agriculture a measure of Protection and then to protect the working man in the factory against the low standard of existence on the Continent, shall we get the real prosperity that we ought to have.
§ Mr. MacLAREN
On a point of Order. Are these remarks in order? The hon. Member is giving us an address on Protection. I was called to order for much less.
§ Mr. SPENCER
I am about to finish. I believe that we are on the right lines in relieving the farmer of some of the 573 burden that is on him. I hope not only that this Bill will pass, but that something further will be done.
§ Sir BASIL PETO
I would like to refer to the speech of the hon. Member for Springburn (Mr. Hardie). The hon. Member said he was convinced that it was impossible to give any relief in money drawn from the community as a whole without its getting ultimately into the pocket of the landlord. I suggest that the hon. Member's views are coloured by hatred of one class and that he refuses to look at the picture as a whole. No general rule can be laid down which is applicable to every case of every farmer. There are now a great many more farms which are owned by the cultivators themselves than there were before the War. All those farms can be eliminated entirely from the question because landlord and occupier are one in those cases. The vast majority of farms in the country where there is a tenant and a landlord are held under conditions which absolutely protect the tenant. From generation to generation the tenancy of those farms continues as it has for years past. In all those cases there is no benefit to the landlord. There may be cases here and there where there is a change of tenancy and where some part of the benefit may accrue, in the form of improved value of the land, in the landlord's interest, but we cannot look at the question from this point of view which I can only stigmatise as a class point of view.
§ Sir B. PETO
We ought to realise that in this matter the interest of the landlord, the farmer and the agricultural labourer are identical and that it is impossible to do anything for agriculture which will not benefit in some degree all those classes. The doctrine of the hon. Member for Springburn is that you must never do anything to assist agriculture with public money, lest you assist the landlords in some way. Does the hon. Member consider that, in order to carry out that theory, the farmer should be left in a position in which it will be impossible for him to pay the statutory wage and the agricultural labourer left in a position in which it will be hopeless for him to expect more than the poor wage which he gets at present? I am not in the least 574 disturbed by this line of attack. The hon. Member for Springburn says that this is going to be one of the burning issues in Scotland at the Election and the subject may also be trotted out in English constituencies, but I am prepared to meet it. We are anticipating this relief in order to assist all classes engaged in agriculture. We have not had wide unemployment in agriculture but the anticipation of this relief, which gives £2,500,000 to agriculture as a whole in the next six months, will be a substantial contribution towards keeping down unemployment in agriculture.
We had a speech some time ago from the right hon. Gentleman the Member for Colne Valley (Mr. Snowden), who is qualifying for the position of enfant terrible of the Socialist party because he seems to let the cat out of the bag oftener than it is possible for his leader to get the animal back into the bag again. The right hon. Gentleman told us then that rates in themselves were no burden. The hon. Member for Cardigan (Mr. Morris) has come down to the House to-day and given us a new version of the some pronouncement. He tells us that the rating relief given by this Bill will do nothing whatever to assist agriculture because the houses of the smallholder and the farmer are not de-rated—although the farm buildings are being de-rated entirely as from 1st April last—and that, therefore, on account of the increased burden which the hon. Member anticipates will be thrown upon local authorities, the agriculturist is going to find himself worse off and not better off in consequence of de-rating. I do not know whether the hon. Member is going to advance that argument in Cardigan, but I should be delighted if he would come down and oppose me in Devon on those lines and argue that de-rating is of no benefit to agriculture. I could not welcome any line of argument more than that.
§ Sir B. PETO
I am glad to hear that the hon. Member is going to put forward that argument. I can assure him that the farmers of Devonshire are not of that opinion. They are profoundly grateful for the additional assistance which is being given to them to carry on their industry and employ labour on their farms. 575 They are convinced that rates of themselves are a burden and that the removal of rates from land and farm buildings is the most practical and complete form of assistance that agriculture can conceive.
§ Mr. KELLY
As one who spent a number of years in the agricultural districts of Somerset, and who has the happiest recollections of that time, I assure the hon. Member for Barnstaple (Sir B. Peto) that I would have no hesitation whatever in meeting my old farming friends of the Yeovil Division and putting forward the point of view which has been expressed from these benches. Those views and views of a similar nature were put forward by me on many occasions in that Division.
§ Mr. KELLY
I can conduct myself both in voting and in speaking on this matter without direction or assistance from the right hon. Gentleman who sits for the agricultural constituency of West Woolwich. I know it is in Kent, but I am afraid it is a long way from the agricultural industry. I would not, however, have intervened in this Debate but for the speech of the hon. Member for Broxtowe (Mr. Spencer). He gave us a word picture of the condition of agriculture in this country showing that both the farmer and the farm worker are in a horrible position. I would remind him that the agricultural industry has already had large relief in the matter of rates. I am using their own term. First they had 50 per cent.; then another 25 per cent., and yet, even with a 75 per cent. relief, we have from the hon. Member this word-picture, which could not be more horrible, of the condition of agriculture. Is it suggested that this remaining 25 per cent. of relief is the miraculous 25 per cent. which is going to give us a prosperous agricultural industry?
§ Mr. SPENCER
Does my hon. Friend know that the wages of agricultural labourers have been raised in many instances by 100 per cent., but that wages are in danger of being reduced unless something is done for the farmers?
§ Mr. KELLY
I ought to know it, as I happen to be an officer of one of the 576 unions engaged in the work of organising and negotiating for the agricultural workers. In this Debate we have had suggestions from hon. Members opposite that this relief will percolate somehow to the pockets of the agricultural labourer, but how and when has not been stated.
§ Mr. SHEPPERSON
If I might give an indication of the way in which it will percolate to the pockets of the agricultural labourer, I would suggest to the hon. Member that during farming operations there is certain work that may be left undone, such as cleaning land and ditches, and so on, and that unless the farmer has enough money he has to leave it undone, but when the money which will be given to him under this Measure comes into his pocket, that farmer, in his own interests, will use some of it in cleaning his ditches, and so on; and, therefore, it will go into the pockets of the agricultural labourer.
§ Mr. KELLY
I appreciate that explanation very much. The suggestion is that, by taking money out of the pockets of one set of workers, it may reach those of another set, and that if those who are engaged in the great milk industry of Somerset will only pay more for their petrol and oil, there is a possibility of the percolation of some of it back to the farmer and the farm labourer. We were told by the hon. Member for Broxstowe that the parties had neglected agriculture, and that is one part of his speech with which I thoroughly agree. The old parties have at all times neglected agriculture, and this kind of death-bed repentance, or this offer by the present Government on their death-bed, is certainly not going to be a sufficient act of contrition for all their offences against agriculture. It has been neglected, and no suggestion from the other parties that one has heard up to now has altered that point of view.
We were told by the hon. Member too that there ought to be Protection. Why do we so often hear that the worker who produces the wealth of this country requires Protection? All these suggestions that the agricultural workers require Protection show how helpless and hopeless those who have been talking of agriculture are. Why is it that we have countries not far removed from us which can make agriculture prosperous? I was 577 hopeful that the hon. Member for Broxstowe and the hon. Baronet the Member for Barnstaple (Sir B. Peto) would have made some reference to countries where agriculture is prosperous without having to go to their Parliaments and ask for subsidies or for relief of rates. May I give a brief quotation from a book called "A Danish View of British Farming"? One of the great authorities in Denmark states, of Danish farming:It will be seen that less than one-fifth of the total acreage is taken up by farms of more than 150 acres. This partly explains why from land of far inferior quality and not much above one-quarter the area of England and Wales (43 against 151) we are able to export £56,000,000 worth of agricultural products, while the total productions of English agriculture is only £225,000,000. (Perhaps it also goes a little way towards explaining why the Danish death-rate is the lowest in the world.)The suggestion has come in this Debate that this miraculous 25 per cent. that is going to be handed out to the landlord will do great things for agriculture. I am surprised when hon. and right hon. Members opposite suggest that this is going speedily to reach the farmer and the agricultural labourer. They know very well that this is going to reach the landlord very quickly. In fact this week I have heard two landowners in this country stating that it was not at all bad to have the feeling that £2,500,000 was coming your way. They are Members, not of the Labour party, but of the Conservative party, who made that statement. That is the position, and in our opposition to this Bill, in our speaking against it, and even in accepting the challenge of the right hon. Gentleman opposite to go into the country—
§ Mr. HASLAM
I rise to correct what I think are one or two misapprehensions under which the party opposite seem to be labouring. The hon. Member for Rochdale (Mr. Kelly) spoke of the last miraculous 25 per cent. of the rates. When we say that 50 per cent. of the rates were relieved towards the end of last century, it must be borne in mind that 578 that relief was given as a fixed grant, a grant, if my memory serves me aright, of about £2,300,000. That served very well, during the pre-War period, to give the farmer the actual 50 per cent. relief, because rates were fairly stationary during that time. But after the War the rates in agricultural districts rose considerably and rapidly, and in consequence of the grant being a fixed relief, the agriculturists did not get the benefit which they would have obtained if it had been paid as a proportion of the rates. The amount which had to be made up was something like £5,000,000, spread over the whole community of a district, but where that community was an almost purely agricultural one, as, for example, in Lincolnshire, almost the whole burden went back upon the farmer, who therefore found himself in the position after the War of paying still a very heavy rate. What is the history of this question? In 1923 half that rate was relieved, and, as I pointed out the other night, a rise in the agricultural wage ensued almost immediately after. Hon. Members opposite never refer to that, but after that relief in 1923 there was a rise in the agricultural labourer's wage.
§ Mr. BUXTON
Did not the right hon. Member for Wells (Sir R. Sanders), himself the author of that rate relief, express his disappointment that it had not led to a rise in wages?
§ Mr. HASLAM
I cannot at this moment say what the right hon. Member said. In point of fact, I suggest that there was a rise of wages after that event, and it cannot be said that that relief did not go in part towards that rise.
§ Mr. HASLAM
There was a rise, I think, from something like 26s. to 30s. [HON. MEMBERS: "Where?" and "When?"] In the agricultural districts, in 1923.
§ Mr. BROAD
Was it not after the Agriculture (Wages) Act, 1924, that the rise took place? I think so.
§ Mr. HASLAM
That is after 1923, and I have no doubt that rating relief did help the farmer to give the additional wage. Therefore, I maintain 579 that the proposition put forward by the Labour party that the relief cannot by any possibility reach the agricultural labourer is not correct as far as the history of the subject goes. I would further like to point out that the 25 per cent. rate with which the farmer was left after 1923 was a rate which was distinctly higher than that levied on comparable business men in the towns. Therefore, I take the view that this relief is an act of justice, and cannot possibly be described as a subsidy at all, because the burden on the farmer previously was too heavy, and was heavier than on comparable industries in the towns. Finally, with regard to the assertion that this particular relief is going into the pockets of the landlord, how can it by any possibility go into the pockets of the landlords when everyone knows that there are fixed rental agreements which cannot be affected by this rate relief in this month of April? The fanner will not pay the rates, and there the matter will end.
§ Sir WILLIAM WAYLAND
If the hon. Member for Rochdale (Mr. Kelly) had studied the agricultural system of Denmark, he would probably know that the conditions are entirely different there, and that it would be absolutely impossible to adopt it in this country. I would, therefore, advise him to go a little more deeply into the subject, to read the history of Danish agriculture and to read a book on English agriculture written by a modern author. One of the objections which the Socialist party have to this de-rating scheme is that the amount of money accruing to the farmers will ultimately find its way into the pockets of the landlords. That is not substantiated in any shape or form. If it were the case, the remission already granted would have have disappeared into the pockets of the landlords, but that is not the case. It has been proved, I think, to the satisfaction of any fair-minded man, that the remission granted has not led to an increase in rents. In what other way can it go into the landlord's pocket? He cannot claim directly from the farmer. He cannot, unless the farm changes hands, increase the rent.
Then as to the statement that de-rating will not benefit farming, of course that is all moonshine. You might just as well 580 say that if you give assistance to any business which is having a struggle to live, it is going to do no good. Of course, it is not going to mean the difference between a big loss and a profit, but it is going to help the farmer along. It is going to help him in many ways which would take too much time for me to describe, but in ways which only I agriculturist can understand, and I am perfectly confident that this relief of 25 per cent., making 100 per cent. total of the rates, is going to do a great deal of good to the farming industry as a whole, and must have its reflection upon the farm worker as well. It will enable the farmer in many ways to do good to his farm, to keep it in a better state, to keep it cleaner. We know there are many dirty farms to-day due to the fact that there is not sufficient money to spend in cleaning. If the farmer has this de-rating money, he will be able to spend more on cleaning. And who does the cleaning? Not the proprietor of the farm, not the landlord, not the farmer if he is a large farmer, but the worker, and, therefore, the worker must get the benefit of this derating.
§ Mr. BROAD
There was, I think, a great deal of exaggeration of the feeble condition of the farmer by the hon. Member for Broxtowe (Mr. Spencer). On the other hand, there have been mis-statements of the position from the other side by the emphasis laid on the number of occupying owners who farm land in this country. I believe it is a fact that one-sixth of the agricultural land of this country is farmed by occupying owners, and I do not think any of us could dispute that this relief will go to those occupying owners. But five-sixths is bound eventually to go to the owners of the land, which they lease or let on agreement to the farmers who are not occupying owners. I have occasionally taken the trouble to look at the Report of the Commissioners of Inland Revenue, and I find there that the profits derived from the occupation of land are actually more than five times what they were pre-War, and, as the years have gone by, they have not shown a decline. But that is not sufficient, unless we ascertain how that amount is computed to income on which they pay Income Tax. Pre-War the farmer was charged Income Tax on half 581 the rental value of his land. During part of the War it was raised to the rental values of the land, and then at a later stage to double. Now the farmer is charged Income Tax on the actual rental value of the land, and that total is five times what it was pre-War.
§ Mr. HASLAM
The farmer of to-day has the choice of paying under Schedule A or Schedule D and therefore those farmers who pay on their profits of course do not pay on their rent and that must modify the hon. Member's figures.
§ Mr. BROAD
The hon. Member has helped me very considerably by his interruption. It indicates clearly that the farmer is satisfied, and that when he is paying on an actual income two and a half times what it was before the War, he prefers that rather than pay on the actual income which he receives. That is the remarkable thing about it. Although the income from the occupation of land for agricultural purposes is assumed to be equal to the rent, the total is five times what it was before the War, when it was assumed to be half. If the farmer thinks that is an exaggerated estimate of his profits, he has always the opportunity, like any other taxpayer, of saying that it is too much and that his income from the land is not equal to the rental value, and that therefore he prefers to show his hand and be assessed on his actual income; and the fact that very few farmers think it worth while to submit that account, shows that they are not doing so badly. That is a very astonishing thing, and I know a number of farmers who will admit that position, and who resent the way in which some people, who know nothing about it, but who think to gain some credit, will go snivelling on behalf of the farmer because of this wretched condition which he is supposed to be in. We know that the farmer is affected by fluctuations, but he has to take that into consideration.
I am convinced that as compared with any other industry, the farmer, with the capital which he has to put into his farm, the risks which he takes, the amount of work and attention which he has to give, is not getting an adequate return. How can we remedy that? Any doles, subsidies and bribes that you deal out to the farmer to improve his position are going back to the landowner, except in those 582 few cases—one-sixth of the whole—where a man owns his land. We saw it through the War and after the War. Leases ran out and agreements expired, and the landlord raised the rent in order to get, as far as he possibly could, every advantage which the farmer had received owing to restricted supply on the market. What is more, the one-sixth who now occupy their own land were held to ransom by the landowners, who forced them either to buy at enormously inflated prices or to clear out, and many of these farmers are suffering because they have been held to ransom by the great landlords and money-lenders. We want to see if we can set to work to give an adequate return and what security is possible to the farmer, so that he shall not grudge the miserable existence which he has to give to his workers; to see that he is secure in his position and rewarded for good farming and penalised for bad; and to see also that he shall get a full return for his labour, risk, and intelligence. That will only be possible when the community owns the land and sees that the rent of the farmer is fixed in consideration of the community value and not of the sacrifice of effort that he has to put in. The Labour policy is the only one which will enable the farmer to get a fair deal for the community; it is the policy of cutting out the landlord who has bled him in the past.
§ Question, "That the Bill be now read a Second time," put, and agreed to.
§ Bill read a Second time. Bill committed to a Committee of the Whole House for Monday next. [Mr. Chamberlain.]