CLAUSE 44.—(Adjustment of losses and gains of areas and payment for that purpose of Supplementary Exchequer Grants.) (Hansard, 22 February 1929)

§ Major ELLIOT

I beg to move, in page 41, line 16, to leave out the word "fifteen," and to insert instead thereof the word "nineteen."

This Amendment is to give effect to the proposal that the special arrangements to be made for spreading the change in the incidence of rates between separately rated districts over a period of 15 years, should be modified. The guarantee against any increase in rate poundage by reason of the scheme for the first year of its operation will be extended for a further period of 4 years. That is a very substantial concession to rating areas which may be hardly hit. There will be no increase in rate poundage in any separately rated area for five years, and any necessary adjustments will be spread by one-fifteenth per year for a period of 14 years. There are similar Amendments in regard to separately rated parts of large burghs. These are proposals similar to the arrangements in the case of annexations between one local authority area and another, where arrangements are made, so I am informed by my legal friend, for differential rating for a particular period. The differential rating gradually shades away, and finally the rate is uniform over all the areas. In this particular case the guarantee has been made for five years, during which no increase in rates will take place in the separately rated areas. That involves a certain extra grant of new money from the Exchequer. It is considered that to continue the guarantee further will amount 1474 in the second year to £11,400; iii the third year to £22,800, in the fourth year to £34,200, from the fifth to the sixteenth year £45,600, in the seventeenth year £34,200, in the eighteenth year £20,800 and the nineteenth year £11,400.

It will thus be seen that a substantial additional sum is being found by the Exchequer to make up to the separately rated areas for losses which they may suffer from being merged in the general county rate which is now being established for major services. These are terms fully as favourable as any local authority has been able to offer to another local authority in the case of any annexation or combination. The difference between the case with which we are now dealing and the ordinary annexation or combination is that any sum necessary to carry over the differential rating period has in previous cases been found by the local authority but in this case it is being found by the Treasury to the extent of one half, and no extra expense is falling on the local authority on this account. That is continuing the same procedure that was covered for one year in the previous cases, but the loss is not falling upon the local authority. The loss of continuing is being borne in one form or another by the Treasury.