HC Deb 22 June 1949 vol 466 cc343-54
Mr. Niall Macpherson (Dumfries)

I beg to move, in page 5, line 25, to leave out "words," to the end of subsection (1), and to insert: 'and (b)' of the words 'or (b) that the entertainment is held in a borough, urban district or parish defined as above with a population not exceeding six hundred and forty to the square mile and.' This Amendment differs from the previous Amendments on the Order Paper in that it is not clear on the face of it. Indeed, I gather from one film journal which has been brought to my attention that in their view it is not clear at all and it does not appear to them to have any meaning. However that may be, I may say that the Treasury have had an opportunity of looking at it and, while they may not have found the drafting perfect, at any rate they have found the Amendment comprehensible. It cannot be understood simply by reference to the Finance Bill we have before us. One must also refer to the Finance Act of 1948.

In one sentence, the purpose of the Amendment is to exempt from Entertainments Duty entertainments in buildings which are situated in boroughs of a population of not more than 2,000, or where the population does not exceed 64 to the square mile, whether or not the seating capacity of those buildings exceeds 400. The present position, as the House will be aware, is that exemption is given so long as the Commissioners are satisfied on two points: first, on the point regarding population—that is to say, that the building in which the entertainments are given is situated in a small borough with a population not exceeding 2,000 or, alternatively, in a district or parish with a population not exceeding 64 to the square mile; and secondly, that the seating capacity does not exceed 400.

The Clause we are now discussing alters that so as to substitute for the provision regarding the population not exceeding 64 to the square mile a provision that the population shall not exceed 640 to the square mile. The Amendment itself substitutes for the two legs, so to speak, for the two conditions—the population condition and the seating capacity condition—two alternative conditions. It says either that exemption from Entertainments Duty can be given if the previous Section as it exists in the Finance Act of 1948—that is, a borough of 2,000 or a population of 64 to the square mile—is satisfied, whether or not the seating capacity exceeds 400; and there is a second condition which is in line with what the Chancellor is now proposing, that is to say a small borough with a population not exceeding 2,000, and a district or parish with a population not exceeding 640 to the square mile, and a seating capacity not exceeding 400.

The reason for putting down this Amendment is that there are in a number of areas, where the population is thin, halls which were built at a time when the population was a good deal more dense. [Laughter.] I am not referring to the mental capacity of the population but to the numbers. The right hon. and learned Member for Montgomery (Mr. C. Davies) quoted a case in his own constituency last year. There is a very much more remarkable case in my constituency where, during the First World War, a very big population was built up, where a hall was constructed to cater for that population and where the population has now sunk to less than one-tenth of what it was previously. That will not necessarily always be the case. There must be many cases where village halls have been built with a view to various forms of entertainment which are really out of proportion, so far as seating capacity is concerned, to the density of the population of the areas in which they are situated.

10.30 p.m.

I know that the Commissioners have interpreted the present regulations very reasonably, but there are certain circumstances in which it might have been desirable for a seating capacity of more than 400 to be provided in a hall where the seating capacity is normally limited to 400. One knows that in rural areas there are rural festivities of a special local character at which almost the whole population will attend at one time, in which case, if there is a big hall, it would be normal to seat to the very maximum capacity of that hall. So far as I can see, if that happened only once in a year the proprietor of the hall, whether the town or a private person, would be debarred from obtaining this exemption from Entertainments Duty. It seems to me that that is quite wrong and not in keeping with the purpose of the Act. In areas where the population is very thin, or in small boroughs with a population of less than 2,000, this condition that the seating capacity of the hall should not exceed 400 should not apply.

Mr. Selwyn Lloyd

On a point of Order, Major Milner. The hon. Member for Dumfries (Mr. N. Macpherson) raised one aspect of the possible extension of the exemption of rural entertainments. Some of my hon. Friends and I wish to raise another aspect of the matter. I wonder whether it would be convenient to the Committee, and perhaps save time, if the whole matter were dealt with on this Amendment.

The Chairman

If the matter the hon. and learned Member wishes to raise is relevant, let it by all means be dealt with now.

Mr. Selwyn Lloyd

The point I want to raise is rather different from that of the hon. Member for Dumfries. It deals with entertainment in what are really rural parishes in urban districts. The purpose of the original exemption, I gather, was to foster the community spirit in rural areas. It so happens that some districts which are rural cannot qualify for this exemption because they happen to be within the area of an urban district. I have had correspondence with the Financial Secretary about this matter during the last year, and he said that under the terms of Section 17 of the Finance Act of last year it was quite impossible for this to be done. He said the matter was to be reviewed. As we are now reviewing it and the Government have made, I admit, a certain concession so far as population is concerned, this seems to be the time to raise that matter also.

The sort of example I want to give is a specific one—the village of Willaston, eight miles from Chester and nine miles from Birkenhead. It is essentially a rural area. Transport facilities are not good. There is a scanty bus service and a very irregular train service. The population is under 1,800. It has a village institute which holds 200 and a church hall which holds 300. But it happens to be in the local government area of Neston Urban District Council. Neston is another small place about 2½ to three miles away which has no particular relation to it geographically but happens to have been put in the same urban area. Neston Urban District consists of 9,341 acres and has a population of 9,492.

The new test which this Clause sets up is that if the population is under one to the acre, then even in urban districts the sort of place about which I am talking can qualify for exemption, provided that the village hall does not hold more than 400. I admit that in the original Act of last year the population had to be one to ten acres, or not exceeding 2,000; but I submit that if the purpose of the right hon. and learned Gentleman really is to help rural areas in which there are no real amenities—and this village is 10 miles from a centre of population, has no cinema, and depends upon entertainments in the village hall or the church hall—that is the sort of place which the Chancellor intended to help by the original exemption.

There are two ways in which it could be done. It would be possible for the right hon. and learned Gentleman to go further than the concession which he has made this year; but I imagine that if he were to do that, it would bring within the ambit of the exemption a certain number of places which really are urban areas. The other way in which it seems that the right hon. and learned Gentleman could help the sort of place of which I am speaking is not to restrict the definition of a rural parish to the definition given in the Local Government Act, 1933, which means that it must be a parish in a rural district, but to take in this case the register of population, namely, the register of population for the village of Willaston, and in such cases to give the exemption. The matter is one of some difficulty, but I believe it was the intention of the Government, and that it will be the desire of Members in all parts of the Committee, to help the sort of place of which I am speaking. I hope the right hon. and learned Gentleman will give consideration to this matter when he is considering the matter which has been raised by my hon. Friend.

Mr. M. Philips Price (Forest of Dean)

I wish to raise another point in connection with this matter, as you, Major Milner, are allowing us a certain latitude. It is connected with the Amendment, but it is not quite the same matter. In my constituency there is a number of small mining communities which are in rural areas, but which will just fail to benefit under this provision. There is one with a cinema capacity of only 50 over the limit, and the population is just more than 2,000. It has a population not of 640 to the square mile, but of just under 700. I know that the line must be drawn somewhere; I know that there are administrative difficulties; but in this case the district will have to pay the full rate.

It appears to me that it might be possible to arrange a graduated scale. Could not one, in a case like that, levy a duty somewhat less than the full figure, though with not too great a difference? I do not know whether it is possible to do that in the present Bill, but I hope that if it cannot be done now, it may be arranged in the next Budget. The present provision leaves out a whole lot of districts, particularly in mining areas, where this exemption is needed. We are grateful for this concession, which will enable rural areas to benefit, and will make it possible for village institutes to get cinema shows of the educational kind. There are other cases like the one I have mentioned which I hope can be considered.

Viscountess Davidson (Hemel Hempstead)

I should like to support the plea of the hon. and learned Member for Wirral (Mr. Selwyn Lloyd). More than two years ago I approached the Chancellor of the Exchequer with regard to village cinema clubs and sent him detailed accounts which had been kept by these small clubs. As the Chancellor is aware, most of them are run by small people, with little financial background; many of them are ex-Service men and with the tax they find it impossible to make the venture pay. They do not ask or expect large profits, but they must make ends meet, and if I may be allowed to quote one account sent to me, and passed on to the Chancellor, when the tax was deducted there was a loss of 19s. 8d. after paying £2 for the hire of a hall and £8 6s. for hire of the film. We all know how difficult it is to persuade people to stay on the land, and to succeed we must see that they have some of the amenities which are available in the towns. These village cinemas are of enormous importance to the villages, and are run, as I have said, by small people.

The Chancellor was very sympathetic when I approached him; I have had many courteous replies from him, and he promised that he would look into the whole matter before his next Budget. The next Budget came, and he made certain concessions, but the proposals did not cover those villages which came just within an urban boundary. Many of my villages do not benefit, as the population is included in the population of the parent town. I took the matter up again with the Chancellor and again he was most sympathetic; and again he said he would consider the matter in the Budget. But I am sorry to say the problem still remains. I should like, if I may, to read one letter which I received. It reads: We approached the collector of Customs and Excise at Northampton, but he refused a certificate on the grounds that Bedmond is part of the village of Abbots Langley, with a population exceeding 2,000. We would say that, while this is substantially correct, the village of Bedmond is some way from Abbots Langley, that the hall was built by the village, is run and used by the inhabitants for usual village community purposes, etc., and has a seating capacity of 150; the population of the village is about 600 and it comes somewhat hardly upon them that they should have to bear the taxes. You will appreciate that all functions held for the benefit of the inhabitants, bearing in mind that they are almost solely of the working classes, have to be very moderately priced; in consequence of which, in many cases, the venture shows a loss. I can repeat that that is the experience in very many of the villages in my constituency, and I ask the Chancellor whether some means cannot be found so that they may also benefit from the tax exemption.

Commander Maitland (Horncastle)

The difficulties with which we are concerned have been very well expressed in the Debate we have had on this matter, which is of very deep concern to the rural people. We want the country-people to have an opportunity to see cinema shows as much as they can. I fully sympathise with the difficulty of devising a correct formula, but there is really a very proper case for looking into the whole formula again. The hon. Member for Forest of Dean (Mr. Philips Price) and the noble Lady the Member for Hemel Hempstead (Viscountess Davidson) have given cases of anomalies. I sent the Chancellor a case the other day where I thought there was a complete anomaly. It concerned a small district, just going over, by a hundred, I think, the permitted figure. This man gave details of all his shows for a considerable time. There was no doubt that he was making a loss and he said he would probably have to shut down, which would mean that the people in that district would be deprived of a cinema.

10.45 p.m.

On the other hand, I should like to give an example of something of the other side of the picture. It is of a district by the sea which has a large influx of summer visitors and which probably is quite reasonably prosperous. In that particular case, because it has a large hinterland geographically, it is able to claim exemption. That creates a sense of injustice in the minds of those men who are just not able to meet such a tax. I think there is a case for the right hon. and learned Gentleman looking into the whole formula.

Mr. C. Williams

I want on this Clause to put what is possibly a rather different angle from that which has been put on some of the Clauses we dealt with earlier in the day, because I have had a considerable amount of correspondence——

Mr. McKie (Galloway)

On a point of Order. I desired to raise another point on the Clause, but I have refrained from doing so when the Committee are discussing an Amendment which is on a comparatively narrow point. The hon. Member is now discussing the Clause.

The Chairman

We are, of course, discussing an Amendment. There has been a tendency to widen the discussion and within limits that is permissible on the clear understanding that we do not have another Debate on the Question "That the Clause stand part of the Bill."

Mr. McKie

I take it we are now in Order in discussing other points which arise on the Clause?

The Chairman

Yes, within limits, as I have said.

Mr. Williams

I have no wish to controvert the position so far as Order is concerned, but I wish to comment on this Amendment and for a very short time to express some sympathy with the Clause itself. There has been a great deal of correspondence between myself and the Treasury on this matter. I have also been into this matter in previous Debates and quite honestly, I think that on this occasion the Treasury and the Chancellor of the Exchequer have tried to meet a very difficult position. There are immense complications, as has been shown by those hon. Members who have spoken. There are a large number of marginal cases as regards the size of the towns and the size of the halls, and matters of that kind. There are other marginal points as far as actual entertainment is concerned.

I use this occasion not only to thank the Treasury for what they are doing, but to try to ease out this matter so as to help the rural population and encourage people to stay in the rural areas as much as possible. I also hope that in the rural areas, and in some of the comparatively large towns which come just outside, there will be encouragement of amateur theatricals, which very largely take place in these local halls. I believe that the Financial Secretary and others are looking at this matter with care and consideration and with a desire to help. May we have some assurance that between now and next year, he will go into a large number of borderline cases with that same sympathy which I think both sides of the Committee have shown with a view to helping? If he gives that assurance, I am sure I shall be forgiven for praising the worst Government that ever was for having provided a few bright things.

Mr. McKie

I also share the desire of my hon. Friend to congratulate the Government on what they have done on this occasion. I quite agree that in extending the scope of the relief in the way proposed the Government are doing quite a big thing for some of the smaller local authorities. I should like to point out, however, that although it is sought to give great relief to many forms of entertainment, nothing is done for one particular form of rural entertainment. Until now I was afraid to catch your eye, Major Milner, because I feared that the points I wished to make were outside the scope of discussion on this Amendment. Now you have given certain latitude on the understanding that hon. Members do not seek to prolong the Debate on the Motion that the Clause stand part of the Bill.

About the only form of rural entertainment which will have no relief under this Clause will be the gymkhana. This entertainment was provided by local authorities largely at the express invitation of the National Government of 1942, and as the Clause now stands it obtains absolutely no form of relief. The same rate of duty has to be paid as is levied at Ascot, Goodwood or Sandown Park. I am not disparaging those institutions. I was at Ascot last week and enjoyed it, but I should strongly object to having to pay admission to a rural gymkhana at the same rate as to the Royal enclosure at Ascot or the club stand at Goodwood or Sandown.

Some hon. Members opposite may say that those great race meetings exist solely for gambling, but that charge cannot be made against rural gymkhanas: they exist solely for sport and they have provided a great deal of innocent entertainment for people whose lives are lived, in the main, without a great deal in the way of amusement. Gymkhanas played a great part during the war in promoting the objects of the holidays-at-home campaign and were continued after the war. They are organised by people who give their services freely. As the Clause is now drafted, it would be impossible for the Chancellor of the Exchequer to do anything about them. There have been many pleas to the Treasury in recent weeks and months on this point, and when another Finance Bill is presented to the House, if by any stroke of ill-luck this Government are still in power, I hope they will be generous when the time comes.

Sir S. Cripps

Perhaps I might deal first with the last point raised. So far as the gymkhana is concerned, that is in quite a different category from what we are speaking of here. We are speaking here of the hall in which a village has its own entertainment. A gymkhana often draws thousands of people from the whole countryside around and is quite a different proposition.

It is clear that the difficulty which arises, as one would expect, is over the various marginal cases. Every case we have had cited this evening has been a case in which there are a few more people or the building is just a bit larger, or whatever the circumstance might be. Whatever the limit, that is going to happen. It is obvious that if we put the limit at 740 to the square mile, we should get cases in which there were 741. That would be bad luck, and we can do nothing about it. I promised last year that we would keep this matter under review and that we would carefully investigate all the cases to see whether if some amendment was required, it could be introduced to cover the majority of cases.

So far as the Cinematograph Exhibitors Association are concerned—and this, of course, does not cover all the cases, but a good many of them—they have put forward the view that this has worked very well and has given welcome relief in a great number of cases. We have actually had about 70 complaints during the year. About 40 related to cases where the population of rural parishes exceeded the statutory limit of 2,000, and most of the remaining 30 cases concerned urban districts and municipal boroughs in England and Wales, and comparable areas in Scotland, whose population also exceeded the statutory limit of 2,000.

There were a few cases where the question arose as to the application of the seating capacity of 400, and I think it has been possible to deal with all those cases administratively. In fact, the case of Gretna, mentioned by the hon. Member in moving the Amendment can, I hope, be dealt with administratively, too. The question as to whether it might be required, or deemed advisable to use it for more than 400 people in any area is a question which can be debated when it arises, but it can per- fectly well have a seating capacity limited to 400, in which case it will fall within the class with a satisfactory result.

Therefore, the only really outstanding cases were those in regard to population density, and we have dealt with that matter by increasing the density ten times, from 64 to 640 to the square mile, and it does seem to us that, although we appreciate that there are difficulties, we have substantially covered those rural—truly rural—cases which exist and with which this was intended to deal. It would he quite impracticable to have a sliding list, as the hon. Member for the Forest of Dean (Mr. Phillips Price) suggested, with different taxes according to the number of seats in the cinema. Quite obviously it is not an administrative matter to go through the cinemas and tax according to Beatings. It would not only be impossible administratively: it would give a quite nonsensical result, as one might have a small cinema in a densely-populated area paying less tax whereas a larger cinema in a less densely-populated area would pay a higher charge which it could not afford. That is not a true criterion.

Therefore, I suggest to the Committee that it should rest content with what we have done, which I think is a first-class job for the rural areas; and, much as we regret it, we must leave the marginal districts untouched by this concession because there must be a limit to what we can do and I think that with 640 to the square mile we really have reached that limit.

Mr. N. Macpherson

I am in a certain difficulty here because of the width of the discussion which has taken place on my Amendment. I would like to say that I think hon. Members on this side of the Committee do recognise the special interest that the right hon. and learned Gentleman has taken in this question, and so far as the narrower scope of my own Amendment is concerned, I am quite prepared to accept his suggestion and see how it will work. Subject to any action that any other hon. Member may seek to take on the Question that the Clause stand part of the Bill, I shall be prepared to ask leave to withdraw my Amendment.

11.0 p.m.

Mr. Selwyn Lloyd

May I ask the right hon. and learned Gentleman, as he was good enough last year to say that he would not close his mind to future change, if he will also say now that he will cause the matter to be watched carefully during the coming 12 months, so that he may be able to bring within the ambit of the relief further marginal cases?

Sir S. Cripps

We shall certainly watch matters, because I am anxious to do the job we have set out to do, but of course I can give no promise.

Mr. N. Macpherson

I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Clause ordered to stand part of the Bill.