Clause 19.—(REDUCTION OR EXTINGUISH MENT OF BALANCE.) (Hansard, 13 July 1954)

§ The Attorney-General
I beg to move, in page 22, line 45, to leave out from "an," to the end of line 18, on page 23, and to insert: original unexpended balance of established development value, then, subject to the next following subsection, the land shall be taken to have that balance at any time after the commencement of this Act except in so far as that balance is by virtue of any provision of this Act to be treated as having been reduced or extinguished immediately before that time. (2) Where any land taken as a whole has an original unexpended balance of established development value, but at any time after the commencement of this Act an act is done or an event occurs in relation to any area consisting of, or including, part only of that land in consequence of which, by virtue of any provision of this Act, an amount would fall to be deducted from the original unexpended balance of that part of that land for the purpose of determining the unexpended balance thereof at any subsequent time, then, without prejudice to the operation of the preceding subsection with respect to any part of the land taken separately, the land taken as a whole shall be treated as not having any such balance at that subsequent time. (3) Where compensation under this Part of this Act becomes payable in respect of the depreciation of the value of an interest in land by a planning decision, then, for the purpose of determining whether that land or any part thereof has an unexpended balance of established development value at any subsequent time, the amount of the compensation shall be deducted from the original unexpended balance of established development value of that land and the original balance of that land or that part thereof shall be treated as having been reduced or extinguished accordingly Immediately before that subsequent time. This is the first of the series of Amendments to Clause 19, and I should like to give as brief an explanation as I can of the general purposes of the series, for I am afraid that in explaining this Amendment I may trespass slightly on the others. I hope the House will agree that that will save time. This series of Amendments is another attempt to meet the wishes of the Standing Committee in the direction of reducing the complication of the Bill. Hon. Members will find that although there is a large number of words in the Amendments the result of making them will be materially to shorten the Bill and, I hope, to clarify it.
355 The general purpose is to make a change in the conditions in which land may be spoken of as having an unexpended balance of established development value—one of the artificial conceptions which is essential to the Bill, and which, I think, hon. Members in the Committee agreed was a convenient vehicle for carrying out the particular purposes required. Under the Bill as drafted any piece of land can be described as having an unexpended balance when the Bill comes into operation if it falls wholly within the area of any claim holding which affects it. That is provided by Clause 18. The balance is useful in setting the limit of the payments that may be made under Parts II and III of the Bill either for compensation or on compulsory acquisition. The land continues to have that balance except in so far as the balance is reduced under the provisions of the Bill as the result of some compensation payment or the carrying out of some development.
As Clause 19 stands, any act or event which gives rise to a debit against the balance affects the unexpended balance of the land concerned and of any part of it, but not of any wider area. That is to say, if a field, for example, has an unexpended balance taken as a whole, and compensation is paid because permission to build on half of it was refused, the unexpended balance of that half of the field and of each of the plots in it will be suitably reduced, but the unexpended balance of the field taken as a whole will not be affected.
6.45 p.m.
It has been found that might have the effect of creating a danger of overpayment, and the first thing that has to be done is, obviously, to avoid that. So far as Part II of the Bill is concerned no difficulty arises. If the claim for compensation is made for such damage as is caused by a planning decision and different parts of the land have a different history so far as the unexpended balance is concerned, then Clause 22 requires the land to be broken down into areas each of which has a uniform history as regards the balance and the compensation is assessed piecemeal. So far as that part of the matter is concerned this point was of no importance, but there is no similar 356 provision in Clause 35, under which payments are to be made from the balance on compulsory acquisition, and as the Bill stood, there was a danger of overpayment.
One way of dealing with the matter would be by the introduction into Clause 35 of something like the fractionalisation process we discussed on Clause 22. As a result of our experience of this fractionalisation that certainly would not be a course any Members would undertake likely. I am glad that is agreed. A better remedy, and the one that has been adopted, as hon. Members will see, in these Amendments, is to make this provision, that as soon as part of an area which has an unexpended balance is affected by any act or event which results in a debit against the balance which does not affect the whole of the area, then that area taken as a whole cannot be spoken of as having an unexpended balance. It goes out of the picture from that point of view altogether. In other words, to have an unexpended balance an area must have a uniform balance history. Or to put it yet another way, the process of Clause 22 is now introduced into Clause 19.
That is the effect of the proposed new subsection (2). The remaining Amendments we shall ask the House to make to Clause 19 are for the most part consequential or drafting, following out this line of thought. The proposed new subsection (4) provides for the apportionment of amounts of compensation and other deductions from the unexpended balance as between the different parts of the land which is affected.
By reorganising Clause 19 in this way it has been found possible to shorten Part II substantially, because it will be found that Clause 22 becomes entirely unnecessary, and Clause 27, which deals with cases where two or more interests in the same piece of land are depreciated by the same decision can be combined in Clause 21.

§ Mr. A. J. Irvine
We are grateful to the right hon. and learned Gentleman for the explanation of this Amendment. It is in substance a rearrangement and largely a drafting Amendment which deals with matters which were in doubt. We regard it as an improvement upon the original Clause 19. Our main doubt about Clause 19, as amended, was on 357 subsection (3), to which I referred in connection with a matter I raised on a previous Amendment. We are greatly obliged to the right hon. and learned Gentleman for the explanation he has given.

§ The Attorney-General
I beg to move, in page 24, line 10, to leave out from the beginning, to "unexpended," in line 19, and to insert: (4) Where an act or event has occurred in relation to any land in consequence of which any of the provisions of this Act requires an amount to be deducted from the original unexpended balance of established development value of that land or any part thereof, there shall be attributed to the various parts of that land so much of that amount as might reasonably be expected to have been attributed thereto if the authority determining the amount had been required to apportion it between those parts in accordance with the same principles as applied to its determination; and where two or more such acts or events have occurred in relation to the same land, those provisions shall apply cumulatively, and the requisite deduction from the original. This ie the substantive subsection (4) which is necessary for the purposes which I have already explained.