I beg to move, in page 36, line 32, to leave out from "development," to the first "in." in line 36, and to insert:(a) to which section twenty-four of this Act applies; or(b) which consists in the winning and working of minerals; or1151(c) to which, having regard to the probable value of the development, it is in the opinion of the Secretary of State reasonable that this section should apply;Provided that—The Clause says:
- (i) this section shall not apply to any development by virtue of paragraph (c) of this subsection if, on an application made to him for the purpose, the Secretary of State has certified that, having regard to the probable value of the development, it is not in his opinion reasonable that this section should apply thereto; and
- (ii).No person shall initiate any new development to which this section applies…until such amount…as is recoverable…has been paid or secured to the satisfaction of the Secretary of State.That is in subsection (1). Subsection (2) says:This section applies to any new development"—and then come the words the Amendment inserts after the deletion the Amendment makes.
The new development refers tosection twenty-four of this Actwhich hon. Members will remember replaces the Sixth Schedule, which concerns the winning and working of minerals. It then adds:having regard to the probable value of the development, it is in the opinion of the Secretary of State reasonable that this section should apply.If the value of it were high it would be wrong not to require the repayment of the compensation that has been paid.
Then there is a proviso which follows on that and which merely says that where a developer wishes to undertake an unusual standard of development he can ask the Secretary of State if he will be required to repay the compensation. If the Secretary of State certifies that that is unreasonable then there need be no repayment. That merely has to do with the question of compensation and subsequent development.
§ Mr. Woodburn
Perhaps we can get a little more clarification. I want to be quite clear what we are dealing with. If the compensation has been paid, I take it that this is a definition of the conditions under which the Secretary of State will be entitled to ask for the recovery of the compensation, and the next Amendment 1152 we are going to discuss takes another point of view, that the Secretary of State may waive his right in certain circumstances. But why should there be two such waivings? This proviso also enables the Secretary of State to waive his right to recover compensation. That, of course, might refer to quite a different matter, and perhaps the right hon. and gallant Gentleman will clear up the point so that we do not confuse the two issues.
In a way they are complementary. The proviso in this Amendment is concerned with something that is unusual and out of the ordinary. In the subsequent Amendment we are dealing with a normal case. I agree with the right hon. Gentleman that they would appear to be really the same thing, but I am told they are different. It is right that they should both be in.
§ Mr. T. Fraser
I wonder if the Joint Under-Secretary of State would keep me right here? It is laid down in this Amendment that this will apply to the subject to which Clause 24 of the Bill applies. When we debated Clause 24 we found that it was a question of the Secretary of State suggesting that some alternative development should take place and compensation would not be paid if it were reasonably remunerative. It will be recalled that I said that surely it would be practicable for the intending developer to claim compensation if he were refused permission to go ahead with the development, but the Joint Under-Secretary said it would not be practicable at all.
Am I right now in thinking that this Amendment ensures that where a developer has done what I said he would do, namely, apply for permission and is refused, then if he had a claim outstanding in respect of the land he would claim his compensation? Further, does this Amendment provide for the Secretary of State to recover in part the claim? Is that the purpose of the Amendment?
No, Sir. The compensation is recoverable after it is paid, and then, if a better and more comparable development is allowed, a repayment is asked for. It may be that there is a development of a football field and the Secretary of State waived some of the compensation payable. Then, if a building went on to the football field, naturally the Secretary of State would require the compensation to be repaid.
The compensation would be waived and then it would be paid if a better development took place.
§ Mr. Fraser
It is the other way round. It is the recovery of compensation not payment of compensation.
§ Mr. Willis
It seems to me that this part of the Bill places enormous power in the hands of the Secretary of State. I should have thought that, if it were possible, it would have been much better for these decisions to be made by someone or some tribunal other than the Secretary of State. This seems to me to be placing very great power in the hands of the Secretary of State. He can refuse permission to provide compensation and try to bribe people to develop. He can do almost anything that he likes under this Bill. I think that it is quite wrong that this very important power should be given to the Secretary of State.
§ Mr. Pryde
In the Amendment we read:which consists in the winning and the working of minerals.Can the Joint Under-Secretary of State give an explanation of how this affects the Coal Industry Nationalisation Act and the operations of the Coal Board?
§ Amendment agreed to.
I beg to move, in page 37, line 10, at the end, to insert:(4) Where, in the case of any land in respect of which a compensation notice has been recorded, the Secretary of State is satisfied that, having regard to the probable value of any proper development of that land, no such development is likely to be carried out unless he exercises his powers under this subsection, he may, in the case of any particular development for which planning permission has been granted, remit the whole or part of any amount otherwise recoverable under this section.
I think that this Amendment and the following three Amendments in the name of the Secretary of State go together.
These Amendments are merely complementary to the previous Amendment. The purpose of 1154 this Amendment is to permit the Secretary of State to waive recovery in whole or in part where the value of the proper development of the land is low compared with the recovery payment.
Cases may arise where planning permission has been refused on land with a high development value and substantial compensation paid, and where later on, because of some change in the plan or circumstances, it becomes proper for the land to be used for some less valuable development, say, a limited number of houses, or it may be a playing field, as I suggested a moment ago. Under the Bill as it stands, the full compensation paid would have to be repaid before the land could be put to that use. Repayment would operate like a heavy development charge which the Secretary of State had no power to waive, and the desire for development may well be frustrated. That of course, would be bad planning. It is obvious that it would be bad planning because the land would not be developed as it ought to be, and the intending developer would be driven to seek other land, possibly not so satisfactory, from the planning point of view, where little or no compensation would be required.
§ 9.30 p.m.
§ Mr. Hoy
As the right hon. and gallant Gentleman says, where the land has this development value there might be a waiver by the Secretary of State if the planning needs of an area show that a particular plot should be used as a sports field or for a similar purpose. The right hon. and gallant Gentleman, however, did not say that this provision goes rather further, and that where the Secretary of State waives payment for that purpose he retains the right to reimpose a development charge if the land is used for something other than a sports ground.
It would be interesting to know exactly what is meant, because it is not usual for sports grounds to be turned into housing sites; I have never known it happen. [HON. MEMBERS: "Oh, yes."] I see that this will provoke discussion and that the Amendment might not go through as easily as the right hon. and gallant Gentleman thought. I do not know of football fields of any size being turned into housing sites. As one of my hon. Friends suggested, claims were made 1155 against a golf course for that purpose, and I remember the case in question. All I am pointing out is that while the Secretary of State is being given power to waive payment for one purpose, he is also given the right to reimpose the charge should there be a change in the use of the land.
§ Mr. Woodburn
I listened to the explanation by the Joint Under-Secretary but it did not convey very much to me. Perhaps if I suggest a simple illustration, the right hon. and gallant Gentleman will say whether it is correct. There have been builders who, after building their housing schemes, have been left with a patch of ground that could not be built upon without building more than the normal number of houses to the acre and who have generously handed over the land as a park to the local authority.
Suppose that the builders had not done that, and the local authority had said, "You cannot develop that ground, because it must be kept as an open space," and the builders had claimed compensation for being denied the possibility of developing, say, a factory or something else on that open space. In that case, they would be paid compensation.
If, however, the builders then proposed to develop the land as a sports ground or golf course or something of that nature, it would appear that without the Amendment the Secretary of State would be able to claim recovery of the compensation that had been paid to them. But in view of the fact that the land was to be developed only as a golf course, and, therefore, was not of high development value, the Secretary of State, I gather, would be entitled to waive recovery.
On the other hand, after the Secretary of State had given the waiver, the builders might decide to go ahead with building a factory, and a newly-appointed local authority might grant permission to do so. I take it that in that event the Secretary of State would be able to call for recovery of compensation. I do not know whether that is what would happen. I have been trying to wade my way through the technical language used by the right hon. and gallant Gentleman in his explanation. If my illustration is incorrect, can he put it into simple and clear language that we can follow?
The right hon. Gentleman has got it absolutely clear, and I am sorry that I did not make it as clear to him as he has made it to me.
§ Mr. Lawson
Perhaps the right hon. and gallant Gentleman could clear up some of my doubts. I understood that there was one thing which was fixed and that was the amount of development compensation payable; that a sum was fixed in 1948 and that at no time was this to be altered. I understood that it was to be quite inelastic. From the previous Amendment it would seem that there is a possibility that development might take place in excess of the devevlopment value placed upon the land, that is to say, that there would be an opportunity for the Exchequer or the Central Land Board to recover money paid because development had been carried out in excess of the valuation placed on the land. This Clause seems to permit an alteration in the development value from a higher to a lower figure.
I am concerned about this when it comes to a question of compulsory purchase. I understood the position was that the authority making such a purchase would buy at existing use value plus the unexpended balance. The claim for compensation might have been reduced by certain development. I understood that the claim was originally a fixed amount. Now it seems that this claim is itself elastic. If so, might not a local authority making a compulsory purchase find itself confronted with a demand for development value for a particular piece of land greater than was placed on it in 1948? If we have an example of a variation in development value here, what is to hinder a possible seller of a piece of land from asking much more development value than was put on the land in 1948?
§ Mr. T. Fraser
I think that the language used in the Amendment is hardly sufficient. We are still discussing a piece of land intended to be put to one use at one time and where the local planning authority, supported by the Secretary of State, was unable to permit the land to be used for that purpose; where compensation was paid and now the land has been put to another use. There is provision in this Clause for the Central Land Board to recover a part or the whole of the compensation that was paid as the land is developed.
1157 As I understand it, the Joint Under-Secretary of State has put to us a fair proposition. May I use my own example to put the picture before the House? A piece of land might well have been acquired for the purpose of a considerable industrial undertaking. Ultimately the local planning authority could not give permission for this work to proceed and the Secretary of State, having supported the local authority, had to authorise compensation to be paid in respect of that land. It might well be land which the local planning authority wished to be used for recreational purposes. I think the right hon. and gallant Gentleman mentioned a football field or something of that kind.
If it is proposed to use the land for recreational purposes in the form of a sports field, I think that the Joint Under-Secretary wishes to have power under the Amendment to waive recovery of the compensation which he would otherwise be entitled to seek under the Clause. However, it seems to me that the language is inadequate and too loose. The Joint Under-Secretary in defending the Clause said that if the Secretary of State was not able to waive recovery of compensation, in whole or in part, in certain circumstances the recovery would have the same effect as would a heavy development charge upon the subject.
I think that I take the Joint Under-Secretary with me so far. The person developing would require to remit to the authority the compensation that had been paid in respect of the land when earlier planning permission for a development was refused. Will not recovery always be regarded by the developer as a kind of development charge? So long as the developer or the owner of the land is asked to refund part of the compensation paid, he will regard it as something like a development charge.
Is not it necessary, in providing for the waiving of part of the recovery of compensation, to have a fuller provision made by Statute? Are not we leaving much too much to the Secretary of State who will be subject to all kinds of pressure? One can fully understand that if a local authority were acquiring the piece of land which was originally intended for industrial purposes to use it for the provision of playing fields for the community, they would not be making any profit out 1158 of the land. On the other hand, the local planning authority might permit the land to be used as a great sports stadium, which might very well be a most profitable undertaking for somebody.
Will not the Secretary of State be in a position, under the Amendment, to decide favourably in the case of the local authority developing the ground for recreational purposes and will he not be able to put the hammer on the company which proposes to develop the same land for sports purposes? I should think that the Secretary of State would be obliged to afford himself some protection against the accusation that he was imposing a development charge unjustly on a group of people who said that they were providing sports facilities for the good of the community and it would be purely incidental if they were to make some profit out of the development.
One can sympathise with the purpose which the Joint Under-Secretary said the Government had in mind when drafting the Amendment, but I think that the Secretary of State ought to protect himself and his successors—especially his successors—by statute. There is no doubt that if a Secretary of State refuses to waive the recovery of compensation in any case and the sum of money is considerable and the intending developer regards it as a development charge, he will go to his Member of Parliament and the Member of Parliament will go to the Secretary of State. What can the Secretary of State offer in defence of his decision?
He can offer only the words of the Amendment and I submit that they are no defence at all for the Secretary of State. He will be accused of imposing an unfair burden on the intending developer if he does not agree to waive the recovery of the whole of the compensation paid.
I wonder whether the Joint Under-Secretary has followed my train of thought and agrees that it is highly desirable that further protection should be provided by statute for the Secretary of State?
§ 9.45 p.m.
§ Mr. Willis
I am glad that my hon. Friend the Member for Hamilton (Mr. T. Fraser) has stated very clearly the point which I tried to make on an earlier 1159 Amendment, that very great powers are being placed in the hands of the Secretary of State. A short time ago there was great excitement about the unanimity between both sides of the House because the Secretary of State was over-ruling a local authority in deciding what should be the plan for certain districts.
The Amendment strengthens the Secretary of State's powers because he will exercise a very important influence upon the developments which are to be permitted on land for which a compensation certificate is held by virtue of the fact that an indication can be given to a person that for a certain type of development there will be a 100 per cent. waiver and for another 50 per cent. That power will influence the type of development taking place on the land in question. I should have thought that the Secretary of State would have been anxious to protect himself against the influences which will be brought to bear upon him relating to the amount of waiver to be allowed.
For the reasons which united the House a short time ago—the desire not to allow the Secretary of State to have too much influence over planning decisions—and because of the need to divorce the Secretary of State from these financial matters, I ask the Secretary of State to look at the Amendment again with a view to providing some safeguards.
§ Mr. Hector Hughes
I submit that the words which are now the subject of controversy are unnecessary, and I hope that the Government will not insist upon them.
Subsection (3, a) provides for the amount which is recoverable in certain cases, stating that it shall be the amount of compensation specified in the notice. Paragraph (b) says that it shall be so much of the amount of the compensation specified in the notice which is attributable to the land comprised in the notice. Subsection (4) states what is not recoverable; it says that no amount shall be recoverable under the Clause in respect of the compensation, in so far as it is attributable to the land, in connection with any subsequent development thereof.
If, as indicated in subsection (4), an amount is not recoverable, what is the 1160 necessity for the Amendment, which says that it shall not be recoverable:…then, except where, and to the extent that, payment of that amount has been remitted under the last preceding subsection.The two subsections to which I have referred clearly indicate what is recoverable and what is not recoverable, and now the Amendment tautologically seeks to insert words to repeat that which is already the meaning of subsection (4).
I hope the Government will not clutter up this already complex Bill with unnecessary Amendments of this sort, but will accept the view which I have expressed and withdraw the Amendment.
With permission, I will reply to the hon. Member for Motherwell (Mr. Lawson), who asked me a number of questions. He referred to compulsory purchase, which, of course, is always on the basis of existing use value, plus the balance of the claim. The hon. Gentleman also asked me if the amount of the payment for development value compensation was a fixed amount, and the answer to that is "Yes; as a ceiling, it is a fixed amount." The development value at current prices may exceed that, but the compensation will never exceed the ceiling.
§ Mr. Lawson
The right hon. Gentleman says that the development value may exceed that figure. How is that?
If the hon. Gentleman will think about it, he will see that the development value may be greater than the ceiling.
No; I said that the ceiling is the limit, and that we would never exceed the ceiling.
The hon. Member for Hamilton (Mr. T. Fraser) stressed a number of points in relation to the waiver, and thought it might be considered as a heavy development charge. I can quite see the dangers, but, at the same time, it seems to me to be right that the Secretary of State should have this particular power. In the ordinary case, it will be an amount acceptable in relation to the development which is proposed. The sports stadium, of which the hon. Gentleman talked, would be something almost of a commercial nature, 1161 and in a case like that there would be no question of waiving repayment. In the case of a big area like that, it would be a valuable development. It would not be of low value, but would have a very great value.
§ Mr. T. Fraser
If the land had been previously scheduled for industrial development, would not the compensation be very high and the value of the land for a sports stadium be low by comparison? Would it not be necessary to waive part of the recovery when development took place?
I do not think a great stadium of that nature could be considered for a waiver. It would have to be something of really low value, whereas a stadium of that kind would have a great value. There must be a discretion here, and it would be extremely difficult to specify the cases in which the waver ought or ought not to be exercised. My right hon. Friend has looked at this very carefully, and I think it will be all right. I sincerely hope so.
§ Amendment agreed to.
Further Amendments made: In page 37, line 13, after "notice," insert:
then, except where, and to the extent that, payment of that amount has been remitted under the last preceding subsection.
In page 38, line 10, after "relates," insert:
and, in the case of any notice of the fact that part only of any such amount has been so paid, stating whether the balance has been secured to the satisfaction of the Secretary of State or has been remitted by him under subsection (4) of this section.
In line 16, after "time," insert:
except where, and to the extent that, payment of that amount has been remitted under subsection (4) of this section."—[Mr. J. Stuart.]