§ Motion made, and Question proposed, That this House do now adjourn.—[Mr. Oakshott.]
§ 11.1 p.m.
§ Mr. Goronwy Roberts (Caernarvon)
The subject which I wish to raise tonight is one which is causing very great anxiety to millions of ratepayers and to scores of local authorities all over the country. I refer to the recent revaluation of properties. For the reasons which I propose to give, the effects of this in Caernarvonshire are particularly alarming.
It is the small businessman, the shopkeeper, the hotelier, the small restaurateur and the owners or tenants of what the Treasury calls "miscellaneous properties" who are being hit the hardest. These people are among the most industrious element in the country, and are certainly so in Caernarvon. Many operate on a surprisingly narrow financial margin. Another class to which the new demand notes constitute a major catastrophe are elderly people, of whom we have a remarkably high number in our county, who have retired on small, fixed pensions to small cottages.
Their assessments may now have been raised by 200 per cent., 400 per cent., or even to 600 per cent. Throughout the country property has been revalued upwards by about 70 per cent. compared with last year. In Caernarvonshire, the increase is 114 per cent. It may be argued that, on the other hand, the rate precept will go down so that the net increase in the rates payable will not be intolerable. In fact, one finds that in some areas that this has happened. But it has not happened in Caernarvonshire. In my county the rate precept is down by only 24 per cent. The reason for this is that the appreciated valuation has been used to depreciate a certain Government grant.
The result is that while we would be receiving this year £492,000 grant if the conditions of 1955 obtained, we will, in fact, receive only £215,000. In addition, we shall lose this year a special education grant of £20,000, and the total loss to the county is equivalent to a rate of 4s. 5d. in the £. In consequence, Caernarvonshire ratepayers will pay this 1588 year, or do their best to pay, £150 for every £100 they paid last year.
On whom will this burden largely fall? It will mainly be borne by the class of ratepayer I mentioned earlier—the small businessman, shopkeeper and hotelier. The proportion of the total rateable value attributable to these "miscellaneous properties" in my county has now risen from 20.55 per cent. to 30.7 per cent. That is to say, this class of ratepayer in my county is called upon to bear almost one-third of the total rate burden of the county. Put in another way, it means that while the percentage increase in the rate burden on this class throughout England and Wales is 29.7 per cent., in Caernarvonshire it is 49.4 per cent.
I would like to give a few instances of how this additional heavy burden threatens the livelihood of many of these people. I have here a letter from the Criccieth Chamber of Trade. Most of its members belong to this class of small business people. The letter protests agents the new valuations asUnfair, unjust. uneconomic, and out of all proportion to the economic circumstances of the town.This protest goes on to say thatThe valuation, by increasing the value of some properties by as much as 400 per cent. may, and probably will, force people to close down their businesses.In fact, that is already happening. A constituent of mine only this week has sent word to me that he has been forced to dispose of his business solely because of this additional heavy burden. This man was disabled 100 per cent. while serving with the R.A.F. during the war; so that it is the weakest and the most deserving, as in this case, who are driven to the wall by this arbitrary demand.
The tourist trade, and its ancillaries, as my hon. Friend the Member for Conway (Mr. P. Thomas) will undoubtedly say, is a major industry for our part of the United Kingdom; but although in every sense an industry it does not qualify for the derating concessions under the 1929 Act. Furthermore, it is very easy to forget that the people depending on tourism for their livelihood, as they often do in Caernarvonshire, have only a short season in which to collect a full year's income. In Wales, the summer is not long; it is of no greater length than in England, and while a wet season may 1589 spell disaster to small shopkeepers or boarding houses, the rate demand is inexorable. It is there. rain or shine.
We in Caernarvonshire have the second highest unemployment rate in Great Britain. The highest place is taken by our neighbour, the Isle of Anglesey, where the figure is more than 8 per cent. of the insured population; our own figure last winter was 6.3 per cent., while the general average for the United Kingdom is only 1 per cent. In other words, the figure for Caernarvonshire is more than six times as great as for the rest of the Kingdom; and perhaps because of that, our county is not an area of high wages. We are not a prosperous county.
Many of our shopkeepers, restaurateurs. and hoteliers are "marginal", as I have said, but they are assessed as though they were in the prosperous Midlands, in the boom towns. For instance, a small shop in the village of Rhosgadfan, where about a quarter of the male population is out of work, has had its valuation increased from £6 to £36—a sixfold increase. There are similar excruciating examples in the Nantlle Valley, where a factory, formerly employing about 200 workers, has been closed for the past three months; and in Llanberis, where an Air Ministry maintenance unit is now declaring redundant about 500 men.
Mention of Llanberis reminds me of the case of the Snowdon Mountain Railway, whose assessment has been increased from £141 to £3,505. This must surely be, literally, the highest peak to which the new valuation has climbed! All this is happening against a background of depression and unemployment, and not only are our assessments substantially higher than the average, but our precept is the second highest in England and Wales. The highest is in Cambridgeshire, with a precept of 17s. 6d. in the £. We follow with 15s. 3d.
At the same time, really prosperous areas like Cheshire, Derbyshire, Lancashire, Leicestershire, Northamptonshire. Nottinghamshire, Wiltshire and the North and West Ridings have precepts ranging between 10s. 9d. and 1ls. 6d. The precept for Surrey is 9s. 6d. and for Durham 9s.—both very prosperous counties. But in Caernarvonshire, which has almost the highest rate of unemployment in the United Kingdom, the precept is almost double that.
1590 I always thought that the object of this revaluation was to extinguish some of the more glaring anomalies of our rating system, but here they are again, only bigger. There must be something wrong with the administration of this valuation when such anomalies occur. We are told that in parts of Shropshire they have to do the job all over again. I think that there is a case for reassessing the whole of Caernarvonshire.
It may be said that there is ample provision for appeal. This is the point to which I want mostly to direct the mind and sympathy of the Financial Secretary to the Treasury. It really depends on the manner and spirit in which these appeals are conducted. People are appealing in very large numbers in Caernarvonshire but, so far, we have not got beyond a few negotiated cases with the valuation officers. From what I hear, these officers—able men, all of them—are extremely cautious, and I do not blame them. It depends on the directives and instructions they have received or are receiving from above. It is an administrative point susceptible of helpful treatment by the Minister.
In view of all the circumstances in Caernarvonshire, the valuation officers might well be directed to show the greatest possible sympathy in negotiating with appellants, and the same applies to local valuation panels or courts. They, too, should be directed to bear in mind the peculiarly disadvantageous position of the kind of appellant I have described, and who is so common in the county. Pending a radical reorganisation of local government finance on workable lines, this is really our only hope in counties like Caernarvonshire, namely, the operation of the appellate machinery with due regard for the true facts of the situation in the county. I hope that the Minister will deal with these people sympathetically.
§ 11.12 p.m.
§ Mr. Peter Thomas (Conway)
What the hon. Member for Caernarvon (Mr. G. Roberts) said about the extremely high new assessments of rating in the county of Caernarvon is true. In fact, these assessments have exceeded the most pessimistic forebodings of the ratepayers, and have caused great distress.
1591 Particular attention, to which I subscribe, was paid by the hon. Gentleman to those small businessmen who work on a small margin of profit and depend to a great extent on a short tourist season. He mentioned in passing, however, another section of the community, and to these I would like to pay particular attention, for many of them live in my constituency. They are the people who exist on small fixed incomes and pensions, people who are retired and who are, in the main, elderly.
The new rating assessments, particularly in the area of Llandudno, have had the cruellest impact on this section of the community. Very few people expected, when it was known that dwelling houses would be assessed on their 1939 value, that the new assessment would be so high. I could give my right hon. Friend, indeed, I have given the Minister of Housing and Local Government, many examples of small bungalows in the Llandudno area, in particular in Penrhyn Bay, occupied by retired persons, where the rateable value has gone up three times and over.
These elderly people living on small fixed incomes, who, in the past, paid about £15 yearly in rates, are now faced with demand notes for £35 and £40. They just cannot afford to pay. These people have no organisation to champion them. They have no trade association or trade union to come to their aid. They are just people who have been good members of the community all their working lives, who have conserved their resources, possibly at great sacrifice, and who have retired. They do not wish the community to assist them, as they have never in the past asked for assistance. But now they find themselves, with incomes probably far less than those of the average unskilled worker, faced with demands wholly out of proportion to the net value of their houses in 1939 and having to bear an unjust proportion of the burden of the rates.
I have mentioned these people in particular—though I could go through all sections of the ratepayers in Caernarvonshire—because I think that they deserve special attention. I trust that my right hon. Friend, when he considers the impact of the new rating assessments in Caernarvonshire, and the loss to the ratepayers 1592 through these new rating valuations of £300,000 in Government grants, will bear in mind the hardship on this section of the community.
§ Mr. Speaker
I have had great doubt how far the last two speeches were in order. In so far as the hardship complained of arises out of the operation of a Statute, and can only be remedied by legislation, it is out of order to discuss it on the Motion for the Adjournment. If it can be said that there is a point of administration in this under the existing law, that would be in order; but I am bound to say that my doubts were increasing as I heard the speeches.
§ Mr. G. Roberts
The whole point of our appeal, Sir, is that the Minister, through administrative action, should see that the negotiations and the appeals are administered as sympathetically as possible. It is purely an administrative point that we are raising.
§ 11.18 p.m.
§ Mr. T. W. Jones (Merioneth)
I would like briefly to support the appeal concerning this administration, especially in the case of a town like Barmouth, in my constituency. The people there are groaning under the rates. Llandudno has been mentioned, but what is happening there is not comparable to what is happening in Barmouth, where there is a heavy incidence of sea-defence rates. The season at Barmouth is only a few weeks, at the most, so there is no margin of profit to enable these people to meet the increased rates, which vary from 33 per cent. to 395 per cent.
I would like to say more, but it would not be fair to the Financial Secretary, who is to reply to the debate. I shall perhaps enlarge on my appeal for the people of Barmouth by writing to my right hon. Friend.
§ 11.19 p.m.
§ The Financial Secretary to the Treasury (Mr. Henry Brooke):
It is true that the revaluation in Caernarvonshire has produced an increase of 112 per cent. in the total rateable value. I am sorry to have to say that parts of the county were heavily under-assessed in the past. That is what has brought the ratepayers up against what must be an extremely unpleasant increase in a number of cases. I would assure all the hon. Members who have spoken in this debate—and this is entirely a matter of 1593 administration—that there is no evidence in these Welsh counties of a breakdown of the valuation system.
Reference was made to Shropshire. It has been admitted in the House that errors were committed there and the whole list is to be looked at again, but there is no similar evidence from these Welsh counties. Indeed, there have been few complaints or general criticism and the number of appeals so far made in Caernarvon against assessments is under 2 per cent.
The county is suffering—I quite recognise this, and I am sorry that it is happening--from the sudden withdrawal of the Exchequer equalisation grant, as some big English cities, which were previously under-assessed, are suffering. It is suffering through the increased rateable value. The average rate in Caernarvon-shire has gone down, as, a result, from 28s. 5d. in the £ to 19s. 11d, in the £, which compares with a figure of 18s. 5d. for the whole of Wales and 15s. 8d. for England and Wales together.
I assure hon. Members that my right hon. Friend the Minister of Housing and Local Government is unable to determine grants otherwise than in accordance with the provisions of the 1948 Act. As the House knows, the Government are now carrying out a thorough-going review of the whole problem of local government finance. I cannot say at this stage what the issue will be, and even if I could, and it involved fresh legislation, I might be out of order in referring to it.
I want to stress that anyone in the County of Caernarvon or elsewhere who feels that he has been unfairly assessed should, if he is wise, in the first instance seek a discussion with the valuation officer. This is quite informal. It may be that that conversation will clear away a lot of doubts and difficulties. I do not say that that will necessarily happen, but it would be worth trying. If they cannot be so cleared away, there is the statutory right of appeal. It is only the local valuation court, as a court of appeal, which can give a final answer, but, nevertheless, the preliminary discussion with the valuation officer may be helpful.
I hope that hon. Members will forgive me if I do not go into the question of the new assessment of the Snowdon 1594 Mountain Railway, because I understand that the Company is challenging the assessment by way of appeal. In a sense the question is, therefore, sub judice and it would be wrong for me to prejudice the hearing of the appeal. I must assure hon. Members, however, that throughout these counties the valuation officers who have done the reassessment have sought scrupulously to follow the basis laid down in the statutes and have sought to base the assessments on the evidence of rents payable, in 1939 in the case of houses and currently for other classes of property. Rents payable in any area are affected by the general level of prosperity in the area and, in the case of seaside resorts, by the fact that profits are earned only in the holiday season.
It is often said that it is tenants who fix rents and not the valuation officers. I do not want to press that too far, but the valuation officer, in basing his assessment on the rental evidence, will thereby be having to give weight both to the length of the holiday season and the profitability of trade in the area.
The question which the hon. Member for Caernarvon (Mr. G. Roberts) put to me was whether the local valuation panels would be sympathetic. These panels have been operating for a number of years and I do not think there has been any suggestion in any part of the country that they are operating unsympathetically towards the ratepayers appearing before them. I agree that they are just about to face their biggest test, with all the appeals coming to them from the revaluation. I am certain that they will do their best to secure justice. What they cannot do, and what it would be wrong for anyone to ask them to do, is to grant favours to an individual ratepayer, because by so doing they might do an injustice to the other ratepayers.
These local valuation courts are local courts—that is implicit in their name—with local personnel. It is, therefore, most unlikely that they would be ignorant of or would overlook the local conditions. The hon. Member asked me whether the Government could send an instruction or message to the panels in Caernarvonshire or North Wales generally to treat appeals sympathetically. I certainly do not want to be hard-hearted towards him or the constituents of the 1595 hon. Members who have spoken. Nevertheless, it might be fatal to people's confidence in these courts if the idea grew up that they were merely instruments of the Inland Revenue or agents of the local authorities. It is most essential that they should be independent bodies, and if the Government were to purport to give them advice, or even to make any suggestions, that might create a risk of jeopardising their independence. That is what I want to safeguard them against.
The hon. Member suggested, I believe. that I might give some kind of indication to the valuation officers themselves. They are professional people. I think that they should be encouraged at all times to act in an objective, professional way in the light of the accepted principles which are well understood by the local authorities and by professional practitioners who are outside Government service. I am quite sure that they will show every consideration towards dissatisfied ratepayers or prospective appellants insofar as it is possible for them to do so, but I am sure that what they ought not to do is in any way to infringe their professional integrity.
§ Mr. G. Roberts
I really must insist that nothing of the sort has been suggested. What has been suggested is that, administratively, it could be brought officially to the notice of these officers—nobody wants to impinge on their integrity—and the valuation courts that there are special, peculiar circumstances affecting the ratepayers of a county like Caernarvonshire, the reasons for which I 1596 have tried to give as temperately as possible, and that they should bear these things in mind and not simply follow the broad lines of the directive which applies to the entire country.
§ Mr. Brooke
I said earlier in my speech that no valuation officer can do his duty according to the principles of his own profession unless he bears in mind the levels of rents in the area, and those rents must necessarily reflect the economic conditions and other things, such as the shortness of the holiday season.
The hon. Member for Caernarvon and my hon. Friend the Member for Conway (Mr. P. Thomas) are entirely within their rights in raising this matter. It is right that Parliament should be informed if there are people in any part of the United Kingdom who feel that they are being unfairly treated, but I am equally sure that the right course is for those people, in the first place, to have a talk with their valuation officer, to see whether that helps to clear away their difficulties. If it does not they should then exercise their right of appeal to the local valuation panel.
As I say, while it would be quite wrong for the Government to give local valuation panels any suggestions or advice how they should operate, nevertheless they are staffed by local people who should thoroughly understand.
§ Adjourned accordingly at half-past Eleven o'clock.