§ [Queen's Recommendation signified]
§ Considered in Committee under Standing Order No. 88(Money Committees).
§ [Sir SAMUEL STOREY in the Chair]
§
Motion made, and Question proposed,
That, for the purposes of any Act of the present Session to make provision for the payment by instalments of rates on dwellings and for the granting of rebates in respect of such rates, it is expedient to authorise the payment out of moneys provided by Parliament—
§
(1) of any sums required for making grants to any rating authority equal to three-quarters of the aggregate net amount of any rebates afforded by that authority under the said Act in any financial year in respect of the rates levied in each half respectively of that year, subject to the limitation that—
(a) any such rebate is afforded to any person only in respect of the amount by which that person's reckonable rates for the half year in question determined in accordance with the said Act exceed £3 15s.; and
(b) any amount which would otherwise be payable to any person by way of such rebate in respect of the rates levied in the half year in question shall be reduced or extinguished in accordance with the said Act if the reckonable income of that person determined as aforesaid in such previous
167
period of six months as may be so determined exceeds the following limit or such other limit as may from time to time be substituted therfor by order made by statutory instrument, that is to say—
apart from any increase of that limit provided for by the said Act in respect of a child;
§ (2) of any increase attributable to the provisions of the said Act in the sums payable out of moneys provided by Parliament under any other Act.—[Mr. MacColl.]
§ 10.0 p.m.
§ Mr. Boyd-Carpenter (Kingston-upon-Thames)During the Minister's Second Reading speech, he said, wholly accurately, that the main controversy as he understood it between the parties and outside arose over the question of whether the local authorities should be bound to contribute 25 per cent. of the cost of the rebates. I am sure that in those circumstances the right hon. Gentleman would not have agreed to the tabling of a Money Resolution which could have the effect of excluding an Amendment in Committee which raised this issue.
I am conscious of my inexperience in the construction of Money Resolutions, despite the fact that, as hon. Members may know, my name has on occasion appeared on such a Motion. Nevertheless, reading tonight's Money Resolution as a layman—I am sure that I am wrong about this, and I rise only to obtain correction—it rather looks as if paragraph (1) might be construed as excluding the possibility of raising the question of the 25 per cent. imposition on local authorities.
It would be such a monstrous act on the part of any Government to inhibit the discussion of Amendments raising an issue which, as, the Minister knows well and has indeed said, has raised acute controversy outside, that I cannot help feeling that I must be wrong in my construction of the terms of the Money Resolution.
I know that what is or is not in order in Committee is a matter for yourself, Sir Samuel, or for the Chairman of the Standing Committee. On the other hand, even the present Government must be presumed to know what they are doing—this is, at least, a charitable assump- 168 tion—and I should like to know from a representative of the Government—[Interruption.] As the Chief Secretary says, it would be a happy change. One can hope that even the most appalling of reprobates will reform.
I should like to know from a member of the Government whether, in their understanding, the Money Resolution is framed so that it tends to exclude discussion of an Amendment directly raising the 25 per cent. issue or whether, as I hope is the case, my reading is wrong, that this issue is open and that it will be open to the Committee to consider that matter on its merits.
§ Mr. Michael English (Nottingham, West)In my speech on Second Reading, I made the point that the Financial Memorandum did not include all the charges upon local rates, contrary to one of the rules laid down for such Memoranda and one of the practices normally followed in accordance with assurances given to the House on many occasions. I asked whether my right hon. Friend the Minister would comment upon whether the Money Resolution permitted discussion of such costs, namely, the equivalent of the interest element of rates collected in a lump sum early in the year as against rates collected over a twelvemonth period throughout the year.
I did not get a reply to that on Second Reading and it is important, before we pass the Money Resolution, to know whether it is so worded that it would inhibit Amendments of that type to the Bill. I think it is even more important when the matter is not merely one of a policy consideration but one which has been omitted from the Memorandum in which it should have been. I gave the charitable interpretation that this was omitted because it was omitted from the Allen Report. I believe that interpretation to be correct, but if this Money Resolution also inhibits discussion of an issue which was accidentally omitted, then I think we are going rather far. I sincerely hope that the interpretation of the Money Resolution is different from that. If not, I hope that some Amendment will be made to it.
§ Mr. Terence L. Higgins (Worthing)The difficulties of keeping within the rules of order when discussing the complications of a Money Resolution are well 169 known in this House, and anyone who attempts to do so for the first time must do so with some trepidation. But I think I should be failing in my duty to my constituents if I did not stress that this Money Resolution supports a Measure which seems to me to be woefully inadequate and completely misconceived. Therefore I rise to ask, with my right hon. Friend, whether we can have an assurance from the Chief Secretary with regard to the extent to which this Money Resolution will inhibit Amendment of the Bill in Committee. We have given the Measure a Second Reading, because we all support the principle involved, namely, that help should be given to those worst hit by the constant increase in rate demands. At the same time, I think we should make clear that we on this side of the Committee will want to table very considerable Amendments to the Bill as a whole.
This is particularly important because, as has been pointed out the members of the present Government, in their election addresses, stressed that they would, to a considerable degree transfer the cost of public expenditure from the rates to the Exchequer whereas this Measure, for the large majority of ratepayers, will have precisely the opposite effect. At the Committee stage we on this side will certainly wish to offset this effect which, as I say, is quite contrary to what hon. Gentlemen opposite put in their election addresses, and we shall wish to do so by tabling Amendments with regard to the 25 per cent. of this cost which is to be paid by ratepayers.
I hope we shall have an assurance from the Chief Secretary that the Treasury would not oppose any Amendment of this kind. On a previous occasion when this matter was raised the argument was put forward from the Treasury Bench that more of the cost of public expenditure could not be transferred from the rates to the Exchequer because of the economic situation. I think we should be quite clear that that is a completely invalid argument. The economic situation is quite irrelevant to the actual split between the rate burden and the Exchequer—
§ The ChairmanOrder. We cannot on this Money Resolution discuss the economic situation.
§ Mr. HigginsThe point which I was trying to make was that this split between the Exchequer, on the one hand, and the rates on the other should not be opposed by the Treasury, and that Amendments to the Bill should not be opposed because of the economic situation at any one moment of time.
The second point I want to raise is that we have in the Money Resolution the expression
the aggregate net amount of any rebates".I would ask the Chief Secretary whether this can be construed to include the cost of organising payment by instalments as covered by the Bill, because if it does not, then it may be that Amendments we would wish to table on this subject will also be precluded. In view of the short time which we on this side have had to study this Measure, I think it is extremely undesirable that the Money Resolution should be used to prevent us tabling Amendments of this kind. The same is equally true, I would suggest, with regard to the cost of organising the rate rebate schemes, because here again it appears that the cost of this is to fall on other ratepayers, whereas I believe it should fall on the Exchequer. Again, I would ask the Chief Secretary whether Amendments of this kind will be precluded by the terms of the Money Resolution.Finally, I would like to ask the Chief Secretary whether there is anything in the Money Resolution which will prevent us tabling Amendments so that the incomes of households can be taken into account, because it seems quite definite that we shall wish to amend the Bill in that respect. One of the main objections raised against the system of rates is that in assessing them no allowance is made for the fact that the income of a household may be very high, because there are a large number of children in it. It would seem that allowance should be made for the ability to pay in assessing hardship under the Bill.
I would ask for a clear assurance from the Front Bench opposite that the Money Resolution which is before us will not preclude us from introducing Amendments of the kind which I have been asking about.
§ Mr. Martin Maddan (Hove)I should like to raise a question with the Chief Secretary on paragraph (1,b) (i) and (ii), 171 though it may be that I should address it to you, Sir Samuel. In my simple way, I was always brought up to believe that back benchers could not propose anything designed to increase taxation, but if I read the Money Resolution aright, we are being prevented from doing the opposite—from raising in Committee suggestions that would reduce the tax burden of certain households whose half-yearly income in a case of a married man exceeds £260 and in the case of a single man exceeds £208. What I should like, either from the Chief Secretary or from you, Sir Samuel, is an explanation of whether we may do that.
The Deputy ChairmanIt is not for me to give any explanation of what would be in order in Standing Committee.
§ Mr. MaddanIn that case, the matter falls squarely upon the Chief Secretary. Will it be in order to increase those limits of £520 for a married man and £416 for a single man? Will it be in order to move Amendments to that effect?
§ The Joint Parliamentary Secretary to the Ministry of Housing and Local Government (Mr. James MacColl)I will try to deal with each of the points that have been raised, with the proviso that I do not decide what is in order and what is not in order. Thank goodness, I no longer draft Opposition Amendments, so I cannot be responsible for what is in order and what is out of order.
My hon. and learned Friend was anxious to make the Money Resolution as wide as would be reasonable. In these matters, inevitably one is faced with precedents. One particular precedent was as recent as 1964 in the Rating (Interim Relief) Bill, and one of the difficulties which inhibited us from going beyond what we have done was the fact that that Money Resolution was extremely tight.
There were two grants in it. One was a grant of £5 for each old person, and that was completely tied by the Money Resolution. It was quite impossible to increase the amount. The other was the double grant on the hardship side, which was 50 per cent. in some cases, rising—although, as my hon. Friend pointed out, it never did rise—to 66⅔ per cent. Not only was the maximum of 66⅓ per cent. fixed, but the figure of 50 per cent. was 172 also fixed. We were, therefore, faced with a very rigid Money Resolution which, as a precedent, it is difficult for us to go beyond. It appears to be a principle which the right hon. Member for Kingston-upon-Thames (Mr. Boyd-Carpenter) laid down quite early in his brilliant career, when he was Financial Secretary to the Treasury; the general principle that grants should be fairly clearly and definitely limited in a Money Resolution.
§ 10.15 p.m.
§ My hon. Friend the Member for Nottingham, West (Mr. English) spoke of the problems of the payment of interest arising through having to pay interest before the full amount of the rates was received. The hon. Member for Worthing (Mr. Higgins) wondered whether the aggregate net amount could be increased to cover the cost of administration. The position is that the costs of administration are not covered by the grant.
§ The difficulty in the instance mentioned by my hon. Friend the Member for Nottingham, West is that this matter would be extremely difficult to define, because local authorities have working balances of varying sizes at different times of the year. They also vary in their financial methods and in the way they calculate rates of interest. It would, therefore, take a very long time to find out how much of these are relevant for grant purposes. It would also be difficult to isolate the matter from the general costs of collecting the rates. For these reasons, we are leaving this out of the specific grant which is covered by the Bill, although this naturally ranks for deficiency grant.
§ Mr. EnglishIs my hon. Friend saying that that will apply in the case I quoted, since I do not believe that it would rank for rate deficiency grant? Rates at present come in fairly early in the year in a lump sum. That will not happen in future and, since this will represent a loss to local authorities what will be the position?
§ Mr. MacCollI see that you are watching me like a hawk waiting to swoop, Sir Samuel, if I break off into a discussion of local government finance. I suggest that at some later stage, if my hon. Friend is in a position to do so, he tries his luck with an Amendment 173 to see whether or not it would be in order. In any case, if it is an expense paid out of the rate fund it must be paid out of the rates, and if it is paid out of the rates it must rank for rate deficiency grant. That would be my rough guess of the position, although I should not like to be committed to that in any later discussion we may have of the matter,
I was fascinated by the question asked by the hon. Member for Worthing. He wondered what would happen if, instead of going in the direction which everyone wants to go—namely, to be more liberal in this matter—the Committee wanted to be tougher and to alter the allowances in such a way as to reduce the charge which had been met in connection with rebates.
§ Mr. HigginsBefore the hon. Gentleman proceeds, since I have not understood his explanation of what I said, would he care to try again?
§ Mr. MacCollI thought the hon. Gentleman wanted to move an Amendment at a later stage which would increase the amount of income which was deducted from the rate rebate to reduce the charge on rate funds.
If that is what the hon. Gentleman wanted, there are two aspects to it. One is that the allowance for children is free and can be amended up or down, but the allowances for married couples and for single people are tied by the Money Resolution. On the other hand, if the effect was to reduce the amount, the Money Resolution probably only fixes a ceiling to the charges on public funds. The hon. Gentleman might get away with an Amendment and an ingenious argument to that effect. I am not responsible for his drafting, but it would be worth trying.
§ Mr. MaddanWe on this side are rather confused. I asked whether we might increase these limits so that people who now would be excluded from the Bill could be brought into its benefit. Do I take it that this Money Resolution excludes that type of Amendment?
§ Mr. MacCollYes, except in so far as it is connected with the allowances for children.
I think that I have dealt with the major points. We are very anxious in this 174 Money Resolution to have as much freedom for debate as is consistent with precedent and something we felt reasonable to offer to the House.
§ Mr. Boyd-CarpenterThe Joint Parliamentary Secretary was his usual agreeable self, but the result is simply not good enough. The Committee knows that reliance on precedent is the last resort of a Minister in difficulties, and when the precedent relates to a Measure which the right hon. Gentleman the Minister spent some minutes in denouncing in all its aspects, the sincerity of the Government's arguments is plainly called in question. As far as I know, nothing in that Measure appealed to the Government, yet the Parliamentary Secretary still seems to shelter behind the precedent it affords, but he produced a precedent that does not apply to this issue.
He said that it was a precedent—and, as a representative of this brave, progressive and streamlined Government, he is devoted to precedents—the precedents of his predecessors—that grants should be limited by Resolution. When one is dealing generally with grants, that is no doubt an arguable proposition, but it has nothing to do with this Money Resolution, and you would rule me out of order, Sir Samuel, if I discussed it.
In this Bill the Government propose to impose on local authorities not a charge but a diminution of the income which otherwise they would get. To say that because the Government seek to limit the amount of that loss of income which the Government will reimburse to them it comes within any precedent about grants being limited by resolution is just a misuse of words. What the Government are saying is that they want to limit by this Money Resolution the amount they refund to the local authorities which by this Bill they propose to take from them.
The reality of the matter is this. The Minister admitted earlier, and everyone admitted during Second Reading—and some hon. Members opposite as well as my hon. Friends argued—that this 25 per cent. was a very doubtful proposition, and that it was the main issue arising on the Bill. The Minister knew that before he made his Second Reading speech, because the fact that it was the main issue of controversy was typed in the script he used. To come forward at the same time 175 with a Money Resolution designed to prevent that being tested by way of an Amendment in a Committee of this House seems to be an abuse of our procedure.
It is a clear indication that the Government are frightened on this issue. It is a clear indication that the Government do not think they can put up a justification for it. It is a clear indication that the Government do not think that they can carry their supporters with them if that issue is raised. Therefore, they deliberately and in advance—and I hope this will be noted outside—use the procedure of the Financial Resolution to prevent the House of Commons in Committee coming to a decision upon a matter which bodies outside representing local authorities, the ratepayers, and the great bulk of public opinion want us at least to debate and argue.
If the Government think they have a case, let them have that case deployed in argument by a Motion and let the Committee, when it comes to a conclusion on it, decide it. What is quite wrong and an abuse of the procedure of this House is to prevent any possibility of that being discussed. This is a vivid illustration of the Government's consciousness of the weakness of their case.
§ Mr. EnglishThe right hon. Member for Kingston-upon-Thames (Mr. Boyd-Carpenter) will know that we have always to face the fact that on Money Resolutions Governments have to decide how much money they are prepared to spend on particular projects. I do not want to press the issue I raised too far but, because the Ministry seem to have forgotten something, this is a rather different matter. That the Government should consider a principle and then decide that the Committee should not discuss it is something which we all have to suffer on Money Resolutions. The fact that a matter has been omitted from the Resolution is a rather different thing.
Here we are possibly precluded from discussing something which has not been 176 mentioned because it was not mentioned by the Allen Committee and that seems rather different. I want an assurance that if the rules of the Standing Committee make this matter out of order my right hon. Friend will produce a modification of the Money Resolution so that this will be in order and we can discuss it.
§ Mr. Hugh D. Brown (Glasgow, Provan)I apologise for speaking at this time, but I have not been impressed by the argument of my hon. Friend the Parliamentary Secretary. It seems shocking to base a case on precedent which we have been condemning. I hope that I am not going far into the camp of the right. hon. Member for Kingston-upon-Thames (Mr. Boyd-Carpenter). Hon. Members on the Government side should pay a little respect to the fact that there is a point here. This Bill has been published for only a week. Although officials in the Department may have discussed it with officials of local authorities, I hazard a guess that practically no local authority members know the implications other than what they have read in the Press during the past week.
We on the Government side should not be too complacent in thinking that there will not be no reaction to this. I say this perhaps through inexperience and, some hon. Members may say, in ignorance. If we are tied to a particular sum of money, would there be anything to stop Amendments being moved on the 75 per cent. to be found by the Government? If any alteration were to be made, could it be compensated for by increasing the amount of rates which would be excluded? In other words, if we altered the first paragraph of this Resolution could we alter paragraph 1(a) by increasing the amount to be excluded for rebate purposes? Are we tied to the extent that we cannot move one against the other after discussions with colleagues in local authorities?
§ Question put and agreed to.
§ Resolution to be reported.
§ Report to be received tomorrow.