HC Deb 28 October 1965 vol 718 cc419-31

6.28 p.m.

Mr. Robert Mathew (Honiton)

I am grateful for this opportunity to raise a matter in my constituency which amounts to a case of grave injustice. One could describe it as a land grab followed by ungenerous and somewhat shabby behaviour by a Government Department, an example of the ever-increasing arrogance of the State and the Executive in its dealings with the ordinary citizen. It is another example of what the late Lord Hewart called the new despotism riding roughshod over the just interests and rights of the individual, Government Departments and the Executive exercising powers granted to them by this House without proper consideration for the rights of the individual citizen.

My constituent, a Mrs. Clarke, is the executor of the will of the late John W. Palmer and as such is running, and running very efficiently, a small family business in Budleigh Salterton. It is a well-known local business of estate agents, valuers and auctioneers, funeral directors and furnishers, and building contractors. As the House knows, Budleigh Salterton is one of the most attractive resorts, and certainly one of the most attractive towns in all England. It is quite unspoilt, and the local authorities have gone to great pains to keep it as it always has been.

This land was acquired in circumstances which I shall describe shortly. It lies at the back of the family home of the Palmers and Mrs. Clarke and was, in the main, valuable building land. In 1956 the Post Office was looking for a site for a new telephone exchange in Budleigh Salterton, and Mrs. Clarke was approached by a Mr. Gibson, then in the Ministry of Works. Mrs. Clarke was extremely reluctant to sell, partly because the business had already lost some valuable building land which had been converted into a car park. But there were two other main reasons, about which she informed Mr. Gibson. First, the firm badly needed this land for building in connection with its business projects and, secondly, the Post Office at that time required not only the building land site but also a portion of the garden of the Clarke family's house on which there was an excellent brick cottage, in splendid repair, in which an elderly couple were living who had been promised by the late Mr. J. W. Palmer, at the time of his last illness, that they would never be turned out during their lifetime.

That cottage has now been pulled down to make way for the Postmaster-General's telephone exchange. Mrs. Clarke was extremely anxious not to be put into a position of breaking a promise made just before his death by her father to the old couple living in the cottage. Mr. Gibson then tried to find an alternative site. Incidentally, Mrs. Clarke has emphasised to me that throughout the negotiations on this matter and in correspondence Mr. Gibson was extremely friendly, and very helpful and courteous. He tried to find an alternative site but failed, and then returned to Mrs. Clarke saying that hers was the only suitable site in the whole town.

At this point in the story there is a dispute as to what was said in the negotiations with Mr. Gibson. I will read an extract from a letter which Mrs. Clarke wrote to me in February of this year. She described the abortive negotiations, and said: Mr. Gibson did try to find other land but returned to me after some time to say that there was nothing else which was suitable for the erection of a telephone exchange. I then asked what would happen if we refused to sell and he told me that the Ministry of Works would acquire it under a compulsory purchase order and the terms would probably not be as good as if we sold without a compulsory purchase order. Mrs. Clarke has checked with Mr. Gibson about this, and Mr. Gibson says that he remembers discussing the matter with her and that she was most anxious not to sell the land. He even remembers the name of the tenants whom she was anxious not to have to turn out. He says that he made a report of that conversation to the Ministry of Works, which should be on its files. I therefore ask the Parliamentary Secretary what records he has been able to find about this all-important conversation which took place during the negotiations.

I would like to assure you, Mr. Speaker, that Mrs. Clarke is an extremely intelligent and capable business woman. In view of certain suggestions made to me in correspondence with the Post Office I have made it my duty to discover what actually happened, and my conclusion is that Mrs. Clarke's recollection is crystal clear. Nobody would ever suggest that she was anything but a lady of the highest integrity. I can testify that that is so. There is no question that, first, she remembers what happened and, secondly, that her description of what happened is wholly accurate.

In any event, anybody who is negotiating in the circumstances which I have described knows that the State—the Government Department or whatever it may he—holds the ultimate big stick. It is necessarily implied in any such negotiations that a Government Department which is trying to take somebody's land against his will ultimately cannot lose. The ultimate sanction of a compulsory purchase order is always there, like the Sword of Damocles, and colours everything said and done by both parties in such negotiations. It is implied in the negotiations, and it cannot be seen otherwise.

It is quite clear that in the circumstances of this case Mrs. Clarke would never have sold this land, which belonged to her family business and which was needed for the purposes of that business, if it had not been for the threat of a compulsory purchase order. Whether it was specifically mentioned I do not know, but it was there, and it was quite clear to Mrs. Clarke that if she refused to sell the Department would take action and she would have to yield it up, perhaps at a lower price.

In the event the land was sold by Mrs. Clarke for £2,100. This was the district valuer's price and it was very low for building land. I have looked into this matter and have ascertained the price of land in the area at that time, and I am convinced that the amount she got was low. Today two derelict cottages which were on a portion of the Clarke family's land have been demolished to make way for the building of the telephone exchange.

These cottages having been demolished, the Post Office discovered that it did not need all the land for the exchange. A parcel of land was found to be surplus to its requirements. In those circumstances, I ask the Parliamentary Secretary why this fact was not known at the time of acquisition. There may be some explanation. It may have been due to technical changes. Nevertheless, it is very surprising that, having built the exchange, the Post Office discovered that it had more land than it needed. At what stage was it discovered that there would be surplus land, and what prevented this fact being known at the time when the land was purchased, with the expenditure of the taxpayers' money?

Mrs. Clarke asked for the surplus land to be offered back to her at a fair price. Only today, on the telephone, she again stressed to me that she is ready and willing to pay a fair and reasonable price. I am glad to see that the Postmaster-General is now on the Front Bench, because I want to refer to the fact that he was courteous enough to look into this matter with some care, although from my point of view he came to the wrong conclusion about it. He answered a number of Questions, and in a letter written on 9th September of this year to me he said, inter alia: In case there are any doubts in Mrs. Clarke's mind about what constitutes a fair price may I make it clear that if we did sell to the executors they would have to pay the current market value for it? Naturally, I put this very clearly to Mrs. Clarke, and she wrote to me a few days later, on 20th September, saying—I quote this because it makes the position absolutely clear: With regard to price, we quite expect to pay the present market price for the remaining land. We feel we should be offered this land before it is offered publicly at a fair price at present day values. I would emphasise again it is not the price of the land which concerns us but the principle of the whole matter. So Mrs. Clarke has made the position absolutely clear. She has stressed again today that she understands the position and would pay the fair market price.

I understand from various sources that the Devon County Council wishes to build a library on the site. I cannot tell the House what the position about that is, but it seems to me that it is obviously a legitimate desire on the part of the county council, and, in view of the fact that Mrs. Clarke is directing a building firm, it seems to me that some arrangement could be made without putting into the market the land which was originally hers and which was taken from her under duress. The firm would be most willing, I think—we should have to confirm it, but I am almost certain—to build the library.

Mrs. Clarke has been refused the land. She is told that it must be put up for public auction. I would put a third question to the Assistant Postmaster-General. Why has the land to be put up for public auction when a fair market price—at today's values—is offered by the former owners who were deprived of it under the ultimate threat of the powers which the Government have? Is it because it is hoped that the Post Office will make a nice profit, that somebody will pay more than the land is worth and so the Post Office will do extremely well? Does the Post Office want to enter into competitive business by means of an auction? What is the reason.

I wrote to the Postmaster-General first at the end of September, 1964. He has refused throughout to modify his attitude. He has refused to see Mrs. Clarke, who was very disturbed at the interpretation put upon Mr. Gibson's report, that there was no mention of a compulsory purchase order. But there was according to the information which I had. The report, naturally, was accepted by the Postmaster-General. There clearly was some difference of opinion here as to what actually happened. For this reason, I wished the Postmaster-General to see Mrs. Clarke so that he could appreciate that she was a woman with a very crystal-clear recollection, a capable business woman who knew exactly what had happened, although it was some time before.

My view is that the Postmaster-General is hiding behind the Treasury Minute relating to the Crichel Down type of cases, saying that as no compulsory purchase order was used, threatened or even mentioned he has no obligation of any sort, legal or moral, to offer the land back to the original owner. I remember a number of cases on all fours with this when the Conservative Party formed the Government, not affecting the Post Office, it is true, but cases where this sort of situation arose, where there was surplus land. If I remember rightly, it was a matter of policy that the land should be offered back to the original owner at a fair market price. Surely this discretion exists and should be exercised.

After considerable investigation of the case, I am in no doubt that there was an actual implication or mention of a compulsory purchase order. Even if there was not, it must have been implied. After Mrs. Clarke had refused, Mr. Gibson went away and then he came back again and started renegotiating. These were not two free citizens entering into a contract. One was under duress because she knew that ultimately the Government, through the Post Office, would be able to force her to sell. This puts the citizen in a very disadvantageous position.

There is no possible doubt that when, for whatever reason it was—I shall listen to what is said about this—the mistake was made, if it was a mistake, and too much land was acquired with public money for the telephone exchange, surely the first refusal of the surplus land should have been given to the original owners whose business was damaged, who did not wish to sell their property but had to. Once again, I ask what the reason is for the land being put up for public auction. Why cannot Mrs. Clarke be offered the first refusal of it? It may be that she will not accept the price. Is it because the Postmaster-General wants a bigger profit at a public auction than the figure that the district valuer would probably put on the land?

Something has happened in the last two or three days which throws a certain light on the intentions of the Post Office and, perhaps, the lack of co-ordination between Ministries in this Administration, because the South West Electricity Board has approached Mrs. Clarke apparently not knowing the background at all, saying that it wishes to remove an electricity pole which is in the middle of the land because it is necessary to remove it if the land is to be built on. The board has asked whether Mrs. Clarke would mind if it put certain underground works and stays in the back of her garden to help it. This shows a certain lack of co-ordination between the Ministry of Power and the Post Office.

This is a monstrous case. It is a typical case of the citizen up against the State coming off worse every time. Everybody appreciates that compulsory planning is necessary and that the individual has to give way and concede his property in the interests of the community as a whole. But this is a monstrous case. Mrs. Clarke is morally entitled to be offered the first refusal of the land which the Post Office is about to sell. This is really a case of a Government Department using its powers inflexibly and unjustly, and riding roughshod over citizens and taxpayers of whom the Department is, after all, the servant, which is very often forgotten by officials. I ask the right hon. Gentleman once again to consult his conscience and act in accordance with that in justice and fairness and give Mrs. Clarke and her business the first refusal of the small piece of land which is left.

6.49 p.m.

The Assistant Postmaster-General (Mr. Joseph Slater)

First, I congratulate the Member for Honiton (Mr. Mathew) on being successful in seeking to raise this matter on the Adjournment. His constituent had had a good advocate to present the case on her behalf.

I begin by repeating what my right hon. Friend said in his letter of 15th March to the hon. Member: This is a long, involved and not very happy story. I have listened to the hon. Gentleman's careful exposition and can well understand how it is that Mr. Palmer's executors feel so strongly that the part of the site no longer needed for Post Office purposes should be offered back to them. However, let me repeat very briefly the facts of this case. The hon. Gentleman has endeavoured to give us the facts as he knows them. I shall endeavour to give the facts as they have been given to me.

The Post Office started looking in 1937—not 1950—for a site in Budleigh Salter-ton on which to build a telephone exchange along with a garage and an engineering depot, and began negotiations for a site in Fore Street, held on lease by Mr. Palmer. The negotiations were interrupted by the war and resumed in 1947. They lapsed and were started again in 1950. By this time the need for an engineering depot had disappeared, but we still needed a site for a telephone exchange and garage. In 1950, the Post Office applied for the Fore Street site to be designated for Post Office use under the Town and Country Planning Act, 1947.

However, Mr. Palmer objected strongly to our request for designation and by 1953 it became known that the Budleigh Salterton Urban District Council had decided that the Fore Street site would be better used as a car park. This, and Mr. Palmer's objections, led us to agree to withdraw our request for designation.

About this time Mr. Palmer offered us the Station Road site in which, too, he held the leasehold interest. This may have been to attract us away from the Fore Street site to which he probably attached more importance. That he was obliged in the end to hand over the land in Fore Street to the local authority was, indeed, unfortunate from his point of view. But the hon. Member will appreciate that this had nothing to do with the Post Office.

When we found that the site in Station Road was too small for our needs, Mr. Palmer offered to sell us as well a wider strip of land from an adjacent property—"The Lawn"—which he owned. After his death, negotiations continued with his executors until the sale was completed in 1961.

On the Station Road site were three occupied cottages, one brick, the other two derelict. The latter were subject to demolition orders, and the occupants were rehoused by the local authority. The brick cottage—in good condition—was occupied by old servants of Mr. Palmer: these found themselves a rented house when sale to the Post Office was finally agreed.

By 1963, when we had completed our plans for the new telephone exchange on the wider part of the site, we found we could make do with a smaller, more compact type of exchange, and could do without a garage. So the narrower end of the original site became surplus to our needs. I say "narrower" and would like to stress this as it is relevant to the issue now before the House. In this piece of land Mr. Palmer held only a leasehold interest of which just over fifty years were unexpired when the lease was purchased by the Post Office. The Post Office shortly afterwards purchased from another party the freehold reversion in this land. This is the land which my right hon. Friend told the House on 11th May he had decided to put to public auction.

I now turn to the specific points of criticism which have been made, not only by the hon. Member but by persons outside.

The executors have criticised the fact, first, that we bought more land from them than we needed: secondly, that we went and built on the part of the site containing the brick cottage and the strip of land from "The Lawn"—in their contention we should have avoided this end of the site and built on the other. I would remind the hon. Member that ten years elapsed between the time when Mr. Palmer first offered us the site and the time (1963) when we had completed our plans for the new exchange. It is really not to be wondered at that our operational needs should be modified in the course of that period.

I agree it is a pity that we did not know—before we were contractually committed to buy—that we could make do with less than the whole site. But the point I want to bring out is that, even if we had known this in time, we should still have had to buy and build on the northern end of the site—that is the piece with the brick cottage and the strip of garden from "The Lawn"—because only at that end was there sufficient depth to provide the area needed for the telephone exchange and for probable future extensions of it. So, much as I regret it, we just could not avoid having the brick cottage pulled down.

It has been claimed by the executors and the hon. Member has stressed this—that during the negotiations to buy the Station Road site they were told that, if a voluntary sale fell through, the only alternative was a compulsory purchase order. When this was first brought to his attention, my right hon. Friend thought it right to have the closest enquiry made into the matter.

As the House may know, the Ministry of Public Building and Works act as agents for the Post Office in land transactions. The estates officers of the Ministry directly concerned with these negotiations have been questioned. They have confirmed that the executors were reluctant to sell, but they are quite sure that they did not, at any time, imply during the negotiations that the Ministry or, more properly, the Post Office would resort to compulsory purchase if voluntary negotiations broke down.

Mr. Mathew

But this is surely what one would expect an official to say in view of the rules made after Crichel Down. An official has to be very careful indeed in what he says. But I have carried out a thorough investigation. I am convinced that Mrs. Clark's account is accurate, and, as far as it is humanly possible, I have checked it. In these circumstances, it is a little surprising that neither the Postmaster-General nor any high official was willing to see her or to have a confrontation between the persons concerned. Of course any official will protect himself, and one can scarcely blame him in view of what happened over Crichel Down, which is writ large on the souls of these people.

Mr. Speaker

Order. This intervention is suspiciously like a second speech.

Mr. Slater

I do not call in question the hon. Gentleman's belief in the truth as he sees it, but we have carried out our investigation and I hope that he will give credence to my right hon. Friend in carrying it out in order to get at the facts from the Department. The hon. Gentleman should be fair in his criticism because at one time he himself was connected with a Government Department.

Mr. Mathew

We gave good answers.

Mr. Slater

I remind the hon. Gentleman that all this story happened under the previous Administration and not this one. I make it quite clear that we found no other than we expected.

Specific standing instructions in the Ministry of Public Building and Works lay down that no suggestion, however indirect, of compulsory purchase proceedings on behalf of the Post Office may be made—and I want the hon. Gentleman to get this clear—without the authority of the Post Office. Under standing Post Office instructions, no application may be made for the designation of a site under the Town and Country Planning Act and no compulsory purchase order can be made in respect of a site once designated and no hint or threat of any such action can be made to any party—without the express authority of the Postmaster-General in person. Even if I were to accept what the hon. Gentleman has said, my right hon. Friend's predecessor gave the instruction and none of these sanctions was sought or granted.

My right hon. Friend is satisfied that these are the plain facts. It may be—I can only speculate—that the history of the previous negotiations for the Fore Street site, where designation was sought as a means ultimately of obtaining compulsory purchase powers, coloured the executors' attitude when they came to negotiate the sale of the Station Road site. All I can say is that, so far as the Post Office and, indeed, the Ministry as our agents were concerned, this was a negotiation—a protracted and difficult negotiation lasting not one year but some six years—for the voluntary purchase of the land.

I come now to consider the main point—the contention that in all the circumstances my right hon. Friend should sell the surplus land back privately to Mr. Palmer's estate. That is what the hon. Gentleman's case really is.

Mr. Mathew

First offered at a fair market price.

Mr. Slater

This raises the question of Government policy in general on the disposal of surplus Crown land. The over-riding principle is quite simple. It is that surplus Crown land should be sold at current market value. The normal means of establishing current market value is, wherever practicable, to put the land up to public auction, or to sell it by competitive tender. There are very few exceptions to this general rule. One relates to surplus land which was formerly hospital land taken over from a local authority in 1948 without compensation. Another relates to agricultural land acquired compulsorily or under threat of compulsion. The only other exception relates to the sale of land to a local authority where it is deemed that such a sale would contribute towards the solution of a public problem.

I may point out that this last exception to the general rule is not irrelevant here. The Devon County Council, I understand, wants to buy the site for a county branch library and in order to provide access to a proposed health centre on land at the rear. Budleigh Salterton Urban District Council, too, has expressed interest in buying the site for various purposes. So, too, have other people as well as Mr. Palmer's estate. If my right hon. Friend were prepared to authorise a sale other than by competition in the open market, he might well have come to the view that a sale by private treaty to the Devon County Council would be justified in the public interest. However, as he said in the House in answer to the hon. Member's Question on 11th May, my right hon. Friend thinks it right, in the circumstances, to put the land up to public auction.

Finally, let me say that Mr. Palmer's executors have been at pains to point out that their main object in buying back this land is to build on it and not to make a vast profit on it. They would sell it to anyone nominated—including the Devon County Council—provided they built on it whatever was planned. I would point out that my right hon. Friend's decision to sell by public auction deprives Mr. Palmer's executors neither of the freedom to bid for the land at auction, nor of the freedom to tender for any building contract which may follow the sale.

I sincerely hope that following the debate about this important matter which has caused so much heart searching and about which there has been an investigation to try to get at the facts and now that I have endeavoured to give the full picture as we see it and understand it, the hon. Gentleman will be satisfied with the way in which things have been done.