Commons Sitting of 20 October 1966

Preamble
The House met at half-past Two o'clock
PRAYERS
[MR. SPEAKER in the Chair]
PRIVATE BUSINESS
  TEES VALLEY AND CLEVELAND WATER BILL (By Order)
  Read the Third time and passed.
ORAL ANSWERS TO QUESTIONS
  ECONOMIC AFFAIRS

    Building Societies (Mortgage Interest Rates)
    Mr. Boyd-Carpenterasked the First Secretary of State and Secretary of State for Economic Affairs if he will make a statement on the National Board for Prices and Incomes' Report on the rates of mortgage interest chargeable by building societies.
    The First Secretary of State and Secretary of State for Economic Affairs (Mr. Michael Stewart): I have not yet received the Board's Report.
    Mr. Boyd-Carpenter: May I first welcome the right hon. Gentleman, my old senior officer at the Oxford Union, in his new office? Is he aware that the Leader of the House told us that this Report would be available in the middle of October and that the building societies were induced to hold their hand until then? When will this Report be available?
    Mr. Stewart: It should be ready quite shortly.

    Wages Standstill
    Mr. Boyd-Carpenterasked the First Secretary of State and Secretary of State for Economic Affairs whether he is satisfied with the degree today of voluntary observance of the pay freeze; and whether he will make a statement.
    Mr. M. Stewart: Yes, Sir. The bringing into force of Part IV of the Prices and Incomes Act is no reflection on the great majority of employers and employees who are voluntarily observing the standstill.
    Mr. Boyd-Carpenter: Is the right hon. Gentleman's satisfaction with this not marred at all by the fact that a great many people have been induced or cajoled into going back on bargains which they have freely made? What is he going to do to build up again faith in agreements freely negotiated?
    Mr. Stewart: The reasons for this step were explained and discussed in the House in July. I believe that the nation as a whole accepts its necessity, and that the problem of building up confidence which the right hon. Gentleman creates in his mind does not therefore exist.
    Mr. Crawshaw: Is my right hon. Friend aware that what many people on fixed incomes—especially pensioners—are more concerned about is whether prices are voluntarily being held down? Can he assure the House that he will apply the same vigour in keeping down prices—which I believe that he has rightly applied—in respect of incomes?
    Mr. Stewart: Yes, Sir. It is the Government's intention to see that the principles of the White Paper on the standstill are observed as much in respect of prices as of incomes. My hon. Friend will realise that people with lower incomes or with small fixed incomes would be among the worst sufferers if there were a free-for-all.
    Mr. Iain Macleod: Does the First Secretary appreciate that the main factor in the increases in prices is the Selective Employment Tax and the burden of taxation that has been imposed by this Government? Does his answer, therefore, mean that he is going into reverse in this matter?
    Mr. Stewart: No, Sir. As explained in July, there were bound to be some increases in prices, for the reasons which the right hon. Gentleman has mentioned. It is true that since then those reasons have been the main reasons—indeed, almost the only reasons—why prices have risen. That follows necessarily. But I should have said that we shall carry out the principles enunciated in the White Paper.
    Mr. Molloy: Will my right hon. Friend acknowledge the fact that while there might be some justification in some places for an increase because of S.E.T., what is really happening is that people are using S.E.T. as an excuse to cheat the public? Will he consider introducing legislation to stop this form of downright cheating?
    Mr. Stewart: This fact has been brought to my attention and that of my colleagues in a number of letters and reports. These cases are being vigorously investigated. If it were necessary the powers under the Act would be used.

    Economic Planning
    Mr. Martenasked the First Secretary of State and Secretary of State for Economic Affairs if he will set up a standing advisory committee to guide the Government in their economic planning.
    Mr. M. Stewart: No, Sir.
    Mr. Marten: As the National Plan—which was launched about a year ago as a great advance in economic planning—has now really become a meaningless irrelevance, does not it show that the national planners have failed in their job? Can the right hon. Gentleman say whether we are to have another National Plan and, if so, when? Will it be done by the same group of people as produced the last one?
    Mr. Stewart: The hon. Member is wrong to say that the Plan is a meaningless irrelevance. It was said from the beginning, of course, that difficulties presented by the balance of payments could act as a constraint on what was planned. I accept that that difficulty is inherent in this country's economic situation, but that does not mean that the concept of planning ceases to be relevant and important. As to revision of the Plan, I want first to have consultations with the National Economic Development Council.
    Mr. Fletcher-Cooke: Since the Plan said that there would be 200,000 too few people labouring in this country and since there are now 400,000 too many, when will that part be revised?
    Mr. Stewart: The hon. and learned Gentleman is wrong to say that there are 400,000 too many. What we have to do at the moment is see that we do not get over-manning of certain industries. We
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    must take the necessary measures to see that people are employed where their efforts will be most effective.
    Mr. Gwynfor Evans: In view of the grave increase in unemployment in Wales, will the right hon. Gentleman consider creating machinery which will start economic planning in that country?
    Mr. Stewart: As I think the hon. Gentleman knows, there are special regional measures which are intended to have and are having an effect in helping regions which may be in particular difficulty.

    Salaried Staff (Incremental Awards)
    Mr. John Leeasked the First Secretary of State and Secretary of State for Economic Affairs if he will take steps to prohibit for 12 months all incremental awards of salaried staff in both the public and private sectors of the economy in respect of salaries at present exceeding £3,000; and if he will make a statement.
    Mr. M. Stewart: No, Sir.
    Mr. Lee: Does not my right hon. Friend understand that permitting incremental increases when there is a wage freeze helps to cause resentment in people's minds, particularly those of lower workers? Will he reconsider his Answer?
    Mr. Stewart: No, I think not. The incremental increases which are permissible under the standstill are only those which were automatic and predetermined, that is to say, those which are really part of the method of payment of those workers.
    Mr. Patrick Jenkin: Would not the right hon. Gentleman agree that it is a ludicrous distinction to make between one category of workers, where the increase happens to be automatic, and another category which is on exactly the same sort of ladder but where there is more discretion for management on where the individual rungs should be? Does he not recognise that this is giving rise to great resentment in many industrial firms which pay their salaries by the later method?
    Mr. Stewart: If the increases are discretionary, it means that that is not the same sort of ladder. If a man enters an

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    occupation with rates of increase clearly laid down in advance, that is part of his method of payment from the start.
    Mr. Will Griffiths: Is my right hon. Friend aware that in many professions, such as those of dentists, solicitors and architects, these increments are being paid to relatively highly paid workers, whereas in the same offices and the same surgeries people like clerical assistants and cleaners are being flatly refused them?
    Mr. Stewart: Yes, but if, as is suggested, we made automatic, predetermined increases of this kind subject to the standstill, it would be not only higher-paid workers who suffered but lower-paid workers as well. It has never been part of the standstill that we should discriminate between one kind of worker and another simply with relation to the size of income. The distinction here is between predetermined increases and those which are not predetermined.

    Economic Policies
    Mr. Wallasked the First Secretary of State and Secretary of State for Economic Affairs if he will make a statement on the progress of the Government's economic policies.
    Mr. M. Stewart: No, Sir.
    Mr. Wall: Does the right hon. Gentleman agree with the Economic Review, which suggests that the rise in output next year will be only fractional? Is not the root cause the Government's curbing of wages and any form of incentive? When will he do something to make it worth while to work harder?
    Mr. Stewart: The reason I said "No" to the hon. Gentleman's Question is that I do not believe that this subject, which would cover a very wide range of topics, could be properly or adequately dealt with by a statement and a few questions thereafter, without opportunity for debate. I trust, however, that the opportunity for examination of these matters will arise; I would welcome it.
    Mr. Park: Is my right hon. Friend aware that the Government's economic policies will not be effective as long as the widespread increases in profits and dividends continue to take place? Will he takes equivalent power of public super-
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    vision and control over profits and dividends to that which he has already taken over wages and salaries?
    Mr. Stewart: There are powers, of course, over prices, which affect profits and dividends. Dividends themselves are a matter for my right hon. Friend the Chancellor of the Exchequer.
    Mr. Peyton: Will the right hon. Gentleman accept our congratulations on the modesty of his first reply and understand that we all hope that that modesty will be communicated to his colleagues?
    Mr. Michael Foot: Will my right hon. Friend tell us whether there has been any revision by the Government since the statement of 20th July of the likely figure of unemployment both during the period of redeployment and after, particularly in view of the fact that it is this aspect of the matter which most gravely disturbs hon. Members on this side of the House?
    Mr. Stewart: To the question, has there been a revision?, I would say, no. This is a matter, of course, of concern to us all and will be debated in the House on Monday next.

    Import Surcharge
    Mr. Dickensasked the First Secretary of State and Secretary of State for Economic Affairs what steps he is taking to ensure that the forthcoming removal of the import surcharge is passed on to the consumer in lower prices.
    The Under-Secretary of State for Economic Affairs (Mr. William Rodgers): My right hon. Friend expects those concerned to recognise fully their responsibility in this respect.
    Mr. Dickens: Does my hon. Friend remember that, in November, 1964, many manufacturers increased their prices to consumers by amounts at least ample to cover the import surcharge? Can we have an assurance this afternoon that the Government will take the most rigorous action to ensure +hat those manufacturers will reduce their costs to consumers by amounts at least equivalent to the import surcharge?
    Mr. Rodgers: I can give that assurance and there should be some scope for reductions. However, it is only fair to say that inquiries which we made

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    early in 1965 showed that the majority of importers, wholesalers and retailers, had, in fact, absorbed the import surcharge, wholly or in part.
    Mr. Frederic Harris: Would not the hon. Gentleman agree that a large number of importers reduced their prices, because of the import surcharge coming down in November, when it was announced by the Chancellor last July, as otherwise they would not have sold their goods?
    Mr. Rodgers: Some reductions might have taken place, but there is scope for many more.

    Postal Charges
    Mr. Biggs-Davisonasked the First Secretary of State and Secretary of State for Economic Affairs whether he will refer the latest increases in postal charges to the National Board for Prices and Incomes.
    Mr. Bryant Godman Irvineasked the First Secretary of State and Secretary of State for Economic Affairs why an exception was made to allow the recent increases in postal charges.
    Mr. William Rodgers: No, Sir. The increases in postal charges were an integral part of the measures necessary to remedy the economic situation announced by my right hon. Friend the Prime Minister on 20th July.
    Mr. Biggs-Davison: Does not that reply suggest that the Government are not only tyrannical but capricious? Is not the Government's prices and incomes policy in fact just a policy of higher prices and smaller incomes?
    Mr. Rodgers: The position was set out very clearly indeed, as my right hon. Friend the First Secretary said, in the White Paper three months ago. There has been no change since then.
    Mr. Irvine: Would the hon. Gentleman not agree that this looks to the country as if there is one law for Government industries and another for private industries? Would he not further agree that the increased Post Office charges are an integral part of all costs in every industry and that private industry is now supposed to absorb these costs itself?
    Mr. Rodgers: We made it clear at every stage that, whether the prices are in the public or private sector, every effort should be made by those concerned to absorb them.

    National Plan
    Mr. Costainasked the First Secretary of State and Secretary of State for Economic Affairs what was the cost to his Department and to other Government Departments of preparing the National Plan, exclusive of printing costs.
    Mr. John Hallasked the First Secretary of State and Secretary of State for Economic Affairs what was the cost of preparing the National Plan.
    Mr. William Rodgers: It is not possible to give any useful figure.
    Mr. Costain: It not this a further indication of how wrong the National Plan was? Does the First Secretary realise what this cost industry—industry which took them seriously for a few weeks? Would he realise, before bringing out another Plan, that they may not be believed to the same degree again?
    Mr. Rodgers: The publication of the National Plan was always more popular in industry among those it concerned than among hon. Members opposite. There is still a great deal to be done on the check list for action of the Plan which alone would make it very worth while.
    Mr. Sandys: Would not the Government do well to recognise that their National Plan is now as dead as the dodo?

    Scottish T.U.C. (Talks)
    Mr. Dalyeasked the First Secretary of State and Secretary of State for Economic Affairs if he will make a statement on his official talks with the Scottish Trade Union Congress on Friday, 30th September, on the subject of the employment and industrial position in Scotland.
    Mr. M. Stewart: My colleagues and I met with representatives of the Scottish Trades Union Congress to discuss the economic prospects in Scotland, particularly in the light of the Government's economic measures announced in July. The Scottish Trades Union Congress expressed their concern at redundancies in Scotland and sought reassurances that

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    Ministers would keep watch on the unemployment situation to ensure that the claims of Scotland were not prejudiced. That assurance I gave them.
    Mr. Dalyell: On the question of assurances, am I right in supposing that the S.T.U.C. received one assurance that the Government would intensify their policy on the question of issuing industrial development certificates? If that is right, can the Minister give evidence that this is being done?
    Mr. Stewart: I explained that it was the intention to administer the policy of industrial development certificates in a way that would help both Scotland and other regions that might otherwise be prejudiced by the present situation. That is being done and will continue.
    Mr. Edward M. Taylor: In view of these talks and the developments since, will the Minister advise his Cabinet colleagues to stop making speeches saying that Scotland is exempt from the freeze and that houses and schools are not affected by it when it is blatantly obvious to us in Scotland that this is not the case?
    Mr. Stewart: It is the case that houses and schools are not affected. It is not claimed that Scotland—like the rest of the country—does not face difficulties. What is claimed is that there are measures carried out which help Scotland and other regions which might be specially injured.

    Prices
    Mr. Dickensasked the First Secretary of State and Secretary of State for Economic Affairs if he will indicate the procedure whereby the prices standstill is to be enforced.
    Mr. Winnickasked the First Secretary of State and Secretary of State for Economic Affairs whether it is the Government's intention to take action against those companies who have raised their prices during the wages and incomes standstill.
    Mr. William Rodgers: As my hon. Friend will be aware, we have taken powers under Part IV of the Prices and Incomes Act, now in force, which can be used to reinforce the voluntary basis of the standstill.
    Mr. Dickens: Is my right hon. Friend aware that the Government's attempts to hold the prices standstill so far have proved utterly inadequate? Will he not give the House an assurance that the Government will forthwith establish a central prices control agency to regulate essential prices?
    Mr. Rodgers: In the first place, although I share my hon. Friend's concern on the question of prices, as I am sure we all do, I would not agree that the voluntary standstill has not achieved a very large measure of success. As I said, the great majority of those concerned are co-operating with it, and we have the reserve powers within the Act. I think that these are adequate for our purpose.
    Mr. Winnick: Despite that Answer, will the Minister agree that there is widespread concern among people in the Labour movement over the large price increases that have taken place? Does he agree that if no action is taken on prices, but only on wages, the whole freeze will be discredited?
    Mr. Rodgers: May I make it quite clear that there is nothing at all between us on the importance of working on prices, but I think that we have achieved a large measure of success, and if a full explanation is given in the light of the standstill White Paper, many people will appreciate what has already been done.
    Mr. Iain Macleod: Would the Minister answer a simple but very important question: does he really believe that under a mixed and competitive economy it is either possible or desirable to enforce a prices standstill?
    Mr. Rodgers: In a society where there is a large degree of public responsibility, there are very many people who are prepared to co-operate with the Government when the Government make it clear that their policies are in the national interest.
    Mr. Manuel: Is my hon. Friend aware of the big erosion of the income of the lower income groups by price increases? Would he inform the House quite clearly and definitely which commodities, where price increases have taken place, he is having examined? Will he pay particular attention to the price increases in respect of laundries and biscuits?
    Mr. Rodgers: We are examining a very large range of commodities and services. But as my hon. Friend will agree, the whole purpose of the prices and incomes policy is to help, among others, those who, because of their fixed incomes, have suffered most in the past from rising prices.

    Regional Studies (Publication)
    Mr. Tinnasked the First Secretary of State and Secretary of State for Economic Affairs whether he will now make a statement regarding publication of the Northern, Yorkshire and Humber-side, and East Midlands Regional Studies.
    Mr. William Rodgers: The Stationery Office is publishing the Northern Region's Study on Monday, 24th October. Those for the Yorkshire and Humberside, and East Midlands Regions will be published on 14th November and in early December respectively.
    Mr. Tinn: Is my hon. Friend aware that this statement will be welcomed, particularly in the North? Can he indicate to what extent these publications are Government documents reflecting Government policies and intentions?
    Mr. Rodgers: These documents will not be statements of Government policy and for that reason will not commit the Government, but they will provide a basis for discussion on regional planning questions and will in this way lead to the formulation of policies.

    Wages (Period of Severe Restraint)
    Mr. Hefferasked the First Secretary of State and Secretary of State for Economic Affairs (1) whether he will clarify in greater detail the concept of severe restraint following the period of the wages standstill; and if he will make a statement;
    (2) whether he will make a statement on his talks with the Trades Union Congress and the Confederation of British Industry concerning the future machinery needing to be introduced regarding wages and salaries, following the ending of Part IV of the Prices and Incomes Act.
    Mr. M. Stewart: My hon. Friend will be aware that I am at present holding consultations with the Trades Union Congress and Confederation of British Industry on the criteria for prices and incomes determination and arrangements for continuing mutual discussions during the period of severe restraint. Good progress is being made and a White Paper will be published when consultations are completed. Further consultations will be held in due course with the object of securing a planned growth of money incomes in line with real output after the period of severe restraint comes to an end.
    Mr. Heffer: Could my right hon. Friend give the House an assurance that there will be no question of a continuation of compulsion as far as collective bargaining is concerned? Will he give us an assurance that at the earliest possible moment there will be a return to free collective bargaining, that this in no way means the ending of an incomes policy, but that he will adopt the views of the Trades Union Congress and allow them to set up machinery through the trade union organisation?
    Mr. Stewart: In the first place, I should like to repeat what I said recently in a public speech and which was recorded in the Press. The life of the compulsory powers under Part IV of the Prices and Incomes Act is in any case limited by Statute and there would be no question of renewing or prolonging them. Next, I agree with my hon. Friend that the end of that exceptional period does not mean the end of an incomes policy. It is certainly desirable that the trade union movement should have its own machinery for considering wage claims. Exactly how trade unions, Government and employers work together on this is something which we are still working out.
    Mr. van Straubenzee: Will the Minister give an assurance that during the period referred to in the Question he will not seek to override, or to obtain the authority of the House to override, the arbitration provisions written into the Act by which teachers' salaries are negotiated?
    Mr. Stewart: I do not think that I shall make—without any prejudice whatever to what is contained in that question—any pronouncements at all at this

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    stage about the operation of criteria during the period of severe restraint until I have concluded these consultations.
    Mr. A. J. Irvine: Does my right hon. Friend agree that while it may be necessary, to overcome an economic crisis, to make provision that contracts freely entered into shall not be enforceable—and I think that the Government were right to do this—it is desirable that that state of affairs should cease as soon as possible? Will my right hon. Friend give an assurance that in the period referred to in the Question the Government will give careful reflection to that matter?
    Mr. Stewart: I can give my hon. and learned Friend the assurance for which he asks, carefully worded as it was. On the earlier question, we do not underestimate the seriousness of what has been done about contracts, but I believe that the nation as a whole understood the Tightness of this at the time.
    Mr. Gresham Cooke: Will the First Secretary wipe out in the period of wage restraint the great unfairness by which civil servants and local government officials will get their annual incremental increases whereas the staff of private enterprise are not allowed to have theirs?
    Mr. Stewart: I answered a Question about that a little while ago. I will not at this stage prejudge the criteria for the period of severe restraint. That is exactly what I am engaged on discussions about at the present time.

  BOARD OF TRADE

    Drake Collection
    Dr. David Owenasked the President of the Board of Trade, in view of his decision to raise the limit on the export of works of art, what steps he intends taking to safeguard all the items in the Drake Collection.
    The Minister of State, Board of Trade (Mr. George Darling): I do not think that the recent raising of the limit calls for any special steps. The normal procedures still apply to the export of antiques.
    Dr. Owen: Is my right hon. Friend aware that this subject is causing great concern in Plymouth, that certain parts
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    of the Drake Collection fall in this category and that there is considerable anxiety that they may go to America?
    Mr. Darling: No applications have so far been received in respect of any of the items in the Drake Collection. The reviewing body will, of course, take note of any applications that may come in, but I do not believe that at the moment there is any need to be alarmed about the situation.

    Australia (Minister's Visit)
    Sir R. Russellasked the President of the Board of Trade if he will make a statement on his recent official visit to Australia.
    The President of the Board of Trade (Mr. Douglas Jay): Yes, Sir. I visited Australia between 18th and 30th September, including in my tour Canberra and the six State capitals. I should like to express my thanks to the Australian Government for their warm hospitality.
    The purpose of the visit was not to negotiate with the Australian Government on trade matters, but to see at first hand and to encourage the British export effort in Australia. The main impressions I received was the great goodwill which still exists towards Britain and the vast opportunities for the expansion of British exports, particularly in the capital goods sector.
    Sir R. Russell: While thanking the right hon. Gentleman for that Answer, may I ask him when he intends to approach the Australian Government with a view to getting the Anglo-Australian Trade Agreement renewed on a long-term basis instead of the present year-to-year basis?
    Mr. Jay: There is an agreement between ourselves and the Australian Government that it would be wiser to complete the Kennedy Round negotiations before we revise the Anglo-Australian Trade Agreement. Meanwhile, it remains in force.
    Mr. Doughty: Does the President of the Board of Trade realise that Australia is developing very fast indeed and is in urgent need of capital for that purpose? As trade will follow the investment of capital, will the right hon. Gentleman use his influence on the Chancellor of

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    the Exchequer to see that Great Britain and not the United States supplies that capital?
    Mr. Jay: I entirely agree. Australia is a very great market for British exports of that kind and I have been impressing that on British industry since returning home.
    Mr. Marten: For the benefit of those who were not there, would the right hon. Gentleman repeat what he said in Australia about gold?
    Mr. Jay: I have already made a statement about this matter and J am sure that the hon. Gentleman fully understands it.

    Artificial Heart Valves (Customs Duty)
    Mr. Geoffrey Lloydasked the President of the Board of Trade what steps he is taking to waive the customs duty on improved artificial heart valves being imported from the United States of America as free replacements for a less up-to-date type of valve.
    Mr. Darling: These replacements have presented us with a problem because we have no powers to waive duty on them, but I am considering whether there are grounds for suspending the duty on all imports of artificial heart valves. I hope to make an announcement shortly.

    Central Scotland (Employment)
    Mr. Dalyellasked the President of the Board of Trade what action he is taking to promote development of male-employing factories in central Scotland.
    Mr. Jay: I am prepared to use to the full my powers under the Local Employment Acts to assist the development of male-employing projects in central Scotland. The report published yesterday of my Department's actions under that legislation shows that in the year to 31st March, 1966, assistance totalling £14,120,000 was offered in Glasgow and the central belt of Scotland. Much of the benefit of this has yet to mature.
    Mr. Dalyell: In view of Mr. George Harriman's statement to the effect that it is unlikely that the redundant men will be taken on again at B.M.C. during the next 12 months, can something more be done?
    Mr. Jay: As I am sure my hon. Friend knows, the redundancies at the B.M.C. factory at Bathgate are, happily, comparatively small and many other industrial expansions are going on, including advanced factories, in central Scotland.

    Plant and Machinery (Capital Investment)
    Mr. Hooleyasked the President of the Board of Trade what was the total value of capital investment in plant and machinery in manufacturing industry during the first nine months of this year: and what percentage increase or decrease this represents on 1965.
    Mr. Jay: In the first half of 1966 this investment was £472 million at current prices, and was in volume 3 per cent. higher than the average level in 1965. Figures for the third quarter are not yet available.
    Mr. Hooley: Would my right hon. Friend agree that, from the point of view of productivity, capital investment is of far greater importance than the redeployment of labour?
    Mr. Jay: Yes, Sir, and I am happy to say that private capital investment is still running at a high level, though slightly lower than some months earlier. Fortunately, public investment is still rising substantially.
    Mr. Barber: Will the right hon. Gentleman confirm that the estimates made by the Board of Trade indicate that next year industrial investment will fall by between 7 per cent. and 8 per cent.? Is not this a grave reflection on the Government's policies and does it not go far to stultify the modernisation of industry?
    Mr. Jay: The forecast—and it is only a forecast—reduction is quite small and, fortunately, the increase in public investment greatly exceeds this. Of course, this rate of public investment would never have occurred if hon. Gentlemen opposite had had their way.
    Mr. Barber: Would the right hon. Gentleman confirm that the figures which I gave for manufacturing industry, with which the Question is concerned, are correct?
    Mr. Jay: I am not sure exactly what the right hon. Gentleman said [HON. MEMBERS: "Answer."] It is perfectly clear

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    that the current forecast is for some slight reduction, but this will be offset, on present figures, by the increase in public investment. However, I fully agree that we must watch the figures carefully and that it is essential to maintain the level of private as well as public investment.
    Mr. Barnett: In view of the serious evidence of turn-down of capital investment in the future, which could have disastrous consequences, would my right hon. Friend consider having discussions with the Chancellor of the Exchequer with a view to bringing forward the date of payment of the cash grants, making them payable now instead of people having to wait such a long time?
    Mr. Jay: I advise my hon. Friend not to exaggerate this tendency, which is at present quite moderate. We will watch carefully how it goes before taking further decisions of policy, but, if necessary, we will take them.
    Sir E. Boyle: Is it not a fact that the projections in the National Plan took as one of their principal assumptions the figure of an increase of 7 per cent. for each year in private manufacturing investment? In view of that, is it not clear that the Government should look at their whole policy for private investment—that is, unless the National Plan is to be more of a dead letter than it is already?
    Mr. Jay: Of course, these tendencies should be constantly reviewed, but as I said in my statement, for the first half of this year private investment was higher than last year.

  EDUCATION AND SCIENCE

    Works of Art (Export)
    Dr. David Owenasked the Secretary of State for Education and Science why he did not take the advice of the Gallery directors on the Advisory Committee on the Export of Works of Art when they opposed the proposal to raise the limit of control to £2,000 on the grounds that this increased the chances of items of artistic or historical interest leaving the country.
    The Joint Under-Secretary of State for Education and Science (Miss Jennie Lee): The reviewing Committee on the Export of Works of Art unanimously
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    recommended this change, which was accepted in July. Allowing for the rapid inflation in value of works of art in recent years, the new value limit is still lower than the original recommendation of the Waverley Committee in 1952. May I add that no advice to the contrary was submitted to me by gallery directors.
    Dr. Owen: I thank my right hon. Friend for that reply. Will she consider keeping the limit low, lower than it is now, and not allowing it to rise persistently as it has in the last few years?
    Miss Lee: I assure my hon. Friend that I am keenly concerned to give every encouragement to the regional galleries, and perhaps we could have a talk about it as soon as the report of the Reviewing Committee is out next month.
    Mr. Robert Cooke: How does the right hon. Lady hope to stop the export of national treasures which have no monetary value?

    Head-teachers (Appointment)
    Sir E. Bullusasked the Secretary of State for Education and Science what is his policy in regard to the appointment of known members of the Communist Party to headships in schools for which his Department is responsible.
    The Minister of State, Department of Education and Science (Mr. Edward Redhead): The appointment of head-teachers to maintained schools is in local hands and is not the responsibility of the Department. In my right hon. Friend's view a teacher's membership of a political party should not, of itself, affect the choice of the appointing body.
    Sir E. Bullus: Is the Minister aware that there was much public criticism and opposition to one such appointment recently in the London Borough of Brent and that this is not a question of witch hunting? Is he not aware that there are very many parents who art anxious about the possibility of their children coming under the influence of active Communist Party workers?
    Mr. Redhead: Our view is that the political opinions of teachers are their own private concern, so long as they do nothing which makes them professionally unacceptable; for example, if they were

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    to use their position to propagate their political views in the schools. I am advised that the Brent local education authority followed these principles when making its recent appointment.
    Mr. Rankin: Would my hon. Friend assure the House that teachers who are members of the Tory Party will not be debarred from becoming headmasters?
    Mr. Redhead: The general principle which I have enunciated is applicable whatever be the political opinions of the teachers concerned.
    Sir E. Boyle: While not necessarily disagreeing with the Minister's original Answer, may I ask whether he would not agree that when a local authority turns down an application for a job at a school or college of education on non-educational grounds, it is highly desirable that this should not be done in terms which are prejudicial to the appointment of that applicant elsewhere?
    Mr. Redhead: If I understand the right hon. Gentleman correctly, he is referring to another case, in Derbyshire, about which the hon. Member for Chigwell (Mr. Biggs-Davison) has written to my right hon. Friend. My right hon. Friend is making inquiries of the Derbyshire education authority, and he will write to the hon. Member as soon as he has obtained the authority's reply.

  HOME DEPARTMENT

    Petrol Filling Stations (Revised Code)
    Mr. Gresham Cookeasked the Secretary of State for the Home Department when the revised code for petrol filling stations, with particular reference to the use of the latched cut-off petrol nozzle, will be circulated for the guidance of licensing authorities.
    The Minister of State, Home Department (Miss Alice Bacon): The technical sub-committee which I mentioned during the Adjournment debate on 29th July has considered as a matter of priority the use of latched automatic cut-off nozzles, and has this week agreed on the recommendations it wishes to make to the Standing Advisory Committee on Dangerous Substances. The Advisory Committee will
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    be asked to consider them as soon as possible, and, when its views have been received, my right hon. Friend will decide what guidance can be given to licensing authorities.
    Mr. Gresham Cooke: I thank the right hon. Lady for that reply. Would she ask the Standing Advisory Committee to hurry up with its decision, as the garage trade wants it as a matter of urgency to offset some of the very heavy costs imposed on it by the Selective Employment Tax?
    Miss Bacon: Yes, Sir. We are treating this as a matter of urgency, and seeing to it that the Advisory Committee considers the matter as soon as possible.

    Fraud Squad
    Mr. Whitakerasked the Secretary of State for the Home Department what is the present strength of the police Fraud Squad; and what plans he has for its expansion.
    The Under-Secretary of State for the Home Department (Mr. Dick Taverne): The present strength of the Fraud Squad is 83, against an establishment of 84. No increase is contemplated at present.
    Mr. Whitaker: In view of the growing evidence that, despite several newspapers risking libel actions, large-scale frauds can go uninvestigated until they cause considerable damage, will my hon. and learned Friend consider co-opting civilian chartered accountants to assist the police?
    Mr. Taverne: It is certainly true that the Fraud Squad is heavily engaged, but its establishment was reviewed within the last two years, when it was increased by 20. As my Answer indicated, the Fraud Squad is approximately up to establishment and we do not intend to increase it. I think that the Squad can cope with the difficulties.
    Mr. Hogg: Turning to the substance of the supplementary question, will the Under-Secretary confirm or deny that there are no qualified accountants at present operating in the Fraud Squad as an integral part of its establishment?
    Mr. Taverne: That is a point I shall look at. The Fraud Squad certainly uses expert knowledge, but I will take account of the supplementary questions asked by

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    the right hon. and learned Gentleman and by my hon. Friend.

    Derelict Cars, Willesden (Removal)
    Mr. Pavittasked the Secretary of State for the Home Department if he will take steps to enable the Metropolitan Police force to remove derelict cars in the Willesden area without the long delays which arise at present.
    Mr. Taverne: The police remove vehicles which are causing a traffic obstruction. Otherwise it is for the local authority to remove and dispose of abandoned derelict vehicles. I am assured that, in the Willesden area, the police give all the help they can.
    Mr. Pavitt: Will my hon. and learned Friend accept the gratitude of the people of Willesden for what the police already do? Will he look further at the possibility of enabling the police to do the job more efficiently, not only by means of the Measure now going through the House but by giving instructions which will enable them to move with more speed?
    Mr. Taverne: The Bill that is being promoted by the right hon. Member for Streatham (Mr. Sandys) would certainly improve the position if it were passed in the form that is now proposed. Further discussions are taking place with the Ministry of Transport and the Ministry of Housing and Local Government to make the procedures swifter and more effective.

    Police (Arms)
    Mr. Wingfield Digbyasked the Secretary of State for the Home Department in what circumstances he is now authorising the arming of the police, uniformed and in plain clothes; and what consideration he has given to a general extension of the present authority.
    The Secretary of State for the Home Department (Mr. Roy Jenkins): Arms are available for issue to police officers who are on protection duty or need to carry them for self-defence when engaged on specially dangerous duty, and who have been trained to handle them. I do not contemplate any substantial change in these arrangements, but I am considering, in consultation with the organisations representing the various ranks in the police service, a number of detailed
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    improvements, for example, in firearm training.
    Mr. Digby: While recognising that any general arming of the police would be a retrograde step, is it not possible that the third policeman would be alive today if there had been a gun in the car? Consequently, is there not a case for being a little more generous in allowing those on special and dangerous duties to have guns with them?
    Mr. Jenkins: It is very dangerous to draw hypothetical deductions such as the hon. Gentleman has drawn. I am certainly prepared to look at matters' of detail in this respect, as I have indicated, but my mind—and I think that all ranks in the police force are in agreement—is very strongly against moving towards any general policy of arming the police.

  VIETNAM
  Mr. Zilliacusasked the Prime Minister whether he will represent to President Johnson that Her Majesty's Government cannot support proposals to Hanoi to enter into unconditional negotiations so long as a United States force remains in South Vietnam, since the United Nations Charter prohibits resort to force or threats of force as a means of settling international differences.
  The Prime Minister (Mr. Harold Wilson): No, Sir. I remain in favour of unconditional negotiations.
  Mr. Zilliacus: Is not the Prime Minister aware that, as he himself has said, unconditional negotiations leave the Americans free to propose anything they like, and to threaten the renewal of hostilities if they do not get what they want?
  The Prime Minister: In essence, all unconditional negotiation means is that any party in the negotiations can make proposals, but I feel that if we were to start recommending the attaching of conditions such as my hon. Friend suggests it would be inimical to the prospects of getting the parties round the conference table.
  Mr. Zilliacusasked the Prime Minister if he will give an assurance that Her Majesty's Government, in their capacity as co-chairman under the 1954

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  Geneva Agreement, will reject any proposal for treating the provisional military demarcation line in Vietnam as a territorial or political boundary, which is inconsistent with the agreement.
  The Prime Minister: No, Sir. Our aim is to bring the fighting in Vietnam to an end in conditions which give as many as possible of the people of Vietnam who wish to live in peace the chance to do so. It is not our purpose to insist at this stage on conditions which in the event may hamper rather than help that objective.
  Mr. Zilliacus: Is not this country a party to the 1954 Geneva Agreement which provides that Vietnam is one country, the unity of which must be respected, and is not the Prime Minister prepared to live up to that treaty obligation?
  The Prime Minister: It is precisely because my right hon. Friend is co-chairman under the 1954 Agreement that he has been pressing very hard during his recent visit to North America for unconditional negotiations to bring an end to the fighting. We have declared our view a number of times that any final settlement must be consistent with the 1954 Agreement, but if my hon. Friend is using the 1954 Agreement as a reason for not having unconditional negotiations I cannot think that his advice is tending towards the best and quickest road to peace.
  Mr. Doughty: Does the Prime Minister agree that, difficult as it is to get these negotiations going under the 1954 treaty, they would be even more difficult if it was sought to impose pre-conditions of this kind?
  The Prime Minister: That is what I said. Of course, it is not only the 1954 Agreement that is in question, but the 1962 Agreement. That is why my right hon. Friend made plain, in what I think was one of the clearest sets of proposals for ending this fighting, that we want to see not only the end of the bombing but of the infiltration, and my right hon. Friend set forth some very clear proposals both for the means of getting to the conference table and what, perhaps, might happen thereafter.
  Mr. Winnick: While the war continues, would it be possible for the Prime Minister
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  to ask President Johnson to have respect for the feelings of humanity about the way the war is being conducted by the Americans? Is he aware of the growing horror at the way the Americans are using napalm and other means of killing?
  The Prime Minister: As I have said many times—and I am aware of the growing horror, which I share—the longer the war takes there will be horrible things done on all sides. That is why it is the duty of all concerned to get to the conference table as quickly as possible. When my hon. Friend refers, as he did in an earlier Question, to the United Nations, it is the grim fact that the authorities in Hanoi do not regard this as a matter for settlement by the United Nations. I hope that they will change their mind on that. Her Majesty's Government have made it plain, as did the whole Commonwealth, that we believe that the bombing should cease and, in return, a stop be made to infiltration and the measures taken by the other side in this war.
  Lord Balniel: Is it not a fact that the United States have also offered a timed and phased withdrawal of troops provided the Vietnamese do the same? Could not the Prime Minister make that fact clearly known to his hon. Friend behind him?
  The Prime Minister: All the facts in the matter are well known. It is a fact also that my right hon. Friend has put forward proposals which so far have not been accepted by Hanoi. I hope that they will be. I am not sure that we will necessarily advance the cause of getting the parties round the conference table if we pursue the matter in too much detail. I would rather leave things to follow up the initiative taken by my right hon. Friend.

  HOUSE OF COMMONS (SPECIALIST COMMITTEES)
  Mr. Wallasked the Prime Minister if he will make a statement on the establishment of specialist committees of the House.
  The Prime Minister: Not yet, Sir, but I would hope that a statement can be made to the House soon.
  Mr. Wall: Will the Prime Minister give particular consideration to the establishment of specialist committees for defence

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  and external affairs as these are two subjects which we never have time to debate fully in this House and they affect very much our whole policy?
  The Prime Minister: I am not aware that we do not spend very much time on foreign affairs, both at Question Time and other times, but nothing is ruled out, obviously. I am sure that the Leader of the Opposition would agree that after some difficulties and delay over the past few months good progress has been made. I think it will be possible to say something to the House on this matter very soon now.

  ATLANTIC NUCLEAR FORCE
  Mr. Martenasked the Prime Minister if he is satisfied with the coordination between the Secretaries of State for Defence and Foreign Affairs in pursuance of progress towards an Atlantic Nuclear Force; and if he will make a statement.
  The Prime Minister: Yes, Sir.
  Mr. Marten: That being so, can the Prime Minister tell the House whether an Atlantic Nuclear Force is still a major policy objective of this Government and, if it is not achieved, have the Government any indication of what they might have as an alternative?
  The Prime Minister: As my right hon. Friend and I have made clear a number of times, there is no change in the policy we are advocating here. My right hon. Friend knows the reasons for some delay in this matter and also the prospects for a non-proliferation agreement which we and many hon. Members in this House regard as of paramount importance. There are discussions going on about the future of nuclear planning within the Alliance. This being so, I am sure the hon. Member will agree that it would be right to see what can be done to stop the proliferation of nuclear weapons.
  Mr. Zilliacus: Will the Prime Minister make clear that the Government stick to their view that they will not proceed with an Atlantic Nuclear Force including Western Germany if that means sacrificing the chance of agreement with the Soviet Union on a non-proliferation agreement?
  The Prime Minister: An agreement requires people to be forthcoming on both sides. I agree that some of the discussions with the Soviet Union in Moscow this year have helped us to move a little towards an agreement, but I have made clear that, whatever is proposed in N.A.T.O. for an Atlantic Nuclear Force or anything else, there will be no question of handing over control of nuclear weapons to other nations.
  Mr. Sandys: Is it not a fact that the proposal for an A.N.F. or a M.L.F. has now been generally dropped and it will now be necessary to concentrate on the alternative of trying to improve the arrangements for inter-allied consultation on nuclear strategy on the lines of the McNamara Committee?
  The Prime Minister: Yes. Since the proposals of the McNamara Committee were put forward, we have always expressed very full support for inter-allied consultation and co-operation rather than for any hardware solution proposed in certain quarters. I am glad that the right hon. Member shares my satisfaction that the M.L.F., which I think was supported by the Government of which he was a member, is no longer an active runner.

  RHODESIA
  Mr. Hector Hughesasked the Prime Minister if he will now make a further statement on the negotiations with Mr. Smith about the future status and government of Rhodesia indicating what progress has been made towards securing for all the people of Rhodesia full access to equality of franchise, education and other rights of citizenship.
  The Prime Minister: My hon. and learned Friend will be aware that since the present régime in Rhodesia is illegal there can be no question of negotiations with Mr. Smith. As to the rest of the Question I would refer my hon. and learned Friend to the Answers I gave to Questions on 18th October.
  Mr. Hughes: Is my right hon. Friend the Prime Minister satisfied that this controversy between constitutional legality and illegality is being watched not only

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  by the Commonwealth but by the whole world and may have very important consequences to the British Commonwealth of Nations?
  The Prime Minister: Yes, Sir. Anyone who had sat, as I have done, in the Chair of the Commonwealth Conference for 14 hours a day for 10 days would be in no danger of forgetting the wise words of my hon. and learned Friend, but this is no longer a question of constitution and legality but a question of a return to legal rule on which all parties in this House have insisted, and also a question of honouring the principles on which all parties in this House have insisted with regard to progress to majority rule and satisfaction for the people of Rhodesia as a whole in an ultimate settlement.
  Mr. Heath: When are the Prime Minister and the Commonwealth Secretary prepared to make a full statement to the House about the talks carried on in recent months between the Commonwealth Secretary and Mr. Smith and officials on both sides? I think he will agree that the whole House has been very patient in this matter. When will a full account be given?
  The Prime Minister: I agree that the House has been very patient. Only in the headier air of a seaside town did the right hon. Gentleman let his patience go a little and he made some statements about Rhodesia which are not justified either by the facts or the principles which his party upholds, but I certainly undertake to the right hon. Gentleman that at the earliest possible moment my right hon. Friend and I will make an appropriate statement. I think the House will be aware that Sir Morrice James is on his way back to this country after seeing Mr. Smith this week and we are to have from Mr. Smith his comments on the proposals which have been made. I shall obviously need to study them. The whole House will realise that we are at a critical stage, but I am sure the right hon. Gentleman will carry his patience a few days further. I shall certainly make a full statement at the earliest possible moment.
  Mr. Biggs-Davison: Apart from the legalities, has the Prime Minister observed that the High Court in Salisbury which we all respect—[HON. MEMBERS: "Oh."]—the High Court in Salisbury
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  which we all respect has held that under the present régime there has been no diminution of the rights of citizens under the 1961 Constitution?
  The Prime Minister: I think the hon. Member is not only summarising a 108-page judgment, but over-simplifying it and slanting it a little bit in what he has said. As far as the rights of individuals are concerned, I referred on Tuesday to the proposals now for a constitutional amendment Bill giving chiefs, the paid executives of the Government, criminal jurisdiction. In regard to the judgment itself, I think the Leader of the Opposition was in error and I was in error in attempting in this House to construe that judgment since it is now under appeal. I think it would be better to wait for the appeal to the Privy Council before we try to draw final conclusions as to what the law is.
  Mr. Molloy: Does the Prime Minister realise that the very High Court referred to in the previous supplementary question is now itself under reported threat because of what it said?
  The Prime Minister: I am not aware of any theats to the judges in Rhodesia. There have been rumours and suggestions of this from time to time, but I am not aware of any current threat to their position. I am aware, as the whole House is, that the régime there has given notice of some further amendment—which would be quite illegal—to the 1961 Constitution and which would seriously derogate from the existing human rights, such as they are, in Rhodesia at the present time.

  SCOTTISH TRADE UNIONS (DEPUTATION)
  Mr. Edward M. Taylorasked the Prime Minister why he refused to meet a deputation representing the Scottish trade unions to discuss the economic situation in Scotland.
  The Prime Minister: I did not refuse to see them but suggested that in the first instance they should meet my right hon. Friends the First Secretary of State, the Secretary of State for Scotland and other Ministers from the Board of Trade, the Ministry of Labour and the Ministry of Technology. This meeting took place on 30th September and was, I think, regarded as helpful by those present.
  Mr. Taylor: Will the Prime Minister accept that his speeches on the economic situation at the seaside and elsewhere have given us in Scotland the impression that he has little if any idea of what is happening there, where we have mounting unemployment and a stagnant and declining programme of school and house building? Would it not help for the Prime Minister to show a little courtsey and to hear direct from the S.T.U.C. the facts which his advisers are obviously hiding from him?
  The Prime Minister: I am glad to see that now he is in opposition the hon. Member is paying so much attention to the Scottish T.U.C. because I have had the privilege of addressing its conference several times both in opposition and in Government. The members of the Scottish T.U.C. will be aware, if the hon. Member is not, of the progress which is being made in industrial diversification and the improvement in employment prospects in Scotland compared with the situation two years ago.
  Mr. Noble: Does not the Prime Minister realise that in the past the S.T.U.C. has asked for and been given access to the Prime Minister on many occasions, if not annually, when they were really worried, as they are at the moment? Does he not realise that, after meeting his right hon. Friends, they expressed their disappointment that on this occasion the Prime Minister had refused to see them?
  The Prime Minister: There is no question of refusing. I have in fact met them since we came into Government earlier this year and I have made it plain that I should be very happy to see them, but I thought on this particular occasion it would be right for them to see my right hon. Friends. After that, if they still feel it would be useful to them to have a further meeting with me, I would of course be pleased to see them.
  Mr. Heath: Does the Prime Minister recall that when he last met the S.T.U.C., as he has just told the House, in April he gave them a firm undertaking that the Government would not try to solve their problems by means of unemployment, but as unemployment since June in Scotland has gone up by 15,000 and is now 3 per cent., showing that Scotland has not been shielded from the Government's
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  measures, does he not feel under an obligation to meet the S.T.U.C. and explain the position?
  The Prime Minister: I should be delighted to see the Scottish T.U.C. I think that its members will understand some facts which the right hon. Gentleman obviously does not, because in fact unemployment today in Scotland is lower than it was when the right hon. Gentleman as President of the Board of Trade left office. Unemployment in Scotland today is 20,000 fewer than when the right hon. Gentleman assumed office as President of the Board of Trade. Unemployment in Scotland today is even lower than it was when he left the Ministry of Labour, though the figures at that time were temporarily improved by the 1959–60 election boom.
  Mr. Heath: Will the Prime Minister also recall that the improvement is due to the action taken through the incentives provided during those five years between the time when I was Minister of Labour and President of the Board of Trade? Will the Prime Minister still return to the pledge which he gave the Scottish T.U.C. that there would not be an increase in unemployment? There has been an increase of 15,000. Will he explain that?
  The Prime Minister: The right hon. Gentleman will be aware now that he has left Blackpool and is in the House of Commons. He will also be aware that that might have been the one place where he could get away with, but not here, the statement that everything good that has happened in the last two years is due to the things he left us with. [HON. MEMBERS: "Answer."] I was asked three questions. I am answering them in turn. The right hon. Gentleman's suggestion in his supplementary question was that the improvement in the unemployment situation in the last few years was due to his beneficent work at the Board of Trade. In fact, the advance factory programme, which he did not build but which we have, and the other measures we have taken—[HON. MEMBERS: "What about the increase of 15,000 in unemployment?"] I will come to that in a moment—and the other measures we have taken have led to the most rapid improvement in the unemployment situation in Scotland for very, very many years.

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  I am only suggesting to the right hon. Gentleman that he cannot go on saying that every increase in imports is due to Labour and every increase in exports is due to the Tories, which is the line he has been arguing.
  With regard to the last part of the right hon. Gentleman's question, he has changed his ground between his two supplementary questions. The first time the right hon. Gentleman quoted me as saying in April that we would not seek to solve the problem by unemployment. That is our position. What he is now saying is that I said in April that there would not be any increase in unemployment. That is not what I said.
  Mr. Heffer: Is my right hon. Friend aware that, despite the hypocritical statements from the other side of the House, hon. Members opposite have no right to talk about unemployment? Nevertheless, there are many Members on this side of the House who are deeply concerned at the growth in unemployment, both in Scotland and elsewhere, and we cannot feel happy because it is lower than it was under the Tories. Will my right hon. Friend give us an assurance that this continued growth in unemployment will be arrested and the present trend reversed?
  The Prime Minister: My hon. Friend is perfectly right and I think that the concern that he has expressed—concern about what is happening, about the transitional situation, what is happening in regard to unemployment until redeployment is more effective—is a concern we all share in all parts of the House. I can certainly assure my hon. Friend that the position is being very closely watched. [Laughter.] This is no laughing matter. I will give some figures in a moment to take the grins off the faces of some hon. Members opposite. As I said at the Productivity Conference, having now released resources because everyone knew that this was necessary if we were to be able to deal with our balance of payments problem and strengthen sterling, we want to see the release of resources put, not back into a consumer boom, but into strengthening the economy by investment. It is on this that we have been having discussions with industry and will make a statement as soon as is possible.
  I will certainly take advice from my hon. Friend, who knows a great deal
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  about the unemployment problem on Merseyside over the last few years. I shall not take advice from the right hon. Gentleman, who told us last week that his policy would be that unfilled vacancies should be equal to the unemployed, seeing that in the last three years of Conservative rule, when the right hon. Gentleman was in high office, out of 37 months the unfilled vacancies exceeded the unemployed in only two out of those 37 months.
  Several Hon. Members rose—
  Mr. Speaker: Order. We have already exceeded Question hour. I must point out to the House that during this week both questions and answers have tended to get longer, and this deprived some hon. Members who had put down a Question of the opportunity of putting it to the Minister orally.

BUSINESS OF THE HOUSE
Mr. Heath: May I ask the Leader of the House to state the business of the House for next week?
The Lord President of the Council and Leader of the House of Commons (Mr. Richard Crossman): Yes, Sir, the business for next week will be as follows:
MONDAY, 24TH OCTOBER—Supply [1st Allotted Day]: Committee, which if agreed to, will be taken formally to allow a debate on Redeployment, which will arise on a Motion for the Adjournment of the House.
Afterwards, consideration of the Motion on the Import Duties (General) (No. 6) Order.
TUESDAY, 25TH OCTOBER—Motions on the Prices and Incomes (Commencement of Part IV) Order, and on the Double Taxation Relief (Taxes on Income) (Denmark) and (Norway) Orders.
WEDNESDAY, 26TH OCTOBER—Report stage of the Land Commission Bill, which it is expected will be completed on Thursday, 27th October.
FRIDAY, 28TH OCTOBER—Second Reading of the New Towns Bill, and of the Barbados Independence Bill.
MONDAY, 31ST OCTOBER—The proposed business will be: Third Reading of the Land Commission Bill until 7 o'clock.
Thereafter, opposed Private Business.
Mr. Heath: When will a statement be made about the future of the Ministry of Aviation, so that the uncertainty in the industry can be removed?
Mr. Crossman: I can give no precise time. It will be made as soon as it is ready.
Mr. Dalyell: In view of the recent publication of three major reports on science—the Reports of the Willis Jackson Committee and the Swan Committee, and the first annual Report of the Science Research Council, may we have an early debate on science problems?
Mr. Crossman: We have all seen the arrival of these great reports with interest. They have only just been published. I think that we should give the House time to digest them before we decide to debate them.
Mr. Graham Page: As to the Report stage of the Land Commission Bill, is the Leader of the House aware that his right hon. Friend the Minister of Land and Natural Resources tabled 24 pages of Government Amendments only yesterday? The right hon. Gentleman has tabled another 24 pages of Amendments today. As the Minister gave 67 undertakings in Committee, I suppose there are still more to come. Does not the Leader of the House think that it is something of a contempt of the House to rush on the Report stage of this monstrous nationalisation of land and heavy taxation Bill at such very short notice?
Mr. Crossman: I think it important not to confuse one's personal feelings about the Bill with concern about procedure. We have decided to have two full days for Report and then half a day on Third Reading. I consider that to be wholly adequate.
Mr. Strauss: Can my right hon. Friend now say when he proposes to bring forward his measures for Parliamentary reform?
Mr. Crossman: As I told my right hon. Friend yesterday, I am hoping to have first the debate on the television experiment, which we will get before the end of November. Then the debates on
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the three Reports of the Select Committee on Procedure will follow fairly quickly.
I should like to take this opportunity to remove a misapprehension which, I am afraid, has arisen as a result of my reply yesterday to my right hon. Friend's supplementary question. My right hon. Friend asked me whether the Whips would be off on both these topics and I said "Yes". This answer holds good for the television debate, but in the case of the Reports of the Select Committee on Procedure, where it is likely that I shall be proposing a complex package Motion, I am not in a position to give an omnibus assurance to my right hon. Friend about a free vote.
Dr. Winstanley: Is the Leader of the House aware of the presence on the Order Paper of Motion No. 213, which calls for the continuation of British Summer Time in order to keep us in line with Europe?
[That this House, recognising the success of the experimental extensions to the period of British Summer Time and that reversion to Greenwich Mean Time will unnecessarily hamper commercial communication with Europe, urges Her Majesty's Government to bring Great Britain into line with Europe by adopting British Summer Time, mid-European time, throughout the whole year.]
Is he aware that nobody wants to put the clocks back on Sunday? Will he give us an early opportunity to discuss the matter?
Mr. Crossman: I never believe in the universality of the rationality of human nature, but I know what the hon. Gentleman means. I think that when he has time to read the Answer of my right hon. Friend, he will get reasonable satisfaction from it to the Question which was not reached.
Sir B. Janner: Has the attention of my right hon. Friend been drawn to the present position of the Jewish community in the U.S.S.R.? As 180 hon. Members from both sides of the House have signed Motion No. 99, and the position is very serious there now and is being considered by the United Nations Assembly, will he provide at an early day a debate on that Motion?

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[That this House notes with concern the continuing difficulties confronting Jews in the Union of Soviet Socialist Republics, and calls upon Her Majesty's Government to use its good offices to secure for them the basic human rights afforded to other Soviet citizens.]
Mr. Crossman: We all know of my hon. Friend's passionate interest in this subject, which I share. I shall discuss this with the Foreign Secretary. I should have thought that this is a subject to be raised in our next foreign affairs debate.
Mr. Gibson-Watt: Is the Leader of the House aware that during the past two years only one day has been given for the discussion of Welsh Affairs on the Floor of the House? Could he now tell the House when a day will be given to discuss these matters?
Mr. Crossman: I cannot say. It certainly will not be next week.
Mr. Driberg: Did my right hon. Friend say that the debate on televising Parliament will take place "before the end of November"? Can he be a little more precise and, if posible, a little more urgent—since, if a certain decision were to be taken on a free vote, certain technical arrangements would have to be made before and during the Christmas Recess?
Mr. Crossman: I am well aware of the urgent necessity to get this forward. However, many things have to be done about this. I said "before the end of November" for the reason that my hon. Friend has given. We have to give time to the authorities if we make the decision to take the experiment, on which, of course, a free vote will be taken.
Sir F. Bennett: In view of the continual deterioration of the situation in Gibraltar, can the Leader of the House say when we may expect a debate on this matter? I hope that he will not talk about having no debate while the present talks are going on, because Her Majesty's Government like having time limits and there should be one on this.
Mr. Crossman: The hon. Gentleman can always anticipate the rational when I say it. That is exactly what I will say to him.
Mr. Coe: The Royal Commission on Local Government which my right hon. Friend so sensibly set up as Minister of Housing and Local Government is receiving a lot of new evidence from local authorities and elsewhere. Would he consider it right that the House should have a chance to express its opinion on the reform of local government before the Commission reports?
Mr. Crossman: I cannot consider the possibility of a debate on Local Government before the Commission reports, and as it is not expected to report before the winter of 1968 there is a little time ahead of us.
Mr. Sandys: Will the right hon. Gentleman provide time to debate Motion No. 211, calling for capital punishment for the murder of police and prison officers, which is supported by over one quarter of all hon. Members, including members of all parties?
[That this House, mindful of the special dangers to which they are exposed, calls for the restoration of capital punishment for the murder of police and prison officers.]
Mr. Crossman: I had the impression that the right hon. Gentleman intended to seize an opportunity for a Ten-Minute Rule Bill to test the atmosphere of the House after the great events at Blackpool. If he does not get enough chance in 10 minutes, I suggest that the Opposition give themselves some time to reconcile the disagreement between hon. Members above and below the Gangway.
Mr. English: Now that the premises of the House are under its control, would my right hon. Friend consider instituting the custom of having at least one small debate a year on the activities of the House of Commons Services Committee?
Mr. Crossman: Certainly I will.
Mr. Boyd-Carpenter: Will the Leader of the House reconsider what he said about the Land Commission Bill? Is he aware that this is an immensely complicated Measure? A large number of Amendments are down, and I understand that more are to come. Does he think that it will be satisfactory to deal with a Bill of this importance and complexity in the middle of the night with the aid of Closures and other very unsuitable

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expedients to apply to a Measure of this kind? Will he at least keep an open mind?
Mr. Crossman: The right hon. Gentleman and I have in our time discussed equally difficult Measures. Each time he has expressed the deepest alarm and despondency about the time allocated. In the first half we have gone very slowly and then, mysteriously, the Report stage has been completed in reasonable time. I have a feeling that sanity will again prevail, and that we shall go through very happily on this long, complicated and important Measure.
Mr. Raphael Tuck: Will my right hon. Friend say whether the House will have the opportunity in the foreseeable future of discussing the Brambell Report?
Mr. Crossman: I am aware that my predecessor promised a debate. Consultations are still taking place and we still cannot talk about giving a definite time for it.
Mr. Fisher: The Leader of the House gave rather a frivolous reply to a serious question by my right hon. Friend the Member for Streatham (Mr. Sandys). Does he not consider that a Motion signed by 170 Members of all parties deserves discussion? Even if he does not agree with the Motion, will he give time?
Mr. Crossman: I did not give a frivolous reply, but if the hon. Gentleman wants me to reply not in terms of what happened recently at Blackpool, but in terms of the House, I can see no early opportunity in Government time of reopening a question which the House decided by a large majority on a free vote recently.
Mr. Hastings: On the question of the reform of Parliament, would not the Leader of the House agree that it is the effectiveness of the House about which many hon. Members on both sides have the gravest doubts and that this is more important than televising it? Why does his priority seem to be the other way round?
Mr. Crossman: A priority of time does not mean priority of value. I agree with the hon. Gentleman that the matters we shall discuss when we debate the three Reports of the Committee on Procedure are basically more important than the
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issue of television, but as my hon. Friend the Member for Barking (Mr. Driberg) explained, there are technical reasons why, if we want the experiment, we have to allow the authorities enough time to provide it. That is why I gave temporal priority to something which, I agree, is of secondary importance.
Mr. S. C. Silkin: Can my right hon. Friend now say when the Bill for the reform of leasehold will be published? Will he bear in mind that it is now nearly two years since he undertook to the House that those who are still in occupation of their homes when the Bill became law would have the benefit of its provisions?
Mr. Crossman: I can assure my hon. and learned Friend that the excellent progress which was being made while I was Minister of Housing and Local Government has been accelerated since I left, and that the Bill is now under way.
Mr. Lubbock: Reverting to the question asked by the hon. Member for Barking (Mr. Driberg), does the Leader of the House recall that in the Report of the Select Committee on Broadcasting the Proceedings of the House of Commons all three Chief Whips gave their opinion that an experiment of this kind would be favoured? Is it not therefore a fair inference that the House will come to this decision when the mater is debated? [HON. MEMBERS: "NO, no."] If the right hon. Gentleman agrees with this, could not the television authorities at least be allowed to make such technical arrangements as are necessary to allow the experiment to proceed after the Christmas Recess?
Mr. Crossman: The noise that the hon. Gentleman has heard showed how wise I was not even to consider the possibility of assuming that a Chief Whip of either the Conservative or Labour Parties is as totalitarian in his calculation of public opinion as the Chief Whip of the Liberal Party.
Mr. Tomney: Will my right hon. Friend consider, or reconsider, his reply to the right hon. Member for Streatham (Mr. Sandys)? He must be aware—if he is not, he is completely insensitive—of the tremendous feeling in the country regarding the brutal murder of three policemen, committed in my constituency.

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My right hon. Friend will be tragically overtaken by events if he is not careful. He should give time for this Motion at once. People in the country want the Government and the House of Commons to be given the chance to reverse their previous lunacy.
Mr. Crossman: While I respect the feelings expressed by my hon. Friend in the first part of his question, I cannot accept his views about ourselves in the second.
Sir E. Bullus: I support the request that Government time be found for a debate on that very important Motion in the name of my right hon. Friend the Member for Streatham (Mr. Sandys). May I also ask the Leader of the House to find time to debate a Motion standing on the Order Paper in my name critical of the Home Secretary for rejecting the recommendations of his own Commissioner in regard to the re-warding of boundaries in the Borough of Brent and accepting the Socialist majority's gerrymandering scheme?
[That this House deplores the decision of the Secretary of State for the Home Department once again to disregard the advice of his Commissioner and accept the proposals of a Labour-controlled local authority for ward boundary alterations, in this case for the London Borough of Brent; and further deplores that the Minister should announce his decision within a few days of Parliament rising for the long summer recess, and especially when it would have been more logical to await the decision in regard to the parliamentary boundary alterations for the same Borough.]
Mr. Crossman: Dealing with the second part of the question first, by some miracle I have in my mind the subject to which the hon. and gallant Gentleman alludes, and all I can tell him is that I have nothing to add to the Written Answer given on 11th August by my right hon. Friend the Minister of State, Home Office, which seems to me to be a satisfactory answer which the hon. and gallant Gentleman should accept.
Mr. Geoffrey Lloyd: As unemployment in Birmingham has trebled in the last month, and the motor industry has been thrown into disorder, will the Leader of the House consider having an urgent
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debate on whether the severity of the squeeze on our greatest exporting industry should be relaxed?
Mr. Crossman: It is my impression that the Opposition have selected for next Monday a topic for debate somewhat akin to the one which the right hon. Gentleman mentions.
Mr. Hogg: In view of the widespread anxiety, felt on both sides of the House, about crimes of violence, can the right hon. Gentleman say when the Criminal Justice Bill is likely to come forward for debate?
Mr. Crossman: No, I cannot give a date. I can say that progress is being made. It is a very ambitious and major Measure; it is going forward and will come before the House in due course.
Mr. Pavitt: Will my right hon. Friend find time and opportunity for hon. Members to discuss the hanging of pictures in the Palace of Westminster? Is he aware that in one Minister's room there are 33 Victorian pictures and——
Mr. Speaker: The hon. Gentleman may not discuss the merits of the subject which he raises. He must merely ask for time to discuss it.
Mr. Crossman: I have already said that we shall consider the possibility of a debate on the work of the Services Committee; no doubt, the hanging of pictures falls into that category.
Mr. Peyton: The Leader of the House has dodged the question which was originally raised by my hon. Friend the Member for Crosby (Mr. Graham Page). The very complicated hotch-potch Land Commission Bill is having injected into it at the last minute a series of complicated Amendments. Does not the right hon. Gentleman think that it would be in accordance with the demands of courtesy, if nothing else, that the House should be given adequate time to consider these before coming on to the Report stage?
Mr. Crossman: We have discussed this and considered it through the usual channels, and I am convinced that the time allotted—two whole days for the Report stage and one half-day for the Third Reading—is adequate.
Mr. Peyton: That is not the question. The question is——
Mr. Speaker: Order. Only one question per hon. Member at business question time.
Mr. Hugh Jenkins: Will my right hon. Friend reconsider the extraordinarily vague and imprecise reply which he gave just now on the question of leasehold reform to my hon. and learned Friend the Member for Dulwich (Mr. S. C. Silkin)? Cannot he give the House some more practical and precise information about the Government's intentions in the matter? Will he consider bringing it forward the week after next, if not next week?
Mr. Crossman: No Sir. As a novice in my present responsibility, I know that caution is wise in giving assurances. However, I can go a little further and say that the Bill will be ready in time and will be introduced in this Session. It is there, but it will not come in the next week or two.
Mr. Grant-Ferris: When does the Leader of the House expect to be able to give time to debate the Government's White Paper on Transport?
Mr. Crossman: I cannot discuss this yet.
Dr. David Kerr: In view of the widespread demand from both sides of the House for the liberalisation of some of our laws, will my right hon. Friend consider the reply given by his predecessor to a question I put on progress with the Sexual Offences Bill, introduced by my hon. Friend the Member for Pontypool (Mr. Abse)?
Mr. Crossman: I am hopeful that a reply more satisfactory to my hon. Friend can be given in the relatively near future.
Mr. Longden: I am sorry to delay proceedings further, but the right hon. Gentleman has three times misconstrued a question. We are not complaining about the time allotted for the Land Commission Bill. We are complaining about the short delay between the tabling of Amendments and the Report stage. Will the right hon. Gentleman think about this again?
Mr. Crossman: I have thought about it. I think that the difficulty or differ-
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ence between us is that the hon. Gentleman—I appreciate this—is saying that because of the nature of the Amendments which have been tabled, the interval of time is too short, and he holds very strongly that these Amendments make such big changes in the Bill that we ought to have a longer time. This is a point of argument about the policy of the Bill and the business of the House. We on this side are convinced that that argument is not true and that reasonable time has been given.
Mr. Ogden: Will my right hon. Friend agree that 10 days' notice of future business causes difficulty and inconvenience to many hon. Members? Will he consider trying to extend the period of notice a little, or say what his intentions may be?
Mr. Crossman: I shall give consideration to that, but there are two opposite dangers here. It is nice to know three weeks ahead what business is to be discussed, but it is also good to be fairly topical in what we discuss. We have to bear in mind the advantages and disadvantages of each side there.
Mr. Mayhew: My right hon. Friend referred to decisions on capital punishment taken at Blackpool. Has his attention been drawn to decisions on defence taken at Brighton? When are we to have a debate on that subject?
Mr. Crossman: I think that my proper answer is, "In due course and at the right time".
Mr. Heath: Returning for a moment to the question of the Land Commission Bill, the Leader of the House has said that there have been consultations through the usual channels, but is he aware that the last wodge of Amendments, about 20 pages of the Notice Paper, has been put down since yesterday when the consultations took place at the normal time, and that this, therefore, gives only a very short period for consideration before the debate starts on the Bill next Wednesday? Could the Leader of the House look at this further and also give a clear undertaking that there will not be still further Amendments put down between now and the beginning of our debate?
Mr. Crossman: I was not aware of that fact. We will certainly have further negotiation and discussions through the usual channels, but we are convinced that the time is adequate and will be wisely used.
Mr. Peyton: On a point of order, Mr. Speaker. Would you say whether a Motion under Standing Order No. 9 is appropriate to draw attention to the fact that a Minister has been five times asked a question and has answered another?
Mr. Speaker: The hon. Gentleman will have to ask leave to submit to me a Motion to seek the Adjournment of the House under Standing Order No. 9. I cannot tell him what my answer will be until I have it.
Mr. Driberg: On a point of order, Mr. Speaker. A few minutes ago you said, "One question per Member", which seems fair enough. May I ask you, with great respect, whether you are laying down an absolute and immutable Ruling which will be binding on your successors, since the question I now wish to ask is directed merely to correcting a misstatement of fact by the Leader of the House?
Mr. Speaker: This is a question of practice rather than a rule. If I may, as a precedent, quote myself a year ago, I said then that I did not want to call a second round of business questions unless I was instructed by the House otherwise. I would always accept instructions from the House and, if the House felt that it would be advantageous that the business question period should include any number of questions by an hon. Member, then I would accept the instruction of the House.
So far, the House has concurred in the practice—in my opinion, it is a good practice—to have one question per Member at business question time. Otherwise, the business question period would extend too much into the business of the House. But I am willing to accept correction from the House at any time.
Mr. C. Pannell: Further to that point of order, Mr. Speaker. I remember this question being considered over a long time, and it was the practice of Mr. Speaker Morrison to call only those Members who had risen immediately on the reply giving the business of the week. I
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had a conversation with him about it afterwards. We were thus usually able to get business questions over by about a quarter to four, and we never extended it. But a practice is now growing up for Members to feed on other Members' questions, and without any anticipation. There is abuse here by extravagance. I submit to you, Mr. Speaker, with the greatest possible respect, that some of us feel that you are rather too generous in the allocation of questions at this time of the week.
Mr. Speaker: Mr. Speaker Morrison must have been a very clever Speaker if he was able to recognise at the conclusion of the business statement everyone who had stood at that precise moment. I see no harm in the present practice. It is possible sometimes that the answer of the Leader of the House to an hon. Member may give rise to trepidation or to a desire by other hon. Members to press the Leader of the House on the same issue. If it were to be abused, I would certainly stop that.
Mr. Michael Foot: Further to the point of order. Will you take into account, Mr. Speaker, that although taciturn fellows like my right hon. Friend the Member for Leeds, West (Mr. C. Pannell) may think that you are too generous in allowing us to speak, the rest of us do not?
Mr. Speaker: I thank the hon. Member for Ebbw Vale (Mr. Michael Foot) for completing the double-handed compliment.
Mr. Driberg: Further to the point of order. I am sorry to take up more time. I merely wanted to save the time of the House, Mr. Speaker, by correcting a misstatement by the Leader of the House, because if it is not corrected in this simple and informal way he will, no doubt, wish to come and make a statement to the House tomorrow to correct it, thereby taking up more of the time of the House.
Mr. Speaker: Will the hon. Member say exactly what he has in mind?
Mr. Driberg: It is simply to ask my right hon. Friend whether he is not aware that the hanging of pictures in the Palace of Westminster has nothing to do with the Services Committee, but is the concern of an advisory committee of the Minister of Public Building and Works.
Mr. Crossman rose—
Mr. Speaker: Order. This is a justification of one question per hon. Member.

BILLS PRESENTED
  LONDON GOVERNMENT
  Bill to amend the provisions as to the election and retirement of councillors and aldermen of London borough councils and councillors of the Greater London Council; and for connected purposes, presented by Mr. Roy Jenkins; supported by Mr. Richard Crossman, Mr. Anthony Greenwood, Miss Alice Bacon, Mr. Maurice Foley, and Mr. Dick Taverne; read the First time; to be read a Second time Tomorrow and to be printed. [Bill 116.]
  EXPIRING LAWS CONTINUANCE
  Bill to continue certain expiring laws, presented by Mr. Niall MacDermot; read the First time; to be read a Second time Tomorrow and to be printed. [Bill 115.]
  NATIONAL COAL BOARD (ADDITIONAL POWERS)
  Bill to confer on the National Coal Board certain powers with respect to petroleum within the meaning of the Petroleum (Production) Act, 1934; and for connected purposes, presented by Mr. Richard Marsh; supported by Mr. John Diamond, and Dr. Jeremy Bray; read the First time; to be read a Second time Tomorrow and to be printed. [Bill 117.]
  NEW TOWNS
  Bill to raise the limit on advances imposed by Section 43 of the New Towns Act, 1965; to amend the Land Compensation Act, 1961, and the Land Compensation (Scotland) Act, 1963, in connection with extensions made after the commencement of this Act to the areas of new towns; to repeal provisions of Section 46 of the New Towns Act, 1965, and Section 13 of the New Towns Act, 1946, relating to certain accounts and reports; and for purposes connected with the matters aforesaid, presented by Mr. Anthony Greenwood; supported by Mr. William Ross, Mr. Cledwyn Hughes, Mr. Niall MacDermot, Mr. Robert Mellish, and Mr. Arthur Skeffington; read the First time; to be read a Second time Tomorrow and to be printed. [Bill 118.]
ORDERS OF THE DAY
  LOCAL GOVERNMENT BILL
  As amended (in the Standing Committee), considered.
  LOCAL GOVERNMENT BILL

    New Clause.—('DWELLING-HOUSE' TO INCLUDE CERTAIN PREMISES USED IN PART OTHERWISE THAN AS PRIVATE DWELLING.)
    A hereditament which is not a dwelling-house by reason only of the fact that part of it is used for purposes other than those of a private dwelling or private dwellings shall be deemed to be a dwelling-house within the meaning of the Valuation for Rating Act 1953 in any case where, if that part were a separate hereditament in the same occupation as the remainder of the hereditament and used solely for those other purposes, the separate hereditament would not be liable to be rated.—[Mr. MacColl.]
    Brought up, and read the First time.
    4.4 p.m.
    The Joint Parliamentary Secretary to the Ministry of Housing and Local Government (Mr. James MacColl): I beg to move, That the Clause be read a Second time.
    The Clause arises from our deliberations in Standing Committee. We had discussion then about the possibility that a dwelling-house which was partly used for a non-residential purpose which itself was not rateable might lose its status as a dwelling-house. The hon. Member for Devizes (Mr. Charles Morrison) gave an illustration of one room in a farmhouse being used as a farm office.
    We have given thought to this matter and for the avoidance of doubt we propose the new Clause, which will make it clear that that will not be the effect.
    Mr. John M. Temple: We are all obliged to the Government for introducing the Clause, which will especially clarify the position concerning the rateability of a farmhouse in which it is customary to have a farm office.
    I would like to know whether the Government consider that there are any other non-rateable parts of dwelling-houses other than farm offices to which a Clause like this would be applicable. We are satisfied that the Clause covers the question of the farm office, which my hon.

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    Friend the Member for Devizes (Mr. Charles Morrison) and I brought to the attention of the Standing Committee, but I wonder whether there could be any other non-rateable part of a hereditament
    Mr. MacColl: It was the point put by the hon. Member for Devizes (Mr. Charles Morrison) that particularly carried weight with us. There could, I think, be other examples. Some rather frivolous ones were deployed in our earlier debates, but the farm office in a farmhouse is the substantial example which we have had in mind.
    Question put and agreed to.
    Clause read a Second time, and added to the Bill.

    New Clause.—(SETTLEMENT OF PROPOSALS FOR ALTERING VALUATION LISTS.)
    For the purposes of this Act and of any other Act, whether passed before or after this Act, a proposal to alter a valuation list shall be taken to be settled when an alteration is made in the list so as to give effect to the proposal, or to an agreement made in consequence of the proposal, or when proceedings on an appeal against, or a reference to arbitration relating to, an objection to the proposal (including any proceedings consequent on such an appeal or reference) are finally determined, or when the proposal is withdrawn, whichever first occurs.—[Mr. MacColl.]
    Brought up, and read the First time.
    Mr. Speaker: It is proposed that with this Clause we take Government Amendments Nos. 28, 64, 81 and 84.
    Mr. MacColl: I beg to move, That the Clause be read a Second time.
    This Clause belongs to another Part of the Bill and deals with paving the way for ultimate consolidation, which, I think, on Second Reading the whole House recognised as being wholly desirable. Dotted about the law of valuation are various definitions of what is meant by determining when a proposal for the alteration of a valution list is deemed to be settled. They are contained not only in the Bill, but in the 1955 and 1961 Acts.
    The Clause provides one definition which will make it much easier for the draftsman in consolidation to pick the matter up. The consequential Amendments relate to definitions both in the Bill and in the earlier legislation. The new
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    Clause makes no addition or change. The definition remains the same.
    Question put and agreed to
    Clause read a Second time, and added to the Bill.

    New Clause.—(RATING OF CERTAIN OFFICE PREMISES OF NATIONALISED BOARDS &C.)
    (1) In respect of any rate period beginning after 31st March 1967, an authority to which this section applies shall, notwithstanding anything in Part V of the Local Government Act 1948, section 6(2) of the Rating and Valuation (Miscellaneous Provisions) Act 1955 or section 3(1) of the Gas Act 1965, be liable to be rated in respect of any office premises occupied by the authority which are not situated on operational land of the authority; and accordingly any such premises shall be rated for any such period, and shall be included in the valuation list in force during any such period for the rating area in which the premises are situated, and in every rate made for any such period by the rating authority for that area.
    (2) Valuation officers shall make such proposals under Part III of the Local Government Act 1948 as appear to them to be requisite for altering valuation lists in consequence of the coming into force of subsection (1) of this section.
    (3) This section applies to the following authorities, that is to say, the British Railways Board, the London Transport Board, the British Waterways Board, the Central Electricity Generating Board, any Area Board within the meaning of the Electricity Act 1947, the Gas Council and any Area Board constituted for an area in England and Wales under the Gas Act 1948; and in this section—
    'office premises' means any hereditament used wholly or mainly as an office or for office purposes; and
    'operational land', in relation to an authority to which this section applies, means land which is used for the purpose of the carrying on of the authority's undertaking and land in which an interest is held for that purpose, not being land which, in respect of its nature and situation, is comparable rather with land in general than with land which is used, or in which interests are held, for the purpose of the carrying on of statutory undertakings;
    and for the purposes of this subsection 'office purposes' includes the purposes of administration, clerical work, handling money, telephone and telegraph operating and the operation of computers, and 'clerical work' includes writing, book-keeping, sorting papers, filing, typing, duplicating, punching cardsortapes, machine calculating, drawing and the editorial preparation of matter for publication, and 'statutory undertakings' has the same meaning as in the Town and Country Planning Act 1962.—[Mr. MacColl.]
    Brought up, and read the First time.
    Mr. Speaker: It is proposed that with this new Clause we debate also new Clause 4 (Rating of nationalised industries.)
    Mr. MacColl: I beg to move, That the Clause be read a Second time.
    This is a much more substantial Clause, in more senses than one, and without taking up too much time I will try to explain what is behind it. It affects three industries: gas, electricity and transport boards. In these three industries, it has always been rather a problem to fix the rateable value because of the difficulty of finding comparable property with which to make comparisons. Over a period of time, there has grown up a corpus of decisions on the matter, which, nevertheless, has left feelings of unfairness in some areas.
    The main cause of complaint has been over blocks of offices which are rented from other people away from their operational land. Quite often they may be speculatively built and taken on lease by the industry. Although they are not in any sense intrinsically part of the ordinary rated part on which the cumulo is fixed for rating purposes, they are exempt from rates. This has been a problem which previous Governments have recognised as well as we have, but they have found it difficult to solve.
    The matter arose in Committee, when I rather stalled for time by saying that I hoped that we would have a satisfactory result from the working party which was considering the problem. A general review of the rating of nationalised industries, which was started under the last Government, is still actively proceeding, but there remain considerable differences between the Departments, the industries affected and the local authorities.
    We are not ready yet to propose a fundamental change in the method of valuation and we do not think it is right just to do a temporary tinkering with the formula; there is need for more fundamental study of it. That will become part of the general review of local government finance which is going on in readiness for the conclusions of the Royal Commission. At the same time, we do not want to be accused of what, quite wrongly, we have sometimes been accused of doing—of using general reviews as an
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    excuse for a particular indecision. We do not want to be accused of doing nothing about a particular problem because of the difficulties of the general problem. So we are here proposing a limited change in the law, a change which, though limited, has been very difficult to do and presented very considerable drafting difficulties.
    I am bound to say, in self-defence, that it may well be that when the Bill goes to another place it may be found necessary to make some further alterations in it, but now that the new Clause is published and will be in the Bill there will be opportunity for all those wise people the hon. Member for the City of Chester (Mr. Temple) is in constant touch with to study it and to ring up—not him, but some colleagues of his in another place, and it may be necessary to amend the Bill again. But this Clause at the moment, I think, fairly explains what we are trying to do and, I think, will be more or less effective.
    I should say that there is another matter we have in mind to do if we can get it done in another place, and that is to make some alterations in the distribution formula. This deals with fixing how the total amount of assessment of the industries is divided between rating authorities. The need is to find a new method to take into account some of the recent developments arising from getting methane from the North Sea, and other technical changes which have happened.
    I think that it is clear from this Clause in its present form what we are trying to do. We intend to rate blocks of offices in town centres—offices which are away from railway stations or generating stations or gasworks and functional plant of that kind. We do not intend to impose rates separately on offices at railway stations—such as we discussed in Committee upstairs, the stationmaster's cubbyhole and the small place where the parcels office may be. Those, which are essentially part of the undertaking, will not be rated separately, where they are part of the operational land; but they will be where they are quite separate and, in many cases, performing a different function. Then they will be liable to extra assessment. I emphasise "extra" because this will not reduce the cumulo. It will be in addition to the cumulo, which, as hon. Members know, is the total amount for the industry.
    Mr. David Winnick: My hon. Friend spoke about the difficulties. I am having a careful look at the Amendment which was tabled two days ago, I think, by his colleagues. He referred to the possibility that this might be discussed and a further Amendment made in another place. I thought he had actually said this. Would is be possible now to say whether it would be possible at a later stage to go a little further than the Amendment submitted by the Government? I am sure that he is aware of the fact there is a great deal of concern in certain places, certainly Croydon, on this matter.
    Mr. Frederic Harris: There has been for 10 years.
    Mr. Winnick: Under the hon. Member's Government.
    Mr. MacColl: I was about to explain the limits of the new Clause; I was in process of doing that. I do not think that we are likely to want to extend it beyond this.
    On the other point I was dealing with, I was suggesting that there might be a change. That was in the distribution formula itself. That does not affect the total amount. It is only a question of what goes to different authorities. Although my hon. Friend says it is not perhaps very much, it is going to mean additional rate payments of something like £1 million from the transport Boards and perhaps £2 million by gas and electricity authorities.
    I mention that because if I do not I shall be asked why I did not, but it is a guess: we do not know yet, till we see the valuations, how much it will mean, but the hon. Member for Croydon, Northwest (Mr. Frederic Harris) did once say it would mean 2d. in Croydon and, therefore, I do not think that it can be dismissed as merely a trivial matter, certainly in the case of some of the authorities.
    I think that it would be helpful to the House if I compare the Clause with the new Clause in the name of the right hon. and learned Member for Hexham (Mr. Rippon) and the hon. Member for the City of Chester. As far as I can see the purpose behind both new Clauses is broadly the same. In one respect, I think
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    that the Opposition's new Clause goes further than ours. It is wider open because it deals with any "non-operational" land, not merely offices. I do not think that it is a substantial point because there are not many cases I can think of apart from offices where this is a serious matter, because railway hotels and houses, and offices of gas and electricity boards, are already outside the formula and are assessed separately.
    4.15 p.m.
    Mr. Eric Lubbock: Are engineering workshops included in that list? Are they rated separately at the present time?
    Mr. MacColl: Well, I should think that they were not, but I will certainly have that looked at and information obtained. I should have thought they were part of the operational land of the undertaking, but I will have it looked at and let the hon. Member know.
    Where I think our Clause is broader than the Opposition new Clause is in that ours is not limited to "land contiguous with" or "land not contiguous with". Compare the stationmaster's cubbyhole with the purpose-built block of offices in a separate part of the town; that is the distinction. The effect of the Opposition's new Clause would probably be that where any office building is backing on to the railway line it would come within the being contiguous with operational land, and therefore would not be rateable. We think it should be rated, if it is in fact a quite separate thing. Therefore, in that respect, I think that our Clause probably has advantages over the Opposition one.
    Now, for a moment I had better deal in rather more detail with our Clause. Subsection (1) provides that office premises of the authority which are not situated on the operational land are to be rated from 1st April next. Subsection (2) requires valuation officers to make proposals under Part III of the Local Government Act, 1948, to include those premises in valuation lists. It puts the burden on the valuation officers to take the initiative.
    Subsection (3) is the interpretation subsection and provides that the Clause is to apply to the listed authorities. It

    423
    defines the expressions "office premises", "operational land", "office purposes", "clerical work", and defines the undertakings for the purposes of the Clause. Hon. Members who delve in these rather complicated matters will recognise some of these definitions. The definition of "office premises" we discussed on the Control of Office and Industrial Development Bill which is now the Act of 1965. It is comparable with the definition there. "Operational land" was defined in Section 221 of the Town and Country Planning Act, 1962, the consolidating Act. "Office purposes", again, comes under the 1965 Act, Section 15, and so does "clerical work". "Statutory undertakings" were defined under the 1962 Town and Country Planning Act. One item in Section 221 of that Act defines "statutory undertakers".
    By some strange good fortune, I am able now to deal with the point raised by the hon. Member for Orpington (Mr. Lubbock). Engineering workshops which are an integral part of the railway network are not separately rated. If they are quite separate and not part of the network, I suppose that they might be in a different position.
    Those are the main points to which I wish to draw the attention of the House on this Clause. Every Government have found it an extremely difficult and complicated operation both from the point of view of drafting and of getting agreement. We do not say that this is the final answer, but it is a valuable and important aid to local authorities which we want to get done now. That is why we have recognised its urgency and taken steps to introduce it into the Bill.
    Mr. Speaker: May I announce to both sides of the House that I have received a request for the separation of Amendments Nos. 38 and 39 from the hon. Member for the City of Chester (Mr. Temple), and I have acceded to his request.
    Mr. Frederic Harris: I thank the Minister for what he has told the House today. I might say at the outset that I had prepared some notes in support of Clause 4 which I have now been able to curtail considerably since new Clause 6 appeared on the Notice Paper.
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    Like all of my hon. Friends who are deeply concerned with the matter, I am delighted that the Government have decided to bring forward this very important Clause today. They have decided to adopt the principle which we have been advocating for many years, and for which I and my colleagues have fought for a long time, that the offices of nationalised industries should pay their full rates, just as any other commercial undertaking does.
    This is the third specific occasion on which I have raised the matter. You will recall, Mr. Speaker, that in 1961 I moved a new Clause to the Rating and Valuation Bill, under which I tried to provide for the rating of administrative offices covering the very gas and electricity undertakings to which the Minister has referred and, in addition, the Railways Board. The then Minister of Housing and Local Government, Mr. Henry Brooke, as he then was, indicated that he accepted that there was a problem and well remembered that I had raised it previously during the course of the Local Government Bill of 1958. At that time he suggested that on some suitable occasion after the 1963 valuations had come into effect, that weakness in the formulae would need looking at again.
    It is three and a half years since those valuations were first published. As no progress had been made, I raised the matter again in the House during an Adjournment debate on 26th February, 1965. I recall that that debate was most courteously answered by the Joint Parliamentary Secretary at the Ministry. In his reply, he asked me and the ratepayers of Croydon who were very much affected by the matter to be patient. At that time, I thought that it was a reasonable request, because the hon. Gentleman had only been in office for about four months. But when a further 18 months had passed, it came as a shock to those of us who are closely concerned to learn that this anomaly was not the subject of amending legislation in the new Local Government Bill.
    I must say that my hon. Friend the Member for the City of Chester (Mr. Temple) has done sterling work while he has been serving on the Standing Committee dealing with the Bill. We appreciate it very much, and I feel that he

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    should be congratulated by all hon. Members who are interested for the work that he has done in bringing the matter constantly to the attention of the Minister and the Committee. On behalf of Croydon and my colleagues in Croydon, I should like to express our indebtedness to him for what he has undertaken. Without question, he has brought out all the facts right the way through our discussions.
    It was undisputed that there was great unfairness in the rating of nationalised industries, and it will be appreciated why I am so pleased with the outcome after what has been a long drawn-out battle.
    If I may say so to the hon. Member for Croydon, South (Mr. Winnick), it was in 1958 that the Conservative Government managed to get the showrooms of the nationalised industries rated separately, but we were unsuccessful in getting their offices rated separately at that time. When we got the showrooms through, it was claimed with justification that the nationalised industries were getting unfair trade allowances by way of overhead expenses against their private enterprise competitors.
    I hope that we are right in assuming now that the Clause which the Government have introduced means that the offices of nationalised industries will, from 1st April next, be rated exactly on a par with other commercial undertakings. I assume that that is what the Minister is confirming to us today. If there is any doubt about it, I hope that he will be allowed to resolve it later. I am anxious to be assured that the advisers of the nationalised industries cannot attempt subsequently to avoid the liability by some technicality, although I understand that it is a complex Clause and must be subject to further amendment in another place.
    If it be correct that such offices separated from the undertakings and situated in the centres of our towns will be rated separately from 1st April next, as happens in the case of any other commercial undertaking, it goes 90 per cent. of the way to meet our problem in Croydon, where we have had large blocks of new office buildings erected since the end of the war by what I claim is a very progressive town. Many of those offices have been taken over by nationalised
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    industries, and no rates have been paid separately in respect of them.
    I have calculated that that has meant a loss to Croydon alone of a rateable value itself exceeding £300,000, which, in cash rates on the present rateable basis, represents about £173,000 a year, or a rate of 2¼d. in the £. That has directly affected every ratepayer in the town. The offices referred to have been occupied by British Railways and the electricity and gas undertakings.
    On the face of it, the Clause goes a good 90 per cent. of the way towards meeting the problem, and it is no small measure for us. I hope that the Minister can tell us that the Government clearly have in mind that they intend that all properties of nationalised industries should pay full rates on exactly the same basis as those of commercial undertakings do. In that connection, I am thinking in terms of generating stations, gas works, railway goods yards and premises of that kind.
    I am anxious to see that all ratepayers, whether private or commercial, should have the assurance that it is now the intention of the Government to complete the job that they have started and make certain that there can be no ratepayer injustice operating in favour of the nationalised industries.
    I am very pleased with the present decision, but I hope that the Minister will have an opportunity to respond to this invitation and say what else the Government have in mind to complete the task. I thank the Minister for moving the Clause.
    4.30 p.m.
    Mr. Temple: Mr. Speaker, I am obliged to you for calling me now. It had been my intention to rise rather earlier, but I was answering a question which you put to me, and, therefore, did not realise that I had the opportunity of speaking on this important situation.
    There are two new Clauses before the House dealing with this difficult subject of the rating of the offices and other hereditaments of nationalised industries which are not necessarily part of the operational land of those industries. I apologise to the House for using this rating jargon to which, unfortunately, we became so accustomed in Standing Committee.

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    I should like to pay a real tribute to the tenacity of my hon. Friend the Member for Croydon, North-West (Mr. Frederic Harris). He has pursued this matter relentlessly for many years, and today is a day of triumph for him, because the Government have brought in a new Clause, even though it is twice as long as the new Clause with which I am associated, and not quite as effective.
    The hon. Member for Orpington (Mr. Lubbock) asked whether railway workshops, if they were separate from the operational land of a railway or other undertaking, were rateable. I think that I can agree with the partial assurance which the Joint Parliamentary Secretary gave, in that at present they are not rateable. My Clause is drawn in much wider terms, and, if it were accepted, it would apply to railway workshops, and, indeed, the workshops of other nationalised industries, stores, sports grounds, and car parks which are not part of the operational land of those undertakings. This is why, in many ways, I would prefer the Clause with which my name is associated, and which is half as long as the Government's Clause.
    I was glad that the Minister was able to give an assurance that the cumulo value of the whole of these undertakings would not be affected by the operation of this Clause. I must admit that I had thought rather the reverse, but it is not a matter of great moment.
    I draw particular attention in my Clause to a rather different terminology. I seek to identify all hereditaments which are not part of the operational land of the particular undertaking as hereditaments for which there is a general demand or market. This term is well known in law, and it means all those other types of hereditament to which I have referred for which there is a general demand or market. There is a general demand or market for car parks and for any type of office accommodation. Equally, there is a general demand or market for a sports ground, but there is not a general demand or market for an electricity generating station, for a railway track, for a station associated with the railway, or for an office which is definitely part of the railway station.
    During our discussions in Standing Committee I undertook to produce a more
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    sophisticated Clause to deal with this problem. I produced my Clause about two weeks ago, and I think it fair to say that the Government tabled their Clause about 48 hours ago. They have, therefore, had an opportunity of looking at my Clause. If they cannot take it over today, they might at least look at the added breadth which it would bring to this situation, as they have given an undertaking to look at some of the details of this position between now and the time when the Bill receives the Royal Assent.
    I always think that it is interesting to look at the general position surrounding a problem when it is being discussed in the House, and also at the particular position in any one locality. With regard to the general position, there is no doubt in the minds of local authorities that these nationalised industries are not making anything like a full contribution to the rate burden which is being borne by all ratepayers throughout the country, and I think I might stress that either of these new Clauses will be of substantial benefit to all ratepayers, that is domestic, commercial and industrial ratepayers.
    It has been reliably estimated that the electricity industry's rateable value for cumulo purposes is £51 million, whereas its true rateable value, that is judged on the normal assessment of a valuation officer, is between £100 million and £170 million. The present rateable value of the gas industry is £10 million, whereas it is reliably estimated that the true figure should be £13 million to £17 million. With transport, the difference is even more glaring, no doubt because transport is one of the oldest of our service industries, particularly the railways. The present rateable value is a derisory £5 million, whereas it is estimated that the true figure should be £40 million, about eight times as much.
    The Minister has given an undertaking to look at the formulae. I hope, therefore, that he will have regard to these global figures which are so important in the context of achieving a true apportionment as between the rateable value of the nationalised industries, and the rateable value of all other industries in this country.
    I said that when looking at a problem in this House it was interesting to look

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    at the general, and to look at the particular. With regard to the particular problem, I must admit that when I first became associated with this matter I had no idea that it would have such an affect on the City of Chester, which I have the honour to represent in Parliament, but a decision has been made by the Mersey-side and North-West Electricity Generating Board to group four of its major sub-area offices together and bring them within the rating area of the City of Chester.
    That will mean an increase in the office staff in Chester of about 1,500 office workers. This, in itself, is pretty considerable, but when gets down to the figures of the possible assessment and value of the new office block which is being erected in the city, one finds that its estimated cost is about £2 million, and the rateable value, taking a 4 to 4½ per cent. return on capital, which is very modest at the present time, is £70,000. At a rate of 10s. in the £ the actual contribution in rates would be £35,000 a year, which is equivalent to a 3d. rate in the County Borough of Chester. I have assumed a 4 to 4½ per cent. return on capital, but any ordinary developer at the present time would assume a return of 8 to 10 per cent. on capital, nearly double the figure which I gave. If an ordinary office block of a similar nature were erected in the City of Chester, the extra rates to be paid to the City would be the equivalent of a 5d. to 6d. rate. There is no doubt that if either of these Clauses is accepted it will have a substantial effect, and I would say an effect which in all equity the House should accept.
    I gave that example from my area to highlight the importance of this matter. I should like to express my gratitude to the Joint Parliamentary Secretary for the way in which he has dealt with this problem. I recognise, and have done for a long time, that this problem was not easy of solution. I understand that the working party has been considering this matter for some time, and I am glad that, contrary to the promises of the erstwhile Minister of Housing and Local Government, though this matter was not able to be dealt with in Committee, it will be dealt with on Report.
    I believe that the Clause with which I am associated is rather more all-embracing and does the same thing as the
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    Government's Clause does but in a slightly more far-reaching manner. Nevertheless, I advise my right hon. and hon. Friends to accept the Government's Clause if the Government do not make a decision to accept the new Clause to which I am speaking.
    Mr. R. B. Cant: I do not want to delay the House unduly, but I agree with the hon. Member for City of Chester (Mr. Temple) that there is something slightly hazardous in trying to speak on these occasions. I hoped to speak on new Clause 16, which has not been selected. I then proposed to support new Clause 4, which, perhaps fortunately, has been linked with new Clause 6, and this, I hope, prevents my getting a local newspaper headline to the effect that I am supporting a Tory Amendment. I now find that the hon. Member for City of Chester has made most of the speech which I intended to make. We must have read the same pamphlet. Ho quoted the same figures as I had it in mind to quote.
    May I make a gentle non-technical point in saying that I am supporting the Amendment not because I am concerned about any commercial or industrial interests which may exist in the city, part of which I represent, but because I am an unavowed municipal Socialist and I am quite prepared to support anything which will improve the finances of the city to which I belong.
    So much has happened to erode the basis of the rating system in the past few years that if we can possibly make this very small movement forward in terms of increasing the amount of money which nationalised industries have to pay, then let us make it with very great thanks. I certainly agree with the figures mentioned by the hon. Member. I hope that when the Working Party reports it will encourage the Minister to adopt full-scale rating of nationalised institutions.
    I made an inquiry through the usual channels to find out whether I could see a copy of the Working Party's Report. I was told that the job of the Working Party was done and that the Report existed but that it was secret, classified information. It is strange that we can get the local authorities' point of view; in the March supplement to the Municipal Review the local authority evidence to this Working Party is laid out.

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    Presumably, the bone of contention lies with the boards of nationalised industries. Of course, my information may be wrong. The Report of the Working Party may not be concluded. Perhaps I have been misled.
    I rise only to say, let this just be the first step in the full rating of nationalised industries because I believe that it is right that they should pay this rate. They are great economic institutions, many of which are making substantial, not profits, but surpluses, and anything which will increase the finances available to local authorities on this basis I will support. I therefore agree with this proposal.
    4.45 p.m.
    Mr. Lubbock: I agree with every word that the hon. Member for Stoke-on-Trent, Central (Mr. Cant) said. He made a valuable contribution, and one which my party accepts completely, for he hoped that it was only the first step in extending the rating system so that it covers all hereditaments owned by nationalised industries.
    One of the features of our present cockeyed rating system is that where we depend on getting an annual value it is quite impossible to compare a railway line with an ordinary hereditament owned by a commercial firm or a private individual. While we have to put up with the present rating system, it may never be possible to compare an electricity generating system or a railway line with other kinds of hereditament which are subject to the normal rates, but—and here I agree with the hon. Member for the City of Chester (Mr. Temple)—I think that we could have gone a little further than does the Government's new Clause, in which we are concerned only with offices, for there may be many other types of property which are directly comparable with those already in the rating lists.
    I happened to mention one, and the Minister was not able to answer straight away. He told me rather cautiously that if an engineering workshop were part of a nationalised undertaking or operated together with it, then it probably was not subject to rates at present. I was thinking at the time of the railway workshops in Derby, which are extremely large and extensive. It would be interesting to know whether they make their proper
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    contribution to the rates of Derby. The hon. Member for the City of Chester shakes his head, and from the Answer which the Parliamentary Secretary gave me I am inclined to think that they do not. I cannot see why there should be this difference between the office properties which are already dealt with in the Government's new Clause and the other types of hereditament which are directly comparable with properties operated by commercial undertakings which are already in the rating list.
    The hon. Member made a most admirable speech explaining the new Clause to my entire satisfaction. He also gave some hint that in another place it may be possible even to alter the terms of the new Clause and to extend it to the other types of hereditament, and I hope that their Lordships in another place will take that hint and will consider the type of property which I mentioned—the engineering workshops which are operated by the nationalised industries.
    One thing which the hon. Member said rather worried me. He said that a general review of rating of the nationalised industries was in progress and—I hope that I am not misinterpreting him—that this would become part of the work of the Royal Commission on Local Government If that is true, it means that after the Bill goes on to the Statute Book, any further alterations will have to wait for many years, because the Royal Commission has to report and then legislation consequent upon its findings must be drafted and brought before the House. Unless we nail the Government—I do not mean that in an unpleasant sense—and pin them down while the Bill is passing through another place, we may have lost an opportunity for several years. I hope that when he winds up the debate the Parliamentary Secretary will make it clear whether this general review of the rating of nationalised industry has been transferred to the Royal Commission on Local Government and whether any action on it by the Government will have to wait until the Report is received and the consequential legislation is drafted.
    I have only one point of criticism to make on new Clause No. 4, introduced by the hon. Member of the City of Chester. I would have agreed with it entirely except for the word "contiguous". I do not see why he put that in. It does not

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    seem to me to make any difference whether the hereditament about which we are talking happens to be adjacent or contiguous to operational land occupied by the nationalised undertakings. If we are to extend the rating system so that it applies to all properties which are comparable with those already in the rating list, this should be an invariable rule and the geographical location of the offices, workshops or whatever they may be is of no importance.
    That apart, I agree with the principle behind new Clause 4, and I hope that it will be taken up in another place and that there will be this extension which I have mentioned to all the other kinds of property which they own and which can be compared with other properties which are already in the rating list.
    Mr. Bernard Weatherill: I am glad to join with hon. Members on both sides in thanking the Government for their new Clause, which goes a long way towards meeting the case we put in new Clause 4. I hope that the House will forgive my mentioning Croydon again, not only because I have the honour to represent part of it, but also because, of all places in the country, it is the most affected because of the large number of nationalised industries which have recently come within its boundaries.
    One of the things I have learned since becoming a Croydon M.P. is that the ordinary citizen of the town is intensely proud of its long history and that even now most Croydonians rather resent being part of London. My hon. Friend the Member for Croydon, North-West (Mr. Frederic Harris) epitomised this case during the passage of the London Government Act in so far as it reduced the status of Croydon as a county borough. I am glad to have this chance of saying how much his courageous advocacy of Croydon's interests is admired in the town. I also thank my hon. Friend the Member for the City of Chester (Mr. Temple) for what he has said. But it is equally fair to say that the victory, such as it is, belongs to my hon. Friend the Member for Croydon, North-West, who has, as has been mentioned already, raised this matter many times in the House.
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    With that kind of background, the House will understand that the popular acceptance of the revamping of Croydon was not easy. The fact that East Croydon station is only some 15 minutes from London Bridge or Victoria made Croydon a particularly appropriate place as a site for city offices. The redevelopment of the town was largely "sold" to the ratepayers on the belief that there would be a considerable increase in the rateable value in the borough and a considerable contribution to the rate fund.
    So the redevelopment was carried out, and since then we have had an invasion of non rate paying industries into the borough. Not only do they occupy premises which would have yielded, as my hon. Friend mentioned, over £173,000 a year at a 2¼d. rate but also—and this is important, too—they compete commercially in a number of ways with local businesses saddled with the obligation of having to pay full rates.
    I therefore join my hon. Friends in thanking the Government for what they have done in putting this matter right to a degree. It was obviously unfair that nationalised industries should occupy premises for which there was a general demand and should not pay the same rates as any other commercial undertaking. It was obviously unfair that any local authority should lose revenue which it otherwise might have had and that local citizens should have to pay increased rates for the privilege of having nationalised industries within their area. It was equally wrong that nationalised industries, often in competition with local traders, should have had this advantage over their competitors.
    The first step, as my hon. Friend mentioned, in putting this unsatisfactory state of affairs right was taken in 1958, when gas and electricity showrooms were rated on a commercial basis. This is the second step. The third logical step is to accept the whole of our new Clause 4 so that all property occupied by any nationalised industry is separately rated.
    I am naturally gratified that the Government have gone as far as they have. I do not think that the citizens of any borough should be asked to subsidise any nationalised industry that happens by chance or misfortune to come into their midst. As someone once said, if Par-

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    liament wills the end it is up to Parliament and not the local council and the ratepayers to will the means. I am glad that the Government have gone as far as they have and I hope that, in the long term, they will go the whole hog.
    Sir Stephen McAdden: As you know from long experience, Mr. Deputy Speaker, I shall not delay the House for long. I apologise to the Minister for the fact that I was unable to be present when the Government's new Clause 6 was moved because of circumstances beyond my control, and also because I had in any case no idea that it was to be moved at all. I am delighted to see that it has been moved and that it has so far met the arguments which have been advanced over many years by my hon. Friend the Member for Croydon, North-West (Mr. Frederic Harris).
    I would have said that this must be the happiest day of his life but I was best man at his wedding and I know that there have been happier days for him. Nevertheless, I am sure that he has derived great satisfaction from the step forward which has been taken, largely as a result of his initiative. If I ask a question it is only because I want further information. I am not sure whether Her Majesty's Customs and Excise is a nationalised board or not. It happens that one of the most magnificent buildings in the county borough of Southend-on-Sea is, I am glad to say, occupied by H.M. Customs and Excise. I do not know whether it makes any contribution to our rates but if it does not I hope that it will.
    If new Clause 6 is a step in the right direction, I hope that, in due time, all Government offices may be persuaded to make some contribution to the rates of the areas in which they are situated. After all, local ratepayers put themselves out to help them when they come locally through the provision of housing and so on. I hope that this will be brought within the ambit of the Bill.
    I do not want to prolong the debate, but I express my thanks to the Minister. I am glad to be able to congratulate him. It is the first time I have had the pleasure of addressing the House since the right hon. Gentleman's appointment, and I am glad to be able to agree with him. I cannot guarantee that that will persist over a period of months, but it is good to start off on a nice footing. I hope that
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    our happy association outside the House will also apply during his period of office, at least for a short while.
    Mr. MacColl: I thought that the hon. Member for Southend, East (Sir S. McAdden) was thanking me, and I was preparing, in a blushing way, to acknowledge his thanks. However, he then made it clear that he was thanking my right hon. Friend. I did begin to wonder during the debate who had put down new Clause 6. We had the hon. Member for Croydon, North-West (Mr. Frederic Harris) praising the hon. Member for the City of Chester (Mr. Temple) for his sterling work. The hon. Member for the City of Chester thanked the hon. Member for Croydon, North-West for his relentless pursuit. The hon. Member for Croydon, North-East (Mr. Weatherill) at least said that he was glad that the Government had gone as far as this, but still implied that the whole thing had been done by the Opposition.
    I do not want to be ungenerous, but I was reminded of the old saying about the National Health Service. It was said that the Conservative Party had been fighting for the National Health Service for years. But who had it been fighting? After all, it is the Government who have produced this Clause, and that is surely deserving of recognition.
    The hon. Member for the City of Chester said that his new Clause 4 would have gone much further, that it was half as long and twice as broad. But that is not so. I did not make drafting points about it when I spoke earlier, but there are drafting difficulties in it which would probably draw its teeth, while, in a major aspect, as I have pointed out, it is consciously different from new Clause 6 in that it would not bring into separate rating the office property contiguous to operational land. That is an important weakness.
    I want to make the Government's position clear. I do not think that there is any chance of our getting in this Bill an agreed decision on the wider issue to which hon. Members have referred. Indeed, I suspect that it will take a good time. I did not say that it would be left to the Royal Commission. I said that a working party was reviewing finance in preparation for the Royal Commission's Report.

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    My hon. Friend the Member for Stoke-on-Trent, Central (Mr. Cant) asked about the report of the working party. There are two working parties. One is a joint working party, representing the interests of local authorities, nationalised industries and Departments, and is the one to which I referred. That has not yet reported, but informal working parties of this kind do not normally make formal reports. If they did make formal reports available for Parliamentary scrutiny, that might somewhat handicap the frankness with which views were exchanged. The working party has reported, but its report is a confidential document. It was a purely Departmental Committee, a working committee within the Government.
    5.0 p.m.
    The hon. Member for Southend, East (Sir S. McAdden) asked about Customs and Excise. The building which he mentioned is Crown property and not the property of a nationalised industry. Although constitutionally exempt from paying rates, Crown properties in fact make a contribution in lieu of rates of the same amount as the rates would be.
    Every hon. Member who has taken part in the debate has spoken of the nation alised industries paying no rates. That is not correct. What happens is that the rates are collected en bloc in cumulo and that cumulo is distributed according to a formula, which we are now considering and about which we hope to do something in the Bill, to the local authorities. The nationalised industries would indignantly deny that they were not paying rates. It is the view which local authorities understandably take——
    Mr. Cant: I certainly did not give the impression that nationalised industries paid no rates. The figures given by an hon. Member opposite indicated the precise amount of rateable value on which rates were paid.
    Mr. MacColl: That is quite true, but there was a good deal of talk about buildings being erected and then no rates being paid on them. It is only fair to the nationalised industries to make it quite plain that what happens is that they have a formula different from that for the ordinary rated hereditaments and pay their "whack". Naturally, local authorities would like them to pay more and
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    they think that they are paying too much, which is one of the difficulties.
    I am glad that the new Clause has had a cordial welcome, because I believe that it will be a useful addition to the Bill and will be a considerable help to some local authority areas.
    Question put and agreed to.
    Clause read a Second time, and added to the Bill.

    New Clause.—(CONTRIBUTIONS BY COUNTY COUNCILS TO DISTRICT COUNCILS AND NON-COUNTY BOROUGHS CLAIMING TO BE HIGHWAY AUTHORITIES.)
    District councils and non-county boroughs claiming to act as highway authorities shall be entitled to receive from county councils a contribution under section 237(1)(b) of the Highways Act 1959 to the cost of providing a lighting system equal to the full difference between the amount of the capital grant to which they may be entitled to receive from the exchequer towards the cost of such a system and the total cost of the system.—[Dr. Winstanley.]
    Brought up, and read the First time.
    Dr. M. P. Winstanley: I beg to move, That the Clause be read a Second time.
    This new Clause deals with the position of those urban district councils and non-county borough councils which are loosely known as "claiming authorities", I do not know whether there is any statutory significance in the phrase, but it is used in correspondence by both the Ministry and the authorities themselves. They are claiming authorities in the sense that by virtue of having a population of more than 20,000, they have been able to elect to claim to be highway authorities and have these powers delegated to them by the county council.
    It appears that the new situation arising from the Bill will penalise these claiming authorities as against those other authorities which have had such powers delegated to them, and the Bill will therefore produce a distinction which it was probably not intended to create. It will produce and perpetuate a distinction between two types of local authorities responsible for lighting, particularly a distinction in financial responsibility.
    There seems to be little doubt about this. In correspondence which I have had with him, the Parliamentary Secretary to the Ministry of Transport confirms that the effect of the Bill will be to make

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    the provision and maintenance of road lighting a function of the highway authority. For "unclaimed" county roads in non-county boroughs and urban districts the highway authority will be the county council and the non-claiming urban authority will therefore be relieved of its financial responsibility for all lighting except footway lighting as defined in the Bill. The county council may delegate responsibility for lighting to the borough or district council, but in that case the county council will retain full financial responsibility and the second tier authority will simply be acting as its agent. But claiming authorities are highway authorities in their own right for county roads within their own area and are therefore financially responsible for any lighting provided by them on county roads.
    I doubt whether it was intended to produce that distinction. It is an undesirable distinction and I would have thought that we would not wish to do anything to inhibit local authorities from taking more powers unto themselves. I would have thought that it was the intention of the Government to see that local authorities played as full a part as possible in all the various activities which could possibly come under their control. But while there remains a clear and definite financial disincentive so to do, I would have thought that it would have undesirable effects. It is unfortunate that merely by having claimed under previous legislation to exercise these functions, these authorities should be financially penalised, whereas if they had not claimed but merely had these functions delegated to them by the county councils, the county councils would have continued to be financially responsible.
    There is no doubt about the effects of this provision. In his letter to me the Parliamentary Secretary said:
    "… claiming authorities will still have to meet some of the costs of road lighting from the rates…".
    This may not be the case in the next door authority.
    This matter was first brought to my attention by the treasurer of an urban district council in my constituency, but inquiries have shown me, as no doubt they have shown others, that many authorities are concerned. The matter has been discussed in many places,
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    although it was not discussed on Second Reading or ventilated in any detail, ii mentioned at all, in Committee. The new Clause therefore deals with an entirely new issue, with an undesirable anomaly which will arise with the passage of the Bill unless specific provision is made. The new Clause makes that provision and would remove the anomaly and make the situation much more satisfactory, and I hope that it will be accepted.
    I have been informed that some county councils have written specifically to claiming authorities to inform them that as an act of grace they will defray any financial burden and will make grants direct to certain claiming authorities in order to deal with this anomaly. That may be the case with one or two county councils, but it is undesirable that it should be left to the whim of county councils to decide to take that choice. It would be much better for the Minister to make it quite clear that this is a matter of policy and in regulations or by amendment or in some other way to provide that this should happen automatically and not merely as an act of grace.
    The Joint Parliamentary Secretary to the Ministry of Transport (Mr. John Morris): I am grateful to the hon. Member for Cheadle (Dr. Winstanley) for the way in which he has moved the new Clause, which deals with a most difficult matter about which he has had some corresponce with my hon. Friend the Joint Parliamentary Secretary. He was right to say that the county will remain financially responsible for works delegated to non-claiming authorities. We say that that is a perfectly right position. He then sets out the difference between when the work is delegated by the county authorities and when, on the other hand, an authority exercising the power is a claiming authority. The difference lies in the fact that a claiming authority is the highway authority for county roads in its area and will have the powers of decision on lighting on county roads and for other such highway improvements. The rate of contribution by the county is normally agreed between the authorities concerned, and in the event of a dispute the claiming authority has the right to refer the case to the Minister for determination.
    That is the situation over the claiming authority, and I would be the first to

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    concede that there is a difference between a claiming authority and an authority with delegated powers. My hon. Friend the Joint Parliamentary Secretary set out the issue very fully, and I have very little to add to the reasons that he has set out. The difference is that, on the one hand, the county remains financially responsible for the works that it delegates and on the other, it is right and proper that the claiming authority should be given some measure of financial responsibility since the power of decision rests upon its shoulders. I hope that the hon. Member will withdraw his New Clause.
    Mr. Lubbock: In view of what the hon. Gentleman has said in reply to my hon. Friend, may I ask him to answer one question? Why does he think that certain county councils have decided to reimburse the claiming authorities with 100 per cent. of the cost of street lighting schemes, therefore implying that they do not see this connection which the Ministry makes, that where a council is responsible because it has claimed these powers, then it should bear some of the financial burden? The Cheshire County Council does not take this view.
    There is going to be a quite arbitrary difference between the treatment of urban district councils in one county and another, because some county councils will not pay 100 per cent. of the cost of street lighting schemes to claiming authorities. Can the hon. Gentleman justify this situation? Does he think that it is reasonable for an urban district council in Cheshire to receive 100 per cent. of the cost of street lighting schemes from the county council when an urban district council in Lancashire—I do not say that this happens in Lancashire but it could—only receives some lesser proportion as reimbursement?
    Would it not be much better, as my hon. Friend has suggested, to have one uniform scheme to cover the whole of the country so that both urban district councils and county councils know where they stand?
    Mr. Morris: Without notice, I cannot comment on the particular instances which the hon. Gentleman has advanced. The principle that I seek to put before the House is that where there is responsibility for action by a local authority
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    and the power of decision lies with it, then it should have a measure of financial responsibility.
    Dr. Winstanley: Would the hon. Gentleman explain in what way the degree of responsibility varies when the powers are claimed as against when the powers are delegated? The authority with delegated powers still has responsibility.
    Mr. Morris: Without straying from the terms of this new Clause, which is fairly strictly drawn, I would say that the difference is that powers are delegated by the county authority to the other authority. In this case the authorities are exercising powers and are the claiming authorities. The measure of contribution has always been open to discussion between the two authorities. Where there is any dispute or difference the claiming authority has the right to refer the case to the Minister for determination.
    Question put and negatived.

    Clause 1.—(RATE SUPPORT GRANTS.)
    5.15 p.m.
    Mr. MacColl: I beg to move Amendment No. 1, in page 2, line 3 leave out 'provided by local authorities'.
    This is a small but rather complicated Amendment. When my right hon. Friend is fixing the aggregate amount of rate support grant, he has to do a series of sums. He had first of all to find the aggregate total amount available by Parliament. Then he has to find how much of that sum will be allocated to grants in respect of specific services provided by local authorities.
    There are a certain number of items of expenditure which fall to be defrayed out of the rate fund, such as expenditure upon county and borough police forces, magistrates courts and probation service. The aggregate amount of the grant is fixed to include the specific grants towards the services but the ad hoc committee is responsible for them. This means that they are provided by that committee and not by the local authority. Therefore the use of these limited words "provided by local authorities", will have some effect on the amount of the grant. This is slightly more than a drafting Amendment but it

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    is not a very major point. It arises in these particular circumstances in relation to these services.
    Mr. Temple: The Joint Parliamentary Secretary has said that this is a fairly complicated matter and that the Minister will have to do a series of sums. I would like to welcome the Minister and to wish him every good fortune in his responsible office. I would certainly wish him a series of very cool wet towels to wrap round his head when he is doing this series of sums.
    The Joint Parliamentary Secretary and mystelf have debated on many occasions the words "relevant expenditure", and I must admit that I cannot understand how he is able to handle a Bill of this nature, bringing so many other grants into relevant expenditure after all that he has said about irrelevant expenditure in the past.
    One of the important aspects of this Amendment is that it makes it perfectly clear that police expenditure is part of relevant expenditure. I wish to draw attention to this point about police expenditure. This Bill was introduced in May and since then various statements have been made by various Minister about the importance of increasing the scope of the police services. The police grant is a 50 per cent. grant, and under these new formulae all specific grants as well as all other grants are deemed to be relevant expenditure.
    These specifics are then taken off and we arrive at the figure of the rate support grant. I hope that the Minister can reply to this point. Can he say that he is satisfied, in view of the changed circumstances since May, that the additional police expenditure envisaged will be met without vast increases of expenditure being incurred by ratepayers?
    There has been no debate on police expenditure during the passage of the Bill. This Amendment highlights the fact that police expenditure is within "relevant expenditure" and is maintained as a specific grant, but I submit that no extra money will be provided for the expansion of that service unless very special provision is made by the Government at the time of the determination
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    of the global sum of money to be given to local auhorities.
    I make this point only because of the extreme relevance of the increase in police expenditure to our country, and I am fearful lest that increase falls on the ratepayers rather than on the Home Office.
    Mr. MacColl: I think that my right hon. Friend the Minister would choose to make his maiden incursion into our debate on some other subject rather than in this abstruse field.
    We are aware of the growing importance of the police force and the amount of expenditure on police forces. The estimates of that expenditure are now in the process of being collected. Many of of them are in. When we get them in and examine them, we shall be able to see the size of the problem. It is something which we shall take into account when we consider the aggregate amount of the grant.
    Amendment agreed to.
    Mr. Deputy Speaker: In calling Amendment No. 2 in the name of the right hon. and learned Member for Huntingdonshire (Sir D. Renton)—in page 2, line 24 to leave out 'and'—may I say that it will be convenient to discuss at the same time Amendment No. 4.
    Sir David Renton: I am much obliged, Mr. Deputy Speaker. Amendment No. 2 is merely a paving Amendment. No. 4 is the substantive Amendment which I would wish to move. If a Division became necessary, I should hope that it would be possible to have it on Amendment No. 4.
    Mr. Deputy Speaker: I see no reason why that should not happen.
    Sir D. Renton: I beg to move Amendment No. 4, in page 2, line 24, to leave out "and".
    I hope that, first, I may be allowed to congratulate the Minister of Housing and Local Government on his appointment. We have known each other for over 30 years, and I wish him well in his appointment. I am sure that he will be a very great improvement on his predecessor. Indeed, I commiserate with him on the most appalling inheritance which he has found in his Ministry.

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    During the 1964 General Election the Labour Party promised early relief for ratepayers. This Bill is the second bite of the cherry. The first bite was not much of a bite. It was the Rating (Interim Relief) Bill which gave relief to some ratepayers but at the partial expense of the general body of ratepayers. One would have hoped, therefore, that all ratepayers would enjoy some relief under this Bill, but, alas, that is not so. Some local authorities will come off worse as a result of the Bill, and therefore a good many ratepayers will come off worse.
    In order to fortify that plain statement of fact, may I refer to what the previous Minister said in answer to a question which I put to him during the Second Reading debate. I said:
    "Would the Minister agree that if the new rate support grant replacing the general grant produces less money for a county council than the general grant now produces, there is a serious risk that the 5d. extra due to the domestic element could be wiped out?"
    The right hon. Gentleman, with all his candour—and he can be a very candid man—said:
    "Yes, there might be a possibility. We are negotiating with the county councils on this point to ensure that it does not happen."—[OFFICIAL REPORT, 14th June, 1966; Vol. 729, c. 1275–6.]
    Nothing was written into the Bill during its long passage in Standing Committee to ensure that that did not happen, and nothing said by the Minister or the Parliamentary Secretary since the Second Reading debate gives any indication that it will not happen. We are all in the dark as to how each local authority will be affected by the Bill.
    We are therefore in the very difficult position of not being able to tell our constituents definitely whether, as the Government promised, they would be relieved by the Bill, or whether, as will happen in the case of the county of Huntingdon and Peterborough, of which I am one of the two Members, the rate burden will increase. It was against that background that I tabled Amendment No. 4.
    May I explain how it can help the Government over their difficulties? Paragraphs (a), (b) and (c) of Clause 1(3) specify matters which the Minister shall take into consideration when determining
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    the amount of the rate support grant, after consultation with the local authorities. They include future trends in the cost of providing services; fluctuations in demand for services; and the need for developing them. All those are matters relating to the future, and obviously they should be taken into consideration.
    There is, however, a serious omission. Nothing is said in the Bill about mitigating the harsh effect on ratepayers in those counties where the Bill will provide less Exchequer support than they get under the present system. This is one of the very few Bills which I can remember changing the financial support given by the Exchequer to outside bodies into which no transitional arrangements are written. The knife falls. We have the present system. One day in future, when the Minister makes an order under the Bill, we shall have the future system, and, however rigorous the effect of the change, nothing is to be done about it. There is to be no tempering of the wind to the shorn lamb. However, if my Amendment is accepted, it will be incumbent on the Minister to take into consideration the effect of the Bill.
    I suggest that among the matters to be taken into consideration, should be the one set out in Amendment No. 4(d)—
    "the need to prevent any local authority from suffering a substantial decrease in grant compared with the grant or grants received by them in the year immediately preceding".
    On the first occasion that the Minister has his negotiations for fixing the rate support grant, "the year immediately preceding" will be the last year under the present system. But on any future occasion when he goes through this biennial exercise it will be the year immediately preceding the making of a new biennial order. Therefore, the Amendment has the advantage of being both immediately transitional and very helpful to prevent sudden changes to the detriment of a local authority and its ratepayers in future. The Government ought to be grateful to anyone like myself who, on this occasion, is trying to save them from breaking faith with the voters.
    5.30 p.m.
    Not all local authorities who would benefit from the acceptance by the Government of the Amendment, or something similar moved in another place, have

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    obligations under the town and Development Act or are for other reasons receiving rapid increases of population, but nearly all local authorities which are in that position are anxious about the effects of the Bill. It would not be in order for me to go into this matter in great detail, but it is relevant, in order to show that the Bill will have particularly adverse effects in the case of those local authorities with schemes under the Town Development Act, for me to explain the reasons.
    They are twofold. When a large number of people move out of a city into the area of a receiving authority, the great proportion consists of young married couples with young children, and after they arrive more young children come along. Therefore, on top of the children coming into the primary schools through natural increase of the people who were there already, local education authorities have to account for further large increases in numbers in the primary schools. This has very serious effects.
    I do not wish to burden the Committee with a lot of figures, and if I sought to fortify my case by doing so it might be wearisome. Nevertheless I ought to mention, by way of illustration, that whereas on 31st March, 1965, the average debt outstanding per head of population in England and Wales in respect of educational commitments was £19·7, in the county of Huntingdon and Peterborough it was £31·7. That shows the tremendous increase above the average, in respect of every educational commitment, that occurs when there is a large increase in population.
    I know that the Minister is an open-minded man, and I ask him to bear in mind the fact that it is in the national interest to have these town development schemes and a better-distributed population, and it seems rather a shame that ratepayers in the districts and counties which are receiving these people from the cities should have a rate burden which is so much higher because of this educational commitment.
    I do not wish to go into the other aspect in detail because I know that many of my hon. Friends have strong cases to make on this point, but it is apparent that, if town development is taking place, there is a special commit-
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    ment for the building of new roads, which are expensive. I will leave it at that.
    I implore the Minister to accept the Amendment. It will not create a specific charge upon him. It will merely mean that the problem of preventing sudden increases of rates in those counties where the Bill operates less helpfully than the present system does will be easier to solve.
    Mr. Daniel Awdry: I support my hon. and learned Friend's Amendment. I shall do so shortly because he has covered the ground very fully. There is no doubt, however, that some local authorities are worried about these new arrangements. They feel that a great deal more research could have been carried out on the effect of these changes. My county of Wiltshire is anxious about this question and wishes me to support the Amendment. I discussed the matter fully with the county treasurer only yesterday. I am certain that many other counties share Wiltshire's view.
    The amount of grants now received by counties is very substantial. In the current year, under the present general grant and rate deficiency grant, Wiltshire will receive £10½ million. A further £1½ million will come from the school meals grant and the highways maintenance grant. The county 1d. rate in Wiltshire produces only about £70,000. Even a small fluctuation downwards in the amount of grant would have serious repercussions on the ratepayers and on the amount of rate which would have to be levied.
    That is Wiltshire's fear. All that this small Amendment seeks to do is to avoid that hardship falling upon the ratepayers. I cannot imagine that the Government would wish to quarrel with out intention in this matter. If I manage to catch the eye of the Chair on the next Amendment—which is a very important one—I shall develop the case further, because a very important principle is involved. This Amendment seems fair and sensible. I know that it has wide support throughout the country and I hope that the right hon. Gentleman, in his first intervention—if this is to be his first intervention—will be wise enough and big enough to accept it.
    Mr. Francis Pym: I am glad to have an opportunity of

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    supporting the Amendment. I congratulate my right hon. and learned Friend the Member for Huntingdonshire (Sir D. Renton) on the excellent way in which he moved it. The purpose of the Bill is to relieve the ratepayer, and in those circumstances it cannot be right to introduce a new system of grant distribution which will have the effect of making some authorities worse off. No research has been carried out to make sure whether this will be so, but all the evidence that can be adduced goes to show that this will probably be the case. It will probably be so for my county of Cambridgeshire.
    In the early summer the Government claimed that the amount of money that they would make available by way of grants would have the effect of reducing poundages by about a 5d. rate. But this will not happen in Cambridgeshire; in deed, there may have to be an increase in the rate. In that county the position is made the more serious because it has already suffered under the 1958 Act. We must be quite frank about it. The amount of grant received at present does not conform to the national pattern and therefore does not reflect the true needs of Cambridgeshire. That is why that county has the third highest rate of all English counties. Had the 1958 Act not been passed, Cambridgeshire would have received £250,000 per annum more by way of grant. This is equivalent to a rate charge in excess of 1s. in the £.
    In 1963–64 I was already representing this serious situation to the then Government. This adds emphasis to this Amendment. During the early 1960s expenditure per head in Cambridgeshire has exceeded the average for the English counties by sums varying from 2s. to 12s., whereas the general grant per head has been over £1 below the average. I am sure that the Minister will understand the great significance of this. It arose from a defect in the distribution formula, and therefore an amendment was needed. But the amendment is not provided by the Bill, because the rate support grant is to be calculated and distributed broadly on the same basis as the general grant and the rate deficiency grant which it replaces.
    Many of the existing anomalies remain. My right hon. and learned Friend the Member for Huntingdonshire raised
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    the question of education. An important aspect of this matter which applies peculiarly to Cambridgeshire is that the resident student population at Cambridge University is included in the figures of population of Cambridgeshire for calculating the supplementary educational grant. The number involved is about 10,000. In a county with such a small population as Cambridgeshire, hon. Members will appreciate what a difference that makes. This is because, of course, the ratio of pupils per 1,000 of the population is shown as being unduly low.
    It is true that secondary school pupils at technical schools, who were excluded under the 1958 Act, are now to be included under the Bill, and therefore, in that sense, the pupil ratio calculation is improved. But the new factor which comes in under this Bill is the question of roads. It is clear that the counties will suffer while the boroughs benefit and the sum of money available to the counties will be diluted, so that a county like Cambridgeshire will be worse instead of better off.
    In supporting the Amendments, I hope that the Minister can give a clear undertaking, that in no circumstances will any local authority be worse off after the passage of the Bill than it is now. That is the purpose of the Amendments—as it were, to put a bottom in the market. I seek to make sure that there is no deterioration in the present position in Cambridgeshire or any other county. I want the Minister's assurance, if possible, that the new method of distributing grants can and will protect all authorities from the danger or the risk that their grant may in some way be reduced.
    Mr. John Hay: I should like to add my support for the Amendment and to pay tribute to the powerful case deployed with moderation, brevity and cogency by my right hon. and learned Friend the Member for Huntingdonshire (Sir D. Renton). These are Amendments and this is an issue on which he could have made a very long speech, but he chose not to do so. I am sure that he was right, and I will try to follow his example.
    We are concerned here with the repercussions of the change in the grant system in several respects. Two have already been mentioned. One is the

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    situation in which growth of population needs to be taken into account and the other is the case in which educational facilities will have to be improved and increased largely because of the increase in population. A third point mentioned by my hon. Friend the Member for Cambridgeshire (Mr. Pym) was that of highways. It is on this issue that I should like to speak.
    5.45 p.m.
    I do not contest the desirability of reorganising the grants structure in respect of highways. In many respects, this structure has become out of date and I do not object to the fact that a change is being made. But one immediate observation which I would make is that the change comes at a moment when the great majority of, if not all, local highway authorities are in the middle of their road programmes, which have been settled and approved for some time ahead. As I see it, a very special responsibility therefore rests upon the Government to ensure that what they do by changing the rules in the middle of the game does not have an adverse effect on the road programme—more adverse than that of Ministerial decisions already taken.
    When my right hon. Friend the Member for Wallasey (Mr. Marples) was Minister of Transport—the years of expansion of the road programme—we were constantly urging local highway authorities to establish long-term, rolling programmes. We constantly promised them that we would match their approved expenditure by increased grants. I remember a number of occasions, when I was Parliamentary Secretary at that Ministry, when I met deputations from local authorities and urging them, with all the power I had, to go ahead and spend more of their rate money on improving highways, promising them that we would match what they could do.
    To give them credit, most local highway authorities followed the lead which we gave them. But now, suddenly—there is every reason for them to complain—the whole basis of their estimates has been falsified and upset. In addition many of these local highway authorities have got on better with the task than others. Some have been much more
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    willing to carry the road programmes on the rates, especially in what is called maintenance and minor improvement. The Joint Parliamentary Secretary to the Ministry of Transport will know the important work which can be done under the overall heading of maintenance and minor improvement. Very often, a "minor" improvement to a road is minor in nothing but name, in that it really ranks as a very important improvement.
    Therefore, the expenditure of this type of local authority, which has tried to get ahead with its road programme, has been higher. But, of course, the need for improving the roads was there and, under our Administration at any rate, the need was always the test. We were always concerned with the volume of traffic. The need as a basis for the amount of grant to be paid to local highway authorities appears to be abandoned, although I see that, in some whimsical fashion, the word "need" is attached to a particular element in the rate support grant.
    The fact is that grants for other than principal roads will in future be based on a common amount per mile for all roads. In addition, there will be an amount in respect of principal roads, but that will be scaled up or down in relation to the population of the local authority. As I conceive it, this will have two effects. The first is that local highway authorities which have a high mileage of roads relative to a small population will lose, some very heavily. Let us remember that a small population usually goes hand in hand with a comparatively small rateable value. This is not an invariable rule, but it is true on the whole.
    The second result will be that a local highway authority have a smaller proportion of principal roads in relation to a large mileage of all roads and a low population per mile of road will also lose heavily. We cannot spell this out. We cannot give details. We cannot be sure of our figures, because, of course, as has been said all through the proceedings on the Bill, the Government stubbornly refuse to give us any exemplifications and many local authorities are completely in the dark about what the effects will be.
    These are the two most probable effects on highways. It seems likely to be the effect in the county of Oxfordshire, which I represent. My hon. Friend the

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    Member for Banbury (Mr. Marten) is at one with me in this, but we do not propose to take up time in making two speeches and I have his agreement to make the point for this county——
    Sir D. Renton: It is only fair to say that my hon. Friend the Member for Peterborough (Sir Harmar Nicholls) asked me to make my points on behalf of his constituency, too.
    Mr. Hay: I had noticed that the name of my hon. Friend the Member for Peterborough was attached to the Amendment.
    Oxfordshire, on all the grounds which I have set out, seems to be likely to lose a considerable amount of money. At present, the highway rate in Oxfordshire is about 1s. 2d. above the average for all English and Welsh counties. That is a pretty high figure. The total county rate is 1s. 10½d. above the average for all English and Welsh counties.
    The House will therefore see that there is very little, if any, leeway in respect of this county. In Oxfordshire, we have a higher average mileage of roads, a lower average population, a lower average rateable value and a lower proportion of principal roads by comparison with all English and Welsh counties, and yet—and this is the significant point—traffic volumes in the county of Oxford are extremely high and are going up all the time.
    Faced with this situation the county appears to see only two alternatives. The first I would regard as disastrous, and that is to reduce its road programme. A great deal has been done in the course of the last few years, but much, much more remains to be done, and I should regard the abandonment or cutting-back of the road programme over the next few years, particularly in maintenance and minor improvements, as a disaster.
    The second alternative is to increase the rate levied to compensate for the apprehended loss of grant. So far as it has been possible to work out figures in the absence of exemplification, we calculate that if we were to take this course it would mean an additional 7d. rate. I hope that the Minister had grasped those figures, which are of the utmost importance and gravity to ratepayers in the county of Oxford.
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    I recognise the Government's problem. In highway expenditure, the only main alternative to carrying on with the present system—which, as I have said, is unsatisfactory in so many respects—would be somehow to base the grant upon traffic density or traffic volume. That would be difficult because if one tried to do it on that basis, presumably one would have to set up some enormously bureaucratic machinery to keep a constant and almost daily count of traffic on the road and to adjust the amount of the grant year by year accordingly. I do not think that that is a practical way of dealing with the matter.
    I fall back upon the Amendment. I suggest that the Amendment which proposes that in calculating the amount the Minister should take account of the need to avoid any disproportionate decrease in the amount of grant over the preceding year would be doing something very useful indeed to help local highway authorities in this situation. I therefore believe that this should be one of the considerations written into subsection (3) of the Bill. It may not be a great deal but at least it will do something.
    There is another Amendment on the Notice Paper which gives another method whereby some help could be given to local authorities in this situation. I stress that it is not an alternative to the Amendment moved by my right hon. and learned Friend; it is an addition and another way in which the Government can show that they want to assist local authorities out of what is a very difficult situation which some of them are facing. The intention of the Amendment is to see a transition from the present system of grant to the new and recast system of grant, and I sincerely urge the Minister to accept it.
    Mr. John Astor: I should like briefly to support the Amendment moved by my right hon. and learned Friend the Member for Huntingdonshire (Sir D. Renton). It seems to me wholly consistent with the Government's policy which was stated by the then Minister of Housing and Local Government on Second Reading as steadily to shift the increasing burden from rates to taxes. Some of my hon. Friends have already pointed out that the Bill as it stands could undoubtedly have the opposite effect in

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    certain cases, and it seems to me particularly regrettable that the group of authorities which are likely to be most seriously affected are those which already have the major problem of having to cope with greatly increasing populations.
    The county of Berkshire has, I think, the most rapidly increasing population of any county in England, and we are therefore in Berkshire fully familiar with the difficulties. Over the last few years just to provide the additional services required by these newcomers to the county it has been necessary to increase our annual expenditure by between 14 and 15 per cent. Admittedly, this pays some regard to increasing costs and to some improvement in services, but the major element is to provide services which would not otherwise be available to the new population.
    Reference has been made to the two main points of education and highways, and it is established that where there are increasing populations they tend to be of young married people moving in, and this produces a disproportionately large number of children in the primary schools. On the evidence available at present it is estimated by the county treasurer that there is likely to be an increase in rates of about 6d. in the £ in the county of Berkshire. I know that all the evidence is not conclusive at the moment, but that is what seems likely.
    I might say that the other three hon. Members with constituencies in the county of Berkshire have discussed this with me. Unfortunately, they are not able to be here this afternoon, otherwise they would have supported this plea. I am sure that all authorities will welcome the greater freedom of action and responsibility which will be conferred on them by the Bill. It seems to me quite unreasonable that, by conferring that additional responsibility, we automatically burden them with an increase in expenditure which they will not be able to control unless they are prepared to lower their standards, which I am sure nobody wishes them to do. I hope that the Government will accept this proposal.
    Mr. James Allason: We know that some authorities will suffer very considerably as a result of this Bill and that all their ratepayers will find their rate bills increased in the next year when they might have expected
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    them to fall. The particular sufferers will undoubtedly be counties with expanding populations. Many hon. Members have given instances of how this is likely to come about.
    The Government have consistently taken the line that they need proof that counties with expanding populations will suffer before they are prepared to take any action about it. I therefore welcome the Amendment moved by my right hon. and learned Friend the Member for Huntingdonshire (Sir D. Renton which avoids for the Government the difficulty of their disbelief. I should like to put to the Government the fact that there is as much proof as is ever likely to be obtained that where there is an expanding population there must be increased costs.
    My right hon. and learned Friend spoke of education. I remember that in one area of expanding population we found that the birth rate was 40 per thousand, compared with the national average at that time of 14 per thousand. When babies arrive at this rate it is inevitable that there must be a tremendous expansion of services. The argument is that the rateable value also increases, but it increases a long time after the expenditure has been incurred. Apparently the Government will not accept that argument. Will they take from me figures of what has happened in Hertfordshire as a result of a consistently expanding population? It has been expanding for years at a pretty fast rate.
    6.0 p.m.
    For example, in 1959–60 the proportion of expenditure amounted to 55·7 per cent. supplied by the Government by way of general grant, which was in line with the national average of just over 55 per cent. Since then the pro-portion which Hertfordshire has received has steadily dropped, usually at the rate of 1 per cent. a year; from 55 per cent. to 54 per cent. and then to 53 per cent. In the current year we are receiving only 49·5 per cent. as against the national average of 55 per cent. This represents a loss to the county of £1¾ million, equivalent to an 8½d. rate. This is solely on account of the factor of expanding population. If this does not prove that help is required, I cannot think of anything that could provide proof.

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    So far as can be discovered, as a result of the Bill Hertfordshire will lose another £300,000, equivalent to a further 1½d. rate. In consequence, the county will be losing the equivalent of a 10d. rate as a result of the factor of expanding population.
    I hope, therefore, that even at this late hour the Government will accept that expanding populations cause undue hardship to ratepayers. Hertfordshire is profoundly dissatisfied with the unfair allocation which will result from the Bill and other counties with expanding populations should take warning from the experience of Hertfordshire.
    Mr. Julian Ridsdale: I support the Amendment which was so ably moved by my right hon. and learned Friend the Member for Huntingdonshire (Sir D. Renton). Coming from Essex, an area of greatly expanding population, I am glad of this opportunity to support my right hon. and learned Friend's suggestion and to say why. The main reason is because the safeguard which it would provide is necessary and because it would be of some help, although the problem is even more serious than this safeguard could solve.
    I would like included a separate factor in the distribution formula of the rate support grant for the purpose set out in Schedule 1. This is supported by Essex County Council, particularly because the problem in that county is so serious. I remind the Minister of how serious it is. It is not only affecting young married people but particularly retired people. In my constituency alone since 1954 the population has increased by between 17,000 and 25,000. This has resulted in the need for more sewerage, schools and welfare facilities.
    The rates have been going up by about 10 per cent. a year for the last five years and are likely to continue to rise at that rate for the next five years. This is in an area which has little industry, remembering that the Rating (Interim Relief) Act, which I supported in its earlier stages when it went before the Allen Committee, only tinkers with the problem faced by people in the seaside areas arising from the burden which is falling on them.
    The previous Minister talked about a reform of the rating system and the Royal
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    Commission has been set up. However, the Lord President of the Council said today that that Commission will not report until the winter of 1968, which shows that the Government are running away from this problem and have no intention of honouring some of the pledges they gave prior to the General Election.
    It is for this reason that I support the Amendment. I do not wish to be drawn into the technicalities of the matter, and I will merely say that it at least provides a safeguard. However, so that ordinary people may understand what is happening, I hope that the Minister will give a definite pledge that particularly the elderly will not be forced to carry a burden which it is impossible for them to bear. After all, 15,000 to 20,000 people coming into a constituency is a considerable burden to shoulder. In the coastal areas the number of retired people is not 11 per cent. or 12 per cent.—the average for the rest of the country—but 25 per cent.
    I therefore welcome the safeguard provided by the Amendment and hope that it will be accepted. It does not go far enough and Essex County Council wishes that it went further. Another Amendment will be discussed later. Meanwhile the elderly must be safeguarded and we must be sure that the Government will not use the Bill as a means of extracting money from people who cannot afford to pay it.
    Mr. Arthur Jones: I join my colleagues in some of their criticisms of the Bill. We have seen a clear example today of the strong lobby possessed by some county councils and the excellent way in which their case and fears have been expressed. I am surprised that no hon. Gentleman opposite supports us in our criticisms of the Bill.
    We are faced in this Measure with proposals the consequences of which cannot be assessed, and no adjustments or transitional arrangements are proposed. This applies not only to the authorities mentioned by my hon. Friends but authorities throughout England and Wales. I am glad that my hon. Friend the Member for Harwich (Mr. Ridsdale) reminded the Government of the undertakings they gave before the General Election about rates, because the White Paper which preceded the publication of the Bill said that the proposals of the Government

    459
    were designed to reduce the burden of rates and to produce a fairer distribution of Exchequer assistance to local authorities.
    Questions have been asked today about the police and the rising allocation of Government and local authority finance that will be needed to expand the police service. Reference has been made to education and highways, in respect of both of which the method of computation for grant-aid is being changed; highways in the different nomenclature—the types of road—and education in the completely different method of assessment for support grant, moving it from the number of pupils to units. As far as I am aware, it is not general knowledge yet what effect that method of assessment under the new proposals will have and whether the new proposals of the unit method of assessment have been finalised.
    It is in the context of this uncertainty that local authorities will be asked to prepare their assessments soon for the next financial year. An impossible task is being laid on local authority treasurers. In these circumstances, we plead for a minimum figure of grant or for some transitional arrangements. This was referred to briefly by my right hon. and learned Friend the Member for Huntingdonshire (Mr. Renton).
    I want to elaborate on the historical aspect. In the past, when a new grant scheme has been introduced, it has always been customary to allow a transitional period during which the change in the rates in the £ levied by local authorities takes effect gradually. Thus, when the first block grant scheme was inaugurated by the Local Government Act, 1929, provision was made not only for the weighted population formula to be applied gradually, but for the payment of additional grant from the Exchequer where it was needed to ensure for each county and county borough council a minimum benefit equivalent to 1s. per head of the population. In addition, there were rules for adjusting the gains and losses of county districts.
    The Local Government Act, 1948, legislated for transitional grants from the Exchequer where needed to ensure that county and county boroughs derived a gain from the reform of local government administration and finance in that year equivalent to a rate of 6d. in the £ and
    460
    those grants were paid each year for five years. Section 15 of the Local Government Act, 1958, which gave rise to the present system of general and rate deficiency grant, provided for transitional arrangements. Although those arrangements did not guarantee a minimum gain to counties and county boroughs at the outset, the Act provided for making good losses.
    It is in the context of transitional arrangements made hitherto that, within the framework of this new Bill, which changes so many of the methods for the arrival at the grant, and a specific grant system, that I state, and I am sure that there cannot be anything but general agreement on this—that pressure should be put on the Government to make some transitional arrangements——
    Sir D. Renton: My hon. Friend has been very helpful in giving us examples of transitional payments involving grant. There are no transitional arrangements in this Bill, but I do not know whether he appreciates that my method introduces a transitional arrangement without the burden of the Government having to find a further grant from the Exchequer.
    Mr. Jones: I follow that point perfectly clearly. It means that the grant shall not be less than that granted in the immediate preceding year. That is a further advantage that lies in the wording of this Amendment.
    6.15 p.m.
    Mr. MacColl: My right hon. Friend had hoped very much to be able to be present for the whole of this very important debate, but our estimated timetable has got a little askew and he has had to leave us to fulfil an important public engagement. He will come back immediately he has performed that duty to the public, and is extremely sorry not to be able to be here now.
    This is a very important subject of discussion, but, if I may say so with great respect, it is not a new subject. The arguments have been deployed forcibly, but I do not think that any new information has been produced to add very much to what has been said before about the effect of the grant. It is as well to recognise what we are talking about. We are simply talking about a guarantee that no one will get less

    461
    grant. The Amendment has nothing to do with whether or not a certain rate poundage, or a certain rate burden, is higher. We are dealing only with the grant.
    From very considerable discussion with local authorities, and among ourselves, we have every reason to believe that we have here a good grant system and a better system than we had previously. As a result, we think that the distribution of the grant will be better than it was under the old system. The question is whether, when we give very substantial advantages to some local authorities, we should have a transitional arrangement protecting the others from any possibility of their grant falling. Put like that, it would be a difficult proposition to defend.
    The grant may fall in a particular area because of very great changes in the position there. For example, a large industrial undertaking may be set up in a certain area where the whole financial position has very greatly changed. A very substantial difference in the fall of population would mean that we would not really have a very good case for stopping the grant. This Amendment seeks to put into the Bill a permanent direction to the Minister. It is not limited to transitional arrangements. The point has been put to us that we ought to have a transitional arrangement, and it has been pointed out quite justly that other Measures have provided for such arrangements.
    This is very largely a practical point. I am advised that our experience of the workings of transitional arrangements has not been at all happy. The hon. Member for Northants, South (Mr. Arthur Jones) quoted the 1929 Act, but my recollection is that the transitional arrangements in that case were very complicated. I am not sure whether by 1939 a full grant system was working—but my recollection may be at fault there. The transitional arrangements under the 1958 Act have been very difficult to work. One eventually needed transitional arrangements for the transitional arrangements, because it was found that some people got more grant than it was ultimately found they were entitled to have, and special arrangements had to be made to take care of that situation.
    462
    Therefore, our answer to the narrow point of why we do not have transitional arrangements is the purely practical point that they are not easy to work. Having got, as we think, the right giant system, and a flexible system that can be adjusted more sensitively than the old system could be to changes, we think it better to take account, if necessary, of weighting for increased population in the later general grant Order. Having got a flexible and sensitive system of grant we do not think it desirable to complicate matters by having transitional arrangements. I am not sure whether the point in the Amendment was raised in Committee, but I know that it has not been put forward by any outside body as being something they wanted.
    The argument advanced now has been based almost entirely on rate poundage. The case was put in terms that in one instance there was the third highest rate poundage in the country and in the other there were astronomical increases, but rate poundage is only part of the total formula. There is rateable value and rate poundage. I should have thought that a fairer test would have been to take the average domestic rate payments rather than rate poundages.
    With the exception of Hertfordshire, which I concede has had higher payments than most, the counties which have been mentioned this afternoon in most cases are above the average and in one case below the average, but not, I think, substantially. In England and Wales, the average domestic rate poundage from hereditaments was £40·35. In Cambridge and the Isle of Ely, which was quoted by the hon. Member for Cambridgeshire (Mr. Pym), it was only £1 more, £41·61. In Huntingdon and Peterborough it was only marginally more, less than £1, £40·99. In Bedfordshire, it was £44·13. In Northamptonshire, on which we have had a very moving speech at the end of the debate, it was very substantially below the average.
    That is why I suspect that the hon Member for Northants, South, with his great ability, did not touch on his own county, but made his argument rather more general. In Essex, as the hon. Member for Harwich (Mr. Ridsdale) quoted, it was £43·15, of £3 more.
    Sir D. Renton: For which year is the hon. Gentleman quoting these figures? A lot depends on that.
    Mr. MacColl: For 1966–67.
    Mr. Hay: Will the hon. Gentleman say what it was in Oxfordshire?
    Mr. MacColl: I shall try to get the figures for Oxfordshire. I was collecting these as the debate widened, but I shall certainly try to do that. As I have said, Hertfordshire shows a substantial increase—not an increase but it is above the average—but in the other cases there is not a substantial amount. In Oxfordshire, it was £43, substantially the same as in Essex.
    Mr. Allason: The hon. Gentleman is making my point for me. I was giving the case of Hertfordshire as an awful example because we have been in this business of expanding population longer than any other county and this is what will happen to other counties. The proposals will not give us a great deal of help because already our rates have gone up so high. I was being altruistic in making the case for other counties with expanding populations.
    Mr. MacColl: I was anxious not to be unfair in making the case about Hertfordshire. I am not committing myself to saying that because the hon. Member's county has had an expanding population and heavy domestic rate payments therefore the two are co-related. There may have been other reasons—the standard of services and special problems of an area of that sort. We have to look a little wider at the general position and not just at the position of one special county because no doubt before long we shall find that Hertfordshire is reaping where it has successfully and prudently sown.
    The hon. Member for Cambridgeshire raised two points. The particular point which I look at is the question of the effect of the undergraduate population on the grant. Undergraduates are counted in the population. In the modern world, although less so than in my time when they did not have so many children. That means that the proportion of school children to population is reduced and that has a lower effect on the grant. On the other hand, the county gets a basic per capita grant for population including the undergraduates and that to some extent is a balancing factor the other way. Finally, there is the fact that because of the increase of popula-
    464
    by undergraduates, the 1d. rate product per head of population is lower and that will have an increasing effect on the resources element in the grant. That illustrates the difficulty. This is a complicated problem of balancing the factors working in different directions. It cannot be said that they all work in one direction.
    The hon. Member for Henley (Mr. Hay) quoted the case of highways in Oxfordshire. He said that, as he has every reason to be, he is proud about the record of his county in this matter. It has a good record in what it spends on roads. It is likely that it will not get as much contribution towards that, but this again illustrates the difficulty of being fair. This arises because in the past the county has had a very high grant for maintenance and its maintenance costs per mile are much higher than the average. That is because it wanted to have a very high standard of roads. That no doubt is highly desirable. If we are to provide money in grant where are we to place it? Are we to place it with the counties which have a high standard of roads and have been paying above the average on maintenance of roads, or are we to weight it in favour of those which have more leeway to make up and have to be encouraged to adopt higher standards? It is impossible to find a system whereby Oxfordshire will not lose without upsetting the balance of the whole system, taking the country as a whole.
    There are very strong reasons for not having transitional arrangements. One has to look at these, not from the point of view of a transitional scheme, but of what we are going to do both in respect of the effects of the transfer from the old grant to the new and of the changes in the new grant. Obviously, some counties will gain and others will lose. That is bound to happen when we have a change of grant, not because it is arbitrary, not because it is unjust, but because it is more sensitive to changes and will place the money where it is mainly needed. That, after all, is one of the major objects of a grant.
    This matter of the effects on particular counties has been examined considerably both here in debate and in discussion with particular authorities and with the local authority associations. General agreement has not been found on the

    465
    idea that there should be a particular change giving particular help to the authorities which have increasing populations. If we are wrong about this, as I said the machinery of the grant is flexible enough to adjust it later—not by this rate support grant Order, but by another Order.
    We had a somewhat melancholy utterance by the hon. Member for Hemel Hempstead (Mr. Allason) about this. If we find that he is right and we are wrong and that this problem gets worse under the new grant as opposed to the old grant, as he was fair enough to appreciate, we can adjust the formula in such a way as to take that into account. That could not be done under the old grant.
    Therefore, I have to invite the House not to accept the Amendment because I do not think that it would make a general improvement in the interests of the general grant system or of local government as a whole.
    6.30 p.m.
    Mr. Temple: I am sure that the whole House is indebted to my right hon. and learned Friend the Member for Huntingdonshire (Sir D. Renton) for bringing this matter forward at a fairly late stage in the Bill. We on this side of the House need not apologise for this matter being brought forward at a late stage, because throughout the whole passage of the Bill we have pressed for exemplification. Had we received exemplification, there would have been no need for the Amendment. It would have been perfectly clear who were the gainers and who were to be the losers.
    The Joint Parliamentary Secretary's reply was very much below his usual standard. It was certainly detailed, but it was also extremely disappointing. The hon. Gentleman said we were dealing only with an increase in grants and not dealing with an increase in the rate poundage. The two are directly interrelated. The lower the grant, the higher the rate poundage. I do not think the hon. Gentleman can get away with that reply.
    The hon. Gentleman admitted there would be gainers and losers, and he said that the matter could be adjusted. It certainly can be adjusted, but only after two years. The Amendment would
    466
    mean that any county or authority that was a loser would immediately be able to have this matter put right rather than waiting for a period of two years or more.
    I stress that there is nothing in the Bill to say that the rate support grant Order which will be brought forward in December this year will be for a two-year period. It could be for any period of two or more years. It might well be a longer period than two years.
    We have been told that the Government are satisfied that the distribution will be satisfactory. But we do not know. Apparently the local authority associations know and the working parties know. Significantly, one of the few speakers from the other side of the House today asked why the deliberations of the working parties were not available to hon. Members. I have been chided on many occasions for having, in the view of the Parliamentary Secretary, tried to look into the workings of the working parties. Apparently those workings are supposed to be secret and, therefore, no Member of Parliament has access to the detailed workings of the working parties. No Member of the House outside of the Government has any idea of what the effects of the new grant will be.
    My right hon. and hon. Friends were quite right to draw attention to the many unknown factors which there are within these grants. My right hon. and learned Friend the Member for Huntingdonshire stressed the need for transitional arrangements. I will return to that point in a moment. He went on to say that we were all in the dark, and I agree with him. The unknown factors were brought out very clearly by my hon. Friends the Members for Cambridgeshire (Mr. Pym) and Northants, South (Mr. Arthur Jones), when they referred to the new educational units.
    Nobody knows the effects on ratepayers of the new educational units, nor the effect on the grants. My hon. Friend the Member for Henley (Mr. Hay), with his vast knowledge of all that goes in the making up of road programmes, said that the new grants might have a very detrimental effect on road programmes or, conversely, might have a very detrimental effect on ratepayers. My hon. Friend is in a position to make a very sound

    467
    judgment, in view of his vast experience in this matter, on the effect of road programmes.
    My hon. Friends the Members for Newbury (Mr. Astor) and Hemel Hempstead (Mr. Allason) stressed the difficulties of counties or districts with rapidly expanding populations. I agree. That is another unknown factor which would be taken care of if this Amendment were accepted.
    In a very succinct speech, my hon. Friend the Member for Harwich (Mr. Ridsdale) stressed that what was needed was safeguards. That is what we are pressing for in the Amendment. My hon. Friend the Member for Northants, South pointed to very powerful precedents for transitional arrangements. The Joint Parliamentary Secretary said, in effect, that the transitional arrangements that were in the 1929, 1948, and 1958 Acts were not, in the light of events, proved necessary. I will tell him why they were not found necessary in the 1958 Act. Before the Government which I supported introduced the 1958 Act, we issued a White Paper which in some considerable detail gave the expected effects of the new grants which would be brought forward.
    I have in my hand this White Paper issued in February of this year which preceded this legislation. In the White Paper there is no detailed forecast of the possible effects on rating areas of the new changes in grant. In the 1958 Act we tried to make it absolutely clear, or clear beyond many doubts, what the effect of our proposals would be. I served on the Standing Committee which considered the 1958 Act. At that time the Labour Opposition asked for detailed exemplification of what would be the effect of our proposed grants on all the various rating areas. Mr. Henry Brooke, as he then was, then the right hon. Member for Hampstead, said that it would be a difficult job for his Department to produce such exemplification, but, nevertheless, he said that in the circumstances if it was the wish of the Opposition he would produce the exemplification. He did so.
    We have asked constantly for this exemplification. I do not believe it is fair to any of our constituencies to pass a Bill of this nature without safeguards in it, and this is an essential safeguard.
    468
    We are asking that where there is a substantial decrease in grant as between one year and another it shall be taken into consideration by the Minister. Surely the Minister should be able to accept an Amendment of this nature, which would give him powers to have regard to unexpected factors.
    A little later this evening we shall discuss an Amendment the effect of which will be to put right a state of affairs which has evidently come to light in the working parties comparatively recently where sparsely populated counties were going to be affected very severely by the new grants. How do we know this evening that there may not be many other types of authority, which, due to a quirk of these formulae, will be affected adversely?
    We have thought about this matter very carefully. We feel very strongly about it. We think that the Minister should be able to have regard to counties or districts which might well be the losers. I advise my right hon. and hon Friends to go into the Lobby in support of the Amendment.
    Amendment negatived.
    Mr. Deputy Speaker (Mr. Sydney Irving): Amendment No. 3.
    Sir D. Renton: The Division will come on Amendment No. 4. We do not wish to miss the opportunity of dividing.
    Mr. Deputy Speaker: My predecessor in the Chair gave an assurance that the House could divide on Amendment No. 4 if it so wished.
    Mr. MacColl: I beg to move Amendment No. 3, in page 2, line 27, at the end to insert:
    'and for the purpose of determining the said amount and portion the Minister may make such adjustments in respect of relevant expenditure and grants as appear to him to be required to offset the effects on those factors of the constitution or alteration after the passing of this Act of any joint board'.
    This is an Amendment which I find it very difficult to explain except by putting it in arithmetical terms. I touched upon this in Committee. The problem arises of the effect on the grant formula of the growth of joint boards, mainly for the police. I wish to compare the effects where the police are taken away from a county police authority and put under a joint police authority, and the simplest way is to explain it numerically.

    469
    If the relevant expenditure in respect of the police under the county police authority is £1,000, the aggregate grant of 54 per cent. will be £540, which will go into the total aggregate grant. The specific grant, which is 50 per cent., will be £500, so that £500 of the aggregate grant will be part of the specific grant and will be deducted, leaving £40 for the rate support grant.
    If that police authority merges with another or joins a joint authority, the expenditure is no longer £1,000 because it is incurred by the joint body. The whole of that expenditure does not come into relevant expenditure until after the deduction of the 50 per cent. grant, so that the relevant expenditure falls to £500. The 54 per cent. then falls to £270. No specific grant is to be deducted because that has gone to a joint authority, which is not a local authority for this purpose, and the amount then available for the rate support grant will be £270.
    The total effect of this operation would be that the total grant would rise from £540 to £770—an increase of £230. It might be said, "Why grumble? That is very lucky". But it would be unfair to do this when there has been no change in the cost or in the police but purely a change in the technical question of which authority administers the police service.
    At one time we had hoped that this would be a small problem and that we could ignore it as de minimis and not
    become too much involved in rather abstruse questions. But with the recent increase in the number of joint police authorities and the likely future increase it has become a rather more serious matter. That is why we propose the Amendment, which enables the Minister to make an adjustment in the formula to deal with this curious anomaly.
    Mr. Temple: The House is very indebted to the Parliamentary Secretary for his detailed explanation. I had an opportunity of studying this extremely complex matter before I rose and at the moment I can claim that I understand it, and I can advise my hon. and right hon. Friends that the Amendment will make the accounting a little more comprehensible where new joint boards and police authorities are being established. Anything which makes accounting a little more comprehensible is valuable, and we on this side of the House can agree with the Amendment.
    Amendment agreed to.
    Amendment proposed: In page 2, line 27, at end insert:
    'and
    (d) the need to prevent any local authority from suffering a substantial decrease in grant compared with the grant or grants received by them in the year immediately preceding'.—[Sir D. Renton.]
    Question put, That those words be there inserted in the Bill:—
    The House divided: Ayes 107, Noes 136.

    Division No. 175.]

    AYES

    [6.43 p.m.

    Alison, Michael (Barkston Ash)

    Elliott, R. W. (N'c'tle-upon-Tyne, N.)

    Kimball, Marcus

    Allason, James (Hemel Hempstead)

    Errington, Sir Erie

    King, Evelyn (Dorset, S.)

    Astor, John

    Gilmour, Ian (Norfolk, C.)

    Loveys, W. H.

    Balniel, Lord

    Glover, Sir Douglas

    Lubbock, Eric

    Bell, Ronald

    Goodhew, Victor

    McAdden, Sir Stephen

    Bennett, Sir Frederic (Torquay)

    Grant, Anthony

    Mackenzie, Alasdair (Ross&Crom'ty)

    Bessell, Peter

    Grant-Ferris, R.

    Maclean, Sir Fitzroy

    Biggs-Davison, John

    Gurden, Harold

    Maddan, Martin

    Black, Sir Cyril

    Hall, John (Wycombe)

    Mathew, Robert

    Body, Richard

    Hamilton, Michael (Salisbury)

    Mawby, Ray

    Boyd-Carpenter, Rt. Hn. John

    Harris, Frederic (Croydon, N. W.)

    Maydon, Lt.-Cmdr. S. L. C.

    Bromley-Davenport, Lt.-Col. Sir Walter

    Harris, Reader (Heston)

    Miscampbell, Norman

    Brown, Sir Edward (Bath)

    Hay, John

    Monro, Hector

    Bullus, Sir Eric

    Heald, Rt. Hn. Sr Lionel

    More, Jasper

    Carlisle, Mark

    Heseltine, Michael

    Morrison, Charles (Devizes)

    Clegg, Walter

    Higgins, Terence L.

    Murton, Oscar

    Coolie, Robert

    Hiley, Joseph

    Nott, John

    Cooper-Key, Sir Neill

    Hobson, Rt. Hn. Sir John

    Onslow, Cranrley

    Corfield, F. v.

    Holland, Philip

    Pardoe, John

    Costain, A. P.

    Hordern, Peter

    Peel, John

    Crawley, Aidan

    Hunt, John

    Prior, J. M. L.

    Crosthwaite-Eyre, Sir Oliver

    Hutchison, Michael Clark

    Pym, Francis

    Dance, James

    Irvine, Bryant Godman (Rye)

    Quennell, Miss J. M.

    Davidson, James (Aberdeenshire, W.)

    Jenkin, Patrick (Woodford)

    Rawlinson, Rt. Hn. Sir Peter

    Dean, Paul (Somerset, N.)

    Jennings, J. C. (Burton)

    Ronton, Rt. Hn. Sir David

    Digby, Simon Wingfield

    Jones, Arthur (Northants, S.)

    Ridsdale, Julian

    Eden, Sir John

    Jopling, Michael

    Roots, William

    Rossi, Hugh (Hornsey)

    Teeling, Sir William

    Wills, Sir Gerald (Bridgwater)

    Russell, Sir Ronald

    Temple, John M.

    Wilson, Geoffrey (Truro)

    Scott, Nicholas

    Thatcher, Mrs. Margaret

    Winstanley, Dr. M. P.

    Shaw, Michael (Sc'b'gh & Whitby)

    van Straubenzee, W. R.

    Wolrige-Gordon, Patrick

    Stainton, Keith

    Walker, Peter (Worcester)

    Wylie, N. R.

    Stodart, Anthony

    Walker-Smith, Rt. Hn. Sir Derek

    Younger, Hn. George

    Summers, Sir Spencer

    Walters, Dennis

    Taylor, Sir Charles (Eastbourne)

    Weatherill, Bernard

    TELLERS FOR THE AYES:

    Taylor, Edward M. (G'gow, Cathcart)

    Webster, David

    Mr. Blaker and Mr. Eyre.

    Taylor, Frank (Most Side)

    Whitelaw, William

    NOES

    Alldritt, Walter

    Hamilton, William (Fife, W.)

    Noel-Baker, Rt. Hn. Philip (Derby, S.)

    Anderson, Donald

    Hamling, William

    Ogden, Eric

    Archer, Peter

    Haseldine, Norman

    O'Malley, Brian

    Atkins, Ronald (Preston, N.)

    Hattersley, Roy

    Oram, Albert E.

    Atkinson, Norman (Tottenham)

    Heffer, Eric S.

    Orme, Stanley

    Bacon, Rt. Hn. Alice

    Hilton, W. S.

    Owen, Dr. David (Plymouth, S'tn.)

    Barnett, Joel

    Hobden, Dennis (Brighton, K'town)

    Page, Derek (King's Lynn)

    Bennett, James (G'gow, Bridgeton)

    Hooley, Frank

    Palmer, Arthur

    Bidwell, Sydney

    Horner, John

    Pannell, Rt. Hn, Charles

    Blenkinsop, Arthur

    Houghton, Rt. Hn. Douglas

    Park, Trevor

    Booth, Albert

    Howie, W.

    Pavitt, Laurence

    Boston, Terence

    Hughes, Emrys (Ayrshire, S.)

    Pentland, Norman

    Brown, Bob (N'c'tle upon-Tyne, W)

    Hughes, Roy (Newport)

    Perry, Ernest C. (Battersea. S.)

    Buchanan, Richard (G'gow, Sp'bum)

    Hunter, Adam

    Perry, George H. (Nottingham, S.)

    Butler, Mrs. Joyce (Wood Green)

    Jackson, Peter M. (High Peak)

    Price, William (Rugby)

    Chapman, Donald

    Janner, Sir Barnett

    Pursey, Cmdr. Harry

    Coe, Denis

    Jenkins, Hugh (Putney)

    Randall, Harry

    Concannon, J. D.

    Judd, Frank

    Rees, Merlyn

    Corbet, Mrs. Freda

    Kenyon, Clifford

    Robertson, John (Paisley)

    Crossman, Rt. Hn. Richard

    Kerr, Mrs. Anne (R'ter & Chatham)

    Robinson, W. O. J. (Walth'stow, E.)

    Davies, Dr. Ernest (Stretford)

    Kerr, Dr. David (W'worth, Central)

    Rogers, George (Kensington, N.)

    Davies, Robert (Cambridge)

    Kerr, Russell (Feltham)

    Rose, Paul

    de Freitas, Sir Geoffrey

    Lee, John (Reading)

    Shinwell, Rt. Hn. E.

    Delargy, Hugh

    Lestor, Miss Joan

    Silverman, Julius (Aston)

    Dewar, Donald

    Lewis, Ron (Carlisle)

    Silverman, Sydney (Nelson)

    Dickens, James

    Lipton, Marcus

    Small, William

    Dobson, Ray

    Lomas, Kenneth

    Snow, Julian

    Driberg, Tom

    Lyon, Alexander W. (York)

    Spriggs, Leslie

    Ellis, John

    Lyons, Edward (Bradford, E.)

    Steele, Thomas (Dunbartonshire, W.)

    English, Michael

    MacColl, James

    Strauss, Rt. Hn. G. R.

    Evans, Albert (Islington, S. W.)

    Macdonald, A. H.

    Symonds, J. B,

    Evans, Ioan L. (Birm'h'm, Yardley)

    McGuire, Michael

    Taverne, Dick

    Faulds, Andrew

    Mackie, John

    Tinn, James

    Fletcher, Raymond (Ilkeston)

    Mackintosh, John P.

    Tomney, Frank

    Fletcher, Ted (Darlington)

    McMillan, Tom (Glasgow, C.)

    Wallace, George

    Floud, Bernard

    MacPherson, Malcolm

    Wellbeloved, James

    Foley, Maurice

    Mason, Roy

    Whitaker, Ben

    Fowler, Gerry

    Mendelson, J. J.

    Whitlock, William

    Fraser, John (Norwood)

    Mikardo, Ian

    Winnick, David

    Gardner, Tony

    Miller, Dr. M. S.

    Winterbottom, R. E.

    Garrett, W. E.

    Milne, Edward (Blyth)

    Yates, Victor

    Garrow, Alex

    Morgan, Elystan (Cardiganshire)

    Zilliacus, K.

    Ginsburg, David

    Morris, Alfred (Wythenshawe)

    Gregory, Arnold

    Morris, Charles R. (Openshaw)

    TELLERS FOR THE NOES:

    Grey, Charles (Durham)

    Morris, John (Aberavon)

    Mr. McBride and

    Griffiths, David (Rother Valley)

    Murray, Albert

    Mr. Walter Harrison.

    Griffiths, Will (Exchange)

    Newens, Stan

    Sir D. Kenton: I beg to move Amendment No. 5, in page 2, line 45, at the end to insert:
    (6) The Minister shall make provision to ensure that any increase in the rate burden exceeding the amount produced by a rate of 2d. in the pound for that year which any local authority suffers as a result of the changeover from general grants to rate support grants shall be spread over a period of six years.
    If the Government had had the good sense to accept Amendment No. 4 which I moved and my hon. Friends supported, this Amendment would still have been desirable and necessary, but, as the Government have just voted down Amend-
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    ment No. 4, though by a small majority—which is of some consequence—this Amendment has become absolutely vital in order to mitigate the harshness of the Bill's effect.
    I shall not repeat the arguments which I put when speaking to Amendment No. 4, and I ought, therefore, to make plain exactly what the purpose of Amendment No. 5 is. Whereas Amendment No. 4 would have been partly transitional and partly permanent in its effect, Amendment No. 5 is entirely transitional. It provides that any increase in the rate burden exceeding 2d. in the £ on the rates

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    shall be spread over six years instead of operating straight away. It is another way of tempering the wind to the shorn lamb.
    It is a fairly modest Amendment. It would not involve an extra financial commitment for the Government because an order will have to be made which will be in operation for at least two years and could be in operation for six years. Although this is, obviously, a complicated matter, I do not imagine that it would be beyond the wit of the right hon. Gentleman and his advisers, in making that order, to ensure that, if counties are to suffer substantially—and an increase of 2d. in the £ on the rates is substantial—such an increase could be spread over a period of up to six years instead of coming into force all at once.
    Knowing the way things work, I assume that the Parliamentary Secretary will pray in aid the arguments which he used on the previous Amendment in order to try to defeat this one. I hope, therefore, that I shall be in order if I answer one of the arguments which he raised earlier and which, as he presented it, seemed to be his principal argument, though, in my view, an utterly inadequate one. He said that even in those counties which complain that they will be worse off as a result of the change-over from the general grant to the rate support grant the domestic ratepayer is paying rates not so very much above the average. That is under the present system. But, as my hon. Friend the Member for Hemel Hempstead (Mr. Allason) pointed out, although they are not very much above the average at the moment, by the time the Bill has been in operation for several years, ratepayers in those counties will be paying very much above the average and, so far from there being any general relief for ratepayers, these people will, as a result of two Acts of Parliament brought in by this Government, find that they are much worse off.
    I am sure that the Government do not want that to happen. They do not want to lose all those votes, which they will surely lose if they do nothing about it! Here again, we offer them a way out, at least a partial way out. They have the opportunity to make people feel less harshly the increases due to the changeover from the present system to the future one. Obviously, if increases in rates are
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    spread over six years, individual ratepayers, although they may complain at there being any increases at all in view of the undertakings given in the past, will not feel it to be quite such a severe burden.
    I ask the Parliamentary Secretary and his right hon. Friend to bear in mind that we are here dealing especially with very humble people. It is those who can lest least afford to bear any increase in rates who will be most resentful of rates being increased at all. One could go on elaborating this argument, but I hope that I have said enough to make it plain that this is intended to be a helpful Amendment which would not be costly and which would get the Government out of a difficulty which they have created for themselves.
    7.0 p.m.
    Mr. Awdry: By now the Minister must realise that the major changes which he is making are bound to have serious results for some local authorities. He said as much in the earlier debate. Particularly difficult problems would arise for those authorities where rapid expansion is planned, and in this connection I want again to mention Wiltshire, as I said I would. My colleagues on this side of the House who represent Wiltshire wish to be associated with what I am about to say.
    To deal with the national problem of pressure of population in the South-East—and everyone agrees that it is a national problem—the Minister's predecessor recently proposed the transfer of 75,000 more people from London to Wiltshire by 1981. In a county like mine, this will obviously mean a great deal of capital expenditure on roads, schools, health clinics and many other services before the population comes and before the industry arrives. The planning is starting now, but the people will not arrive in Wiltshire until about 1970.
    The proposed changes which the Government are making in the highway grants clearly illustrate how unsatisfactory will be the position for Wiltshire. At present, the maintenance of Class I roads and both the maintenance and improvement of Class II and Class III roads are subject to percentage grants, varying from 75 to 50 per cent. Those grants are to be replaced by a system which pays regard only to the mileage of roads. The rapid

    475
    expansion planned for Swindon, which is in my county, will involve a large expenditure on road improvements both inside and round the expansion area. But the new system will not help Wiltshire, because the total mileage on which the new system is to be based will not be increased. The new rate support grant to an authority which is to increase very fast in the next few years will be a matter of too little and too late.
    If the Minister will not accept the Amendment—and I have a nasty suspicion that he will not—will he at least give us some indication of how he intends in future to help counties like Wiltshire which in the coming years are to accept large increases of population? The point was well made in the earlier debate by many hon. Members who have already suffered this experience and who are trying to avoid the experience falling on my county.
    It is obviously wrong that all the initial cost of providing these services should fall on the present ratepayers. As it is national policy to expand these areas, there should be some new thinking on the Government's behalf and a new policy, a national policy, for financing this expansion.
    This is the anxiety of my constituents, and I hope that the Minister will deal with it. I can assure him that, as my right hon. and learned Friend the Member for Huntingdonshire (Sir D. Renton) said, the Government will lose many votes if they do not wake up to the fact that this is an urgent problem about which many counties and many people are deeply worried.
    Mr. Hay: I must confess that I was profoundly depressed by the Parliamentary Secretary's speech on the last Amendment. The general feeling of depression which came over the House was reflected in the very poor vote which the Government had in the Division, and is evinced by the fact that, with the exception of the Parliamentary Private Secretary, there is only one hon. Member on the back benches opposite. That shows the importance which hon. Members opposite attach to the very serious damage which this change in grant structure will do to the finances of local authorities.
    This Amendment is another intended to provide some transitional relief to local authorities who will be hard hit, as has been said. I have no doubt that the Parliamentary Secretary will come out with much the same sort of arguments which he used before. He will say that because in the past it has been found that transitional arrangements when grant changes have been made were not very effective and were sometimes cumbersome and awkward for Departments, in this case we should not have any transitional arrangements. My hon. Friend the Member for the City of Chester (Mr. Temple) made it clear in the last debate that that argument would not do.
    We are faced with the fact that the only method of adjustment open for the Government once the Bill reaches the Statute Book is the Order, and the Order will not be made until two years have passed, and it may be much longer. That is not good enough. Local authorities throughout the country are desperately worried about what their situation is to be. Many of them are perhaps unjustifiably worried when the event is finally made clear, but many others are quite rightly worried.
    There should be some kind of transitional provision. I have never known an Act of Parliament which changed the rights of individual authorities or people to compensation or to grants of Government money without some transitional relief being afforded. It is normally given and I cannot understand for the life of me why such a provision is not already in the Bill.
    I turn to another argument which the hon. Gentleman used and which he will no doubt use in connection with this Amendment. He said that the effect of what was being done was to change the balance, that some local authorities which at present were getting good grants would lose while others who were not getting adequate grants would gain, and that there would, therefore, be a general acceptance that some would gain and some would lose. He seemed to think that that argument was conclusive. However, it is completely possible for Parliament so to adjust the change in the balance as to ensure that although we cannot prevent there being losers, the

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    amount lost does not come upon them all at once and that the loss, which has to be suffered because the system is altered, is tapered over a period. That is the purpose of the Amendment. It sets a period during which the transition can be made and limits the amount of damage which any authority may suffer.
    I believe this to be an eminently reasonable idea and I implore the hon. Gentleman—I have been a little rough with him in my earlier remarks—to consider this Amendment with much more sympathy than he was able to show to the last. This is not just propaganda, for there is a problem and it is incumbent upon the Government to try to do something to relieve it. After all, they are making the change. We have not opposed or violently objected to the fact that a change is being made in the grant structure, but we ask the Government to make sure that if there are to be losers in the exercise, the amount of the loss will be mitigated as far as possible by an extension of the period during which that loss is suffered.
    Mr. MacColl: Many of my comments have been anticipated. I know that when hon. Members opposite say that I am not at my best, I have made a fairly effective contribution to the debate. I am alarmed only when they pay me compliments about having been reasonable and considerate. It is then that I think that I may be wrong.
    I do not want to go over again the case which I have already put, but there are great practical objections to a transitional scheme. I quote the examples of the 1929 grant and the 1958 grant to take the first and the last. They created slowness in getting the advantages of the change and also created complications in estimating. If one is wrong in the estimate of the previous grant and expenditure, that affects the amount one will eventually get. Therefore, it may be that a local authority will get paid something to which it is not entitled and it then has to pay it back. It then gets many complicated difficulties of readjustments and these, as I have said, lead to a transitional scheme on a transitional scheme.
    The right hon. and learned Gentleman said—and he is probably right—that the Amendment would not cost the Govern-
    478
    ment a lot of money. But it would cost the receiving authorities a lot. The way in which the 1958 grants worked was that some of the additional amount being given to authorities was held back as a fund out of which transitional payments could be made if necessary to authorities which were not gaining so much under the new system.
    Thus, the effect of having a transitional arrangement would simply be that the authorities benefiting from the new grants would have to wait to get the benefit so as to meet the needs or the possible needs of others. That does not seem good sense. If one has a grant scheme which one thinks effective, there does not seem much point in holding back its effects in this way.
    Another practical difficulty lies in striking the two figures on which one is to measure the effect on the receiving authorities. One has to start with the amount in one year and compare it with another. The trouble is that some of the amount in the starting year may be capital grants for improvements of Class II or Class III roads and these come into the needs element. Therefore, on paper there is a fall in grant, but in fact a capital grant for this purpose is once and for all and the authorities would not be getting it in later years. Thus, one gets an anomalous impression of a loss which is not really a loss at all because the authority would not have the money again under any system of grant.
    The other point concerns the threshold of the 2d. rate—that when there has been the loss of a 2d. rate one begins to get the advantage of the transitional scheme. In the London Government Act, the threshold was 5d. We now have a number of boundary adjustments to make and in the boundary orders which hon. Members have seen from time to time the figure is 6d. It would, therefore, be a little unreasonable to have a figure of only 2d.
    We are certainly open-minded about the effect in the new towns—as quoted, for example, by the hon. Member for Chippenham (Mr. Awdry)—in considering whether or not we need a change of system. We have had discussions with the local authorities concerned. At the moment, however, our impression is that the amount of expenditure involved is not

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    so great in relation to the total expenditure that it will make a very harsh burden. However, this is something that we will keep under review. My right hon. Friends the Minister of Housing and Local Government and the Minister of Transport will bear this in mind and keep in touch with each other about it. That is not a commitment. It is merely saying that we are anxious to get expanding towns going and want to do what we can.
    The critical point about this is that the right hon. and learned Gentleman said that we ought to be able to look at it again. He was talking about this going on for several years. But, despite what the hon. Member for the City of Chester (Mr. Temple) says, we can make a quick adjustment whenever a new rate support grant comes into operation. The Bill is flexible enough to deal with any major error we may have made of that sort. We do not think that we have made an error. We think we have it right. But if we do have it wrong in any case, then, when the new rate orders come to be dealt with, we shall be able to examine the position.
    This new grants scheme is a great improvement on the old one and by and large it will be of great benefit to most people. There is no case for delaying its benefit by having it tied down by transitional arrangements.
    7.15 p.m.
    Sir D. Renton: If I may have leave of the House, I will reply briefly.
    The Parliamentary Secretary has added only one point to his argument against this Amendment compared with what he said in reply to the previous Amendment. He said that the Amendment would not cost the Government much. He probably meant that it would not cost them anything. He added that it would cost something to the other authorities concerned and that this was another reason against the Amendment. But that is not our fault—it is the Government's fault. They held this out as giving relief to ratepayers and then introduced a scheme under which some ratepayers can get relief only at the expense of others. That is a shocking situation.
    Mr. MacColl: But that is true of all grant schemes. For example, the 1958 Act had a transitional scheme which was
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    at the expense of the gaining authority. The then Government said that they thought that, in justice and good policy, certain authorities ought to get more but that the Government would not give them more because the money had to be held back under a transitional scheme for other local authorities.
    Sir D. Renton: I can see that I have the hon. Gentleman really worried. He leaps to his feet to point out what we have mentioned several times and complained about—that there is no transitional scheme in the Bill whereas before there has always been a transitional scheme. Whether those transitional schemes worked well or not, there is no reason why we should not have had a transitional scheme, supported by the Money Resolution, in the Bill to ensure that the Government should carry out their undertaking to give relief to ratepayers.
    But the longer one continues this argument with the Government, the clearer it becomes that one is wasting the time of the House. I shall not press this matter any further. I shall not even ask my hon. Friends to divide. But I think that it is a most deplorable situation that the Government have led us into over this and I deeply regret the way in which the Amendments have been handled today.
    Amendment negatived.

    Clause 2.—(RATE SUPPORT GRANTORDERS.)
    Mr. MacColl: I beg to move Amendment No. 6, in page 3, line 27 to leave out from 'order' to the end of line 29 and to insert:
    '(hereafter in this Act referred to as a "rate support grant order") made by the Minister with the consent of the Treasury and after consultation with such associations of local authorities as appear to the Minister to be concerned and with any local authority with whom consultation appears to him to be desirable'.
    This deals with a point discussed in Standing Committee about the need to include provision for consultation. We assured the Opposition that we would always consult on any matter where we thought there was any possible help to come from it and that consultation did not need to be laid down in an Act of Parliament. We also pointed out that if the Government were told in too many

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    Measures to consult, it might look as if they did not have to consult in other cases. But the hon. Member for the City of Chester (Mr. Temple) and the hon. Member for Poole (Mr. Murton) both expressed some concern about it and, therefore, we are quite happy to include in the Bill a provision dealing with consultation. This is the standard provision that is to be found virtually in all cases of consultation. It is different from that of the hon. Member for Poole (Mr. Merton)—we had some criticisms to make on his—but I think it meets his point.
    Mr. Temple: I am obliged to the Government for bringing forward the first of the three Amendments to meet points that we raised in Standing Committee. We were keen that there should be statutory consultation between the Government and the local authority associations, more particularly in an important case like this where the Government will be dealing with the fixation of rates of support grants.
    Parliament, at a very late stage, sees the effect of a rate support grant brought forward in an Order. There is no question of amending that Order. Therefore, we thought it right that there should be this statutory consultation between the local authority associations and the Government, because that would give Parliament some assurance that there had been fairly full and free consultation on these very important matters.
    As the Parliamentary Secretary says, this is the first of three of this type of Amendment. We are very glad that the Government are bringing them forward. I do not propose to comment on the other Amendments which are of a similar nature, but I would give a general indication to the House now that these certainly have our approval and I know will be welcome to the local authority associations.
    Amendment agreed to.

    Clause 4.—(REDUCTION OF GRANTS IN CASE OF DEFAULT.)
    Mr. Oscar Murton: I beg to move Amendmnet No. 7, in page 4, line 44, to leave out subsection (2).
    Perhaps I might, first, deal briefly with the background to the Amendment. Subsection (2) of Clause 4 replaces, with
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    amendments, subsection (4) of Section 3 of the Local Government Act, 1958. Under the 1958 Act, general grants, like rate support grants under the Bill, were payable
    "in aid of the revenues of the recipient authorities generally."
    In fixing the annual aggregate amount of the general grants the Minister was—and is—required to take into consideration, among other things, the rate of relevant expenditure as defined by the Act. To discover what is relevant expenditure for the purposes of general grant it is necessary to look at Part I of the First Schedule of the 1958 Act.
    This says that, subject to certain exclusions specified in Part II of the Schedule, relevant expenditure is expenditure falling within any of the paragraphs in Part I of the Schedule, as, for example, expenditure incurred by local education authorities as such, expenditure incurred by or on behalf of local health authorities within the meaning of the National Health Service Act, 1946, in respect of the carrying out of the functions of such authorities, whether under that Act or under any other enactment, expenditure on fire services, expenditure incurred in carrying out any of the functions specified in subsection (1) of Section 39 of the Children Act, 1948, and so on. There are a number of them.
    These matters specified in the various paragraphs of Part I of the First Schedule have one thing in common. They are all functions which had been grant-aided before the coming into operation of the 1958 Act.
    There were other features also which made them generally of a kind. Thus, under the Education Act, 1944, and the National Health Service Act, 1946, the appropriate Ministers were given an overall national responsibility for the service concerned; under the Fire Service Act, 1937, a duty was imposed on fire authorities to make provision for fire fighting purposes, and the Home Secretary was empowered, after consultation with the Central Fire Brigades Advisory Council, to make regulations prescribing efficiency with respect to a wide range of matters, and under the Children Act, 1948, children authorities were required to carry out their functions under the general guidance of the Home Secretary. In much

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    the same way, the activities of local authorities under the Town and Country Planning Acts which were grant-aided were subject to the approval or control of the Minister.
    The other items in the original Schedule either were matters where a definite duty existed, as on the part of registration officers under the Representation of the People Act, 1949, or on the part of the local authority under Section 21 of the National Assistance Act, 1948, or the matters were relatively minor ones in regard to the actual amount of money spent, but where the Government were anxious to encourage the activities of local authorities.
    These were all matters, therefore, where a measure of Government control was, if not inevitable, at least to be expected as the normal concomitant of specific grants; furthermore, in regard to the more important services the appropriate Minister already had a statutory function to supervise in one way or another the activities of the local authorities concerned.
    The provisions of subsection (4) of Section 3 of the 1958 Act were, therefore, not particularly surprising and, in the context of the general grant under that Act, related to the limited range of matters giving rise to relevant expenditure, were not particularly objectionable.
    That has been rather long, and I apologise for it, but that is the background I have sought to prove, that up to that time the situation was what one might call under control. But under the present Bill the position is altogether different. The scope of "relevant expenditure" is extended to cover expenditure on the whole range of local authority services—except housing, which is separately supported by subsidies—and the trading services.
    This change brings within the functions giving rise to "relevant expenditure" a whole range of functions which have not heretofore been subject to any detailed control by central government, where local authorities have been treated as responsible bodies competent to discharge their own functions and to exercise their responsibilities in their own right. Yet subsection (2) of Clause 4 of the Bill would empower the
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    "appropriate Minister to make regulations for prescribing standards and general requirements in relation to any function of a local authority"
    —that is to say, not merely functions where the power of control already exists, not, indeed, only those functions which will give rise to relevant expenditure for the purposes of the new grants, but any function—housing, trading services, functions obtained by local authorities by local Acts of Parliament; indeed, everything.
    This is an altogether unjustifiable invasion of the independence and autonomy of local authorities, and is quite unjustified by anything that it is proposed to do under the Bill. When the Government of the day put forward their proposals which were later embodied in the grant provisions of the 1958 Act—I would remind the House that it was a Conservative Administration—the White Paper, Cmnd. 209, published in July, 1957, said, in paragraph 5 on page 4:
    "A main aim of the proposed changes has been to increase the independence of local authorities in the raising and the spending of their money so far as it is practicable to do so From 1951 onwards it was a declared objective of Conservative Governments to simplify and reduce departmental control, on the view that 'local authorities are responsible bodies competent to discharge their own functions and they exercise their responsibilities in their own right'".
    7.30 p.m.
    In so far as the grants under the present Bill are the successors of those under the 1958 Act, it must be commented that it is a strange way to increase the independence of local authorities—which was one of the aims of the 1958 legislation—by giving Ministers, as this Bill does, new powers to make regulations prescribing standards and general requirements where no controls have previously existed.
    In my view, this is a grave step backwards from the more enlightened legislation of a former day. In their White Paper of February last, entitled Local Government Finance in England and Wales, Command 2923, the Government stated that in their view:
    "… the paramount need is not so much to encourage or assist the development of particular services as to ensure that the total cost of all services does not place an impossible burden on ratepayers and in particular on householders."
    This is a very laudable intention, but I would submit that it is one which is bred out of expediencies because of the

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    Government's own economic policy, which has made it vitally necessary to shield ratepayers, even if it is only to a limited extent, from the impact of increasing costs and the annual cumulative build-up of servicing a loan debt which is at an historically high interest rate.
    The aim of the new system offers no ground for conferring new powers to impose new controls over services which have previously been the responsibility of the local authorities. Doubtless it will be argued that as all local authority expenditure, except expenditure on housing and the trading services, is to come into the calculation of the aggregate grants to local authorities, all local authority expenditure is grant aided and therefore the Government have an interest in how it is incurred.
    In the context of the new grants, and bearing in mind the amount of additional money which the Government are proposing to put in, this argument will not stand up. Paragraph 13 of the Government's White Paper of February sets out the grants paid in 1963–64: £287 million for specific grants, £587 million for general grant and £146 million for rate deficiency grants—a total of £1,020 million. No doubt that sum has increased and will increase again this year. What extra money are the Government offering which can be regarded as justified all of these extra controls?
    Paragraph 16 of the White Paper gives the answer when it says:
    "… something approaching £30 million…"
    in the first year. That is less than 3 per cent. of the grants in 1963–64—
    "… approximately £60 million in the second year, £90 million in the third, and so on."
    Additional grants of this order are insufficient to justify claiming an unlimited power to determine the standards and general requirements of the whole range of local government functions.
    If the Government feel the need for some power to regulate the activities of local authorities, in my opinion that power should be confined to functions for which a Minister has a national responsibility, as in the case of education and the National Health Service, or where Parliament: has specifically conferred some measure of control or oversight of some particular service.
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    The present provision is altogether too sweeping. It is an open denial of the guiding principles laid down by the Local Government Manpower Committee, which incidentally was appointed by and reported to a Labour Government, that:
    "… local authorities are responsible bodies competent to discharge their own functions…"
    and who
    "… exercise their responsibilities in their own right…"
    It is not justified by the circumstances, it is not necessary for the protection of the public, and it is an offence to local authorities who are doing their best to provide proper services for their area and who usually know very well what it is that their ratepayers want.
    Mr. Allason: As a vice-president of the Association of Municipal Corporations I wish to say that it resents subsection (2) and hopes that it will be removed from the Bill. It is a further extension of centralised control by the Government over local authorities. My hon. Friend the Member for Poole (Mr. Murton) has indicated that the Government might try to use the £30 million, by which they say they are going to increase the grant annually, as an excuse for their need to have control over the whole aspect of local government expenditure.
    This is not so. The beauty of the general grant system is that the money goes to a local authority, whether or not it spends it. There is a duty upon a local authority to provide essential services, but over and above that if it wants a marble town hall then it does it at its own expense, not at the general expense of the taxpayer. The argument that a small increase in grant to local government is being made is no excuse for exercising grand-motherly supervision. These are jobs voluntarily undertaken by local government, which under subsection (2) the Government are seeking to supervise.
    The Government should only seek to supervise these if it is a matter affecting the national interest, and the national interest does not enter into this. It is not a question of any increase in national expenditure, there is no national service involved. This is interference for the sake of it. It is a further extension of the good old Socialist principle, that "the gentleman in Whitehall knows best".
    Mr. MacColl: I could have understood this Amendment if it was merely directed to a part of the subsection, to those elements of expenditure which were not in the existing grant. But it is an extremely wide Amendment if it says that these powers should go in respect of all local authority expenditure under the grant. In other words it is repealing even the provisions in the 1958 Act.
    I find myself shot at from different angles because in Committee I was fighting very hard to make a point that we had powers under this Bill, and general powers in the matter of education. Then it was being said that this was all a plot to cut down the amount of expenditure on school meals and milk, which was quite untrue. This is not involved. I am very surprised to find that the attitude which has been taken by the hon. Member for Poole (Mr. Murton) has been put forward by the party opposite. When the hon. Gentleman the Member for Hemel Hempstead (Mr. Allason) said that this was an A.M.C. point I could see that. I could see the case for saying that any local authority would feel irritated by this sort of power but I cannot believe that anyone else would.
    I am certain that the great body of ratepayers would think that it was a good thing that there should be adequate supervision if money was being paid out. The existing position is that the powers to regulate standards have been used in the realm of education to deal with such matters as sanitation, safety arrangements for school buildings, qualifications for teaching staff and the maximum size of classes. My right hon. Friend the Secretary of State for Education and Science feels very strongly that those are necessary. I cannot believe that any impartial person would say that there was something dastardly and Socialist about wanting to ensure reasonable standards of sanitation, safety and teaching qualifications. I know of no case in which other authorities are likely to want to use these powers. There is certainly no general lust to rush in with regulations in every field of local government.
    All that this does is to give the power to make regulations which are subject to the negative procedure. Although the hon. Member for Hemel Hempstead may feel that it is a triviality, we are for the
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    first time extending this grant to virtually every aspect of local authority expenditure. That is very important and generous, and it should be emphasised.
    As we are going into the field of grant in this way, it does not seem unreasonable that we should have a residuary power to ensure that the standards are maintained. No sensible Government would go out of its way to have a whole pile of regulations applying to every small aspect of local government services. I therefore feel that the House would be unwise to accept the Amendment.
    It is true that there are other powers in other Acts. The last Government thought it desirable, in spite of that, to include the provisions about general expenditure. If we are to cover under the new rate support grant the whole of local authority expenditure, with the exception mentioned by the hon. Gentleman, most people would think it only common sense and responsible administration to take these powers. It is not a curtain opener for a devastating onslaught on the freedom of local authorities, and I do not think that any responsible local authority would think for a moment that it was.
    Amendment negatived.
    Mr. MacColl: I beg to move Amendment No. 8, in page 5, line 20, to leave out subsection (5).
    This Amendment is consequential on Amendment No. 3, in Clause 1, page 2, line 27. It is also a paving Amendment for the Amendment in Clause 4, page 24, line 30. It removes the various definitions of joint boards from the substance of the Bill and puts them in the interpretation Clause, Clause 34. This will make it easier for people to understand the Bill. It is a purely drafting Amendment.
    Amendment agreed to.

    Clause 6.—(REDUCTION OF RATES ON DWELLINGS BY REFERENCE TO THE DOMESTIC ELEMENT.)
    Mr. MacColl: I beg to move Amendment No. 9, in page 6, line 34, to leave out from 'amount' to the end of line 40 and to insert:
    'which, apart from this subsection, would be the amount of the general rate levied by the authority for any year on any dwelling-house or mixed hereditament in their area by

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    the following amount in the pound, that is to say—

    (a) in the case of a dwelling-house, the amount prescribed for that year in pursuance of paragraph 1 of Part III of Schedule 1 to this Act; and

    (b) in the case of a mixed hereditament, one-half (disregarding any halfpenny) of the amount so prescribed'.

    Mr. Deputy Speaker: If it is for the convenience of the House, we can take at the same time the following Amendments:
    Amendment No. 10, in page 6, line 38, leave out from 'Act' to end of line 40.
    Amendment No. 11, in page 6, line 40, at end insert:
    (2) When; a hereditament is occupied for domestic and non-domestic purposes, then providing the rating authority is satisfied that the occupation and use of such a hereditament is primarily for domestic purposes the prescribed reduction shall apply in respect of that hereditament.
    Amendment No. 12, in page 7, line 1, leave out from 'year' to end of line 2 and insert
    'in respect of dwelling-houses and mixed heri-ditaments respectively is equal to the amount mentioned in paragraph (a) or, as the case may be, paragraph (b) of subsection (1) of this section'.
    Amendment No. 13, in page 7, line 3, leave out 'a mixed hereditament' and insert 'primarily a dwelling-house'.
    Amendment No. 14, in page 7, line 20, leave out from second 'rate' to end of line 28 and insert:
    (6) Any dispute in respect of a hereditament claimed to be occupied and used primarily as a dwelling-house should be referred by the rating authority to the local valuation panel for determination by a local valuation court.
    Mr. MacColl: These Amendments deal with a series of point relating to the problem of mixed hereditaments. The House will know that in the case of mixed hereditaments, if more than half is a dwelling house, then for the purposes of the domestic element they are counted at half. In other words, if the relief on a domestic dwelling is 6d., on the mixed hereditament it would be 3d. There may be different rates in the £ in an area in respect of different hereditaments owing to differential rating, and that is taken into account.
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    7.45 p.m.
    The second point arises out of what came to be known as the "odd halfpenny". The odd halfpennies may be disregarded. If there is a reduction of 5d. on a house, the mixed hereditament would have a reduction of 2d. Over the next year the figures would be 10d. and 5d. This is done to get over the difficulty of calculating the halfpennies. The hon. Member for the City of Chester (Mr. Temple) is so cynical about these matters that he might even wonder what happens to the odd halfpenny. He may wonder whether it goes into the pockets of the Treasury. I studied this point in some detail. It does not. It goes into the needs element, which is the residuary beneficiary of the grant. The effect is that the saving becomes part of the needs element.
    Amendment No. 12, which is linked with Amendment No. 9, enables a rating authority making a rate for less than a year to apportion the reduction in rate poundage during the rate period in any way that it chooses, so long as the aggregate for the year gives the right result as between the two periods. The same discretion is given in respect of mixed hereditaments. The purpose is to make it possible to keep to the whole number and not become involved in calculating odd halfpennies.
    Mr. Temple: In Committee hon. Members found the question of mixed hereditaments a rather unpalatable meal. I referred to them as mongrels, and I am glad that the Government probably agreed with me and therefore tidied up this mongrel and tried to make it into a bit of a thoroughbred. But there efforts have been singularly disappointing, except that they have decided to do away with the odd halfpenny and thereby not give the computers indigestion. I have a series of Amendments which will make the mixed hereditament into a genuine thoroughbred. I do not know why we are making so much difficulty for ourselves in the way that we are trying to deal with mixed hereditaments under the Government's proposals.
    When local authorities were dealing with the question of whether a hereditament was used mainly for domestic purposes, or for shop purposes, or small office purposes, with the residents living in the shop on the corner, the Parliamentary Secretary urged them not be stingy.

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    The object of my Amendments is simply this. If the primary use of a hereditament or dwelling is for a dwelling house, then the occupant will get the full domestic rate relief.
    For many years rating authorities have had to establish the primary use of any building. Surely the Government wish to give full rate relief where the primary use is clearly domestic. In this context we are not discussing great office blocks, with a caretaker's flat at the top, or big blocks or works buildings where there happens to be a maintenance engineer's flat in some part of the building. In those two instances the primary use of the building would obviously be either industrial or commercial. But here we are discussing a situation in the context of the shop on the corner, and I would have thought it would be absolutely fair, recognising that the trade of such a shop fluctuates, that the rating authority should make a determination as to primary use and give full domestic relief to the dweller in the hereditament.
    The Government ought to think again about this matter. The amount of money at issue will be very small. This series of linked Amendments was suggested to me by no other authority than the Rating and Valuation Association. I urge the Parliamentary Secretary to accept this series of amendments, if only for one reason. Next week I shall be the guest at a dinner in Eastbourne at the Conference of the Rating and Valuation Association, and I should like to be able to go to that Conference and report to it that on its behalf and on behalf of the ratepayers I had scored a singular success.
    This is a sensible arrangement. We have so many complexities in the Bill that we ought to agree to the easy option that I am putting before the House, I hope that the Parliamentary Secretary will jump to his feet and make my visit to Eastbourne a pleasurable one.
    Mr. Michael Barnes: I should like to know what the present position is about the amount prescribed for any year in pursuance of paragraph 1 of Part III of Schedule 1, referred to in paragraph (a) of Amendment No. 9. This is
    "an amount in the pound which in the opinion of the Minister corresponds to the amount of the domestic element".
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    When we last debated this matter, in the Second Reading debate on 14th June of this year, we had not begun the wages and prices freeze. We were then told that the domestic element would be fixed in such a way that in the first year—1967–68—£30 million would be transferred from taxation, £60 million the following year and £90 million the year after. We were told that the effect would be to halve the annual increase in the rates, there being this built-in 10 per cent. increase in our rating system, which is one of the defects of the system, and that this would be an interim measure to carry us over a few years until, presumably, we had our new system of local government finance in the early 1970s.
    It was doubtless very acceptable in June that this cushioning should operate—that the 10 per cent. increase should be cushioned in the rates so that it would become only a 5 per cent. increase, and that next March the ratepayers would be faced with only a 5 per cent. built-in increase instead of one of 10 per cent. But in the present economic circumstances this is no longer acceptable to ratepayers. Local authorities will obviously do what they can to hold their rates where they are, but the Government have a very important responsibility in this matter, and I should like to know what plans they have to give local authorities more help in this respect. This is a very difficult year, and ratepayers will definitely expect the rates to be held where they are.
    I know that if the Government transfer extra money from taxation the money must still be found, but the more we transfer money for local authority expenditure from taxation the fairer is the burden, because of the inherent unfairness of the rating system. What are the Government going to be able to do in this matter, if anything?
    Mr. MacColl: If I may first deal with my hon. Friend's point——
    Mr. Temple: On a point of order. I thought that we were discussing an Amendment dealing with mixed hereditaments and not with the question of the transfer of money for local authority expenditure from taxation.
    Mr. Barnes: This is part of the Amendment. That is my point. To ratepayers throughout the country this point is part of the Amendment under discussion.
    The Deputy Chairman: The hon. Member is in order.
    Mr. MacColl: The final effect of these proposals and the nature of the order which my hon. Friend will make will be clearer when we look at the whole Rate Support Order and when we get the figures of estimates. It will then be much easier for my hon. Friend to appreciate the effect of this expenditure upon the rates. The Bill merely outlines the form of these activities. We are leaving the filling in of details to the order.
    Mr. Arthur Jones: Would it not be possible, in trying to deal with the question so rightly posed by the hon. Member for Brentford and Chiswick (Mr. Barnes), to take a hypothetical example? We shall all be able to see exactly what will happen when we get some figures. That is what we have said all along. But would it not be possible to take a hypothetical circumstance and try to deal with the question in that context?
    Mr. MacColl: My hon. Friend's point was a valid one, and I was saying that it could be discussed with more precision at a later stage, when we have the orders. As for my taking a hypothetical example, at the moment I have enough to do with my existing commitments under the Bill, without endeavouring to make impromptu excursions into hypothetical examples.
    I do not understand the use of the word "primarily" in the Amendment of the hon. Member for the City of Chester (Mr. Temple). That is one of the difficulties of appreciating the effect of his Amendment.
    Mr. Temple: I did try to cut my speech short. The words "primary user "were given in the judgment of Lord Thankerton, in the case of Moon v L.C.C. in 1931. That was why I used those words.
    Mr. MacColl: We have talked a lot about small shopkeepers, and it would lead to uncertainty as to how much they would receive in respect of the domestic element if they had to wait for the interpretation of Lord Thankerton's judg
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    ment in the matter. At least people know what a half is. That is one of the advantages of the Bill. It is fairly precise at this point. The wisest thing would be to keep to the arrangement laid down in the Bill. It would be clearer, especially in cases where the shop use is a fairly substantial one and it is fairly clear which side of the 50 per cent. it falls. That is a much easier test than the test of its being "primarily" for domestic purposes.
    Amendment agreed to.
    Further Amendment made: In page 7, line 1, leave out from 'year' to end of line 2 and insert:
    'in respect of dwelling-houses and mixed hereditaments respectively is equal to the amount mentioned in paragraph (a) or, as the case may be, paragraph (b) of subsection (1) of this section'.—[Mr. MacColl.]
    8.0 p.m.
    Mr. MacColl: I beg to move Amendment No. 15, in page 7, line 23, after 'authority', to insert 'or is determined in pursuance of subsection (6) of this section'.
    It would be for the convenience of the House, perhaps, to take with this Amendment Amendment No. 17, in page 7, line 28, at the end to insert:
    (6) The Minister may by regulations provide for the determination as respects any hereditament of any question as to the proportions mentioned in subsection (5) of this section in any case where the occupier or the person treated for the purposes of the regulations as the occupier of the hereditament is dissatisfied by the refusal of the rating authority to treat the hereditament as a mixed hereditament for the purposes of this section or the occupier, the person aforesaid or the rating authority considers that by reason of a change of circumstances a previous determination made in respect of the hereditament by virtue of this subsection should cease to have effect; and without prejudice to the generality of the power to make regulations conferred by the foregoing provisions of this subsection, the regulations may include provision—

    (a) applying for the purposes of a determination any of the provisions of Part III of the Local Government Act 1948, with such modifications, if any, as may be specified by the regulations;

    (b) for a determination to have effect with respect to such period, whether or not beginning before the time when an application for the determination was made, as may be provided by or under the regulations.

    Amendment No. 15 is really the "lead-in" to the latter Amendment.

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    This is an important improvement in the Bill which, I think, will appeal to hon. Gentlemen opposite. We had a considerable argument in Committee about the need to have some form of appeal from the decision of the rating authority about whether or not something was a domestic or a mixed hereditament. At that stage, my right hon. Friend made an offer that it would be possible to get from the valuer a certificate as to whether or not the mixed hereditament was over or under the 50 per cent.
    That was regarded, rather to my surprise, as being inadequate. I thought that we had gone a long way to meet hon. Gentlemen opposite on the point. However, my right hon. Friend has no desire to be a dog in the manger about this matter and we can now suggest that we put into the Bill a proposal for a right of appeal. What will happen at the moment is that the initial decision will still lie with the rating authority, but where the ratepayer is aggrieved by the authority's refusal to treat his property as a mixed hereditament, he can apply for a hearing to the valuation officer.
    The intention, in the proposed Regulations, is to provide a right of appeal, and this, of course, is complicated. It seems best to do it by Regulation rather than to spell it out in a great deal of detail. The proposed procedure—this is an analogy to what is already done in other spheres of valuation—is that the issue of a certificate will be treated as a proposal and it will then be possible for the parties to agree. If they do not agree, the matter can be taken to the local valuation court and then, if necessary, to the Lands Tribunal. However, it is always possible, of course, for the two parties to reach agreement at a later stage. We are not excluding that.
    I think that this will make the proposals very much more acceptable to the hon. Gentleman and, I hope, to the House. At no stage was the argument whether there should be an appeal or not. The argument was whether we had the resources of valuers and staff to do this effectively. We can now say that this is possible.
    Mr. Temple: Clause 6 ame in for a good deal of criticism in Standing Com-
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    mittee, particularly the fact that there would not be an appeal at that stage to what we regarded as the right adjudicating body, namely, the valuation court. I am glad that the Government's new proposals envisage making Regulations which include the provision that a determination will be made by the valuation court. I wish that these matters could be in the Bill rather than in Regulations, but I understand the difficulty.
    It seems likely that we will have an inordinate number of Regulations as a result of this Measure and that a great deal of Parliamentary time will be taken up by the Regulations. Perhaps, later in our proceedings tonight, the Parliamentary Secretary may be able to say at what stage we may expect these Regulations to come before the House. He and the House will appreciate that the Bill comes into operation in April next year and local authorities will want to know where they stand, particularly over mixed hereditaments, as early as possible. We certainly approve of the Amendment.
    Amendment agreed to.
    Mr. MacColl: I beg to move Amendment No. 16, in page 7, line 28, at the end to insert:
    '(any part of the hereditament used for the letting of rooms singly for residential purposes, whether by way of a tenancy or licence and either with or without board or other services or facilities, or used as sites for movable dwellings within the meaning of section 269 of the Public Health Act 1936 being treated as used for purposes other than those of a private dwelling or private dwellings)'.
    This Amendment is to remove doubt about the treatment of caravan sites and what, in the discussions in Committee, we called "bed-sitters"—rooms let singly as mixed hereditaments. The intention at that time was that the caravan and site, if assessed and rated separately, under the recent decisions in this matter would rank for the full benefits of the domestic element. If, on the other hand, the caravans were part of a caravan park, that park would be regarded as a commercial undertaking and would not get its relief as a mixed hereditament. The same applies to single rooms let as "bedsitters".
    It is not proposed, however, to exclude all such hereditaments from qualifying for relief, because there may be some marginal cases which are rather difficult

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    to treat precisely. Therefore, the Amendment provides for the caravan sites and the rooms to be treated as being used for purposes other than those of a private dwelling when it has been decided whether more than half the rateable value is attributable to the parts used for the purposes of the private dwelling.
    There is nothing new in this: it is what we discussed in the fourth sitting of the Committee. I think that it clarifies the position.
    Mr. Temple: The Parliamentary Secretary has claimed that the Amendment clarifies the position. Unfortunately, I have to inform him that I believe that it makes the position rather worse. I have had a great deal to do with caravans over many years and I know that anything to do with the rating of mobile dwellings presents enormous difficulties. Let us be clear what the position will be if the Amendment is accepted.
    As I understand it, the Parliamentary Secretary said that where a residential caravan is individually assessed, its occupant will be able to get domestic rate relief, but that where a similar type of occupant—in other words, a resident in a residential caravan—is on a site which is rated as a site, then the individual occupant, although he is occupying his caravan for domestic purposes, will not be able to get the domestic rate relief.
    Last summer, I had conversations with a very large caravan site operator. He explained to me some of the difficulties of rating individual caravans. He said that rating authorities much preferred to have a global assessment on the site, as they were then able to collect those rates from the site operator. If the Amendment is accepted, of course, there will be great pressure for all residential caravans and, indeed, all caravans used for domestic purposes, to have individual assessments, because then those caravans will be able to obtain domestic rate relief.
    The Parliamentary Secretary will have a chance to tidy this up in another place, so I will mention the problems of collecting rates from individually assessed caravans. For one thing, caravans can move, and frequently do. Though possibly in the context of this discussion one may think of caravans which one has known on site for many months or years, there are many residential caravans which
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    move frequently. Caravan dwellers by their nature are people who like to change their caravans. I know of caravan dwellers who change their caravans annually. They probably move to a bigger and better van, thereby attracting a larger assessment. It will be almost impossible for the local rating authority to keep track of all these individual assessments on caravans. The Parliamentary Secretary said that the object of the Amendment was to clarify the position. In my submission, it may well do the reverse. I make this very genuine case from my own personal experience and knowledge of this subject.
    I turn to another aspect of this far from simple subject—and that is the dwelling-house with two, three, four or five residential caravans in the garden. That dwelling-house will be only a dwelling-house, because the owner of the site will live in that house. If the value of his house is more than half the value of the whole site, he will be able to claim domestic rate relief. He will be able to claim domestic rate relief in respect of his house, which is assessed at one with five vans on that site. I do not believe that these circumstances have been taken into account. If I am right, then all the occupants of the five vans, although they are not individually assessed, will, because they are part of this one domestic hereditament, be able to claim domestic rate relief. I am bringing these very practical difficulties to the Government's notice.
    The question of rating mobile dwellings is extremely difficult, but the Government have launched themselves further into these difficult waters and I very much hope they will pay regard to what I have said and possibly have consultations with the industry at a very early date, thereby helping the rating authorities to overcome what I believe will be greater difficulties as a result of the acceptance of the Amendment, which I recommend to my hon. Friends.
    Mr. Lubbock: I had not intended to intervene in the debate, but the hon. Member for the City of Chester (Mr. Temple) raised a number of important points to which we would like answers before we leave the Amendment. I have been concerned with caravans for some time, and I have always thought that if

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    caravans could be individually rated it would be to the advantage of the occupant, particularly since we have had the Rating (Interim Relief) Act, because those occupants could make application for the benefit of that Act which they could not make while the site was rated as one.
    The Parliamentary Secretary worried me because he seemed to imply that the recent court decision which provided for the individual rating of caravans would not be followed in all authorities. He was explaining the difference between two types of site, one of which would be treated as a series of domestic hereditaments and the other treated as a mixed hereditament as a whole; and in the latter case the occupants would not be entitled to relief under this Act or the Rating (Interim Relief) Act.
    I was under the impression that following the recent decision of the court the officers of the Inland Revenue in all those areas would extend this provision so that individual rating of all caravans would come under this system sooner or later. But the speeches of both the Parliamentary Secretary and the hon. Member for the City of Chester gave the impression that this was unlikely to happen.
    8.15 p.m.
    The hon. Member for the City of Chester raised some difficulties which he said stood in the way of individual rating, such as the fact that caravans move frequently from their sites and that the owners of caravans tend to change them fairly frequently. If I may say so to him with great respect, in modern sites this is happening less and less. The more expensive caravans are now becoming the norm, with various facilities in them, such as running water and fixed heating which were not available a few years ago when people tended to use the same sort of caravan as a dwelling house as they used for touring. What the hon. Member said probably still is applicable to the holiday sites, but I think that it is less and less applicable to the permament residential site, for the manufacturing industry is trying to encourage people to think of the caravan as a much longer-term dwelling than has been the case hitherto. In fact, they talk of caravans lasting as long as 30 years.
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    When I went to the Caravan Exhibition last year the manufacturers were saying quite confidently that although this had not been the impression which the caravan industry gave to the public in past years, they very much hoped that caravans would be thought of in future as semi-permanent dwellings, that people would not change them so frequently and that they would be far less likely than hitherto to move from one site to another. It is interesting to talk to some of the site operators and to find out the proportion of old people who now find the caravan the most convenient form of residence. These practical difficulties which may have stood in the way of individual rating in the past no longer apply.
    I want to ask the Parliamentary Secretary to deal with one point in particular. Why has this definition been chosen in the Amendment:
    "used as sites for moveable dwellings within the meaning of Section 269 of the Public Health Act, 1936"?
    There is probably something obvious which I have missed, but I thought that the Caravan Sites and Control of Development Act, 1960, would have provided a suitable definition for this purpose. I only just realised when the hon. Member for City of Chester began his speech that caravans were involved in this Amendment. That is probably my fault for not having read the Notice Paper carefully, but other people may well have fallen into the same trap. If the Parliamentary Secretary can give us the assurance for which I asked about the extension of individual rating, then I am sure that this is very good Amendment which should be accepted.
    Mr. MacColl: I said in Committee that we had been rebuked for our alleged disrespect of the rule of law and were regarded as a party inclined to regard decisions of the court as matters which we could disregard. As I said, this was very far from the truth, and in this matter we are following the rule of law very carefully.
    The Court of Appeal has addressed itself precisely to this point—when is a caravan a residence for separate rating and when is it not? We do not think it right to interfere with that decision. Of course that decision will be carried out, and local authorities may well feel

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    that they want to take steps to see that in particular cases proposals are made. That is a matter for the law. The law has made a ruling on this subject, and we do not want to interfere.
    What we say is that once a decision has been taken to rate the caravan separately, then it ranks as residential and it is entitled to relief on the domestic element and will be entitled in appropriate circumstances to relief under the Rating (Interim Relief) Act. That is logical. The hon. Member for City of Chester (Mr. Temple) said that this would be embarrassing for the site owners.
    Mr. Temple: For the local authorities.
    Mr. MacColl: I thought that this would be more convenient for the local authority. They are now accepted as residential hereditaments and are to be rated as such, which is reasonable.
    If there are any points worrying people on this issue I assure the House that we will give consideration to them before the Bill is passed. If any improvements in the Measure can be made, people have only to suggest them and they will receive our consideration. However, we feel at present that this is a reasonable and sensible arrangement.
    The hon. Member for Chester asked why we were using Section 269 of the 1936 Act rather than the later Act. I do not have copies of the two Acts with me to compare the two definitions, but I will inquire and write to the hon. Gentleman.
    Amendment agreed to.
    Further Amendment made: In line 28, at end insert:
    (6) The Minister may by regulations provide for the determination as respects any hereditament of any question as to the proportions mentioned in subsection (5) of this section in any case where the occupier or the person treated for the purposes of the regulations as the occupier of the hereditament is dissatisfied by the refusal of the rating authority to treat the hereditament as a mixed hereditament for the purposes of this section or the occupier, the person aforesaid or the rating authority considers that by reason of a change of circumstances a previous determination made in respect of the hereditament by virtue of this subsection should cease to have effect; and without prejudice to the generality of the power to make regulations conferred by the foregoing provisions of this subsection, the regulations may include provision—
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    (a) applying for the purposes of a determination any of the provisions of Part III of the Local Government Act 1948, with such modifications, if any, as may be specified by the regulations;

    (b) for a determination to have effect with respect to such period, whether or not beginning before the time when an application for the determination was made, as may be provided by or under the regulations.—[Mr. MacColl.]

    Clause 7.—(GRANTS FOR DEVELOPMENT AND REDEVELOPMENT.)
    Amendment made: In page 7, line 30, at end insert:
    'and after consultation with such associations of local authorities as appear to the Minister to be concerned and with any local authority with whom consultation appears to him to be desirable'.—[Mr. MacColl.]

    Clause 8.—(GRANTS FOR PUBLIC OPEN PACES.)
    Mr. Murton: I beg to move, Amendment No. 19, in page 9, line 42, to leave out 'and'.
    Mr. Deputy Speaker: I think it would be convenient for the House to discuss Amendment No. 21, in line 44, at the same time.
    Mr. Murton: On the grounds of comprehensibility, it would be as well if I spoke to Amendment No. 21.
    Mr. Deputy Speaker: Technically, the hon. Gentleman must move Amendment No. 19. There may be a discussion on Amendments 19 and 21 together and, if a Division is thought desirable on Amendment No. 21, that could take place.
    Mr. Murton: A rather different definition was set down by my hon. Friends in Committee upstairs on what was meant by "public open space", a phrase used in the Bill. As there was some doubt about whether it was in order and as it had been tabled rather late, that Amendment was not called. During the discussion of the Motion that the Clause stand part there was, nevertheless, a reference to the Amendment and the then Minister of Housing and Local Government said:
    "What we mean by public open space is public open space in the obvious general sense of the term."
    He went on to give an example, and said:
    "If it is a playing field which is public, it will be covered. If it is a school playing field,

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    it comes under the education grant. The question is whether it is public in the general sense."—[OFFICIAL REPORT, Standing Committee F, 7th July, 1966: c. 206.]
    Unfortunately, it is not quite as easy as that and local authorities are anxious that this provision, which they welcome, should not be too narrowly construed.
    What is a public open space in the "obvious general sense" of the term? A stretch of unenclosed land in the heart of a town, like the Stray at Harrogate, or an open space, like the Town Moor of Newcastle, might be taken as an obvious example, as well as some of the down-lands such as Eastbourne possesses, or even woodlands and moors owned by local authorities. They are open spaces and they are always accessible to the public. No doubt, too, there would be general agreement that the parks and gardens which are to be found in most towns come within this general description, even though they may be closed to the public at nights.
    The then Minister mentioned "playing fields", which is a wide term even if we exclude school playing fields. Here there is room for argument. Most people would agree that the recreation ground where a ball can be kicked about or where cricket can be played would be regarded as a "public open space". But what about the playing field for games such as football, cricket, tennis, bowls and so on? What about places where basic equipment such as goal posts, tennis nets and so on are provided and where pitches, courts and greens are maintained, where appropriate, and marked out? What about places where local authorities customarily make a charge for the facilities provided, whether by a charge for the pitch or whatever it may be, either by the day or the hour, or for a round on a putting green or by a rent payable by a club for the use of a pitch or bowling green throughout the season or on specified days each week? How do these stand?
    These facilities are among those greatly needed almost everywhere. They are as much a part of town life as the pleasure gardens where one can sit among flower beds or perhaps listen to the band on a Sunday evening in the summer—if it does not happen to be raining, as it often is in this country. They are just as
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    important and usually no less a charge on the rates, as income rarely matches the outgoings.
    Local authorities are anxious that the Clause should be capable of the widest interpretation but fear that the words "public open space" are susceptible to too narrow an interpretation. It is important that playing fields other than school playing fields should be covered, even though charges may be made for their use. This definition does not seek to cut down the natural and general sense of the words—that is, if they have such a natural and general sense—but to ensure that some things are not excluded which should be included beyond per-adventure.
    This may seem a minor point, but the Government would be well advised to accept the Amendment, largely because the right hon. Gentleman the former Minister drew attention to this wording and since its acceptance would make the matter clear beyond any possible shadow of doubt.
    The Minister of Housing and Local Government (Mr. Anthony Greenwood): I do not think that there is any difference in objective between the two sides of the House in this matter. The issue between us is how best to achieve the same objective, and I listened with great care to the remarks of the hon. Member for Poole (Mr. Murton).
    8.30 p.m.
    The Clause as it stands empowers the Minister—that is, myself—to pay grant at a maximum rate of 50 per cent. in relation to expenditure by local authorities on the acquisition for use as public open space of such land as I approve. Land appropriated for public open space may also be brought in as required for the purpose. It is true that the Bill does not define "public open space," and the hon. Gentleman gave what seemed to me to be a very fair account of what happened in the Standing Committee when a discussion of what was a starred Amendment was not possible.
    It seems that if the effect of this Amendment would be to extend the meaning of the words "public open space" you, Mr. Deputy Speaker, would have ruled it out of order as not complying with the Money Resolution, and if it would not be to extend the meaning

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    of those words it is unnecessary, and might well prove restrictive and, I think, limit excessively the Minister's power to pay grant. To that extent it might well operate to the disadvantage of local authorities.
    It may be desirable for me to give some indication of our intentions with regard to the administration of the open space grant. Broadly there does not seem to be any major difference between the substance of the grant as the hon. Gentleman has expressed it and as I have in mind to propose to the local authority associations when I have my consultations with them but I invite the House to acknowledge that there must be certain limitations.
    The proposition is that for the purpose of these grant arrangements, "public open space" shall comprise parks and pleasure grounds, recreation grounds and playing fields which are in or near built-up areas and are provided by the local authority primarily for the use of local people. A park or recreation ground, I am advised, even if closed to the public at certain times—for example, during the hours of darkness-would still be a public open space within the meaning of the Clause as it stands. The expression is not confined to common land or downland, which are open to the public at all times, and the doubts which the hon. Member for City of Chester (Mr. Temple)—whose good wishes I warmly appreciated when he expressed them to me earlier—expressed in Commitee during the debate on Clause 8 can be set at rest.
    Public open space should not include school playing fields nor the amenity areas associated with the development of houses or flats or pedestrian shopping precincts. All these are provided as part of the particular services concerned. Nor is it our intention that expenditure in connection with the acquisition of land for access purposes under the National Parks and Access to the Countryside Act, 1949, should be eligible for grant under Clause 8. There will, of course, be cases, where public open space is provided as part of comprehensive development or redevelopment, where the expenditure on the acquisition or clearance of land is eligible for grant under Clause 7. In such a case the expenditure in respect of the land acquired for public open space
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    would be assisted under Clause 7 and not under Clause 8.
    The Amendment, as I understand it, aims to secure that grant shall be payable under Clause 8 notwithstanding that a rent, fee or other charge is made for the use of a playing field. The making of a charge for the use of land and the facilities associated with it will not preclude the payment of grant provided that the land remains, in the ordinary sense of the words, public open space.
    If I might give an example, a park would not cease to be a public open space because it included an enclosure with a band stand, with a fee charged for admission when the band was playing. Similarly, a recreation ground would not cease to be public open space because it included a cricket pitch for the use of which a local club paid a fee or rent, provided the public were able to watch the matches.
    If, however, the local authority proposed to make available a playing field on some basis of rent or fee for the exclusive use of some sporting or social club so that the general public could no longer expect access to it or enjoyment of it, the land would not any longer be, in the ordinary sense of the words, public open space. It would be contrary to the object of the grant provision were land used in such a way to attract grant.
    In view of the explanation I have given, not only of our interpretation of the meaning of the Clause but of our intention as to its application, and in view of the principles we propose to adopt in our discussions with the various associations, I hope that the hon. Member will be prepared to withdraw the Amendment. Otherwise, I shall have to ask the House to negative it.
    Mr. Murton: I am grateful to the right hon. Gentleman for his full and really devastating answer to the Amendment. His precedessor said that the matter was simple and obvious. I rather suspect that the right hon. Gentleman has put a rather different complexion on the case, but he has explained it very carefully. Under the circumstances, I beg to ask leave to withdraw the Amendment.
    Amendment, by leave, withdrawn.
    Mr. MacColl: I beg to move Amendment No. 20: In page 9, line 43 to leave out 'and a parish council'.
    This proposal to leave out "and a parish council" may sound devastating in its implication, but I should like to make quite clear that it is in fact basically a drafting Amendment. In subsection (5) "local authority" is defined as meaning for the purposes of the Clause
    "a local authority within the meaning of the… 1962 Act and a parish council"
    but the definition of "local authority" in the 1962 Act includes any other authority which is a local authority within the meaning of the Local Loans Act, 1875, and a parish council is such an authority under the Act of 1962. Consequently, it does not require a separate reference here. This is a tribute to the recognition of parish councils as local authorities rather than an attempt to disregard them.
    Amendment agreed to.

    Clause 10.—(GRANTS TO PORT AND AIRPORT HEALTH AUTHORITIES.)
    Mr. MacColl: I beg to move Amendment No. 22, in page 11, line 22, to leave out 'Minister of Aviation' and to insert 'Board of Trade'.
    This is a drafting Amendment arising from the transfer of functions. Under the Transfer of Functions (Civil Aviation) Order, responsibility for airports which was with the Minister of Aviation has now gone to the Board of Trade and that change was from 1st July, 1966. This Amendment recognises that change and substitutes a reference to the Board of Trade for that to the Ministry of Aviation.
    Amendment agreed to.

    Clause 16.—(POSTPONEMENT OF REVALUATION.)
    Mr. Murton: I beg to move Amendment No. 23, in page 12, line 36, to leave out 'seventy-three' and to insert:
    'seventy or such later year, not being later than the year nineteen hundred and seventy-three, as the Minister may by order approved by resolutions of both Houses of Parliament appoint'.
    Mr. Deputy Speaker (Sir EricFletcher): I think that it will be for the convenience of the House for this
    508
    Amendment to be discussed at the same time as Amendment No. 24, in page 12, line 38, at end insert:
    Provided that the Minister may by order approved by resolutions of both Houses of Parliament substitute some earlier year for the year nineteen hundred and seventy-three, and upon such an order being so approved this section and the said section 34 shall have effect accordingly.
    Mr. Murton: The Government's proposal embodied in the Bill to postpone revaluation until 1973 is based on the general shortage of valuers in the Valuation Department of the Board of Inland Revenue. Ever since responsibility for valuation for rating was transferred by the Local Government Act, 1948, from local authorities to the Inland Revenue there have admittedly been delays and postponements of each valuation. Under the Local Government Act, 1948, the first new valuation list was to come into force on 1st April, 1952, with power for the Minister by Order to postpone the date until 1st April, 1953. In fact, the new list came into force on 1st April, 1956.
    The second list was supposed to come into force on 1st April, 1961. That date had to be changed to 1st April, 1963. The postponement on that occasion was half the previous one so there was a hope that the position was improving and that the new list, due in 1968, would be ready on time, but now we are faced in this Bill with a proposal for a new postponement, not for two years as in 1961, not even for four years as in 1962, but for five years. What should be a quinquennial revaluation is thus now becoming a decennial one. I dread to think what might happen in future if things were to go on like that.
    In 1952, there were very valid reasons for postponement. First, the Valuation Department had not got into its stride with the new task which had been given to it. Secondly, that task was of formidable proportions seeing that there had been no revaluation since the mid-19308. The reason for that is well known to all of us in the House: 1939 was considered to be the latest date at which a free market value in houses existed.
    The third reason was that the Department was being called upon to work on the basis of a formula which proved impracticable and had to be radically

    509
    changed. In 1961, there was the valid reason that the appeals against the 1956 lists had taken longer than had been expected in being brought to a final decision.
    This time the reasons given for postponement are the general shortage of valuers and the need of the Department to clear up appeals against the 1963 lists. One would accept that, but there is a final reason and I consider it to be the main reason. It might not be altogether palatable to the Minister. It is not admitted by the Government, but we believe that it is their preoccupation with the valuation commitments which arise out of their legislation which is the main cause of this postponement.
    I do not wish to get out of order, but I mention in passing the Capital Gains Tax legislation and the even more notorious Land Commission Bill, which is at present going through its final stages. These have undoubtedly added to an already grave shortage of qualified valuers. I do not deny that there is this shortage. There is a heavy backlog of work to cope with, but an immediate postponement for five years is, in our opinion, a failure on the part of the Government from the very start.
    I suggest that every effort should be made to get the work done quickly. Whether Ministers like or dislike the rating system as a means of raising revenue, it is the only means at present available to local authorities which is under their own control. The rating system has been described as a blunt instrument, but the longer the valuation lists on which it is based are allowed to become out of date the more unfair it will become to ratepayers and to local authorities which are forced to rely on it for the major part of their local revenues. Particularly is it unfair to ratepayers.
    I know about the problems which have arisen in my own constituency in the past because of a postponement of revaluation. I know what difficulties arose after the last revaluation. One appreciates that there are grave anomalies between the rating of various types of flats. I know that there are inequalities in rating as between new flats and older flats and as between flats and bungalows, on the one hand, and two-storey houses, on the other. All this makes me realise that as time
    510
    passes this will become a very much more serious problem.
    If we are to be faced with a virtual 10-year standstill when revaluation eventually takes place, there will be considerable hardship on all sides. We are concerned about the ratepayers. One Measure that might have been attempted—and one would commend it to the right hon. Gentleman—is to employ private valuers on a contract basis in an attempt to overcome this problem. That should afford some relief. No doubt the Minister has thought of this, and possibly his Department have done something about it, or I sincerely hope that it has.
    It might be that this pessimistic approach underlying the Clause is fully justified and that, if the postponement were not for the full five years, nothing could be done. However, it might just be possible for the lists to be completed quicker, and the Amendment gives an opportunity for that to be done. It provides for an initial postponement of two years—a period which proved sufficient on the last occasion; but, in case it finally turns out that it is insufficient, power is reserved for the Minister, with the approval of Parliament, to postpone the date for a further period of one, two or three years.
    We on this side of the House feel that that Government are adopting a defeatist attitude. The valuation department of the Inland Revenue may well lose the sense of urgency which it needs to maintain if the present difficulties are to be overcome. To this extent, public spirited though those officers will be, they will be protected by the Clause and lulled into a sense of security. Let the Government take up the challenge of accepting this Amendment. They owe it to the hard-pressed ratepayers whom I and my right hon. and hon. Friends have as our first concern, as also have the Government, I am sure.
    8.45 p.m.
    The Parliamentary Secretary, who has left us for a short while, admitted in Committee that the postponement was forced upon the Government by the situation. The Government have undoubtedly caused that situation and they owe it to the ratepayers and local authorities to make every effort to mitigate the serious effects of a revaluation which will be

    511
    ten years overdue if the Government do not accept the Amendment.
    Mr. Arthur Jones: I support the Amendment but, at the same time, I recognise the difficulties with which the Government are faced. They are taking not the easy way out, but one which is at the end of the line. It is the most unimaginative way out. It will give valuation officers very little prospect of keeping their departments together. When there is a postponement of revaluation of this sort and a rundown of the potential work which keeps these departments busy the departments will not hold the best men. There will be a general rundown.
    The Government should have made every effort to try to see how this difficulty could be overcome. A number of suggestions were made in Committee, where it was suggested that we should try to concentrate on a certain type of hereditament, that we should have a rolling revaluation. The Parliamentary Secretary was not in the least sympathetic, because he said that if this was done in a particular order it would lead to hardship to one type of ratepayer or another. I do not accept that view. It must be possible, and a way must be found, to provide for the revaluation that is absolutely necessary if the whole basis of rates as a means of income for local authorities is to be assured.
    Mr. Greenwood: The hon. Member for Poole (Mr. Murton) and the hon. Member for Northants, South (Mr. Arthur Jones) have deployed their case with such reason and persuasiveness that I should like nothing more than to be able to oblige them. The case had a certain superficial attractiveness and if we were looking for the easy way out we would accept the Amendment and wait for the pigeons to come home to roost in three or four years. But that would not be the honest and open way of dealing with the problem.
    As I understand the Amendments, they seek to avoid the postponement to 1973 of the next general revaluation for rating. Amendment No. 23 would advance the revaluation to 1970 unless it has previously been postponed by order of the Minister to a later year, not being later than 1973. Amendment No. 24 accepts
    512
    1973 as the year which is prima facie appropriate for revaluation, but would confer on me the power to order that it should take place in an earlier year.
    There is a superficial attraction in leaving open the final decision on whether the revaluation need be postponed for as long as the period proposed, that is, until 1973.
    There would be many attractions in adopting that suggestion. But it is only right to tell the House that we have consulted the Inland Revenue about this, and the Department is absolutely positive that, having regard to its work commitments and its staffing position, it is out of the question to contemplate that the revaluation could take place before 1973.
    To leave the date open, as hon. Members opposite propose, would only raise false hopes which, unquestionably, are incapable of fulfilment. I should mislead the House and the public if I said anything else.
    The hon. Member for Poole very fairly referred to the difficulties of the Valuation Office, and I emphasise how short that department is already in meeting its staffing needs. During the current year, recruitment of valuers has just kept pace with losses through resignation or retirement. The hon. Gentleman suggested that we might consider recruiting valuers from outside the public service, but there is already a serious shortage of valuers outside the Valuation Office as well as inside, and I am informed that the profession as a whole will be hard put to it to meet the demands already placed upon it. If we were to add to the burden, it would, I think, be likely to produce a collapse of the valuation service.
    In view of the references which we have made to the profession, it is only right to remind the House of the answer which the Chief Secretary gave to my hon. Friend the Member for Coatbridge and Airdrie (Mr. Dempsey) on 14th December last. He said that the Inland Revenue would continue to recruit suitable trainees. The primary object of introducing this grade is to recruit school leavers at the age of 18 who have at least two G.C.E. A level passes. They are given a four-year training course, after which they can qualify as valuers. During the whole of this course, they will serve in

    513
    one of the local offices and receive practical training under valuers in the office. In the first open competition, which was held in April, 51 candidates were declared successful, which is considered to be a promising start. In addition, the new grade provides an opportunity for clerical staff in the Valuation Office to receive professional training. Existing clerical trainees have been assimilated in the cadet valuer grade, whose total strength is now 127.
    There is no doubt that everything possible has been done to increase the supply of qualified valuers, but the work which is now being done will not be sufficient to make up the full requirement which would be necessary if we were to accept the Amendments.
    I must, therefore, ask the House to resist this Amendment.
    Mr. Temple: A few minutes ago, I gave the Minister a very warm welcome, which I genuinely meant, and, when he moved an Amendment formally, we took the opportunity to congratulate him, but I cannot offer him hearty congratulations on the speech which he has just made, his first major speech on this Bill.
    The Minister of Housing and Local Government will have to get used to facing up to the Chancellor of the Exchequer. One of the most important facets of the character of any Minister of Housing and Local Government is to be able to stand up to the Treasury, but, almost immediately, the right hon. Gentleman comes to the Box to tell us that he has acquiesced in what the Chancellor has told him about the unavailability of valuers to perform a function for which they are properly qualified.
    I can tell the House why he will not get the valuers. His right hon. Friend sitting next but one to him, the Minister of Land and Natural Resources, has scooped all the valuers from every source in order to deal with the horrible—I call it no more—Land Commission Bill about which we heard so much earlier in the House today. I wonder whether, if the Government are determined to put off revaluation for 10 years, a revaluation will ever take place.
    As we had an exceedingly heated debate in Standing Committee, when I was accused by the Parliamentary Secretary of irresponsiblity, and accused of
    514
    knocking the £, I shall not once again indulge in quite such a heated debate. Nor had I intended to bring up the question of cadet valuers. The Parliamentary Secretary took me to task about this, and I am surprised that the Minister dared tread on this delicate and treacherous ground.
    On 29th July I asked the Chancellor of the Exchequer a Parliamentary Question about the situation with regard to valuers, and I was informed of the size of the staff of the valuation office and the total valuers in post. There are fewer valuers in post in the valuation office today than there were in 1962. But more and more work is being piled on the valuation office. Admittedly, more and more clerks are employed; there has been an increase of 20 per cent. in their number in the valuation office this year.
    As I say, there are fewer valuers in post than in 1962 and there is far more work for them to do. Who is responsible for the increase in work? It is the Ministers opposite who have been bringing in a lot of unnecessary legislation at a time when the most important task that faces valuers is bringing valuations up to date.
    In Standing Committee, we put forward all kinds of suggestions to overcome these problems. The subject of revolving revaluations, mentioned by my hon. Friend the Member for Northants, South (Mr. Arthur Jones), was explained by my hon. Friend the Member for St. Ives (Mr. Nott) in Standing Committee. I can tell the Government that every responsible organisation of local authorities and every learned professional organisation is dead against the Government's proposals in the Bill with regard to postponement of revaluation. What we offered the Government was an opportunity for revaluation to be brought forward by Resolution of both Houses of Parliament. In other words, we offered a degree of flexibility. I am amazed that the Government have not accepted our suggestion. We did not destroy the Government's proposals.
    I suggest that there may well be a change of Government long before 1973, and all that will happen will be that the Ministers opposite will be sitting on this side and will have to face up to fresh legislation that will come from the Conservative Party to bring forward a revaluation. If they had accepted our

    515
    Amendment they could have saved themselves sitting for long hours while we brought in fresh legislation to reverse the decision that the Government are determined to put through tonight.
    The right hon. Member for Coventry, East (Mr. Crossman) let the cat out of the bag with regard to this decision when he said that there are many inequities, in the valuations at the present time. If there are many inequities, why are the Government seeking to put off revaluation for this number of years and thus preserve these inequities?
    During the Recess I had a long-distance telephone call from the Press informing me that there was very great concern among the public about the fact that many houses had been fitted with central heating and the valuation department had not caught up with these installations, the result being that great inequity was caused by the fact that some homes in which central heating had been installed were being rated accordingly whereas many ratepayers were getting away with it because the installation had not been detected. This is one very cogent reason why it is tragic that revaluation is to be put off in this way.
    I think that the Government are trying to destroy the rating system. The present
    Leader of the House, the previous Minister of Housing and Local Government, personally disliked the rating system. I believe, therefore, that within the Bill the right hon. Member for Coventry, East, sought to destroy the rating system, for nothing will more effectively destroy it than the postponement of revaluation, because that will bring it into disrepute. I am a believer in the rating system, properly worked, and that is what we should like to see.
    I do not believe that any Chancellor of the Exchequer will be able to throw overboard a system of local taxation which at present brings in £1,200 million a year. Therefore, we should seek by all means in our power while the system exists to make it work satisfactorily. I am exceedingly disappointed by the Minister. We have offered him a degree of flexibility and I am amazed that he has turned it down. We believe that revaluation at regular intervals is essential and for that reason I ask my right hon. and hon. Friends to divide the House.
    Question put, That the words proposed to be left out stand part of the Bill:—
    The House divided: Ayes 136, Noes 100.

    Division No. 176.]

    AYES

    [9.1 p.m.

    Alldritt, Walter

    Foley, Maurice

    Lee, John (Reading)

    Anderson, Donald

    Fowler, Gerry

    Lestor, Miss Joan

    Archer, Peter

    Fraser, John (Norwood)

    Lewis, Ron (Carlisle)

    Atkins, Ronald (Preston, N.)

    Gardner, Tony

    Lyon, Alexander W. (York)

    Atkinson, Norman (Tottenham)

    Garrett, W. E.

    Lyons, Edward (Bradford, E.)

    Bacon, Rt. Hn. Alice

    Ginsburg, David

    McBride, Neil

    Bennett, James (G'gow Bridgeton)

    Greenwood, Rt. Hn. Anthony

    MacColl, James

    Bidwell, Sydney

    Gregory, Arnold

    Macdonald, A. H.

    Booth, Albert

    Grey, Charles (Durham)

    McGuire, Michael

    Boston, Terence

    Griffiths, David (Rother Valley)

    Mackie, John

    Bray, Dr. Jeremy

    Griffiths, Will (Exchange)

    Mackintosh, John P.

    Brown, Bob (N'c'tle-upon-Tyne, W)

    Hamling, William

    Maclennan, Robert

    Buchanan, Richard (G'gow, Sp'burn)

    Harrison, Walter (Wakefield)

    McMillan, Tom (Glasgow, C.)

    Butler, Mrs. Joyce (Wood Green)

    Haseldine, Norman

    MacPherson, Malcolm

    Chapman, Donald

    Healey, Rt. Hn. Denis

    Mason, Roy

    Coe, Denis

    Heffer, Eric S.

    Maxwell, Robert

    Concannon, J. D.

    Hilton, W. S.

    Mayhew, Christopher

    Corbet, Mrs. Freda

    Hobden, Dennis (Brighton, K'town)

    Mellish, Robert

    Davidson, Arthur (Accrington)

    Hooley, Frank

    Mendelson, J. J.

    Davies, Dr. Ernest (Stretford)

    Horner, John

    Mikardo, Ian

    Davies, Robert (Cambridge)

    Houghton, Rt. Hn. Douglas

    Miller, Dr. M. S.

    de Freitas, Sir Geoffrey

    Howarth, Harry (Wellingborough)

    Milne, Edward (Blyth)

    Delargy, Hugh

    Howie, W.

    Morris, Alfred (Wythenshawe)

    Dewar, Donald

    Hughes, Emrys (Ayrshire, S.)

    Morris, Charles R. (Openshaw)

    Dickens, James

    Hughes, Roy (Newport)

    Morris, John (Aberavon)

    Dobson, Ray

    Hunter, Adam

    Murray, Albert

    Edelman, Maurice

    Janner, Sir Barnett

    Newens, Stan

    Ellis, John

    Jeger, Mrs. Lena (H'b'n&St. P'cras, S.)

    Noel-Baker, Rt. Hn. Philip (Derby, S.)

    English, Michael

    Jenkins, Hugh (Putney)

    Ogden, Eric

    Evans, Albert (Islington, S. W.)

    Judd, Frank

    O'Malley, Brian

    Faulds, Andrew

    Kenyon, Clifford

    Orme, Stanley

    Fletcher, Raymond (Ilkeston)

    Kerr, Mrs. Anne (R'ter & Chatham)

    Owen, Dr. David (Plymouth, S'tn)

    Fletcher, Ted (Darlington)

    Kerr, Russell (Feltham)

    Page, Derek (King's Lynn)

    Floud, Bernard

    Lee, Rt. Hn. Jennle (Cannock)

    Palmer, Arthur

    Park, Trevor

    Rose, Paul

    Wallace, George

    Pavitt, Laurence

    Short, Mrs. Renée (W'hampton, N. E.)

    Wellbeloved, James

    Pentland, Norman

    Silkin, Rt. Hn. John (Deptford)

    Whitaker, Ben

    Perry, Ernest G. (Battersea, S.)

    Silverman, Julius (Aston)

    Willey, Rt. Hn. Frederick

    Perry, George H. (Nottingham, S.)

    Silverman, Sydney (Nelson)

    Winnick, David

    Price, William (Rugby)

    Small, William

    Winterbottom, R. E.

    Pursey, Cmdr. Harry

    Snow, Julian

    Yates, Victor

    Randall, Harry

    Spriggs, Leslie

    Zilliacus, K.

    Rees, Merlyn

    Steele, Thomas (Dunbartonshire, W.)

    Robertson, John (Paisley)

    Symonds, J. B.

    TELLERS FOR THE AYES:

    Robinson, W. O. J. (Walth'stow, E.)

    Taverne, Dick

    Mr. Whitlock and

    Roebuck, Roy

    Tinn, James

    Mr. Ioan Evans.

    Rogers, George (Kensington, N.)

    Tomney, Frank

    NOES

    Alison, Michael (Barkston Ash)

    Gurden, Harold

    Prior, J. M. L.

    Allason, James (Hemel Hempstead)

    Hall, John (Wycombe)

    Pym, Francis

    Astor, John

    Harris, Frederic (Croydon, N. W.)

    Quennell, Miss J. M.

    Balniel, Lord

    Heald, Rt. Hn. Sir Lionel

    Rawlinson, Rt. Hn. Sir Peter

    Batsford, Brian

    Heseltine, Michael

    Renton, Rt. Hn. Sir David

    Bell, Ronald

    Higgins, Terence L.

    Ridley, Hn. Nicholas

    Bennett, Sir Frederic (Torquay)

    Hiley, Joseph

    Roots, William

    Biggs-Davison, John

    Hobson, Rt. Hn. Sir John

    Rossi, Hugh (Hornsey)

    Black, Sir Cyril

    Holland, Philip

    Russell, Sir Ronald

    Blaker, Peter

    Hordern, Peter

    Scott, Nicholas

    Body, Richard

    Hunt, John

    Shaw, Michael (Sc'b'gh & Whitby)

    Bromley-Davenport, Lt. -Col. Sir Walter

    Irvine, Bryant Godman (Rye)

    Sinclair, Sir George

    Brown, Sir Edward (Bath)

    Jenkin, Patrick (Woodford)

    Smith, John

    Bullus, Sir Eric

    Jennings, J. C. (Burton)

    Stainton, Keith

    Burden, F. A.

    Jones, Arthur (Northants, S.)

    Steel, David (Roxburgh)

    Carlisle, Mark

    Jopling, Michael

    Stodart, Anthony

    Clegg, Walter

    King, Evelyn (Dorset, S.)

    Taylor, Sir Charles (Eastbourne)

    Cooke, Robert

    Loveys, W. H.

    Taylor, Edward M.(G'gow, Cathcart)

    Cooper-Key, Sir Neill

    Lubbock, Eric

    Taylor, Frank (Moss Side)

    Corfield, F. V.

    McAdden, Sir Stephen

    Teeling, Sir William

    Costain, A, P.

    Maclean, Sir Fitzroy

    Temple, John M.

    Craddock, Sir Beresford (Spelthorne)

    Maddan, Martin

    van Straubenzee, W. R.

    Crawley, Aidan

    Mathew, Robert

    Walker-Smith, Rt. Hn. Sir Derek

    Crosthwaite-Eyre, Sir Oliver

    Mawby, Ray

    Walters, Dennis

    Dance, James

    Maydon, Lt.-Cmdr. S. L. C.

    Weatherill, Bernard

    Davidson, James (Aberdeenshire, W.)

    Miscampbell, Norman

    Webster, David

    Dean, Paul (Somerset, N.)

    Monro, Hector

    Whitelaw, William

    Digby, Simon Wingfield

    Morrison, Charles (Devizes)

    Wills, Sir Gerald (Bridgwater)

    Errington, Sir Eric

    Murton, Oscar

    Wilson, Geoffrey (Truro)

    Eyre, Reginald

    Nott, John

    Wylie, N. R.

    Gilmour, Ian (Norfolk, C.)

    Onslow, Cranley

    Younger, Hn. George

    Glover, Sir Douglas

    Page, Graham (Crosby)

    Goodhew, Victor

    Pardoe, John

    TELLERS FOR THE NOES:

    Grant, Anthony

    Peel, John

    Mr. R. W. Elliott and Mr. More.

    Grant-Ferris, R.

    Clause 17. (VALUATION ACCORDING TO TONE OF LIST.)
    Mr. MacColl: I beg to move Amendment No. 25 in page 13, line 17, to leave out 'manner of occupation and use' and to insert 'mode or category of occupation'.
    This is little more than a drafting Amendment. It defines what are the relevant factors to be taken into account in varying the tone of the list, and the proposal to use the phrase "mode or category of occupation" rather than "manner of occupation" really arises out of a decision of the Lands Tribunal in 1960, in which the mode or category of occupation was defined. It does not seem wise to use a slightly different phrase because that might look as though we were trying to have a different meaning from that laid down by the Land Tri-
    518
    bunal. It seems best to go back to the form of words proposed.
    Amendment agreed to.
    Mr. MacColl: I beg to move Amendment No. 26, inpage 13, line 19, after the first 'or', to insert ', in the case of a public house,'.
    Mr. Deputy Speaker: It might be for the convenience of the House if we also discussed Amendment No. 27.
    Mr. MacColl: These Amendments also deal with the tone of the list, and refer particularly to public houses. They are intended to refer only to public houses, but it has been represented to us, particularly by the Royal Institute of Chartered Surveyors, that there might be other types of hereditaments where the volume of business was taken into account, but

    519
    where there was no direct link. There is no intention to include other hereditaments and, therefore, these words would make it clear that this was limited.
    Amendment agreed to.
    Further Amendment made: In page 13, line 20, at end insert:
    "; and
    "public house" means a hereditament being or comprising premises licensed for the sale of intoxicating liquor for consumption on the premises where the sale of such liquor is, or is apart from any other trade or business ancillary or incidental to it, the only trade or business carried on at the hereditament'.—[Mr. MacColl.]

    Clause 18.—(APPLICATION OF S. 17 TO PROPOSALS SINCE 2ND DECEMBER, 1965.)
    Amendment made: In page 14, line 26, leave out subsection (4).—[Mr. MacColl.]

    Clause 19.—(APPLICATION OF SECTIONS 20 AND 21.)
    Mr. MacColl: I beg to move Amendment No. 29, in page 14, line 37, after 'operation', insert 'or cease to be in operation'.
    Mr. Deputy Speaker: I think that it would be for the convenience of the House if, at the same time, there was discussed the Government Amendments Nos. 30, 31 and 32, and Opposition Amendment No. 33, in page 14, line 42, at end insert:
    (2) At any time after the following provisions of this Part of this Act have come into operation in the area of a rating authority in pursuance of a resolution under the foregoing subsection, the rating authority may resolve that their previous resolution be rescinded and those provisions shall cease to apply to the area of the authority after such day as may be specified in the amending resolution, being the last day of the current or any later rate period for that area.
    and the Government Amendments Nos. 66 and 68.
    Mr. MacColl: This takes us to another aspect of the Bill, dealing with the very important reform of the rating of empty property. The Bill makes the provisions for rating adoptive and they have to be adopted by resolution of the rating authority. In the Bill, as I put it upstairs, the vows are permanent—once one has decided to rate empty property one
    520
    cannot stop doing it. There was some discussion then between my hon. Friend the Member for Birmingham, Aston (Mr. Julius Silverman) and hon. Gentlemen opposite, who took the view that it was wise to allow an opportunity for a change of mind after this had been tried.
    9.15 p.m.
    As I understand the Opposition's proposal, they would allow the rating authority to do this at will. I said then, and I still think, that this is a little unreasonable. We want to get some stability into our system of local taxation and it is more desirable to have a period before the adoptive provisions can be abandoned.
    We propose an extension of that, because we are applying it both ways. If one can drop the rating powers, one can get them back again if necessary. At the same time, we propose a period of seven years as an appropriate period to give people time to try them out seriously and to see how they work. But we reserve to my right hon. Friend the power to dispense with the seven years if he thinks that desirable. This seems to us a reasonable compromise. I think that this will be an improvement in the Bill.
    Mr. Murton: We are glad that the Parliamentary Secretary has gone some way to meeting our Amendment No. 33. However, we still feel rather unhappy about the situation.
    The only point which I wish to make is this. The Bill is supposed to be, on the Government's own admission, a temporary measure. If this is so, why should a rating authority have seven years before being able to abandon its powers? Perhaps the Parliamentary Secretary would answer that question, because it sums up our views as neatly and shortly as possible.
    Mr. MacColl: There is no magic about the period of seven years. It was the time which Jacob used for obtaining the services of Leah and Rachel respectively. Therefore, it has a good historic foundation.
    We did not want a period which was too short. We want to avoid having a change in the taxation system every time there is an election. On the other hand, we want something which is reasonably flexible. If it is found that seven years

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    is too long and authorities find that they are getting into difficulties, my right hon. Friend can intervene. This is a reasonable balance between permanent powers and complete freedom.
    Amendment agreed to.
    Further Amendments made: In page 14, line 38, after 'apply', insert 'or cease to apply'.
    In page 14, line 39, after 'operation' insert 'or cease to be in operation'.
    In page 14, line 40, leave out from 'resolution 'to end of line 42 and insert:
    (2) The day to be specified by a resolution under subsection (1) of this section shall be—

    (a) in the case of a resolution providing that the said provisions shall apply to the area in question, the first day of a rate period for that area beginning after the day on which the resolution is passed, not being earlier, if those provisions have previously applied to the area, than the expiration of the period of seven years beginning with the day when those provisions ceased or last ceased to apply to the area or of such shorter period as the Minister authorises in any particular case;

    (b) in the case of a resolution providing that the said provisions shall cease to apply to the area in question, the last day of a rate period for that area ending after the day on which the resolution is passed, not being earlier than the expiration of the period of seven years beginning with the day when those provisions came or last came into operation in the area or of such shorter period as the Minister authorises in any particular case.—[Mr. MacColl.]

    Clause 20.—(LIABILITY TO BE RATED IN RESPECT OF CERTAIN UNOCCUPIED PROPERTY.)
    Mr. MacColl: I beg to move Amendment No. 34, in page 15, line 30, to leave out from 'and' to 'relevant' in line 35.
    Again, this is mainly a drafting Amendment. The Clause provides that "relevant hereditaments" may be rated when they have been unoccupied for more than three months, or six months in the case of newly erected dwelling-houses. Subsection (3) defines what we mean by a "relevant hereditament". Generally speaking it is a building with or without ancillary land. The subsection provides specifically for the inclusion of rateable plant and machinery in or on the building, but this specific provision is unnecessary, because in the
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    Rating and Valuation Act, 1925, all rateable plant and machinery in or on the hereditament is deemed to be a part of the hereditament.
    These words are, therefore, superfluous. The Amendment shortens the definition a good deal and does not in any way make the position obscure.
    Mr. Costain: How does the hon. Gentleman decide when a house is completed in this way, when the six months should start?
    Mr. MacColl: That comes up later. It is dealt with in the Schedule.
    Amendment agreed to.
    Mr. MacColl: I beg to move Amendment No. 35, in page 15, line 41, to leave out subsection (5) and to insert:
    (5) Where a relevant hereditament which is unoccupied becomes occupied on any day and becomes unoccupied again on the expiration of a period of less than six weeks beginning with that day, then, for the purpose of ascertaining any period of three months during which the hereditament has been continuously unoccupied and any relevant period of vacancy in respect of the hereditament, it shall be deemed to have remained unoccupied on that day and during that period.
    This, again, is a drafting Amendment. It corrects a defect which the learned editor of the Rating and Valuation Reporter—to whom we have been much indebted during our deliberations—pointed out on 21st July. We have taken his advice and have made the appropriate Amendment.
    Mr. Temple: I should like to add a personal tribute to the work of the learned editor of the Rating and Valuation Reporter, without whose regular weekly journal my contributions to the debates on this Bill could have been nothing like so learned or so well informed. We are particularly indebted to him for getting rid of some of the ghastly draftsmen's jargon. Who would have thought of using the words "six continuous weeks"—a term never used in any public Bill before? The Amendment gets rid of that ghastly jargon. We are extremely grateful to all those outside experts who have been keeping an even more careful eye on the Government than I have been able to do.
    Amendment agreed to.

    Clause 21.—(SUPPLEMENTARY PROVISIONS, EXEMPTIONS AND RELIEFS.)
    Mr. MacColl: I beg to move amendment No. 36, in page 16, line 16, after 'for', to insert:
    ', or for any part of the three months beginning with the day following the end of,'.
    Empty property is exempt from rates in certain circumstances which are outlined in paragraphs (a)-(f) of subsection 3) of the Clause. If they have been unoccupied for three months when the circumstances entitling them to exemption cease, rates immediately become payable. This does not seem to be quite reasonable, because it may be that an owner has been negotiating for some months with the local authority for the sale of the property and if, then, the local authority withdraws from the negotiations the owner will be virtually precluded from attempting to sell the property elsewhere. So we propose that he should have the usual period of three months grace, after which he becomes liable. I will re-read subsection (3) as it will read after amendment:
    "No rates shall be payable under the said section 20 in respect of a hereditament or for any part of the three months beginning with the day following the end of any period during which"
    and so on.
    Amendment agreed to.
    Mr. MacColl: I beg to move Amendment No. 37, in page 16, line 33, to leave out 'or'.
    This arose because we inadvertently accepted an Amendment of the hon. Member for the City of Chester and we left the word "or" in as a sort of memorial to what had been there before. It is redundant.
    Amendment agreed to.
    Mr. Speaker: The House will remember that I divided the next two Amendments, Nos. 38 and 39, at the request of the hon. Member for the City of Chester (Mr. Temple).
    Mr. Charles Morrison: I beg to move Amendment No. 38, in page 16, line 42, at the end to insert:
    (g) the hereditament is subject to a planning condition imposed under the Town and Country Planning Acts, 1947 to 1962, which limits occupation of the hereditament to persons employed in agriculture or forestry or in an industry mainly dependent on agriculture and
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    the hereditament is not required for occupation by any such person.
    In Committee, an Amendment was moved which, if accepted, would have relieved an owner of the payment of the rates if there were any restriction upon the occupancy of a hereditament. That Amendment was aimed particularly at restrictions imposed by the Town and Country Planning Act, 1947 to 1962. But, as my hon. Friend the Member for the City of Chester (Mr. Temple) pointed out during the debate on the Amendment, as drawn it would have referred more widely to any restriction, including any restriction other than those contained within those Acts.
    I was concerned particularly with cottages and houses built with planning permission given only on the proviso that they would be occupied only by an agricultural or forestry or ancillary worker. Therefore, this Amendment is more narrowly drawn to deal with the Town and Country Planninig Acts alone. As such, I hope that the Parliamentary Secretary will make a concession, even though he warned us previously that he was not so disposed.
    During the debate in Committee, the Parliamentary Secretary said that two things could be done in a genuine case of hardship—first, the owner of the house or cottage could apply for removal of the condition and, second, if he could establish that there was no market for the house as an agricultural cottage and it could be let, there would be grounds for an application for a reduction of the rating assessment. I agree that an application for removal of the condition could be made if the cottages became permanently surplus to agricultural requirements—if, for example, the district or area were developed and built over.
    However, in most cases, there would merely be a lessening of demand for agricultural housing, so what would happen is merely that there would be longer and more frequent periods of disuse. It is unlikely that the planning condition would be removed until it became virtually impossible to get an agricultural worker to occupy the cottage, and, in the meanwhile, the unfortunate owners would pay rates on unoccupied premises.
    Equally, where a cottage is occupied from time to time, it is unlikely that an

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    owner could succeed in an application to have a rating assessment reduced. I therefore hope that, now that the Government have had longer to consider this matter, they will be prepared to concede that my Amendment would remove an anomaly which would otherwise bear particularly harshly on many farmers and other owners of agricultural properties.
    9.30 p.m.
    Mr. MacColl: Although this is a balanced argument it is not a nicely balanced argument, and on balance this is not a desirable Amendment. The hon. Member must remember why the conditions were imposed. An agricultural condition is imposed on a cottage because there is such an urgent agricultural need for the cottage that planning permission is given to the cottage when one would not be allowed except for agricultural purposes. For example, if it is in the green belt the urgency of the agricultural need makes it necessary to depart from the general planning rules and to give permission and therefore attach an agricultural condition to the cottage. It is not a fortuitous encumbrance which has become attached to the cottage.
    It is true that if the condition is such that the cottage is not lettable, that is likely to be a ground for getting the rateable value reduced. It may be possible to get the condition removed if circumstances change and there is no longer an agricultural need in the area.
    Finally, I put this bluntly to the hon. Member: this is a case where the rating of empty property ought to apply. I have always understood that there is a great shortage of agricultural accommodation in agricultural areas and that one reason why we have to have tied cottages is that there is not enough accommodation. There ought to be an incentive on the owner of a cottage of this kind to let it and not simply to hold on to it in case he may subsequently need it. One of the main points about having empty property rated is that there should be an incentive on the owner to get it occupied. I see no argument in equity why this should not apply as much in the case of this accommodation as in that of other accommodation.
    Amendment negatived.
    Mr. Arthur Jones: I beg to move Amendment No. 39, in page 16, line 42, at the end to insert:
    (g) the hereditament, being a single hereditament and not part of a larger development involving other hereditaments, is the subject of a planning application for consent to change of user or structural alteration or redevelopment, and until the expiry of three months from the date of the refusal of such consent by the planning authority or by the Minister on appeal (whichever shall be the later);
    (h) the hereditament, being a single hereditament and not part of a larger development involving other hereditaments, is the subject of a planning application for consent to structural alteration or redevelopment and until the expiry of six months from the completion of the work, in a case in which such planning permission is granted provided that the work on the project has commenced within six months of the grant of planning permission and proceeds to completion with due expedition;
    but paragraphs (g) and (h) of this subject shall not apply unless the planning application therein referred to has been made within three months of the hereditament first becoming vacant, calculated in accordance with section 20 of this Act.
    We spent a considerable time in Committee on this subject when we were trying to assess the advantages which would perhaps accrue to people who were requiring a change of use for premises or, as an alternative, a scheme of redevelopment. The purpose of the Amendment is to add to Clause 21, "Supplementary provisisions, exemptions and relief", two paragraphs which it is hoped would alleviate the difficulties where a change of use is involved or a planning consent required. The safeguards are drawn into the effect of the Amendments. Paragraph (h) provides that the work on a project has commenced within six months of the grant of planning permission and proceeds to completion with due expedition, and the wording also draws attention to the fact that these two paragraphs shall not apply unless the planning application referred to
    "has been made within three months of the hereditament first becoming vacant".
    The Parliamentary Secretary dealt at some length with some of the objections which he thought there were in the proposal—possibly abuse by the developers and the fact that a developer should be looking for a profit out of his development and this would absorb any rate charge that he would have to meet. It

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    is not always the case that a substantial developer is involved. It might involve a small shopkeeper who wished to retire or to close his business through illness or death, or perhaps a shopkeeper who was hoping to expand his existing premises into adjoining accommodation.
    The Parliamentary Secretary also suggested in Committee that a proposal could be made for reducing the valuation. This would be a cumbersome procedure and not entirely satisfactory because one would have to give proof of non-occupation and of the fact that the property could not be reoccupied. The Amendment is drawn with a view not only to meeting the points made in Committee, but also to meeting the Parliamentary Secretary's objections; first, by making it clear that there could be no question of successive planning applications, so that one could not run on one application after another, and, secondly, by restricting the exception to a single hereditament so as to take away the exemption from the big property speculator.
    In these terms we hope to have met some of the objections the Parliamentary Secretary expressed. This is an important part of the Bill and the Amendment would provide a useful addition to the text.
    Mr. MacColl: I fear that I must inform the hon. Member for Northants, South (Mr. Arthur Jones) that I have three main reasons for not accepting the Amendment, the first part of which provides for exemption until three months after the refusal of planning permission. That could be used to evade liability for more than a year because the owner would merely have to apply for permission to change the use to some objectionable use or to make some unsightly alterations or unsuitable development so to be sure of getting a refusal. It might take two months to get that refusal. He could then appeal to the Minister and obtain an inquiry, which might hold up matters for many months. He would then be exempt for another three months from the date of the refusal.
    Mr. Arthur Jones: The Joint Parliamentary Secretary is, perhaps, dealing with the point mentioned in the last
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    three lines of the Amendment, where reference is made to the fact that
    "… this subsection shall not apply unless the planning application… has been made within three months of the hereditament first becoming vacant…"
    This would avoid successive applications or a change being made in the type of application to be used in the way the hon. Gentleman suggested.
    Mr. MacColl: Nevertheless, the sort of delay I described could go on, remembering that it takes a long time to get these matters settled.
    The second objection to the Amendment, dealing with the second part of the hon. Gentleman's proposal, is that it would allow for a much more extensive free period than is at present proposed where the alterations have been carried out with planning permission. This free period would cover the time taken to consider the planning application, which might be six months, the period of the works, subject to due expedition—a difficult matter to determine—and a further six months after completion. This is out of all proportion to the periods of three months and six months at present proposed.
    My third objection is that there are a number of structural alterations which do not require planning permission and, in those cases, no application for permission would need to be made, although they might be less fundamental in their form and would not get this protection. There is no reason to make this distinction between those two cases and I must, therefore, advise the House not to accept the Amendment.
    Amendment negatived.

    Clause 22.—(HIGHWAY GRANTS AND CLASSIFICATIONS.)
    Mr. John Morris: I beg to move Amendment No. 40, in page 17, line 19, to leave out "For" and to insert:
    'The Minister may, for all or any of the following purposes, that is to say,'.
    Mr. Speaker: With this Amendment we are taking Amendments Nos. 41 and 42.
    Mr. Morris: This set of drafting Amendments has two purposes. The first

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    purpose is to make it clearer that the Minister's power to classify roads can be used either for grant purposes or other legislative purposes or for any of them either separately or together as the Minister chooses. The second purpose is to enable the Minister to classify roads for the purpose of non-grant legislation which is not in force at the time when the Bill becomes law. The third Amendment is consequential on the other two.
    Amendment agreed to.
    Further Amendments made: In page 17, line 21, leave out from "and" to end of line 22 and insert:
    'the purposes of any enactment or instrument (whether passed or made before or after the passing of this Act) which refers to highways classified by the Minister.'.
    In line 34, after 'classified' insert 'by the Minister'.—[Mr. John Morris.]

    Clause 27.—(SPECIAL PROVISIONS AS TO FOOTWAY LIGHTING SYSTEMS.)
    Mr. John Morris: I beg to move Amendment No. 44, in page 21, line 23, to leave out 'subsection (1)' and to insert 'subsections (1) and (2)'.
    Perhaps it would be for the convenience of the House, Mr. Speaker, if, with this Amendment, we took Amendment No. 45.
    Mr. Speaker: Yes.
    Mr. John Morris: These are drafting Amendments consequential on an Amendment of Clause 26 made in Committee.
    Amendment agreed to.
    Further Amendment made: In page 21, line 36, leave out 'subsection (1)' and insert 'subsections (1) and (2)'.—[Mr. John Morris.]

    Clause 29.—(AMENDMENT OF CERTAIN ENACTMENTS RELATING TO LICENCES.)
    Mr. Greenwood: I beg to move Amendment No. 46, in page 22, line 10, after 'hawkers' to insert ', passage brokers, emigrant runners'.
    Mr. Speaker: With this Amendment we are taking Amendments Nos. 71 and 80.
    Mr. Greenwood: Being a modernising Government, we have tabled these Amendments to repeal certain archaic
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    provisions for the licensing of passage brokers and emigrant runners.
    A passage broker is, broadly speaking, a person who anywhere in the British Islands sells or lets, or is concerned with the selling or letting of steerage passages from anywhere in Europe, excluding the Mediterranean Sea. "British Islands" means the United Kingdom, the Channel Islands and the Isle of Man. He is required to take out a bond with the Crown for £1,000, and a licence for which no fee is prescribed. The 1894 Act provided for the licensing authorities to be the justices of the peace at petty sessions in the administrative county of London, and the councils of county boroughs and county districts in England and Wales. Responsibility would rest upon outer London boroughs under the London Government Act. 1963.
    An emigrant runner is a person other than a passage broker who for reward conducts or influences any intending emigrant to or on behalf of a passage broker, ship owner, lodging house keeper, or money lender for any purpose connected with a passage. He was required to obtain a licence from the licensing authority for passage brokers, and also a badge from the Board of Trade which he had to wear "conspicuously on his breast" while acting as an emigrant runner.
    These provisions are contained in that part of the Merchant Shipping Act, 1894, which deals with steerage—that is, non-cabin—passages on emigrant ships. The provisions came into being at a time when it was considered necessary to ensure that persons engaged in selling or letting steerage passages on emigrant ships could be held to proper fulfilment of their undertakings by deposition of a bond, and by being licensed. These conditions no longer obtain. Steerage passages on emigrant ships are no longer sold or let, and emigrant ships in the 1894 sense no longer exist.
    Only 13 applications have been made for passage brokers' licences in England and Wales for the year 1966, and none for licences for emigrant runners. Most of the firms who have applied for licences for passage brokers have apparently done so as a tradition and, after consultation with them, the Board of Trade has concluded that there are no good reasons for retaining the relevant provisions.
    9.45 p.m.
    Mr. Temple: The fact that this is only the second Amendment which the Minister has moved indicates the importance which he attaches to it. I should like to know if he is absolutely certain that there will not be a large upsurge in demand for emigrant runners, because I have every reason to suppose that there will be a great rush of emigrants out of this country. However, we shall not oppose this Amendment because we may be back in power very soon and under a Conservative Government there will not be a need for passage brokers or emigrant runners.
    Amendment agreed to.
    Mr. Charles Morrison: I beg to move Amendment No. 47, in page 22, line 11 leave out 'guns'.
    Mr. Speaker: With this Amendment it is proposed that we should take Amendment No. 70: In Schedule 3, page 37, leave out line 6; and Amendment No. 79: In Schedule 6, page 44, leave out lines 39 and 40.
    Mr. Morrison: The purpose of this Amendment is simple. It is for the retention of the licence for guns. In Committee, after a lengthy debate, the Parliamentary Secretary agreed, following pressure from a number of my hon. Friends and a number of hon. Members opposite, to have another look at this matter, but there was no doubt that he was opposed to the Amendment. In summing up his opposition, he said of it:
    "I would certainly want to have another look at it. However, I must confess that I am convinced by my own arguments. Over a long period as Parliamentary Secretary I have not always been convinced by my own arguments, but I am in this case."—OFFICIAL REPORT, Standing Committee F, 21 July, 1966; c. 421.]
    He went on to say that the Home Office was in full support of the proposal to abolish gun licences. A lot can happen during a Parliamentary Recess, and this time it appears that the Home Secretary has eaten his own words, or perhaps those of his Department, and those of the Parliamentary Secretary as well. I am very pleased to see that there is a representative of the Home Office here this evening, for we were pleased to hear recently from the Home Secretary that he was considering a new scheme for the licensing of guns. We are still in
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    ignorance of what the scheme is to be, but I hope the Government will be able to say something about it this evening.
    In the light of what the Home Secretary said, this Amendment has become in a way a probing Amendment. At this stage, therefore, I do not propose to propound again the full arguments in favour of the Amendment. It will suffice to say that the proposal to abolish gun licences caused consternation among country folk, particularly those living on the edge of large towns and areas like Epping Forest, to which the hon. Member for Epping (Mr. Newens) referred in Committee, and to the growing number of people who are distressed by the frequent use of shotguns in crimes of violence.
    I know that the issue by a post office of a gun licence is obligatory and, therefore, it can be argued that it provides no control, but anything that can be deemed a possible deterrent or control should be retained and its abolition would be a retrograde step unless it is replaced by some other form of control. We await with interest what the Government have to say on the question of gun licences.
    Mr. Stan Newens: When this matter was discussed in Committee I was one of those who expressed disquiet at the proposal to abolish gun licences. Nothing that was said in Committee convinced me that my disquiet was misplaced. I am well aware of the arguments that were deployed. We were told, first, that the gun licence provides no real control over the present situation, because anyone can buy a gun licence. We were told, secondly, that it was too expensive to collect the revenue that was raised by this licence.
    I disagree with these arguments. The first argument is invalid, because I believe that to put anybody who has a gun and no licence in the position of breaking the law is desirable and useful. We should certainly adhere to gun licences, if for this reason alone.
    The second argument, that it was not worth while raising revenue, is completely invalid. I understand that figures given at the time indicated that £200,000 per annum was raised at a cost of £30,000, a net gain of £170,000. This amount is not to be sneezed at, and in my opinion we should continue to collect it. In any event, why is there any need for us to

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    keep the licence fee at its present level? It was suggested in Committee—I consider this to be true—that we might raise the gun licence fee. Why not make it £2 or £5? Without making it a ridiculous figure, we could at least raise more revenue at present. After all, many people who lawfully wish to have guns can well afford to pay more than they are paying at present.
    Mr. Speaker: Order. The hon. Gentleman cannot discuss on this Amendment the question of increasing the licence fee for guns. We are discussing whether the word "guns" stands part of the Bill.
    Mr. Newens: I beg your pardon, Sir. I was seeking to point out that the argument that insufficient revenue would be raised was, in my view, invalid. Many people will be extremely concerned to learn that gun licences are to be or have been abolished with nothing to replace them.
    When discussing this matter in Committee, my hon. Friend the Parliamentary Secretary agreed to discuss it with my right hon. Friends who are responsible. I do not know what has happened as a result of those discussions, but I hope that something has been decided that will allay the disquiet which this proposal has caused. I should hate it to be thought that only hon. Members opposite are concerned about this proposal. I am very concerned about it, and I am sure that many of my hon. Friends are equally worried about any step being taken to abolish gun licences.
    Mr. John Farr: These Amendments were originally tabled to secure a continuance of the gun licensing system. From a recent announcement made by the Home Secretary it is obvious that the Home Department shares the views of those who have tabled these Amendments that some form of the gun licensing system must be retained. All those associated with guns in the trade and those who use them will co-operate with the Secretary of State in every way in framing a new, modern, effective, sensible and fair system of shotgun licensing.
    Before concluding our discussions on these Amendments, it is only right that we should be told by the Government what system or what sort of licensing control they propose to put in place of the exist-
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    ing 10s. a licence. It is difficult for the House to make a decision on the abolition of an existing system before we have at least an inkling of what the Government propose to put in its place.
    I doubt that even the most stringent methods of control which the Home Secretary may be advised to introduce will prevent the ne'er-do-well or wrongdoer from getting a shotgun if he really wants one. The number of crimes committed with revolvers and pistols is increasing daily, and yet the person who is the utmost pillar of respectability in the community, such as any hon. and right hon. Gentleman on the Front Bench opposite, will find it almost impossible today to be in legal possession of a revolver.
    We see from this that, however stringent the control, if a ne'er-do-well desires possession of a weapon it is not too difficult to come by. Therefore, I hope that the new legislation of which we may get an inkling tonight will not be too stringent and will not choke too much with red tape those who are in the business and those who use shotguns for sport. A number of suggestions will no doubt be given to the Minister from those who represent different interests before he finally makes up his mind. It has been suggested that it might be easier if the existing 10s. annual licence were replaced by a three-yearly licence to save clerical work, on the lines of a driving licence. The hon. Member for Epping (Mr. Newens) suggested £2 or £5. An annual payment of £1 or £2 payable over three years, would not be too much to find for anybody who is really interested in the sport. As the hon. Member said, a considerable number of people take out shotgun licences, and the revenue received is probably brought in with the minimum of effort.
    We are anxious to hear from the Minister tonight what is in the Government's mind. I hope that when he gives the House an inkling of the path the new legislation will take he will bear in mind that our shotgun manufacturing industry turns out the best sporting guns in the world. They are exported all over the world and bring in a considerable sum in dollars every year. I hope that he will also remember that many people travel to this country from all over the world to enjoy sporting facilities, and one reason is

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    that within a certain compass it is possible to enjoy one's sport here without too much red tape.
    I particularly ask the Minister to think very seriously about the three Amendments because of the question of the position if he declined to accept their incorporation in the Bill. What will be the position if the three references to guns are included in the Bill and after the Bill is enacted, possibly in a matter of weeks, it is no longer necessary to possess a gun licence? We have heard from the Home Secretary that proposals are being received from various interested people. Views are being sounded and it is possible that the result of this sounding will be incorporated in a future Criminal Justice Bill which, with the crowded programme of legislation in the House, may or may not come into effect in 1967 or 1968.
    What will be the position after this Bill is on the Statute Book in a few weeks? The new Criminal Justice Bill has not even begun its passage. What will be the position during the period of vacuum, as it were, when no gun licences will be required but the new system to be incorporated in future legislation has not come into effect? I am concerned chiefly for this latter reason, and here I speak on behalf of all those who support my view both in the trade and elsewhere.
    It being Ten o'clock, the debate stood adjourned.
    Ordered,
    That the Proceedings on the Local Government Bill may be entered upon and proceeded with at this day's Sitting at any hour, though opposed.—[Mr. Charles R. Morris.]
    Question again proposed, That "guns" stand part of the Bill.
    Mr. Farr: I ask the Minister to accept that I am expressing a view unanimously held by all interested people who, whether in their business or in their leisure pursuits, appreciate the value of the existing gun licence system. We should hate to see a hiatus between the passage of this Bill and the enactment of some future legislation, and we hope, for that reason alone, that the Minister will accept the Amendments.
    The Under-Secretary of State for the Home Department (Mr. Dick Taverne): As this is a matter which concerns the Home Office, I have been asked to reply.
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    We appreciate the motives behind the Amendments, which, at first sight, have some merit. The objectives behind the speeches of the hon. Members for Devizes (Mr. Charles Morrison) and for Harborough (Mr. Farr) are very much the same as the objectives we have in the Home Office. In Committee, the Parliamentary Secretary to the Ministry of Housing and Local Government said that we would look at the question again, but the position has changed as a result of Government plans for future legislation, announced in a speech by the Home Secretary.
    What is the present law? Clearly, the present gun licence system is not worth keeping as a way of raising revenue because, as a revenue raiser, it is extremely inefficient and wasteful and there are far more efficient ways of raising revenue than by a system which costs so much to administer. I shall have a word to say in response to my hon. Friend the Member for Epping (Mr. Newens), but the main reason why these Amendments have been pressed is that they are, as the hon. Member for Devizes said, probing Amendments, hon. Members having in mind the indirect result of the present gun licence system, that is, control over the use of shotguns. Subject to the remarks of my hon. Friend the Member for Epping, one can say that the issue before us is one of control.
    As a system of control, the present gun licence system is not very effective. At best, control is an indirect result; it was intended as a revenue-raising measure. It is not effective for the very reason that anyone, on payment of 10s. can obtain a licence. If one wanted to institute a system of control, there are very much better ways of doing it than by the present licence system. Therefore, even if there were no such plans as those announced by the Home Secretary for instituting a different form of control, it would be very doubtful whether this method was worth keeping.
    I have been asked to say something more about the statement which the Home Secretary made, that he intends to see that there is some control over shotguns. I am in difficulty here, because I cannot anticipate the detailed provisions which will in due course be proposed. It is envisaged that some form

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    of direct control under our firearms legislation will be extended to shotguns, but this is a matter of considerable complexity, as the hon. Member for Harborough pointed out—the hon. Gentleman made several points which we shall certainly consider—and we are holding discussions with a number of interested organisations. Various views have been presented to us, and, while we are discussing the matter, it would be wrong to give some sort of indication of how our mind is moving now lest we appear to prejudge the outcome of our discussions. I can tell the House that the matter is being treated with great urgency, and there is every hope that some provision for control over shotguns will be incorporated in the Criminal Justice Bill.
    The hon. Member for Harborough said that there might be no Criminal Justice Act until, perhaps, 1968. The Bill will certainly be introduced this Session and, if the House approves it, it will become law this Session.
    The hon. Member asked about the gap. At the moment there are gun licences, and if these go, there will be a gap until the Criminal Justice Bill is passed. I do not think that it is a serious gap when the announcement has been made. I do not think in any event that one should regard that as a reason for postponing a Measure which falls logically into the Local Government Bill to do away with what we regard as obsolete and for most purposes very ineffective methods of achieving the results intended, that is the direct result of raising revenue and the indirect result of establishing some control.
    My hon. Friend the Member for Epping suggested that perhaps an increased fee could be established and that with that one would have a better form of control or make it more difficult for people to obtain shotguns. The difficulties about this are several. First, the Firearms Act is also included under Part II of Schedule 3 of the Bill. So the Secretary of State has powers to increase fees for firearms certificates. The result, if we kept the gun licence, would be that two sets of fees would be payable in respect of one gun. It would be wrong to have two ways of raising payments for a certificate, which would
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    be the result if the present law was kept. So keeping the present law is not the proper way.
    Another objection was that the fee should be fixed and levied—I am sure that my hon. Friend will agree—by a single authority, and that it should be the police, as is done under the Firearms Act, whereas the money raised under the gun licence legislation is raised by local authorities. A much more logical way to deal with it would be to extend the firearms legislation by some form of control of shotguns and not to keep the present obsolete and outdated legislation.
    Those are the reasons why I ask the House to resist the Amendment. The main reason is that the present law is out of date, and was designed as a revenue law. The proper way would be control established under the Criminal Justice Bill.
    Mr. Temple: I am sure that we are obliged to the Under-Secretary of State for joining our deliberations on this very important subject of gun licences, which has attracted very much more attention recently than during the earlier stages of the Bill. I can agree with the Under-Secretary that the issue is one of control. This is what we have stressed throughout from this side, and we were supported from the other side in Standing Committee.
    What we took exception to in the Standing Committee was the abolition of gun licences. We thought that they had a certain amount of value, and it was suggested by both sides that a rather larger licensing fee would be necessary. The Under-Secretary has said that there is some hope of the matter being dealt with in the Criminal Justice Bill. I wish he had put it higher than hope or expectation and had been able to give a categorical assurance, but perhaps the Minister of Housing and Local Government will be able to step up that assurance towards the end of this debate.
    My hon. Friend the Member for Harborough (Mr. Farr) was right to emphasise the question of the gap, that under the proposals of the Government the gun licence will become abolished and there will be a gap until something else is proposed or until some other legislation is enacted. Frankly, I do not like the

    539
    idea of a hiatus in the control of firearms at the present time. The hon. Member for Epping (Mr. Newens) supported the keeping of a gun licence in some shape or form. I am glad that we got support from the other side of the House in this matter.
    My hon. Friend the Member for Devizes (Mr. Charles Morrison), with his vast knowledge of the countryside, expressed the dismay of the countryside. I re-echo that dismay. I will not repeat what I said in the Standing Committee, but I believe that the most dangerous form of the carrying of firearms at the present time is represented by the sporadic shooting in the countryside of everything that runs or flies in and out of season regardless of whether people are on the other side of the hedge or not.
    I gave examples of animals being maimed unintentionally because the shooter was relatively inexperienced. I do not think that any form of licensing will control the criminal carrying of firearms and, therefore, we should direct our efforts towards control of what I call indiscriminate shooting.
    For my part. I would put the responsibility in this matter fairly and squarely on the Government. Many statements have been made and if the Government give us a more or less categorical assurance that tighter control will be brought in, we will be satisfied to accept the proposals within the Bill. I would go further and say that we will look at the proposals made by the Government with an open mind.
    I have only one suggestion in this connection and I think that it has also been made by outside bodies. It is that something in the nature of a passport photograph should accompany the licence. From my experience of these matters, I believe that that would be a sensible and not too restrictive provision and that it would be very valuable in identifying the carrier of a shotgun with the licence he holds.
    Subject to what the Minister may care to say in reply to my point about a more categorical assurance from the Government, I would advise my hon. Friend the Member for Harborough to withdraw the Amendment.
    Amendment negatived.

    Clause 31.—(AMENDMENTS PREPARATORY TO CONSOLIDATION.)
    Mr. MacColl: I beg to move Amendment No. 48, in page 23, line 22, to leave out from 'tithes)' to end of line 23 and to insert 'namely'.
    Mr. Speaker: I understand that it would be convenient to discuss, at the same time, Amendment No. 49, No. 86 and No. 87, standing in the name of the right hon. Gentleman the Minister of Housing and Local Government.
    Mr. MacColl: Amendments No. 48 and No. 49 deal with the consolidation of rating law which we discussed earlier today. To facilitate the consolidation of rating law, the Bill already proposes to end the residual liability for rates in respect of tithes or their successors. These Amendments finally repeal further references in the Rating and Valuation Act, 1925, and the Rating Act, 1874, to tithe rent charges. We do not know of any case in which tithe rent charges have been taken into account in valuing for rating purposes.
    Amendment agreed to.
    Further Amendment made: In line 31 at end insert:
    'and also the provisions of the Rating and Valuation Act 1925 specified in Schedule 9 to the Tithe Act 1936 (which relate to the treatment for the purposes of rating of tithe rent-charge not extinguished by the said Act of 1936) so far as excepted from repeal by the said Act of 1936 by section 48(3) thereof and, in section 7 of the Rating Act 1874, the words "and tithe rentcharge", shall cease to have effect'.—[Mr. MacColl.]

    Clause 34.—(INTERPRETATION.)
    Amendment made: In page 24, line 30 at end insert:
    '"joint board" includes a combined authority or joint committee;'.—[Mr. MacColl.]
    10.15 p.m.

    Schedule 1.—(RATE SUPPORT GRANTS.)
    Mr. John Hall: I beg to move Amendment No. 51, in page 27, line 31 to leave out:
    'or a part of it'.
    Mr. Speaker: With this can be taken Amendment No. 52, in page 27, line 35, leave out 'and around'.
    Amendment No. 53, in line 37 leave out 'wholly'.
    Amendment No 54, in line 38 leave out 'the metropolitan district' and insert 'Greater London'.
    Amendment No. 55, in line 38 leave out, from 'lie' to end of line 39 and insert 'outside Greater London'.
    Amendment No. 56, in line 39, at end insert:
    'and any county district in which a salary or wage rate has at any time either before or after this Act been fixed by any recognised salary or wage fixing body equivalent and by reference to a similar rate payable in any part of Greater London or of any area now included in Greater London'.
    and Amendment No. 57, in line 41 leave out from 'with' to end of line 42 and insert:
    'any administrative county adjoining Greater London'.
    Mr. John Hall: The object of this group of Amendments is to enable a supplementary payment to be payable to any of the Home Counties adjoining Greater London, whether or not part of the county happens to be within the Metropolitan Police District. Amendment No. 56 was tabled as a rather less satisfactory alternative to the rest of the group of Amendments, but, of course, it is directed to the same aim.
    These Amendments are rather similar to those which were debated in Committee when there was a rather short debate on them which took up about two columns of the Official Report, and the arguments at that time were rather cursorily dismissed by the Parliamentary Secretary, not out of any lack of courtesy—we have become accustomed to considerable courtesy from the hon. Gentleman—but because, I think, he did not fully appreciate the problem which faces some of the Home Counties, and perhaps in this respect I might say particularly Buckinghamshire. I want to use Buckinghamshire as an example, because it illustrates the problem which has been created for some of the Home Counties by the Bill in its present form.
    Buckinghamshire is probably one of the most rapidly expanding counties in the country. The estimated increase of population in the four years ending March, 1955, was about 3½ times the rate of expansion of the rest of England and Wales. One would have therefore imagined that in the Bill special attention would be paid to the problems of these
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    rapidly expanding counties, problems which some of us know only too well.
    As it happens, under the new system now proposed by the Bill, as the Chairman of the County Council Finance Committee has said, relative to most other counties Buckinghamshire will be worse off than under the present system. When this information became known to the ratepayers of Buckinghamshire, I can assure you, Mr. Speaker, it was very badly received, because this is a county where between the years 1951 and 1961 the rate increase was three times the average over the country as a whole.
    Paragraph 10 of Schedule I provides for a supplementary payment if the area of an authority or part of it—and I stress the words "or part of it"—lies within the Metropolitan Police District. This means that Hertfordshire, a neighbouring county also rapidly expanding and facing similar problems, but which is fortunate enough to have a few acres within the Metropolitan Police District, receives an increase of the appropriate percentage applied to the whole of its basic payment, whereas Buckinghamshire which, like other similarly placed Home Counties, faces exactly the same sort of pressures of costs and problems as face other counties in close proximity to London, gets nothing under this paragraph.
    After failing to persuade the Government to make proper provision for the financial problems of these rapidly expanding counties, for Buckinghamshire then to be denied the benefit of the London weighting which is provided by paragraph 10 is rather rubbing salt into the wound.
    Those who live in the Home Counties do not need me to emphasise the effect on costs of all kinds of living in proximity to the Greater London area. The Chairman of the Finance Committee has pointed out in a letter which he wrote to me recently the general effect which is suffered by counties such as Buckinghamshire because of this. He says:
    "The most direct example of higher costs due to the common boundary with the London area is shown by wages, where the scales laid down by the National Joint Council for Local Authorities (Manual Workers) recognise the requirements to pay higher wages within the Borough of Slough, and London zone rates are paid. This applies to all manual workers in that area of the county and, for example, represents an increase of something like 6⅔

    543
    per cent. on the wages of various types of Education employees such as caretakers, groundsmen, cleaners, gardeners and the like, and 5½ per cent. so far as ambulance drivers are concerned.
    On the boarding-out of children, the costs in this county are considerably higher because of our proximity to the London area. … the proximity of London has resulted in salaries in Bucks being higher to attract staff to an area"—
    as I know from my own personal experience—
    where the cost of housing and living is high".
    He points out that as far as costs go, the London rate does not apply to Slough. In the surrounding areas of Buckinghamshire its effect is much the same. In parenthesis, I would say that, in general, most tenders for work done in the county are submitted by London firms who use London rates and who certainly do not provide lower costs or tenders because they are tendering for a county outside of the metropolitan area.
    He goes on to say:
    "In addition, there are many other fields in which expenditure in the south of this county is considerably higher than in regions further away from London, due to nearness of that city and competition with it. The cost of land is very high in what is now largely a dormitory for London—for example, in places such as the Chalfonts, Beaconsfield, Burnham and others, where land costs are the same as, say, in Uxbridge. The result of this is that we have incurred heavy expense with resulting high debt charges in order to purchase land bought at these high prices."
    Those are just some of the ways in which Buckinghamshire and counties like it feel the effect of living close to London. I know that the Minister may reply that in drafting paragraph 10 of the First Schedule it was necessary to draw the line somewhere. What I am suggesting is that he has drawn the line in the wrong place and created unnecessary hardship and injustice. I am suggesting that the line should be drawn in another place and in a different way so as to obviate this.
    Mr. MacColl: I appreciate the skill with which the hon. Member for Wycombe (Mr. John Hall) has moved this Amendment and made the case which, from the point of view of those who are fortunate enough to be represented by him, is one of considerable importance. He answered the argument by saying that one has to draw the line somewhere.
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    By custom, the line has been drawn round the Metropolitan area. It is now proposed to include other areas and this includes Hertforshire, although one would not have thought so to hear the hon. Member for Hemel Hempstead (Mr. Allason) complaining earlier about the difficulties there. Kent is not included, and neither is Berkshire, nor would they be under this proposal. It would not help Sussex, a county which, I would have thought, had many of the aspects of metropolitan life.
    The difficulty is that once one starts going beyond this rather clear test it is difficult to know where to stop. One immediately gets counties further away saying that their problems are precisely the same as others which are included. One would get into the difficulty of being asked, "What about Birmingham?". Birmingham is a great conurbation, with many of the features of metropolitan life, and it would be difficult to defend having a special weighting for Buckinghamshire if one does not have it for Birmingham and surrounding areas, and Manchester and its surrounding areas.
    I am forced to the conclusion that while one can make a case for saying that there should be no metropolitan weighting at all, because of the spread of population, there is not a case for widening the existing boundaries of the Metropolitan area without creating as many injustices as this proposal would remove.
    Mr. John Hall: I am grateful for the Parliamentary Secretary's reply, but I am sure that he would not expect me to say that I am in the slightest bit satisfied with it. I find it very disappointing indeed, but in view of some of the things that he has said I do not propose to press this to a Division. I beg to ask leave to withdraw the Amendment.
    Amendment, by leave, withdrawn.
    Mr. Greenwood: I beg to move Amendment No. 58, in page 29, line 10, to leave out 'by regulations provide' and insert:
    ', after consultation with such associations of local authorities as appear to him to be concerned and with any local authority with whom consultation appears to him to be desirable, provide by regulations'.
    This is one of the Amendments tabled to fulfil undertakings given in Committee about consultation.
    Amendment agreed to.
    Mr. MacColl: I beg to move Amendment No. 59, in page 29, line 16, at the end to insert:
    'or,
    (iv) in providing, for persons who suffer from any disability of mind or body, education by special methods appropriate for persons suffering from that disability;'.
    This Amendment deals with the pooling arrangements. The Bill provides that certain types of local authority expenditure can be made the subject of pooling arrangements. They cover, for example, certain aspects of remand homes and other services which are provided by one authority for the benefit of a fairly wide area.
    The object of the Amendment is to extend that to cover expenditure on the education of handicapped children. This is something which is desired and which has the support of the C.C.A. and the A.M.C. I think that it will commend itself to the House as a useful way of financing these very important institutions.
    Amendment agreed to.
    Mr. MacColl: I beg to move Amendment No. 60, in page 30, line 17, to leave out 'two-fifths' and insert 'one half'.
    The purpose of this Amendment is to make a small change in the weighting for sparsity of population in the resources element. The difficulty arises because it is found that the sparsity proposal in the Bill would produce results which would prejudice a certain number of very deserving counties, mostly, if not all, in Wales. All that the Amendment does is to restore the status quo by raising the weighting from two-thirds to a half. It will produce virtually the same result as has been obtained under the existing proposals. The local authority associations have not made any objection to the Amendment.
    Amendment agreed to.
    Mr. Temple: I beg to move Amendment No. 61, in page 31, to leave out lines 35 to 45 and insert:
    2.—(1) The amount of the domestic element payable to a local authority for any year shall be the proportion of the aggregate amount of that element which the aggregate domestic rateable value of the authority bears to the aggregate of the domestic rateable values of all local authorities.
    546
    (2) In this paragraph 'domestic rateable value' shall be ascertained by adding:—

    (a) the aggregate rateable value of dwelling-houses and mixed hereditaments within the area of the local authority as shown in the valuation list on the first day of April in the relevant financial year.

    (b) the aggregate rateable value of dwelling-houses and mixed hereditaments on the first day of April in the subsequent relevant financial year

    and dividing by two.
    (3) The Minister may by regulations provide for the variation of this paragraph for years subsequent to the year 1967–68.
    Mr. Speaker: We can take at the same time the Government Amendment No. 62, in page 31, line 36, to leave out from 'be' to end of line 43 and insert:
    'determined in the manner provided by regulations made by the Minister after consultation with such associations of local authorities as appear to him to be concerned and with any local authority with whom consultation appears to him to be desirable'.
    Mr. Temple: I can move the Amendment very briefly. It arises from a discussion which we had in Committee when I criticised the extremely complicated Government proposals for calculating the domestic element. I suggested that there were three ways which were much simpler than the way proposed by the Government for calculating the domestic element and I recommended the formula proposed in the Amendment. I believe this to be a straightforward formula. It is acceptable to the local authority associations. It has the blessing of the Institute of Municipal Treasurers and Accountants. In fact, it comes from a first-class stable.
    I have every confidence that if the Government accept the Amendment they will be taking a great step forward in helping local authorities to cut out at least some of the extra administrative work being thrown on them at present. I hope very much that the Government will find it in their power to accept our proposal.
    Mr. MacColl: I said in Committee that this was not a matter of great principle, and that we were anxious to do whatever would help the local authority associations. We have had consultations with them and as a result we have found that they think the matter is better dealt with by way of Regulations than by the insertion of a provision in the Bill. They agree that for the first year the distribution should be based on rateable values,

    547
    much on the lines of the proposal of the hon. Member for the City of Chester (Mr. Temple), but they are not so certain that after a year or two, when they see how the thing is working out, they might not have different views about it. They would therefore prefer to have the matter left more flexible, so that it can be altered if necessary. Therefore they think—and we are anxious to help them—that the best way to proceed is by way of Regulations.
    Mr. Temple: In view of the explanation given by the Parliamentary Secretary I am exceedingly glad that he will bring forward these Regulations, and in the first year or two deal with the matter very much in accordance with the proposals I have put forward. We look forward to the Regulations and will study them closely.
    I beg to ask leave to withdraw the Amendment.
    Amendment, by leave, withdrawn.
    Further Amendment made: In page 31, line 36, leave out from 'be' to end of line 43 and insert:
    'determined in the manner provided by regulations made by the Minister after consultation with such associations of local authorities as appear to him to be concerned and with any local authority with whom consultation appears to him to be desirable'.—[Mr. MacColL]

    Schedule 2.—(RATING OF UNOCCUPIED PROPERTY.)
    Mr. MacColl: I beg to move Amendment No. 63, in page 33, line 28, to leave out sub-paragraph (3) and to insert:
    (3) Where a new valuation list is prepared for any area, the valuation officer shall include in the list as transmitted to the rating authority

    (a) any dwelling-house included in the current list for that area in pursuance of a proposal under sub-paragraph (1) or (2) of this paragraph; and

    (b) any building (with or without other land) in respect of which a proposal for its inclusion in the current list as a dwelling-house has been made by him under the said sub-paragraph (1) and has not been settled,

    and, if any such proposal is made by him after the new list has been so transmitted, shall cause that list to be altered so as to include the building (with or without other land) as a dwelling-house in the new list.
    This is purely a drafting Amendment, and we think that in this form the subparagraph is easier to understand than
    548
    it was. I would not pretend that it is shriekingly easy to understand in any form, but we feel that on the whole it is easier to understand in this form.
    Amendment agreed to.
    Further Amendment made: In page 33, line 39, leave out sub-paragraph (4).—[Mr. MacColL]
    Mr. MacColl: I beg to move Amendment No. 65, in page 34, line 26, at the end to insert:
    'and the notice shall be deemed to be withdrawn'.
    This is not much more than a drafting Amendment. The paragraph which it amends enables the owner and the rating authority to agree upon a completion date after notice has been served by the rating authority, but it does not make any specific provision as to the disposal of the notice itself if there has been an agreement. The Amendment repairs that omission and tidies up the provision.
    Amendment agreed to.
    Further Amendments made: In page 35, line 41, leave out '(with or without other land)'.
    In page 36, line 29, leave out from 'period' to 'force' in line 30 and insert:
    'when that section is not in'.
    In line 31, at end insert:
    '; but the fact that the said section 20 has ceased to be in force in any area shall not affect the operation of that section as respects any period when it was in force in the area'.—[Mr. MacColL]
    Mr. MacColl: I beg to move Amendment No. 69, in page 36, line 38, to leave out from the first 'to' to the end of line 39 and to insert
    'a newly erected building or dwelling-house include references to a building or dwelling-house produced by the structural alteration of a building included in a relevant hereditament which by virtue of paragraph 6 of this Schedule has ceased or will cease to exist on the completion of the structural alteration and, in relation to a building or dwelling-house so produced, references to erection of a building shall be construed as references to the structural alteration producing it'.
    This is a drafting Amendment, which makes clear what kind of structually-altered hereditaments are within the provisions of the Second Schedule, which

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    deals with the determination of the rateable values and of the completion dates of new and structually-altered hereditaments for the purposes of the provisions relating to the rating of unoccupied property.
    Amendment agreed to.

    Schedule 3.—(LICENCES, ETC.)
    Amendment made: In page 37, line 10, at end insert:
    5. Sections 341 to 352 of the Merchant Shipping Act 1894, in section 365(1) of that Act paragraph (d) and the words '(e) emigrant runners', and section 23 of the Merchant Shipping Act 1906.—[Mr. MacColl.]

    Schedule 4.—(MINOR AMENDMENTS OF ENACTMENTS RELATING TO RATING AND VALUATION PREPARATORY TO CONSOLIDATION.)
    Mr. MacColl: I beg to move, Amendment No. 72, in page 39, line 6 to leave out from 'to' to the end of line 8 and to insert:
    'that rate whether as originally made (in whatever form) or as it has been applied in relation to particular hereditaments'.
    Perhaps it would be for the convenience of the House if we took with this Amendment, Amendment No. 73.
    These are both drafting Amendments. Before the war, the generally accepted view was that the rate was made by a resolution approving the rate book which set out the rate as applied to individual hereditaments. In the Rating and Valuation (Miscellaneous Provisions) Act, 1955, provision was made for the alternative of making a rate simply by fixing the poundage. Existing provisions in Section 52 of the 1948 Act and in earlier Acts are not easily reconciled with this alternative view and the opportunity has been taken to tailor the earlier provisions to fit. It is felt necessary to clear the matter up and the Amendment does so.
    Amendment agreed to.
    Further Amendment made: In page 39, line 9, leave out from '1948' to end of line 10 and insert:
    'except in subsection (1)(c)(i) thereof, shall be construed as references to that rate as it has been applied as aforesaid,
    and in subsection (3) of the said section 52 for the words "originally made" there shall be substituted the words "first applied in relation to the hereditament in question or,
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    as the case may require, as first amended in respect of that hereditament under paragraph (c) of that subsection"'.—[Mr. MacColl.]
    Mr. MacColl: I beg to move, Amendment No. 74, in page 40, line 14, at the end to insert:
    9. In section 13(2) of the Rating and Valuation Act 1925 after the word 'under' there shall be inserted the words 'subsection (1)(a) of.
    Mr. Deputy Speaker (Sir Eric Fletcher): I think that it would be convenient to take with this Amendment Nos. 75, 76, 77 and 78.
    Mr. MacColl: Amendment No. 74 is a drafting Amendment. Section 1 of the 1925 Act refers to "an application for a certificate of the precepting authority" and to the precepting authority" applying for a receiver." The Amendment makes it certain that the Minister's power to make an application instead of its being made by the precepting authority refers to the application for a receiver.
    Paragraph 26 withdraws from the Secretary of State for Wales certain powers for the purposes of the Amendment to ensure that any Instrument made between the date of making an application and its return to the Minister shall not become void.
    Mr. Temple: Am I correct in understanding that you, Mr. Deputy Speaker, said that Amendment No. 78 is being taken with this one?
    Mr. Deputy Speaker: I said that I thought that it would be convenient if Amendments Nos. 74 to 78 were taken together.
    Mr. Temple: The Parliamentary Secretary slipped over Amendment No. 78 all too easily, because it draws attention to the extraordinary confusion of the Government. The Amendment seeks to put right the fact that certain powers were transferred from the Secretary of State for Wales to the Minister of Land and Natural Resources. The Amendment is putting the powers back again in the right place. It makes one wonder how many other powers were mistakenly transferred to the Minister of Land and Natural Resources.
    But everything will be right very shortly. As we said when this Government came to office, there was no need whatever for such a Ministry. It lasted

    551
    a couple of years, and I suppose that we are all happy that the powers are being taken away from the Minister and that the Ministry is being wound up. The Amendment indicates the amount of confusion in Government circles.
    Mr. MacColl: The hon. Member for City of Chester (Mr. Temple) did not say that he would abolish the Secretary of State for Wales. We had to do this because there was a Secretary of State for Wales, whom we invented—and that is a feather in our cap.
    Amendment agreed to.
    Further Amendments made: In page 40, line 26, leave out 'section 18(4)' and insert 'sections 18(4) and 22(1)'.
    In line 30, at end insert:
    and in the said section 57(1) the words "or residence" shall be omitted'.
    In page 41, line 21, at end insert:
    15. In section 48(2)(a) of the Local Government Act 1948 for the words 'either party' there shall be substituted the words 'one or more parties to the appeal'.
    In page 42, line 26, leave out 'not be treated as transferred to' and insert:
    'be exercisable by that Minister in relation to the whole of England and Wales and shall not be exercisable by'.—[Mr. Greenwood.]

    Schedule 6.—(ENACTMENTS REPEALED.)
    In page 45, line 10, at end insert:

    57 & 58 Vict. c. 60.

    The Merchant Shipping Act 1894.

    Sections 341 to 352.

    In section 365(1), paragraph (d) and the words '(e) emigrant runners'.

    6 Edw. 7.c. 48.

    The Merchant Shipping Act 1906.

    Section 23.

    Amendment No. 81, in page 45, line 32, at end insert:

    4 Eliz. 2. c. 9.

    The Rating and Valuation (Miscellaneous Provisions) Act 1955.

    Section 1(8).

    —[Mr. Greenwood.]
    Mr. MacColl: I beg to move, Amendment No. 82 in page 45, line 48, column 3, to leave out "and".
    Mr. Deputy Speaker: It would be convenient to discuss the next Amendment, No. 83, at the same time.
    Mr. MacColl: The first Amendment is a paving Amendment for No. 83 which is itself not much more than drafting. Clause 30(2) provides that
    "it shall cease to be a condition for exemption from duty under"
    Section 4 of the Dog Licences Act 1959,
    "which relates to dogs kept for tending sheep and cattle that the owner of the dog in question obtains a certificate of exemption under that section".
    These certificates are issued by the magistrates' courts and they are being dispensed with as unnecessarily cumbersome. Schedule 6 provides certain consequential repeals in respect of references to those certificates, and this Amendment provides for the repeal of another reference which has been overlooked.
    Amendment agreed to.
    Further Amendments made: In page 45, line 51, column 3, at end insert:
    'and the words "or certificate" in the next place where they subsequently occur'.
    In line 52, at end insert:

    9 & 10 Eliz. 2. c. 45.

    The Rating and Valuation Act 1961.

    Section 28(3).

    In page 47, line 18, at end insert:

    37 & 38 Vict. c. 54.

    The Rating Act 1874.

    In section 7, the words 'and tithe rentcharge'.

    In line 37, column 3, at end insert:
    In section 22(1)(b), the words 'and tithe rentcharge, if any'.
    In line 38, column 3, at end insert:
    In section 68(1), in the definition of 'gross value', the words 'and tithe rentcharge, if any'.
    Section 68(2).
    In line 38, at end insert:

    19 & 20 Geo. 5. c. 17.

    The Local Government Act 1929.

    Schedule 3.

    In line 42, column 3, at beginning insert:
    In section 57(1) the words 'or residence'.—[Mr. Greenwood.]
    Order for Third Reading read.—[Queen's Consent, on behalf of the Crown, signified]
    10.45 p.m.
    Mr. Greenwood: I beg to move, That the Bill be now read the Third time.
    I do so happy in the knowledge that passage brokers and emigrant runners can sleep peacefully in their beds tonight for the first time for many years. This is, of course, essentially an interim Measure, but it is right that I should outline as briefly as I can the provisions of the Bill as it leaves us to go to another place, reminding the House that more radical changes must await the Report of the Royal Commission on Local Government.
    The Bill breaks new ground in introducing a new relationship between central and local finance. Instead of die various Exchequer grants being considered separately and the total effect on the rates being left more or less to chance, we will determine a total Exchequer contribution by reference to estimates of expenditure that would otherwise fall on the rates. From this total contribution will be deducted the expected total of grants in aid of specific services, and the remainder will be distributed by the three parts of the rate support grant.
    The absorption into the needs element of the money formerly distributed separately in respect of school meals, the improvement of non-principal roads and the maintenance of all roads will permit administration to be simplified and central control to be reduced. An important improvement in the existing formula is the introduction of "education units". In the present formula only the primary and secondary school pupils are counted and they are given the same weight, but a secondary pupil of 16 or over and an award to a university student, for example, each costs about three and a half times as much as a primary school child.
    Since the proportions of pupils at these stages naturally vary from one authority to another, the present formula is over-generous to some and unfair to others. I am happy to be able to tell the House that complete agreement has been reached with the associations of local authorities as to the weighting—that is, the number of education units to be given to pupils and students in the various categories.
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    Another innovation is the domestic element which was devised to channel most of the extra money the Exchequer will be putting into local government directly to the reduction of the rates of the domestic ratepayer, who can neither charge his rates as a business expense nor pass on any part of them.
    The new specific grants will be very helpful to individual authorities facing exceptional expenditure on comprehensive redevelopment or the restoration of derelict land—a serious problem in a number of parts of the country, not least the Pennine towns of Lancashire and Yorkshire—or on special provision on account of large numbers of Commonwealth immigrants.
    Before leaving this part of the Bill, I should tell the House something of the progress that has been made with the preparation for the first rate support grant order that will have to be made later this year. During the earlier stages of the Bill some hon. Members, and particularly the hon. Member for the City of Chester (Mr. Temple), were concerned about the ability of local authorities to provide, in the time available to them, forecasts of expenditure up to the year 1968–69. It is a tribute to the authorities for me to be able to say that most of them got their estimates in within the very tight time limits we allowed. This has given the departments and the local authority associations time to examine the estimates in readiness for discussions due to take place at the end of the month.
    Part II of the Bill makes three changes in the sphere of rating and valuation. The postponement of the general revaluation was fully discussed earlier this evening. Postponement made it essential to provide a statutory foundation for the long-established practice of valuing properties between general revaluation by reference to the existing lists. At the moment, that means using values as they were about four years earlier. The Clause has been closely scrutinised by the professional bodies and other interested parties and it has been amended to meet points they made.
    The proposal to charge half rates on unoccupied property has been generally accepted as right in principle. Most

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    people agree that there should be some deterrent to those who leave property vacant in times of scarcity in the hope of getting a higher price or rent. It is, I believe, also appreciated that owners benefit from local services, such as police and fire, even when their properties are empty. I do not believe that part-rating of empty property is a matter of conflicting party doctrine and I hope it will not be so treated in council chambers.
    Part III of the Bill provides the legislative framework for the new system of highway grants, and brings up to date the administrative arrangements for street lighting. My right hon. Friend the Minister of Transport is now undertaking a comprehensive review of the highway system so that the network of principal roads, which will receive specific grants, can be designated when the new grant system comes into effect on 1st April next year. The Ministry's initial proposals for the new network were sent to local authorities in June, and my right hon. Friend hopes to let them know the results of the review before the end of the year.
    The street lighting provisions have, I know, caused a certain amount of controversy and understandable regret among those authorities which are losing functions they have exercised for many years. Responsibility for road lighting—that is to say, lighting of which the primary purpose is to assist the safe movement of motor traffic—is to be transferred to highway authorities, and the installation of road lighting on principal roads will be eligible for 75 per cent. specific grant in the same way as any other highway improvement. We think it essential that the highway authority for the road should be responsible for lighting it, and particularly for the planning and programming of lighting schemes. The present organisation of street lighting dates from the pre-motor age, and we must now bring it up to date so that it will serve the needs of today and tomorrow.
    The Bill contains many complicated and highly technical provisions, and I greatly admire the hon. Members who served in Standing Committee, and who, without the aid of Departmental briefs, mastered its complexities. Many improvements have resulted from suggestions made at that stage, and I am grate-
    556
    ful to those responsible for their devoted study and constructive attitude, and not least for their kindness to me, coming fresh to a somewhat complicated Bill.
    I began by saying that this is an interim Measure, and I make no claim that it will transform the lot of the ratepayer, but it will certainly help. Over the last decade, the expenditure of local authorities has been rising faster than public expenditure generally, and much faster than national income. The consequent steep rise in rates has put an excessive strain upon this form of taxation. The Government have already given substantial relief to the hardest-hit ratepayers by means of rate rebates, and under the provisions of this Bill the strain on the general body of domestic ratepayers will be eased by a gradual but steady increase in the share of the burden borne by the Exchequer.
    I do not claim, and my predecessor did not claim, that rates will not rise in future. If local authority expenditure continues to grow—as I think it must, since most of it is on vital services which everyone wants to be improved—the rates of all ratepayers could be kept steady only by transferring more and more services to the centre, or by increasing grants to an extent that would be liable to undermine local financial responsibility. Either method would damage local government. The long-term solution must be to find additional sources of local revenue that are buoyant like the expenditure of local authorities and are fair in their incidence. I intend to put in hand an intensive study of possible sources, which will be carried out concurrently with the work of the Royal Commission, so that we are ready to tackle financial reconstruction in the general reorganisation.
    In the meantime, I commend the Bill to the House as a Measure which, together with the Rating Act, will substantially ease the burden of rates for those who find them hardest to bear, and will do so without reducing the vitality and independence of local government.
    10.54 p.m.
    Mr. Temple: I welcome the detailed explanation which the Minister has just given. I acknowledge with him that it is a somewhat complicated Measure. Like himself, I regard it as an interim Measure, and I was very glad to hear

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    him announce that he is putting in hand an intensive search within his Department for alternative sources of locally-raised revenue. I can only wish his Department luck; it has searched in its recesses before and has brought forward very little!
    As an Opposition, our approach to the Bill has been constructive. I am grateful to the right hon. Gentleman for his references to some of our constructive suggestions, several of which have been taken over by the Government. I should like also to thank my right hon. and hon. Friends for the great amount of work they have put in on this Bill.
    I must admit that during the long period when we were in office I had no idea what heavy work it was to be in Opposition. I have now found out for myself that it is indeed a strenuous task to try to study a complicated Bill of this nature even with the good will of many outside organisations behind one. In that respect I pay tribute to the constant vigilance of the local authority associations and also those very valuable bodies such as the Institute of Municipal Treasurers and Accountants, the Rating and Valuation Association and many others who work in this extremely difficult field. I should like, certainly not less, to thank the Ministers for the many ways in which they have been particularly helpful and to make special mention of the Joint Parliamentary Secretary. The Joint Parliamentary Secretary carries a very heavy load in his Department. He has at all times endeavoured to give us very full explanations of what he has been doing and I thank him personally for the cooperation which he has shown to me, which has been so extraordinarily helpful in throwing a little light in some rather dark and abstruse corners.
    This Bill has been lying about this House for some considerable time. It was introduced on 18th May in what I would call a very different world before the prices and incomes freeze. We had an assumed growth rate of the gross domestic product on 18th May this year which was clearly laid down in the National Plan. I do not know what has happened to the National Plan, whether that has gone into a deep freeze or is being disregarded altogether. However, there is no doubt but that the assumptions made in the White Paper of the growth of the
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    gross domestic product have now unfortunately been completely falsified.
    There has departed from the scene the Minister of Housing and Local Government, who has been replaced, and also what I call the "Growth Overlord". He has left for other pastures. So we are looking at the whole problem of the finance of local government in a very different light.
    On Third Reading, I can comment only on what is in the Bill, but I shall do that against the background of the changed economic circumstances, which I think it would be admitted on all sides have taken place since 18th May this year. Significantly, the starting date for all the new rate support grants is April, 1967, a month and a year, which is coming on us extremely fast.
    The Minister paid tribute to the work of local authorities which had got in their estimates in time. They had to if they are to get grants in April, 1967. These estimates had to be in whether they were estimates or "guesstimates". The local authorities associations, I assure the Minister, are under extreme pressure at the present time. I had that confirmed this morning. The Parliamentary Secretary always notes my diligence in having conversations early in the morning with local authority associations. I have to reiterate now what I took an hour and a quarter to say in Committee—the longest speech of my Parliamentary career—when I criticised very much the timetable. I am not able to do it so fully on this occasion. However, the fact remains that the starting date for all these grant mechanisms is April, 1967, and before that time we have to have the rate support grant order. Before that time also the most abstruse calculations have to be gone through. I draw attention to the administrative strain being put on local authorities, I believe unnecessarily, due to the timetable in this Bill. I happened to pick up the Sunday Times of 21st August. It said in a big splash headline:
    "Town Hall Men Fear Breakdown"
    I make a short quotation from that issue:
    "Staff shortages in the offices of five enlarged county boroughs in the West Midlands have become so serious that there are fears of a breakdown in the administration."
    That is the position which has been brought about by the insistence on the

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    starting date of April, 1967. I do not know the remedy for these staff shortages in the Midlands. I can only suppose that a certain amount of redeployment from the car industry will probably be envisaged by the Government, so that the administrative staffs of local authorities can get some extra personnel to help them.
    We have been told by the Minister time and again that, owing to the Bill, some areas will gain and others will lose. An intelligent estimate is that the urban areas will gain and the countryside will lose. Some people know the answers; the working parties know them and Ministers know them—or they should. If they do not know now they must know them in the course of a few weeks, and I complain bitterly that Parliament is not in a position to know the effects of this legislation at Third Reading. Parliament is being "blindfolded" in this matter, and I am very disappointed that fuller explanations of the effects of the grants were not available to the House during the passage of the Bill through it.
    The Minister has said on Third Reading that rates will go up for all. Nothing is more certain. The collapse of the National Plan has entirely vitiated the assumptions in the White Paper. I quote only from Paragraph 15, which is entirely apposite in this matter:
    "The aim would be to keep the average increase in rate poundages more nearly in line with the growth of the economy, as measured by gross domestic product."
    Between last May and this month the growth of the gross national product has been zero, and I hazard a guess that it is declining at present, as opposed to increasing, as was anticipated in the White Paper upon which all the financial calculations of the Bill were made. The growth of local authority expenditure was stated in the White Paper, and referred to by the Minister on Third Reading, as being of the order of 10 per cent. cumulative per annum. The domestic rate relief in the Bill will take care of only half of that growth. It was assumed that the other half would be taken care of by the growth of the gross domestic product as it would have taken place over the last few years. As the growth of the gross domestic product has dropped
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    to zero, most of the assumptions of the Bill upon which rate relief was based have unfortunately been vitiated. I am afraid that the ratepayers will be disillusioned and the domestic ratepayers will not get anything like as much relief as they had been led to suppose they would obtain.
    I have only one comment on Clause 6 and the mixed hereditaments. I was disappointed at the reply of the Parliamentary Secretary on this. I thought that we could have dealt with this very expeditiously and made the mixed hereditament into what I call a "thoroughbred "rather than leaving it as a mongrel. As we leave the Bill it has been tidied up to a limited extent. It is a better looking mongrel, but in my view it is still a mongrel, which is disappointing, even in a temporary Bill.
    The Minister made special reference to the school meals grant and went out of his way to say that central control would be reduced. The abolition of the 100 per cent. grant for school meals under the Bill has had very scant attention. The Parliamentary Secretary and I had a highly esoteric debate in Standing Committee. I think that the honours were about even. The Parliamentary Secretary deployed one of those arguments that perhaps he did not find terribly convincing himself and I deployed an argument that I found convincing but I was not absolutely certain that I was on firm ground.
    As I say, I think that the honours were reasonably even, but the point at issue is not really the esoteric argument behind the finance of the school meals service. It is, in the words of the Parliamentary Secretary, "Can we divorce financial responsibility from policy?" On 7th July, the hon. Gentleman said, referring to the abolition of the school meals grant:
    "… I said that this was a financial operation and not in any sense a policy operation".—[OFFICIAL REPORT, Standing Committee F. 7th July, 1966; c. 238.]
    I put three questions to the new Minister of Housing and Local Government. First, does he happen to read a journal called Catering Management? If he does not read it, I advise him as Minister of Housing and Local Government to read it. I draw his particular

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    attention to the issue of October, 1966, in which there is the splash headline,
    "New Bill could lead to complete break-up of the school meals service. Commons debate will be an October 20th".
    Their timing was exactly right. It is a very well informed journal. Here is one sentence from the article:
    "So far as I am aware, neither the Department of Education nor anyone else took it upon themselves to inform the N.A.S.M.O."—
    that is, the National Association of School Meals Organisers—
    "or the I.M.A.—both vitally interested bodies—about this move".
    Was the National Association of School Meals Organisers consulted about this matter? They are the people who have to operate this service.
    The Minister went out of his way in his Third Reading speech to emphasise that central control would be reduced. I put my other two questions to him. Will the nutritional content of the meals be maintained? Will there be variations in charges for meals as between one authority and another? Both are extremely pertinent questions, and I hope that the Minister who is to wind up the debate will clear the matter up. As I say, the question of the abolition of the 100 per cent. grant for school meals has had very little attention throughout all our discussions on the Bill.
    We have already expressed our views about postponement of revaluation. I had something fairly caustic to say about the previous Minister of Housing and Local Government. I was sorry that he was not in the Chamber when I was delivering myself of those comments. I shall not repeat what I then said, but perhaps he would like to read them in HANSARD tomorrow.
    Now, Clause 26 and the transference of lighting functions. We had one severe criticism of the Bill, directed to the extraordinary "so-called principle" adopted by the Government in transferring the lighting functions of local authorities and the loan charges going therewith. Where lighting functions are to be transferred between authority and authority, the loan charges, naturally, follow the functions and are taken over by the receiving authority. But in the case of transference of lighting functions between a local authority and the Ministry of Transport, the Ministry of Trans-
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    is not to take over financial responsibility for the loan charges.
    This procedure is almost unprecedented. It was precedented in the Trunk Roads Act, 1936, a Conservative Measure, but the Parliamentary Secretary to the Ministry of Transport—who, I know, has apologised to the House for not being with us today—said that that was a precedent he would not like to follow, largely, I think, because it was a Conservative precedent. Yet he has succeeded in following it. I cannot understand the logic of the present Government in this matter.
    Now, highway grants. We have not heard a great deal about these, but there will be a complete change in highway grants prior to a major reclassification of highways.
    The Lord President of the Council and Leader of the House of Commons (Mr. Richard Crossman): Hear, hear.
    Mr. Temple: The erstwhile Minister of Housing and Local Government says "Hear, hear", but, of course, he is a Minister who always likes to jump in quickly before the ground in front of him has been properly prepared. I admire his courage, but I cannot admire his sagacity in these matters. There ought to be a complete reclassification of highways first and then a recasting of the highway grants. In that way, one would know exactly where one was going.
    I think that I have covered the main points of criticism that we have about the Bill, highlighting some of the important facets, and, in addition to those important matters, making reference again to some of the minutiae which also go with the Bill. We can, I think, say that we welcome the tidying up of some of the archaic legislation that the Government have put in hand. It has not taken up a great deal of the time of the House, and I consider that it has been valuable.
    I can say in conclusion that we approve wholeheartedly the extension of the general grant, an amazing volte face by the Labour Party. We approve also the domestic rate relief, which does not go anything like far enough and certainly does not measure up to the extravagant promises given by Labour Ministers at the last General Election. We welcome

    563
    the rating of unoccupied property, although nobody thinks it will bring in a great deal of money or be of great assistance to ratepayers. We deplore the postponement of revaluation and the ridiculous haste with which the new financial provisions are to be brought into operation.
    We have worked as hard as we possibly could to improve the Bill, and think that we have made it a little more intelligible. We hope very much that local authorities will be in a position to operate the Bill in such a way that it will be of great assistance to ratepayers and all householders throughout the country.
    11.12 p.m.
    Mrs. Lena Jeger: This complicated Bill covers a very wide spectrum of activity. I begin by congratulating my right hon. Friend and his predecessor on bringing it so successfully before the House to its Third Reading.
    I would refer specifically to one of the questions raised from the Opposition Front Bench, that concerning Clause 14, about the abolition of the grant under Section 100 of the Education Act, 1944, in respect of school milk and meals. It may well be that this is merely a measure of fiscal rationalisation and should be recognised as such, but I am sure that my right hon. Friend will be aware that some anxiety has been publicly expressed as to the possible implications of the Clause. Certainly it is fair to say that the whole matter is not as clear as daylight to many people, possibly even in the House.
    I gather from careful study of the Committee proceedings that the effect of the change will be that if expenditure on school milk and meals goes up less than other services local authorities will gain. On the other hand, if expenditure on school milk and meals goes up more than other items local authorities will not do so well. The net result of the exercise seems to be that under the new grant proposals a local authority will be worse off if it spends a higher proportion on milk and meals than it does on other services. I am not completely sure what all this means.
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    I ask my right hon. Friend to forgive-any of us who are perhaps over-sensitive on this matter. The whole question of the provision of school milk and meals has been very much under political attack. It is historically one of the starting points of the whole fabric of our social services, and I hope that those of us who regard any possible inroads on this service with anxiety will be forgiven. My point in raising the subject is to give my right hon. Friend the opportunity to allay the anxieties that some of us feel.
    I am sure that it would be no part of my right hon. Friend's wish nor part of the policy of the Government to bring in any Measure which would in any way be detrimental to the provision of school milk and meals. This is part of the whole fabric of our social welfare and we must have a categorical statement that it is invulnerable as far as the Government are concerned.
    One has to be a little anxious, however, in view of what was said in Standing Committee about the possible disadvantage to local authorities whose expenditure on this service increases, possibly out of proportion to the expenditure on other services. While we may have every confidence in the power of my right hon. Friend the Secretary of State for Economic Affairs to ensure that, in the coming years, there are no price increases whatever in many essential commodities, I cannot help wondering what is to happen under this Bill if there is a sudden jump, for instance, in the price of milk.
    I am not sure that this can be ruled out. If it can be ruled out, I shall be relieved to hear it. But there are many instances of rises in the cost of foodstuffs, labour and transport, which are all reflected in an increase in the cost of school meals, and if these tendencies continue it may be that, within a short time, if the standards of nutrition are to be maintained, expenditure will go up.
    In these circumstances, will a local authority which endeavours to maintain a high nutritional standard and to increase the availability of school meals be disadvantaged by this change in the law which is now before us? I hope that this will not be the case and I trust that my right hon. Friend will be able to

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    assure the House that it is the intention of the Government to see that this very important factor in our social welfare provisions is maintained and jealously safeguarded.
    11.17 p.m.
    Mr. Gerry Fowler (The Wrekin): As many hon. Members will be aware, it was suggested in The Times yesterday that Clause 14 means that local authorities will henceforth have power to reduce or abolish either school meals or school milk or both. We should all like a reassurance from my right hon. Friend that this is not the implication of the Clause, that it is simply concerned with a change in the method of financial control and does not imply that local authorities will be able to run down or abolish the school meals and milk service.
    There may be a case for a review of this service but, if so, we hope that it will be done publicly and in proper form and not in consequence of a Clause in a Bill principally dealing with other matters.
    11.18 p.m.
    Mr. Frank Judd: I want briefly to add my name to those seeking clarification on this point. I ask my right hon. Friend to bear in mind that this is not an academic consideration of Clause 14 because there are already reports that certain local authorities, particularly in Kent, have taken active measures to discuss how they might reduce this service.
    This is an urgent matter, particularly at a time when the Government are emphasising their concern for pockets of poverty which still exist in the community and when, obviously, all of us are concerned about temporary difficulties faced by families in the present economic situation and about the sociological changes in the pattern of life and the encouragement of mothers and wives to go out to work.
    It is most important that my right hon. Friend should recognise that already certain local authorities are considering reducing this service and that therefore we must have clarification of the Government's attitude.
    11.20 p.m.
    Mr. Winnick: I want first to give a wholehearted welcome to two measures for which many of us have been cam-
    566
    paigning for some time. I intervened at the beginning of our debates on the Report stage to speak about the new rating assessment of nationalised industry offices, a subject on which my constituents feel very strongly. For some time Croydon Council has been pressing on the Minister its view that the offices of nationalised industries should bear a proper rating assessment, and I therefore welcome the change which my right hon. Friend has introduced and which will be enthusiastically welcomed in the London Borough of Croydon. Having said that, I do not want to appear critical, but I would have liked the Minister to have gone one stage further and perhaps it is not asking too much to hope that when this issue is considered in another place, there will be a complete reform in this respect. However, even that reform which has been made is welcome.
    Another change about which I am pleased, and for which many of us on this side of the House have been campaigning for some time, is the rating assessment of empty property. Opposition spokesmen did not seem to be very cheerful about that, but, of course, over the years hon. Gentleman opposite have been very lukewarm about this reform and I well remember that when in office they dismissed the suggested rating of empty property as completely useless. Perhaps it is understandable that they should not be too happy about the change.
    There can be no doubt that in the past few months there has been a propaganda campaign to get people to accept that the school meals service is becoming obsolete and that too much is being spent on school meals. A number of hon. Members opposite, in speeches and letters to newspapers and journals, have said that in this day and age too much is being spent on this function.
    In the last few months, organisations concerned with poverty in this country, such as the Ministry of Social Security and the new Child Poverty Action Group, have spotlighted the hard poverty which still exists in our society. As a member of the Labour Party, I would be most concerned if there were any attempt to reduce the responsibility of local authorities to perform this very important function of supplying school meals.

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    I can well understand the concern which is sometimes felt in the teaching profession about responsibility for this function and I should like my right hon. Friend to make the position very clear. Will he clarify whether central control is to be retained and that responsibility is still to rest on local education authorities to perform this function? Will he also make it clear that local authorities will not be able to vary the amount of money spent on the school meal service? I am particularly concerned about this, because last week Croydon Education Committee stated that, under new instructions which it had issued, Croydon schools would not be able to use supplementary heating during the winter months, blaming the current "freeze" as a justification for the new freeze in the schools.
    That is something which the Minister should consider. There may be a number of other education committees, perhaps a minority, but nevertheless still a number, who would use the opportunity of a relaxation in the law to reduce the amount of money spent on school meals. With the amount of poverty still outstanding in this country, Labour Members are entitled to expect a clear cut statement from the Minister tonight that there will be no relaxation in the regulations requiring local education authorities to perform the very important function of providing school meals.
    11.25 p.m.
    Mr. Greenwood: By leave of the House I will reply briefly to the points made about school meals and milk, raised by hon. Gentlemen opposite and by my hon. Friends the Members for Holborn and St. Pancras (Mrs. Lena Jeger), The Wrekin (Mr. Fowler) Portsmouth, West (Mr. Judd) and Croydon, South (Mr. Winnick).
    My hon. Friend the Member for Holborn and St. Pancras was right to say that this was simply a measure of fiscal rationalisation. It is true that the Bill does not reduce the power of the Government and the central control is not lessened. Under Clause 14 the 100 per cent. grant paid by the Secretary of State for Education and Science to local authorities on the expenditure of these services will come to an end on 31st March next year. Thereafter the expenditure will be taken into account by the Minister of Hous-
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    ing in calculating the payment of rate support grant, formerly general grant, to local authorities, which will not suffer financially from the change. If for example, there is a rise in prices, that will be taken into account in fixing the grant.
    My hon. Friend the Joint Parliamentary Secretary made it clear in Committee that Section 49 of the Education Act, 1944, and the Regulations made under it will not be affected by the Bill. They impose on local authorities the duty to provide free school milk and meals of adequate quality and quantity at a national charge, fixed by the Secretary of State for Education and Science, with free meals in cases of hardship. If a local authority fails to fulfil these obligations I have the power in the last resort, under Clause 4 of the Local Government Bill, to make a deduction of grant.
    In those circumstances the Secretary of State, under Section 99(1) of the Education Act, 1944, will retain the power to make an order declaring the local authority in default and to give appropriate directions to enforce the order and if necessary, to apply to the High Court for an order of mandamus. I hope that the anxieties expressed by my hon. Friends will be met by this explanation.
    Question put and agreed to. Bill accordingly read the Third time and passed.

  INDUSTRIAL REORGANISATION CORPORATION [MONEY]
  Resolution reported,
  That, for the purposes of any Act of the present Session to provide for the establishment of a public corporation (hereinafter referred to as "the Corporation") with the functions of promoting or assisting the reorganisation or development of any industry or section of an industry and establishing or developing, or promoting the establishment or development of, any industrial enterprise, it is expedient to authorise—
  (1) the issue out of the Consolidated Fund—

  (a) of any sums required for enabling the Secretary of State to make loans to the Corporation;

  (b) of any sums required to fulfil any guarantees by the Treasury in respect of sums borrowed by the Corporation otherwise than from the Secretary of State;

  (2) the payment out of moneys provided by Parliament of sums required by the Secretary of State for making payments to the Corporation on terms which provide for the making

  569
  of payments by the Corporation to the Secretary of State of amounts proposed by the former or determined by the latter;
  (3) the borrowing in any manner authorised by the National Loans Act 1939 of any money needed for providing sums required for enabling the Secretary of State to make loans to the Corporation;
  (4) the payment into the Exchequer of any sums received by the Secretary of State or the Treasury in consequence of any of the provisions of the said Act of the present Session and the re-issue out of the Consolidated Fund of sums so received by the Secretary of State in respect of loans made by him to the Corporation;
  so however that the aggregate of the amounts outstanding in respect of the sums paid to the Corporation as mentioned in paragraph (2) of this Resolution and of any sums issued by the Treasury in fulfilment of any guarantees mentioned in paragraph (1)(b) thereof and not repaid to them, together with the principal of any loans in respect of which guarantees have been given by the Corporation under the provisions of the said Act of the present Session and the principal of any money borrowed by the Corporation under those provisions, shall not exceed £150 million.
  Resolution agreed to.

  BLYTH SHIPYARD (CLOSURE)
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Whitlock.]
  11.27 p.m.
  Mr. Edward Milne: Deployment, "shake-out". job sharing, unemployment and redundancy have become often-used words in connection with the country's economic affairs during the past three or four months. This Adjournment debate deals with a shipyard in my constituency, owned by the Blyth Dry Dock and Shipbuilding Co. Ships have been built there for two centuries, at all stages, from wooden ships to the present-day vessels. The yard has moved with the times, and on occasions has been ahead of them. There were 62 ships built during the First World War and 24 during the Second World War, not counting a large number of frigates and corvettes, reflecting great credit upon the adaptability of men and management.
  The first "Ark Royal was built at Blyth, but it is with the present that we are mainly concerned tonight. In the first week in August of this year, the yard was on annual holiday and the editor of the local paper, the Blyth News,
  570
  on 3rd August, was telephoned and asked to go along to the yard for what was described as an item of news. A receiver had moved in that morning and taken over the running of the yard. Needless to say the town was stunned. Workers on holiday received the news from newspaper reports, and many returned from their holidays to receive the news in envelopes marked "Hong Kong."
  There is not the time to describe the feeling of desolation that is experienced at a time like this. As anybody in the House will appreciate, it is a matter of great sadness to watch a great industry die. The method of announcing the closure was criminal. No other word could fit the act. Men who had given a lifetime of service to the Blyth Company, in good times and bad, were entitled to treatment better than this.
  It is certainly true that the shipyard had lived on a razor edge for years. The city editor of the Newcastle Journal, writing on the state of the shipyard, talked about the fact that it had been in stormy waters financially for some time. The last statement of accounts and balance sheet filed with the Official Registrar of Companies in London makes this clear. It talks—as my hon. Friend knows—about the last audited balance sheet showing the company owning its own fleet of ships, which cost £1,662,000, but which had been written down in value to just over £532,000, and about the Chartered Bank's loan to the company, shown again in the balance sheet as not currently payable but being about £374,000, and that Lloyds Bank had lent the company about £539,000.
  It would be useful at this time to look at the financial ramifications of the company owning this yard. The Blyth Dry Dock and Shipbuilding Company Limited, which has 245,000 shares, saw that 242,000 of those shares were owned by the Moller Trust Ltd., of Hong Kong. Again, there is not sufficient time in a brief Adjournment debate to go into detail, but when we list the interests of this firm; when we cite the fact that the overwhelming bulk of shares in each of its interests was owned by the Moller Trust Ltd., we realise that something needs examination by the Board of Trade.

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  I hope that my hon. Friend will give us some undertaking on the question of an examination of this company and its interests, because, in addition to the Blyth Dry Dock and Shipbuilding Company, we have the Lancashire Shipping Co., Ltd., Brinkburn Steamship Co. Ltd., Moller Line (U.K.) Ltd., and a host of others too numerous to mention now but details of which have been given to the Board of Trade.
  So, from the date of the closure we move on to the stormy creditors' meeting in London on 13th September, chaired by Mr. Tucker, who appears in the list of all the financial interests of the Moller Trust. At this meeting it was again indicated that the Moller subsidiary interests were themselves creditors to the firm which then went into liquidation.
  What surprises me is that I was able to get from my own union's research department, and also from the excellent research department of the Library of the House, details of this firm's interests, but letters which I had from the Board of Trade gave me little or no assistance. They said that a trade directory shows several companies with offices at Union House, Hong Kong, with the word "Moller" in their name.
  But the lack of information from the Board of Trade becomes even more evident in a letter which I received from the Minister of State, Board of Trade, on 3rd October, which thanked me for my inquiry about the meeting of creditors of Blyth Dry Dock and Shipbuilding Co. Ltd., but added that the Board of Trade had no responsibility over voluntary liquidations.
  I am not complaining about that, because the present Government were not responsible for the law which made this situation possible, but I am surprised that, after a meeting of creditors of a firm which had put nearly 1,000 jobs in jeopardy in Blyth, the Board of Trade should say:
  "We are not aware that any report of the meeting, apart from newspapers reports, has been prepared."
  This is the position in 1966—that a Mr. Tucker, with all those interests in Moller Trust Ltd., can chair a meeting of the creditors of that firm and then return to Hong Kong without any compulsion
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  being imposed on him to provide the information which is urgently required to clear up this matter.
  What is even more surprising is that this same gentleman, with little or no knowledge of the yard—having paid only one visit there—according to Press reports of the annual meeting, made a savage attack on the attitude of management and workers there. A statement was issued by the shop stewards' committee refuting the allegations of responsibility for the need for closure and my only regret is that the management were not equally forthright in defending their position.
  The real truth is that the Blyth Yard —my hon. Friend knows this because, as Minister responsible for shipping, he paid a visit there recently—has a powerful case. A deputation met the Minister, Mr. George Darling, on 8th September——
  Mr. Speaker: Order. The hon. Member knows the Parliamentary way of referring to another hon. Member. He must say the right hon. Member for Sheffield, Hillsborough (Mr. Darling).
  Mr. Milne:—my right hon. Friend the Member for Sheffield, Hillsborough (Mr. Darling), whom we met on 8th September. All aspects of the yard's activities were fully examined and the Department was furnished with a document prepared by Mr. Jack Rowlands, the chairman of the North-East Federation of Shipbuilding and Engineering Unions.
  We are particularly concerned with the achievements of the yard in the past five or six years and its prospects for the future. During that period, vessels like the bulk carriers "Chapel River" and "Pacific Princess", of over 22,000 tons, have been built there, as have hopper barges, dredgers and pilot vessels for the Calcutta Port Commissioners and others. Colliers, coastal tankers and oil tankers for firms like William Cory, Stephenson Clark and a number of others have been built in the yard in that period.
  A collier of over 7,000 tons—the "Pul-borough"—was built in the yard and is regarded by seamen as the fastest and most efficient of its kind. We in Blyth know about the shipping of coal, because, over that period, about 4 million to 6 million tons of coal have left the port each year.

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  On the question of the ability to build ships and the ability of the yard. I should like to strike a personal note on a point about the building of a suction dredger at the yard. When I first arrived in the constituency there was a controversy about the yard's ability to do a job of this description, and the Blyth Harbour Commissioners went outside the town to have this suction dredger built, because the experts and those not so expert said that the yard was not capable of doing it because it had never done it before. That is never a good argument against a shipyard not being able to do a job which it sets out to do.
  In 1965, the Blyth Yard completed a suction dredger, the "Tideway", for the Westminster Dredging Company. It is interesting to note, when we make comparisons between the achievements of British yards and those of Continental yards, that the same type of dredger was commissioned by the same company from a firm in Rotterdam, and on all counts and in all matters of achievement the Blyth Yard was ahead of its rival. I could go into great detail about the jobs that can be done and the jobs that have been done in the Blyth yard in the period under discussion. The Geddes Committee's Report recently issued, about which there has been a great deal of discussion, stresses the need for increased shipyard trade in this country. What we are looking for is not a reduction in the capacity for shipbuilding but rather the reverse.
  Another question is that of flexibility. During recent years the yard has moved into industrialised housebuilding and has prepared and erected factory structures, bridges and other erections of that type and is capable as any examination would show, of building tankers up to 40,000 tons and general cargo vessels of 35,000 tons. The question of specialists, research, advancement and other matters has been raised. The yard is adapted to meet the challenges that the shipbuilding industry faces at this time and it would be a tragedy if it were not to be allowed to assist in meeting the challenge which the Government have asked shipbuilding industry to face.
  May we consider ways in which the Board of Trade could help us in this matter? We have two recent examples
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  of financial assistance on a considerable scale given by the Northern Ireland Government to Harland and Wolff and the set-up arranged with Government consent at Fairfield's, on the Clyde. While we realise that there is no exact parallel in this matter, we know that since the closure of the yard was announced there have been firms and individuals ready to consider Blyth as a proposition for future shipbuilding if encouragement from the Government is forthcoming.
  This has been closely examined by myself and others actively interested in the matter. We consider that the Local Employment Act, investment grants and the Bill which the House discussed yesterday setting up the Industrial Reorganisation Corporation are all instruments which the Government have at their disposal for assisting industry in one form or another. Needless to say, we should very much like the Government to have a close examination of the possibility of one or other of these measures being used to assist Blyth and its shipyard in playing the rôle which I have outlined.
  I have in the past referred to the need for the Minister responsible for shipping to visit the North-East. On the last occasion the Minister of State, my hon. Friend the Member for Barnsley (Mr. Roy Mason), visited us he managed to purchase a cloth cap in the area, following in the footsteps of a person from the other side of the political fence who also came to have a look at the North-East with a view to solving its problems.
  We have asked for definite and decisive action along the lines that have been mentioned. We feel that the evidence at the disposal of the Board of Trade and the facts I have mentioned tonight are sufficient, at this difficult period in the economic affairs of the country, for us to ask for such action. If it is not forthcoming, the next time my hon. Friend visits the North-East his garb will not be a cloth cap, but sackcloth and ashes.
  11.46 p.m.
  The Minister of State, Board of Trade (Mr. Roy Mason): I enjoyed the reference by my hon. Friend the Member for Blyth (Mr. Milne) to my having purchased a cloth cap. I assure him that I felt one of those I met and that I did not pretend to be one of them, as did

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  the previous gentleman my hon. mend mentioned.
  I assure hon. Members, and my hon. Friend the Member for Blyth in particular, that the Government are not indifferent to the situation created by the closure of the shipyard in Blyth. We appreciate the worry and distress this closure has brought to those employed in the yard and to their families and the importance of ensuring that there should be alternative employment for those put out of work by the closure.
  However, I cannot accept the simple proposition that the shipyard should be kept open at all costs. The company appears to have failed because, like many other firms in the industry, it had to take orders at fixed prices at a time when costs, including the cost of labour, were rising. Ships constructed have proved to be unprofitable and the yard had for some time been operating at a loss.
  The experience of this yard is not unique in the industry. It was this and similar problems which led us to set up the Geddes Committee. The Report of that Committee has been accepted by the Government, by the industry and, I believe, generally, as showing the way to a viable and competitive shipbuilding industry in this country. If we consider that the Geddes remedies are broadly right for the industry as a whole, we must have them in mind when considering individual shipyards.
  The Report recommended the grouping of existing shipbuilding firms into larger companies, each controlling a number of yards and each making its own specialised contribution to the group as a whole. The initiative for grouping must come from the industry itself and I know that shipbuilders on the North-East Coast are actively considering the Geddes proposals and are in touch with the Chairman-designate of the Shipbuilding Industry Board.
  I have no doubt that they are considering whether there is a viable and profitable place for the Blyth shipyard within the groupings they have in mind. But it would be neither sensible nor in accordance with the Geddes proposals to seek to influence them to do so. Nor would it be in accordance with the proposals to keep a yard of this size operating
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  as a separate unit if it had no viable future.
  Nevertheless, I ask shipbuilders in the North-East to consider very carefully whether there is a place for the Blyth shipyard in their plans for the industry. I know that the Receiver would be willing to discuss any such proposal, but I must make it clear that no useful purpose would be served in Government intervention to keep the yard alive in the hope that such a place may be found at some future date.
  I know that comparisons have been made in recent times, and my hon. Friend made a comparison tonight, relating to Harland and Wolff and also to Fairfield's. Harland and Wolff have been assisted by the Northern Ireland Government. Fairfield's was a different proposition. This was a major yard, it had a lot of modern plant and a good order book. This, I am sorry to say, is not true of Blyth. There is a very short order book—orders, in fact, only until January—and the yard has made a profit only once in the past five years.
  I know that Blyth is a difficult area for employment. The town is largely dependent on two industries—coal mining, which is contracting, and shipbuilding. I appreciate that for this reason the closure of the shipyard was a particularly hard blow to the town. During the Summer Recess my hon. Friend accompanied a deputation of interested parties to the Board of Trade, and I can assure him that the views they expressed have been taken into account.
  But things are not as black as this might suggest. The great shipbuilding concentration on the Tyne is not too far away, and skilled shipbuilding labour is scarce there. Alternative employment should be available on the Tyne for many of the Blyth shipbuilding workers. Indeed, of the 470 employees of the Blyth shipyard who have so far been declared redundant, over 80 per cent. have already found alternative employment, and many of them on the Tyne. One of the fundamental conclusions of the Geddes Report is that the reorganisation of the shipbuilding industry must be accompanied by a redeployment of the resources of the industry, and this applies in particular to those resources which are scarce, including skilled labour. The Report did not exclude the possibility that in the course

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  of such redeployment some yards would have to close. If, as I believe, many, if not most, of the shipbuilding workers from the Blyth yard will be able to find employment in yards on the Tyne, it may, in fact, serve to strengthen the shipbuilding industry on the North-East Coast and, in the long run, provide better prospects than can be provided by a shipyard at Blyth perpetually struggling to survive.
  Moreover, the Government are playing an active part in creating new employment opportunities in the longer term. Under their distribution of industry policy, the Board of Trade is endeavouring to bring greater employment prospects to the Blyth area itself. The development of Cramlington New Town, which is not far from Blyth, is helping to diversify the industrial structure of the area. An advance factory of 25,000 square feet for Blyth was announced in May, and it is hoped that this will be complete in July next year. We hope to acquire more land at Blyth for further industrial development. Other advance factories are under construction in the nearby district of Ashington.
  During the last six months, and under Board of Trade encouragement, 10 visits to the area have been made by industrialists looking for sites, and the area has been suggested in preliminary correspondence on 17 other occasions. Regional officers will now bring to the attention of suitable interested parties alternative proposals for the Blyth shipyard and site. No doubt the receiver-manager is working along similar lines, but I am sorry I cannot say at the moment whether he is, in fact, succeeding.
  I have dealt with the employment situation in Blyth and the possibility of keeping the Blyth yard in existence as a shipyard. There is one other aspect of this matter that I would like to mention. I was disturbed, as I am sure many others were disturbed, by the abrupt way in which the closure of the yard was announced without any prior warning to or consultation with either the Government Departments concerned or with the unions representing the employees at the yard. I recognise that there are legal and other difficulties facing a company
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  in a difficult financial situation, but I am sure that the disturbance and upset which has resulted from this action would have been considerably reduced if it had been handled in a different manner.
  I particularly regret that this action came at a time when shipbuilding employers and unions have been endeavouring with great success to develop that mutual trust and confidence which has been so lacking in the industry in the past, and which I felt the Geddes Committee also considered to be essential to a successful reorganisation of the industry in the future. I know that the shipbuilding employers also regret the manner in which the closure of the yard was announced.
  This particular case has already been discussed between shipbuilding employers and unions. I am glad to be able to say that both sides have agreed to discuss the subject in more general terms at the next meeting of the Joint Industrial Council which has just been formed in the shipbuilding industry. The Confederation of Shipbuilding and Engineering Unions, represented by Dan McGarvey, the chairman of the Shipbuilding Committee, and George Barratt, the general secretary, met me on this matter and suggested that this was a matter for consultation and I agreed. I suggest that this is the best way to proceed, by encouraging the industry itself to evolve processes of consultation which will be both realistic and helpful to all concerned should similar difficulties occur elsewhere.
  Finally, I praise the efforts of my hon. Friend who has shown such keen awareness of his constituents' concern whilst working through the Recess, accompanying a deputation to the Board of Trade and receiving and introducing shop stewards from the yard to me today, and who has also taken the first opportunity in Parliament to see that his constituency grievances have been aired. I shall certainly take notice of the concern expressed and hope that the receiver manager and our Board of Trade regional officers may have some success in finding an alternative use for the Blyth site
  Question put and agreed to.
  Adjourned accordingly at jour minutes to Twelve o'clock.