HC Deb 07 June 1967 vol 747 cc971-7

10.4 a.m.

Mr. T. L. Iremonger (Ilford, North)

I beg to move, That leave be given to bring in a Bill to make provision for any property owner whose property is threatened with compulsory acquisition by a local authority at fair market price to elect to have the fair market price assessed by an impartial district valuer employed by the Commissioners of Inland Revenue and not by an officer employed by the acquiring authority itself; to make provision for any officer who is employed by a local authority for negotiating and bargaining with property owners in his employers' interest to be styled a negotiating officer or, alternatively, a bargaining officer and not a valuation officer; and for other purposes. The beginning of justice is that a man must not be judge in his own case. That goes for local authorities, too. Yet some of the greatest local authorities in the world—the councils of many British cities —laugh at this elementary principle.

The horrid business of the compulsory acquisition of the property of private individuals, sometimes necessary but always regrettable, is rendered far more intolerable by the way in which it is carried out in many of our cities today. Who does the assessing for compensation? It is the interested party—the buyer, the compulsorily acquiring council itself.

Most local authorities in a similar situation arrange for the valuing to be done by the district valuer. He is an employee of the independent Board of Inland Revenue and not the servant of the acquiring authority and according to the President of the Royal Institution of Chartered Surveyors, in a letter to The Times dated 29th April of this year, he is therefore"— and I emphasise the word "therefore"— an impartial assessor… How different with the local authority that uses its own valuation officers. Its valuation officers negotiate and assess. Few people know that such a state of affairs exists. Its existence was confidently denied by the President of the R.I.C.S., in a letter to The Times dated 18th May. Ought it to exist? There are pressures to be resisted, all on the side of parsimony. The good servant will always wish to please his master with a bargain in the market place and economy is equated with virtue by their employers, guardians of the public purse.

For example, speaking with the authority of many years' service as majority party chief whip on what was then the London County Council, the hon. Lady the Member for Peckham (Mrs. Corbett) stated in the House: … Valuers… acquire land for … the council" and "negotiate to get the best terms" which they "arrange in the Council's interests."—[OFFICIAL REPORT, 20th February, 1962; Vol. 654, c. 283.] Again for example, I quote from the judgment of the Lands Tribunal in the case of Ansaldi v. Stoke-on-Trent Corporation. The Tribunal said of the local authority valuer: … it is desirable to distinguish his function from that of a district valuer, who is an independent official whose duty it is to assess value and advise ". The local authority valuation officer acts, the Tribunal stated by contrast, as the local authority's … agent, and he reflects the obligations of his principals to ensure that the ratepayers acquire property as cheaply as is reasonably possible". Always there is the dreaded shadow of a possible surcharge by the district auditor on the wretched local authority valuation officer himself, if he is generous. None of these pressures operate on the district valuer.

"We are fair", cry the indignant local authority valuation officers with pathetic sincerity when their ambiguous position is questioned. I am convinced that these honourable professional men do their best to be fair, but unfortunately one must wonder who believes them. Certainly not the disappointed owner, ruefully comparing his offer with his own assessment of the value of his home. He echoes Emerson: The louder he talked of his honour The faster we counted our spoons.' This is terribly unjust and cruel, but can we really blame him? Justice may be done, but it is not seen to be done.

I quote from a letter which I received from a fellow of the Royal Institution of Chartered Surveyors, the head of an old-established and highly regarded firm of chartered surveyors: Why is it possible to settle with the district valuer and never with… the local authority valuation officer. —without unpleasantness and a tremendous fight? In fact, I have called the county hall 'the den of the Forty Thieves'… I have come to the conclusion that all the affairs of The County Hall are governed entirely by politics and the word 'justice' simply does not exist. That is not my opinion, and I quote it merely to show how responsible people are capable of feeling, much though I deplore their feelings.

This is a nasty situation. It is unfair to the owner, who may, perhaps, be forgiven for seeing the local authority's valuation officer as a hired assassin moving in to the kill. It is even more unfair, let us not forget, to the officers placed in this invidious position, and one of the prime purposes of this Bill is to help them.

Pressure apart, there is the question of efficiency. The local authority valuation officer is less well equipped to do an efficient job than the district valuer, who is automatically supplied with details of every property sold and every lease stamped in his area. Facts and figures reach him from the Estate Duty Office whenever probate is granted. The local authority valuation officer depends on Press reports of auction prices and records of his own past deals. He has no reliable gauge of the current trend of the whole free market. No wonder the compensation offered is so often so unrealistic. No wonder constituents of hon. Members come to them in tears.

To all such protests the orthodox answer is that owners can appeal to the Lands Tribunal. That is true, but life is not always as simple as that, as the monkey found when he closed his fist over the nut and then could not get it out of the jar.A dispossessed house holder has to produce the cash for his new house, or lose it. For that, he must secure the compensation for the old one. He cannot afford the delay of an appeal. Such a man is often forced to accept less than he thinks right. Even when an owner finances the delay there is another deterrent; he may have to pay the costs of the appeal to the Lands Tribunal. Therefore, thousands of householders under the axe accept prices they consider less than "fair market value". Estate agents agree that these valuation officers drive hard bargains and that initial offers are low. On the books of a chartered surveyor and estate agent friend of mine is a case where, over 12 months, the initial offer almost doubled. Why, therefore, did it start so low?

Let me give an example from the Estate Gazette Digest of Cases, 1951–60, which reports 22 appeals to the Lands Tribunal against the L.C.C. In the 12 cases where the local authority valuation officer's final offer can be compared with the Lands Tribunal award the award bumped up the local authority valuation officer's offer on average by 80 per cent. I have quoted this figure in the House before, and it has not been challenged. Details can be found in c. 694–5 of Vol. 698 of the OFFICIAL REPORT. The Attorney-General is now investigating for me further evidence of recent cases.

A friend of mine, a Fellow of the Royal Institution of Chartered Surveyors —the one I have just mentioned—demonstrated to me from his files that his average achievement for clients who were victims of compulsory purchase order proceedings was to bump up the offer by 12½f per cent., but that where his clients could afford to wait and he could protract negotiations for a year or more, his average achievement was to bump up the offer 72 per cent.

It is doubly wrong that the property owner should be at such a disadvantage for, at the best, compulsory purchase creates an abnormal situation. The buyer knows that in the end he can take the property by force. Thus the healthy relationship of willing buyer, willing seller is disturbed. The council frequently does not want all that the vendor has to offer. Most of the vendors would prefer not to sell at all. The man who has spent £300 on his garden—draining the lawn, paving pathways, building a wall and greenhouses—is appalled to find that he is not offered a penny for it. In a normal market, he can stay in his home, or stick out for his price. Need the acquiring authorities make bad worse by seeming to load the dice in their own favour? Let them hand over negotiation and assessment to the independent district valuers.

That we have compensation today based, theoretically, on "fair market value" is due to a revolt by Conservative Members, of whom I was among the foremost, against the Socialist legacy of grab-and-don't-pay. There are still some ends that need tidying up, and this will require legislation.

I offer this little Bill as a humble and, I hope, helpful contribution. It makes, according to the Long Title … provision for any property owner whose property is threatened with compulsory acquisition by a local authority at fair market price to … have the fair market price assessed by an impartial district valuer employed by the Commissioners of Inland Revenue and not by an officer employed by the acquiring authority itself … It also makes … provision for any officer who is employed by a local authority for negotiating and bargaining with property owners in his employer's interest to be styled a negotiating officer or, alternatively, a bargaining officer and not a valuation officer ߪ I think that this would be of immense psychological benefit to both parties, particularly the unfortunate professional men whose embarassment I feel so sorry about. I cannot emphasise too strongly that no odium should attach to them. They are not to be criticised. They are anonymous, and may not defend themselves. The people who must accept blame, criticism and responsibility are the elected councils which favour this practice, and ultimately, of course, this House, which endorses it.

The Long Title also envisages the Bill being for "other purposes."

I should, of course, be open to suggestions from hon. Members in Committee, but I tentatively suggest that local authorities that employ their own valuation officers to assess fair market price for property which they purchase compulsorily should be obliged to pay all costs, including solicitors' fees, of appeals to the Lands Tribunal, whatever the outcome of the appeal, and be obliged to provide interest-free finance to the property owner, and to pay a solatium of 10 per cent, above the award.

This Bill can do no harm—it only provides an option—and I therefore hope that the House will welcome it, and speed it on its way to the Statute Book.

10.15 a.m.

Mr. Peter Doig (Dundee, West)

I oppose the Motion. At present, when a compulsory purchase order is made by a local authority, the first thing that happens is that the local authority and the property owner try to arrive at a mutually satisfactory figure. If they are not successful, the second thing that happens is that the district valuer, who is not employed by the local authority but is a Government employee, is called in. He negotiates with both sides and arrives at what he considers to be a satisfactory figure. If the owner is dissatisfied, with that figure it is open to him to negotiate with the district valuer. It is open to him to appeal to the local authority if he considers the figure to be unfair. It is open for him to go to arbitration if he cannot get satisfaction on the figure. It therefore seems to me that the law already provides for almost everything that this Bills seeks.

But there is another party to these proceedings besides the property owner— there is the local authority and, therefore, the ratepayers. It has been known for a district valuer to fix a figure that was considerably higher than the local authority thought was fair. I used to be a city treasurer, and many times I have objected to what I considered to be an exorbitantly high figure fixed by the district valuer. That may be called pressure, but it was pressure in the interests of the ratepayer.

In a number of cases I got the figure reduced, not by the district valuer but by the person selling the property. Hon. Members opposite may consider that to be unfair, but it is a matter of where one's concern lies. In one case the parties were the owner of a public house and the ratepayers. I know where my sympathies were in that case—they were with the ratepayers, and not with the publican. I succeeded in getting £1,000 knocked off the valuation. This sort of thing happened more than once with my own local authority, and I should imagine that it has happened with many other local authorities. It is not merely a question of considering the poor public house owner or other property owner who may be getting a raw deal. There are ample safeguards for both sides in the present law and we have heard no justification this morning for changing the law. In my view, we would be wasting the time of the House if we allowed yet another Bill to be printed which, we are told, would in any case never get any further. We should not waste the time of the House in this way.

All the Bill would do would be to change the name of an employee of the council from "valuation officer" to "bargaining officer". We all know the saying about a rose by any other name smelling just as sweet, and if people consider that the valuation officer has a bad smell, anyway, it will be just as bad if we change the officer's title. I see no useful purpose in this Bill, and I ask the House to reject it.

Question put:—

Mr. Speaker

A Division having been claimed under paragraph 4 of the Sessional Order, proceedings on this Motion stand over until the end of this evening, when the Division will be taken.

The Proceedings stood deferred pursuant to Order (Sittings of the House {Morning Sittings)).

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