§ 10.10 p.m.
§ The Minister for Local Government and Development (Mr. Graham Page)
I beg to move,That the Mines and Quarries (Valuation) Order 1971, dated 4th March, 1971, a copy of which was laid before this House on 4th March, be approved.As the House will be aware, the rateable value of property is based upon the rent at which it may be expected to let. In pursuance of that principle, mines and quarries have been assessed to rates on the basis of the royalty paid or the royalty which could be expected to be payable for the extraction of the minerals from that mine or quarry.
When it is considered that royalty for extraction of minerals is a payment for removing part of the land itself, not just using it, it is fairly evident that at least a part of that payment is a capital payment for the material extracted rather than a rental payment for the land itself. The Finance Act, 1970, recognised that factor in relation to income tax, surtax and corporation tax, and provided that for tax purposes such a royalty should be treated as 50 per cent. capital payment and 50 per cent. rent. The Government of the time announced that they would deal with rating on the same basis. On taking office we looked again at the matter and decided that the previous Administration were right.
The purpose of this Order is to reduce the rates payable in respect of a mine or quarry, but not in respect of mine buildings or mining equipment, in the first year to three-quarters of the amount otherwise payable and in the subsequent years to one half of the amount otherwise payable. I mean by "otherwise payable" upon an assessment based on the full royalty as the rent. Because the impact may be quite material in some cases on the local authorities, we have in the Order phased this change over a period of two years in order to cushion the impact.
In the first year the derating will be 25 per cent., and in subsequent years 50 per cent. Perhaps I could explain what the impact could be. I take figures for the present year 1970–71 since we do not 1286 yet know the figures of rates to be collected for 1971–72. Let us assume that this Order had been in operation for the year 1970–71. The figures, as best as we can estimate them, are as follows. The total mineral rateable value is £22.4 million, including coal; excluding coal, the figure would be £13 million. The average non-domestic rate in the £ for the year 1970–71 would be 14s. 5d. The total rates payable, therefore, including coal would have been £16.2 million; excluding coal, £9.4 million. We are dealing with the first year of derating, in which the figure is 25 per cent. The loss of rates if the Order had been in force during this year would have been £4 million including coal mining, and £2.4 million excluding it.
There would have been 171 local authorities who would have lost 5 per cent. or more of their total rateable value. Of those, 163 would have been compensated for that loss by the resources element of the rate support grant. In the case of seven of the remaining eight the 25 per cent. would have meant an increase in rates of 1 p in the £. That gives an idea of what we are talking about in terms of the payment of rates as a result of the Order. Of the fewer than 200 local authorities affected by the Order a large proportion would receive compensation in the resources element of the rate support grant, and a mere handful would suffer to the extent of about 1p in the £. In the case of only one authority might the loss have been as much as 3p in the £.
§ Mr. Gordon A. T. Bagier (Sunderland, South)
Will the Minister say whether an estimate has been made of the amount of rate that would have been collected on spoilheaps? None of this has been collected, as the matter has been in dispute.
§ Mr. Dick Leonard (Romford)
The Minister is teasing the House by saying that only one authority will lose as much as 3p. Will he say which authority that is?
§ Mr. Page
It is Ashby Woulds Urban District Council.
In the case of the 163 local authorities which will be compensated by the resources element I must say at once that the allocation of that element for 1971–72 has not yet taken this into account, but I can give the House an assurance that it is proposed to make a recalculation of the 1971–72 grant later this year to take account of that fact the Order provides for certain exceptional cases.
Article 5 deals with coal mining and the National Coal Board. The Board is assessed on a formula set out in the National Coal Board (Valuation) Order, 1963. By Article 5 of the present Order that formula is brought up to date and scaled down to the 25 per cent. and 50 per cent. figures respectively for the first and subsequent years.
Article 6 of the present Order deals with opencast minnig. There it is a matter of scaling down the tonnage factor in the formula. Article 7 deals with the fascinating case of the rate of tin, lead or copper mines. I am told that this originated as long ago as the Rating Act, 1874, and that before that date tin, lead and copper mines were free from rate. The intention in 1874 was that they should be rated, but there was an outcry from the South-West about the precarious state of the industry, and certain concessions were granted. For example, the rating was not on hypothetical royalties but on actual royalties. They have an initial holiday from rates when they are newly opened, but they have to go on paying after they have closed. Their plant and buildings are not rated.
These are the several advantages which mines of this kind receive. They are traditional and rather historical advantages, and although we have not in this present Order altered them, apart from adjusting them in order to bring them into the scale down to the 25 per cent. for the first year and 50 per cent. for subsequent years, I give warning that it may be necessary before long to review the special provisions and see whether the tin mines can be put on the same footing as other mineral workings. It is not appropriate to do that in the Order, so it preserves the special arrangements for the tin, lead and copper mines, 1288 subject only to the modifications needed to bring them into line with the 25 per cent. and 50 per cent. reductions.
The Order does not specifically deal with the shale heaps mentioned by the hon. Member for Sunderland, South (Mr. Bagier). Shale heaps from which material is being extracted will benefit from the reductions in the same way as any other mineral working. In rating terms, there are two kinds of shale heaps or spoil heaps. The kind of heap which has not become so much a part of the land by landscaping or settling that it is still a heap of chattels is still rateable. That information may shock rating purists. Even if the shale is treated as a chattel it is still rated. That has a court decision to support it.
On the other hand, some shale heaps have so settled or been so landscaped into the land that they are part of the land, and are rated as such—
§ Dame Irene Ward (Tynemouth)
Before my hon. Friend leaves this subject, I am sure that he will know that some of us have been carrying on quite a battle with the Chancellor of the Exchequer to get a reduction in the charges, etc. I therefore hope that by the advice it tenders, the Department for the Environment will urge the Chancellor of the Exchequer along in that direction so that we may look forward to getting something tomorrow.
§ Mr. Page
I do not know anything about the battles that my hon. Friend has had with the Chancellor of the Exchequer, though I know that hon. Members of all parties in the North-East have had a fierce battle with my own Department on the subject. We have tried to meet the legitimate aspirations of those who are as anxious as we are to clear the shale heaps and to landscape them properly—if we cannot reduce them to completely level sites yet to do the best we can to fit them in with the countryside.
To some extent this attempt has been helped recently by the acceptance of shale as a proper fill for road work. Only a small part can be used at present and the transport costs are heavy, so that it is not economical to use shale from a pit at any very great distance from motorway construction. Nevertheless, shale is being 1289 used for that purpose. We appreciate that the rating of the shale heaps adds a small sum to the cost of shale used for motorway purposes or construction of embankments or foundations. It is not a large amount. I have calculated that the increase in the cost is about 1p to 30p to 35p on the sale of the material from the heaps. This derating up to 25 per cent. in the first year and 50 per cent. in subsequent years will help to reduce that cost.
§ Mr. Bagier
Is not even the reduced cost of shale from the royalty point of view still considerably higher than the cost of dolomite and the equivalent competitors?
§ Mr. Page
It depends to a great extent on the distance that it has to be transported. Transport is a substantial element in the cost of any road foundations. Although we cannot go all the way with those who have advocated the complete freedom of the shale head from rating, the Order will be of some assistance by recognising that shale heaps which are being worked for this purpose come within the definition of mines and quarries—they are mineral workings—and will get the benefit of the Order.
From time to time I am pressed by right hon. and hon. Members from the North-East particularly, although not only from the North-East, to go the whole distance and relieve shale heaps altogether of rating. This has been a doubtful point in law for a considerable time. When the valuation officers started to rate the shale heaps at the time when the extraction of shale became something of a big business, there was a question whether they were right in doing so. From 1963 to 1968 when the dispute was going on between the shale heap owners or the undertakers of the mineral workings and the authorities the rates were not paid.
It was quite definite after the court decision in 1968 that the owners were responsible in law for the rates. It is unfortunate that now they will be called upon to pay the arrears of rates for that period since 1963 or even earlier, perhaps since 1961, but I regret that as the law stands I cannot do anything about that at present. The collection of the rate must date back to the time when the proposal was made. However, I hope that the Order will be of some assistance 1290 to the owners of the heaps in encouraging the clearance of them and the use of the material in road work.
I think that I have dealt with the main points of the Order. I am sure that the House would not wish me to go through the formulae in any great detail. This is a reform in the rating system which was to be undertaken by the previous Government and which we think is right. Although we intend to review the whole of local government finance at a comparatively early date by putting before the House a Green Paper for discussion with options as local government finance in future, we think that this amendment should be made now without waiting for that general review, because it was promised by the previous Government and seems a fair way of working out the rates as between the local authority and the mine and quarry workers.
§ 10.30 p.m.
§ Mr. Gordon A. T. Bagier (Sunderland, South)
Having listened to the Minister outlining his difficulties, one appreciates that this argument has been going on for some time—with his predecessor, with the junior Ministers of the Department as well as with the senior Ministers, and now with himself.
The right hon. Gentleman seemed to imply that these shale heaps were part of the landscape and that they could not be noticed, but I hope he will take an early opportunity to look at the 260 major pit heaps in the North-East. They are eyesores and they contain 200 million tons of this stinking black rubbish which has been there for many years.
It is remarkable that a change in the law such as is envisaged tonight should not even mention spoil heaps unless they are the result of mining or quarrying or some such activity designated by law. I appreciate the righ hon. Gentleman's difficulty when he says that he cannot interfere with the law, but we are the law makers, and we want to see these heaps shifted.
The fact is that although northeastern contractors—I do not know the position in other parts of the country—have been shifting these abominable heaps and using the contents on such laudable objects as roadworks since 1961, the Minister's statement that the rates have got to be paid from 1961 will mean that out of about 47 contractors 1291 in the North-East, 45 will go bankrupt because they had made no provision for this rate demand. It was not included in their estimates.
The Department may say that they ought to have done so, but may I draw attention to the fact that shale has been used in the North-East and elsewhere for many years. Before the war the great Team Valley Trading Estate was built on shale. The coast road from Newcastle to Tynemouth was built on shale. At that time there was no question of anyone receiving a rating demand. In 1961 onwards, when a need emerged for using some of these heaps it was natural that contractors would enter into contracts without taking into consideration any question of a rate demand.
It was not until 1963 or 1965 that a valuation order was first served on some of these contractors. On receiving it they appealed at local tribunal level, and the local tribunals were much more sensible than we seem to be at national level. They found in the contractors' favour. Then the Smiles case was heard by the Lands Tribunal which found against the contractor, and that led to the present legislation.
We should ask ourselves whether the sensible thing is to have these pit heaps shifted. It may be, as the Minister has said, that these pit heaps have become part of the landscape, or have taken root, or whatever rating valuation officer terminology is used, but the fact is that successive Governments have been prepared to pay 85 per cent. of the cost, in the form of grant, of shifting these pit heaps provided the local authorities were prepared to pay the other 15 per cent.
Good use has been made of these black, stinking, smoking things particularly since 1967 or 1968 by the Road Research Laboratory as infilling for roads and motorways. Anybody who was prepared to use them saved the taxpayer and ratepayer some money, and this was a good thing. It has saved money nationally and locally. But when the operation becomes commercially viable and contractors go to expense and utilise some expertise in making arrangements to have these heaps shifted and put into the motorways, all of a sudden these black, stinking heaps become a valuable mineral. This is absolute nonsense.
1292 Unfortunately, the alternative to removing pit heaps and using them for roadways is to dig a great hole alongside the motorway, a borrow-pit. Anyone who travels up our motorways can see these great holes dug to take out the clay and make the infill for motorway construction. No rates are paid on that sort of thing because they are not in possession long enough for rates to be demanded on them. I shall be glad to be told I am wrong about that, but I think that I am not. There is evidence throughout the country of eyesores being left in the form of borrow-pits, great holes dug in the landscape to provide fill, yet for very little extra cost pit heaps could be used.
Perhaps it is sometimes cheaper to do it in that way. The contractors are supposed to reinstate the land in the proper manner, but they do not always do it. Far from putting an obstacle in the way of using pit heaps for roadworks, we should make it obligatory that they be used. About two years ago, I believe, a committee was set up under the Ministries of Transport and Housing and Local Government to examine this very matter. Unfortunately, in the North-East, where we are particularly blessed—if that is the right word—with these unsightly blots on the landscape, a huge road programme is gradually coming to an end. For the past 2½ years or so, while we have been arguing about it, we could have been using the pit heaps for infill.
I thank the Minister for his attempt to help the shale manufacturers, but, unfortunately, it seems that the majesty of our law works in a mysterious way. In order to reduce the rate liability on one section, we must reduce it for all, so everybody who deals with tin, lead, clay, gravel—anything one cares to name—comes in. I can understand the chagrin of hon. Members on both sides who do not want to see more dereliction on their land and who are annoyed that it is now made cheaper to dig holes, to dig for clay or dig for dolomite, because we want to help the contractors who have been shifting pit heaps.
I hope that the Minister will look at the matter again. He wrote me a letter today which told me something about some of the matters which I raised with him in an interview two or three weeks ago. Even now, after a couple of hours 1293 to try to understand it, I can only say that, if he understands it, he must know Chinese better than I do. After just the first two paragraphs, I am right out of my depth, with all the phrases about planning permissions, chattels and the rest which he has set down at some length.
All I am interested in is getting the pit heaps removed. I am a bit disturbed about the way things went in the discussions leading up to this stage. I spent some time moving my own Government in the matter, and I finally got agreement from the previous Minister of Housing and Local Government that there would be a 50 per cent. reduction in the rating valuation for shale manufacturers under the formula which was to be presented. At that time, I did not appreciate that it would apply also to dolomite, gravel, lead and the rest. But there having been agreement by the present Minister to adopt that suggestion of 50 per cent., it is a bit late in the day, at the beginning of this year, suddenly to reduce it to 25 per cent. in the first year. The basic problem we are arguing is that of shale, although it has other connotations. No one can argue that local authorities will have a reduction in income in respect of that, because they have not had it. Shale manufacturers have been fighting the matter through the courts for the past two years. Therefore, there is no great urgency, particularly as regards shale, to have this one year's reneging on the undertaking given by the previous Minister.
I hope that when the Minister looks into the question he will try to sweep away the technical jargon of planning, chattels and so on. It must be difficult. But what we who are laymen, and not lawyers or valuation experts, want is to have the pit heaps of the North-East removed. If a rating problem is stopping this, or making it less economic to move them than to dig holes, it makes a nonsense of government if we cannot find a way to put the matter right.
§ 10.41 p.m.
§ Mr. Dick Leonard (Romford)
The Minister did not speak to us in Chinese tonight, but it was clear from his speech that the Order covers a number of complex questions. It is certain that it will have varying effects in different parts 1294 of the country. My hon. Friend the Member for Sunderland, South (Mr. Bagier) has spoken as a representative of the North-East. As a London Member, I am especially concerned with the effects of the Order within the G.L.C. area, and particularly in my own local government area of the London Borough of Havering.
The principal—perhaps the sole—type of undertaking affected in the Greater London area is the gravel pit. That is certainly true of my own borough. The points I wish to raise have been argued to me with great force by officials and elected representatives of all political parties of my own borough. I believe that they also substantially represent the views of the London Boroughs Association, which has independently puts its points to the Minister.
The London Borough of Havering and the Association have three fundamental objections to the Order. The first is to the substance of the Order, which will have the effect of depriving London boroughs of useful sources of revenue. The other two are to the manner in which it is proposed that the new policy should be put into effect.
Let me begin by outlining the objections of the London boroughs to the policy contained in the Order, the policy of partial derating of gravel pits. The London boroughs concede that other forms of mineral hereditaments may be wasting assets, and that for them a measure of derating is justified. But in their view the gravel pits in the London area are not in a comparable position, as they have valuable alternative uses once the gravel is worked out.
I quote from a letter sent by the London Boroughs Association to the Ministry on 13th November, 1970:In relation to gravel winning hereditaments in the London area the Association do not accept that the assets are of a wasting nature since the removal of the gravel creates tipping space which is valuable in its turn, and, in the process of profitable controlled tipping, the land can be made ready for further use or development. In effect, the gravel winning is part of a continuous process, and the Association feel that the sweeping compromise of a 50 per cent. reduction in rateable value is a completely unnecessary concession which will prejudice all the remaining ratepayers in the area.The proposed measures will, if approved, have a markedly detrimental effect on the 1295 finances of some of the London Boroughs. Any increase in rate poundage will, the Association feel sure, be deeply resented by the public, for whom gravel winning is in any event unpopular in the life of the community because of the adverse effect on amenity that it causes.In short, the London boroughs take the view that there is no case for a partial derating of gravel pits in their area, and that the inevitable consequence would be a heavier burden on other ratepayers, and in particular upon the domestic ratepayer.
In my borough, for example, the town clerk estimates that the loss in revenue as a result of this Order will be £39,000 in 1971–72 and £82,500 in 1972–73. I am informed on good authority that my borough is not one of those which will be compensated by the resources element in the rate support grant. I imagine that it is one of the seven authorities which the Minister mentioned would be affected to the tune of a rate of 1p in the £.
Whatever may be the justification for this Order in, say, coal-mining areas, it does not seem that the Minister has made out a case in terms of the G.L.C. area, where the problems are very different. As the case has not been established, it will be hard to reconcile boroughs like mine to a substantial loss in revenue.
Over and above this objection to including gravel pits in this partial de-rating, the London boroughs object strongly to the manner in which this is being done. There is, first, what seems to them to be the unseemly haste of the exercise. It should, they feel, have been deferred until the 1973 valuation, which would have been an opportunity for authorities which will lose revenues through this Order to recoup their losses on other types of rateable property which will be revalued upwards in that valuation.
Above all, however, the London boroughs object to the use of a Statutory Instrument for the purpose of introducing this new policy departure. They assert that the use of a Statutory Instrument to this effect goes flatly against the assurances given by the former Minister, now Lord Brooke of Cumnor, when the legislation was introduced originally. Speaking about what was then Clause 3 of the Rating and Valuation Bill of 1961, 1296 which was re-enacted as Section 35 of the General Rate Act, 1967—the authority under which this Instrument is introduced—he said:Here let me emphasise, what I said repeatedly in Standing Committee, that this Clause is not designed either to increase or diminish the overall liability to rates. That overall liability will be left substantially unchanged. The only question is whether a valuation can better be done by a formula than on the basis of the profits method. That applies throughout.Later in the same speech the Minister said:I certainly reinforce what I said in Committee, first, that it is not intended that the application of an order under this Clause to any class of undertaking should be regarded as either a privilege or a punishment. I cannot guarantee that it would leave the rateable value of any individual hereditament unchanged, but the formula would not be acceptable to the Government if it made any substantial upward or downward change in the rateable value of a class of undertakings."—[OFFICIAL REPORT, 10th May, 1961; Vol. 640, c. 442–9.]Having regard to these specific assurances, it is quite wrong for the present Minister to use a Statutory Instrument to make the express and substantial downward change in rateable values which is now proposed.
It cannot be questioned that, legally, this proposal is in order and falls within the authority given by Section 35. The Committee on Statutory Instruments has affirmed this to be so. However, morally there is surely an obligation, in view of the assurances given when the Act was passed, to introduce fresh primary legislation to give effect to this proposal, rather than to rely on a Statutory Instrument.
It seems that there must have been some doubts in the Ministry about the propriety of proceeding in this way, for in the Ministry's reply to the letter I quoted earlier from the London Boroughs Association, the Ministry said:Use of section 35.We are satisfied that it is within the powers of the section to make an order on the lines proposed. Given that the Government has decided to change the basic assessment of mineral hereditaments, it seems sensible to give effect to the decision by means of an order under section 35, since that power is available, rather than by fresh primary legislation.It added:But the general intention not to use section 35 so as to alter the total liability of an industry still stands.1297 In other words, "We are going to cheat just this once and we promise never to do it again."
Is this an acceptable way for the Government to behave? In the whole spectrum of public policy this is a small area and no great loss of face would be involved if the Government had second thoughts about it, even at this late hour, and I ask the Minister whether he will withdraw the Order and reconsider whether this is the right way in which to set about it.
§ 10.51 p.m.
§ Mr. Peter Hardy (Rother Valley)
I have no wish to trespass on the problems presented by the gravel pits of the Greater London area, although I was extremely impressed by the arguments of my hon. Friend the Member for Romford (Mr. Leonard). I was nearly won over to his argument until I remembered that a gravel pit is a hole and in South Yorkshire and the North-East generally we are presented with problems which are much more visible than the gravel pits which are the problem in the Essex area. Nevertheless, I agree with my hon. Friend about the exclusion of gravel pits.
I view the Order with mixed feelings. In so far as it helps the mining industry, which of course is dominant in the economy of my constituency, I view it favourably. But so far as it reduces the capacity of our local authorities in South Yorkshire, I am anxious about it.
I accept the point made by the Minister when he suggested that the rate support grant would carry a greater part of the loss, but he went on to say that the whole subject of local government finance would shortly be under careful scrutiny and perhaps considerably changed. If it is changed, it seems at least likely that there will be changes in the system of rate support, and this will mean that local authorities in the coalfields may find themselves in a difficult situation in a year or two.
I am surprised that the Minister should have suggested that there were only 171 local authorities which would suffer to the tune of 5 per cent. or more. I can think of some local authorities in South Yorkshire where the income from rates paid in respect of National Coal Board hereditaments represents a very large share of the authority's income. If in 1298 1972–73 or subsequently the rate support does not provide generously for any loss under the Order, those authorities may be placed at a considerable disadvantage.
I do not want to labour that any further, for the labyrinths of rating and valuation I prefer other hon. Members to follow. My especial interest in the Order is shared by my hon. Friend the Member for Sunderland, South (Mr. Bagier)—the colliery tip. I have a fair knowledge of colliery tips. I can see 10 or 11 from a window in my home. I admit that I have a splendid view, but it would be even more splendid if those tips were removed. One can encourage the Order in so far as it will encourage the removal of tips. Certainly the Labour Party in Yorkshire will be pleased with the Order so far as it goes, because we have been clamouring for a considerable time for a change in the rating of slag heaps, and I am sure that many of my colleagues in the Labour Party in Yorkshire will be delighted that the Government have followed the policy of the last Administration.
§ Mr. Bagier
The last Administration promised 50 per cent. which the present Government have cut to 25 per cent.
§ Mr. Hardy
I agree, and that is important. What will happen is that any person who considered the removal of a slag heap will probably now wait until he gets greater benefit than that offered in the Order, so that the Order may discourage prompt action on slag heap removal.
My hon. Friend mentioned using colliery waste for civil engineering infill projects. I am told by a colleague with a constituency near mine—I may not mention his name, because he has not given me permission—that a major roadworks was sited near a colliery slag heap which remained untouched while holes were dug and materials extracted a considerable distance away from the roadworks. The people who lived there said that it was anomalous. Some of them said that it was scandalous and I agree with them. It seems ludicrous for us to dig holes to fill holes elsewhere and to leave these ruinous and indecent heaps of colliery waste untouched.
I hope that the Minister will look again at this with a view to allowing a greater 1299 reduction, preferably complete de-rating, because it is necessary at this stage in our civilisation for us to get rid of these unfortunate and ugly monuments to an industrial revolution which has taken place. Certainly the scars of it should be removed now. I therefore ask the Minister to look at this carefully.
I have one further suggestion. It may be that derating or partial derating of the colliery slag heap removal activities may not allow the removal to go ahead at an adequate pace. I therefore suggest that as civil engineering projects are approved the Minister ought at least to consider, if not imposing planning conditions, at least issuing the strongest possible advice to local authorities and the public contractors to persuade them to use colliery slag material rather than dig holes and thus create further dereliction for the future.
§ 10.57 p.m.
§ Mr. Albert Booth (Barrow-in-Furness)
As has been pointed out this Order is made in flat contradiction of an assurance given by a Conservative Government Minister when legislation was introduced. That in no way makes the Order illegal, because the legislation gave the Minister powers to make an Order in these terms. However, it does cast very grave doubts on the wisdom of any Member of this House accepting any assurance from Ministers which might imply a limitation of powers going beyond the wording of legislation.
The wording of the Section 35(1) of the General Rate Act, 1967, states that the Secretary of State may by Order:make provision for determining the rateable value of hereditaments to which this section applies, or any class or description of such hereditaments specified in the Order, by such method as may be so specified.There is no doubt that the subsection gives the Minister power to vary these rates enormously. He can increase them or reduce them and if the Minister who introduced the legislation had intended any limitation to apply he certainly should not have had the legislation written in terms as wide as this. Under Section 35(3) it is provided that the Order may make provision for determining rateable value by the application of different methods of valuation to different parts of the hereditament. This is of 1300 great importance in the light of the considerations raised tonight.
Clearly the Minister has the power to distinguish between one part of an hereditament and another and to apply a different formula and in effect a different valuation. It would be possible to deal with shale or slag heaps in one way and gravel pits in another. Or, where there was one operation by one owner or contractor on land, an operation which was in part extractive and in part an operation dealing with a bank surface, it would be possible to apply different rateable values or different methods of calculating the rateable value to the different processes. Therefore, if the Minister utilised the full scope of the Order, it would have been much more appropriate, if he had in mind the problem of shale heaps or slag heaps, to discriminate in favour of extraction while putting a proper rateable value on more profitable operations of mineral hereditaments.
The provision under which the Order is made requires the Secretary of State to consult authorities and persons carrying on the undertakings concerned. I am sure that the Minister did that. He is most meticulous and therefore he must be aware of the feelings of those operating in these areas and of the local authorities concerned. He must know that they would take different attitudes and views, depending on the area in which they were operating, about whether pit heaps should be removed or the profitable operation of a shale pit. Presumably the views of the local authorities will depend on whether they receive a resources grant which will offset any loss of rateable value which occurs under the Order.
I question the Minister on his obligations under subsection (5) of Section 35 of the General Rate Act, 1971, which requires him, after consulting the local authorities and persons carrying on the undertakings concerned, to investigatethe effect of the operation of the orderand lay before Parliament a report of the investigations and their results. This may give Parliament an opportunity to examine this matter very much more closely. When will the investigations take place? When will the report be available? When will it be laid before Parliament so that we can debate it? 1301 The report may be a means of obtaining some very valuable information on the question of how we should deal with the problem of pit heaps and slag banks.
Members who come from coal mining areas have rightly made the Minister well aware of the problems in their own areas. Therefore, I may be forgiven for raising a constituency point on this Order, namely, the problem of iron works slag banks. Some of my constituents, mainly those living in Schneider Road, Barrow-in-Furness, are prevented from seeing from their front windows a beautiful view of the estuary of the Duddon by an iron works slag bank. I cannot see how one distinguishes in principle in giving benefit through rateable value or any other scheme of administration between those who suffer from a coal pit heap hiding a view and those who suffer from an iron works slag bank, since if the iron works has any merit it is that it reduces the volume of waste compared with the pit. It is therefore necessary to look at the problem of the waste heap on a wider basis than can be done by dealing solely with it on the basis of mineral hereditaments.
We must expand the idea of the dereliction grant. This must be used, as it can be, much more sensitively and directly to deal with the problems of the slag bank and enable local authorities who are keen and willing to do so to go ahead with the solution of the problems in areas blighted by industrial mining works in a way which cannot be done by altering our rating system by an Order like this.
As I have said so much that is critical of the way in which the Government are dealing with this matter, I end by quoting one of the few statements by Conservative Ministers with which I concur and which I applaud, namely, that made by the Secretary of State for the Environment in the Contract Journal of 31st December, 1970. He said:Perhaps I might begin by attempting to define what I mean by a good environment. First, it is one free from pollution, free from intolerable noise, free from blighted and scarred landscapes, free from depressing streets and unfit houses.I hope that next time we consider an Order dealing with mineral hereditaments it will he one which gives far greater priority to removing from our country blighted and scarred landscapes.
§ 11.5 p.m.
§ Mr. John Silkin (Deptford)
It is impossible not to feel some degree of sympathy with the Minister, because what he is trying to do is to please everybody and, unfortunately, it would appear that he has pleased very few. It reminds me of the basis on which tea was served on the lower deck when I first joined the Navy, that as half the lower deck liked sugar in their tea and half did not like sugar in their tea, a half quantity of sugar was served with every cup of tea.
What we have here is the view of my hon. Friend the Member for Romford (Mr. Leonard) who says, "Thank you very much for your partial derating of gravel workings, but we do not like this at all." On the other hand we have the views of my hon. Friends the Members for Sunderland, South (Mr. Bagier), Rother Valley (Mr. Hardy) and Barrow-in-Furness (Mr. Booth), and, if I take her intervention correctly, of the hon. Lady the Member for Tynemouth (Dame Irene Ward), who feel that a great deal more should have been done about the spoil heaps of their regions.
There is a great deal of sense in both points of view. Gravel, as it happens. is a very profitable form of occupation, and it does seem a little strange, therefore, that it should be assisted at the expense of the domestic ratepayer who will have to pay more in any event because of the Government's rate support grant policy and who will now find himself paying even more to assist something which, as I have said, is profitable. On the other hand we have the question of the spoil heaps. My hon. Friend the Member for Sunderland, South dealt with this very fully. If I read the Order correctly it seems to me that we have a very curious anomaly here, namely, that there is an element of derating where a mine is being worked but, if I read this correctly, the moment the mine ceases to be worked then no question of derating applies to the removal of the spoil heap.
I think the Minister might perhaps give us his views on this, but that is the way I read it. If this is so, then no encouragement whatever is given to people to use the spoil heaps in other ways—for example, for infilling of roads, as my hon. Friend the Member for Sunderland. South pointed out, a useful way of diminishing an appalling eyesore. I 1303 believe I am right in saying that there are no fewer than 268 major spoil heaps in the North-East, blights on the landscape of every citizen of this country, for the fact that they occur in major form in that part of the country is as much the concern of someone living in the South as it is of someone living in the North-East: it is our joint heritage.
It seems to me very peculiar, because what we were given to understand was that various Departments which have come together under the Secretary of State for the Environment were brought together so that there could be an overall authority which would see that the environment itself, in all its forms and manifestations, would be protected and made better. Certainly we have found today that rating still retains its old power, that it does not seem to have very much to do with the environment. My hon. Friend the Member for Barrow-in-Furness quoted a very splendid statement by the Secretary of State for the Environment, and I totally agree with it, but it would be rather pleasant to see it brought into effect, and brought into effect by the best possible means. It seems to me that while the hand is the hand of Esau, the voice appears to be the voice of Esau, too, and I have a feeling that that is going against biblical precedent.
What ought to be done? It seems to me that the problem in the North-East needs to be tackled urgently. It might be argued that the previous Administration did not do as much as they should have done. Well, we are all learning a great deal about it and there is a growing feeling in the country that the environment is of vital importance to our lives and the lives of our children, and it does not do any good to say that the previous Administration might have done more. This is a chance for the present Administration, and I am sorry to see whoever it may be losing the chance to do something.
How it is done is another matter. It may be that the rating method is the wrong method of doing it. My hon. Friend the Member for Barrow-in-Furness hinted at the question of grants for derelict land. As I see it, the derelict land grant encourages a local authority to spread the overspill heap over acres 1304 of ground and thus sterilise the ground. Nothing will grow on it for a very long time, and nothing can be built on it. The simpler method of removing the shale or spoilheap and using it as infill in roads requires a method of assistance, and probably the grant system is the best way of doing it.
This is another illustration of change in rating procedure in advance of the Green Paper on local government reform. Once again, we are doing things by new penny numbers instead of looking at the whole problem as one.
§ Mr. Silkin
My hon. Friend is much more critical than I am.
I understand the Minister's dilemma. He should stand up and say that he is not prepared to be forced at breakneck speed to bring in Orders or Bills which change the basis of rating before we have had a real chance of looking at the whole problem and deciding whether there is a better way of financing local government.
First, therefore, we have one dissatisfied customer in my hon. Friend the Member for Romford (Mr. Leonard) because the Minister is giving him too much, several dissatisfied hon. Members because the Minister is not giving enough and an archaic method of dealing with a problem which is crying out to be dealt with. As the Minister knows, neither I nor my hon. Friends intend to divide against the Order—we give him at least one cheer for trying—but perhaps he might take the Order away, consider it and come back with something better in the near future.
§ Mr. Bagier
I would hate my right hon. Friend to appear in the OFFICIAL REPORT as having said something which, I am sure, he did not mean. He said, I think, that a pit heap which was within the working curtilage of a pit would be rated whereas one which was outside it would not. I am sure that my right hon. Friend did not mean that. The direct opposite is the case. Where a heap is within the curtilage of a pit it is derated, whereas one which is outside the curtilage is rated.
§ Mr. Silkin
I am grateful to my hon. Friend. If I said that—and I am surprised if I did—it was, of course, the 1305 wrong way round. I intended to say that where a mine was still being worked, it got the benefit of the derating but that when it had stopped working and, therefore, had become more of an eyesore, it was not derated. That was what I intended to say. So perhaps HANSARD can take note.
§ 11.15 p.m.
§ Mr. Graham Page
With your leave, Mr. Speaker, and that of the House, I will deal with the last point at once. I am advised that shale heaps, spoil heaps, colliery tips and pit heaps are mines or quarries. Whether they are loose piles of shale and remain chattels, or have formed themselves into solid blocks of land, they are treated as mines in accordance with cases which have been decided. If there is removal of mineral from them, they get the benefit of derating.
§ Mr. John Silkin
I accept what the Minister is saying, but he must direct his attention to a spoil heap which is no longer worked, and I suggest that this is not derated.
§ Mr. Page
I am advised that it is. I am not dealing here with pits which are still part of a working mine. I am dealing with pits which are eligible for grant. Heaps which are part of a working mine are not eligible for grant. They are part of the mine and will receive the benefit of derating under the Order. In addition, those on which working has been completed and which may have become solidified as hills or be fairly loose shale are treated, I am advised, in accordance with decided cases as mines, because mineral is removed from them.
§ Mr. Bagier
I understand from correspondence that a working pit is rated on a cumulo basis, which includes everything inside that cumulo. If a pit heap is within that cumulo and is worked, it cannot be rated twice. A pit heap which is used for depositing slag within a working pit is not rated. Is the Minister saying differently?
§ Mr. Page
I am not sure that I understand the distinction which the hon. Gentleman makes. The heap he is describing is surely part and parcel of the working mine and, therefore, gets the benefit of the Order; it is part of a coal 1306 mine. It comes under the formula applicable to the National Coal Board and not to normal mining and quarrying, and to that extent it may differ. The slag heaps are not being worked by the National Coal Board, and to that extent they are rated just as heaps. They do not come under the formula of the National Coal Board.
I am reluctant to give a legal decision off the cuff, but I am advised that the heaps about which we are talking are treated as mineral workings and, therefore, as mines and will get the benefit of the Order. I sincerely hope I am right in the judgment I am delivering from the Dispatch Box.
The hon. Member for Sunderland, South (Mr. Bagier) talked about the eyesore of borrow pits alongside roads and motorways, and objected, as we all do, to them being left in that state and not filled in or landscaped when they have served their purpose. They are rateable. It may be that the owner or occupier is not caught up with very quickly, but they are rateable. I propose to take action concerning the filling in of these pits to see that they are not left in the terrible state in which on occasion one sees them. We may need some new provisions or undertakings by those who work the borrow pits when they obtain planning permission, but that is outside the present Order.
I agree with the hon. Member for Sunderland, South when he says that he is interested in getting these pit heaps removed. We are all eager to do that and good progress is being made.
I was surprised that the right hon. Member for Deptford (Mr. John Silkin) complained about spreading the heaps over the ground. I would invite him to go to Lancashire to see how quickly the grass grows on spread shale. I am speaking of the area from Preston southwards where I have been astonished to see shale spread around one year and grass growing on it the next. Vegetation appears very quickly on the spread slag. In many cases the areas have been landscaped as picnic areas, or quite substantial trees have been planted, or they have been planted as fields. There is more work to be done, and great progress is being made with the aid of the 85 per cent. grant. No grant has been refused.
1307 There is certainly no delay by reason of money not being available. This is an open-ended commitment to grant. It is not like the House saying "We will spend £100 million over the next 10 years on clearing slag heaps." It is completely open. If any local authority comes forward with a proposal to clear a slag heap, it will receive 85 per cent. grant of the cost. It is our job in government to encourage local authorities to get on with the job with the help of the grant.
The hon. Member for Romford (Mr. Leonard) put the other side of the picture. He objected to the derating of gravel pits, and rightly pointed out that it is wrong to say that when a gravel pit has been worked one is left with a hole in the ground. That hole in the ground is very valuable as a dumping spot and may be valuable for amenity and recreational purposes. But when it gets to that stage it is fully rateable; it is rated as a tip and has a quite high rateable value from that point of view.
The hon. Gentleman then complained about the unseemly haste, as he put it, in which the Order had been introduced. Consultations have been under way on this matter for the last seven years, and I do not imagine that would be regarded as unseemly haste in introducing the Order. Therefore, Governments of both political persuasions have now carried out consultations to try to get the Order right.
§ Mr. Leonard
It may well be true that consultations have been going on for over seven years, but would the Minister deny that when the draft Order was sent out to local authorities for comments they were given precisely one week in which to send back their comments?
§ Mr. Page
That was a final draft which was pushed around, if I may so put it, for many months following a consultation document. Everybody concerned well knew what was in the draft, and it was only a matter of whether any mistake had been made in the arrangements which led finally to that draft, and those concerned were asked to consider it.
§ Mr. Leonard
With respect, this last draft Order by no means contains only 1308 accepted material. I believe that in respect of the decision to proceed in two stages—25 per cent. in the first year and 50 per cent. subsequently—the first firm indication that local authorities had was when they were asked to comment within a week.
§ Mr. Page
The hon. Member may be considering the matter from the point of view of an individual authority. The Government negotiate with the local authority associations, and it may be that the associations have not informed the individual authorities.
The hon. Member also referred to the undertakings given when the 1961 Bill was passing through the House, and when Mr. Henry Brooke—as he then was—stated that there was no intention to use Section 35 of the General Rate Act for the purpose of varying the level of rates.
The basis of the Order is agreed between the parties. We were confronted with the problem of either bringing a Bill or proceeding in the simple way by Statutory Instrument, as we had power to do by Section 35. It was right that it should be done in the simpler and more appropriate way, by Statutory Instrument. We were only following out what had been clearly stated to be the intention of the previous Government in this matter. On 15th May, 1970, the then Minister of Housing and Local Government, in reply to a Question by the hon. Member for Rugby (Mr. William Price) said:I have decided that the basis of assessing mineral hereditaments to rates should be adjusted to take into account the proposal of my right hon. Friend the Chancellor of the Exchequer in relation to the taxation of mineral royalties. I am considering the detailed adjustments which might be appropriate, and in due course will be consulting the various interested organisations with a view to making an Order under Section 35(2) of the General Rate Act, 1967 to take effect from 1st April. 1971."—[OFFICIAL REPORT, 15th May, 1970; Vol. 801, c. 398.]The previous Government were contemplating doing this by Order. Although I do not normally accept the actions of the previous Government as good precedents, in this case there was nothing to object to.
The hon. Member for Barrow-in-Furness (Mr. Booth) raised the question 1309 whether we should make some report to the House under Section 35(5). We shall do so in due course. That Section obliges the Government to make a report in the year following the coming into force of the second valuation lists, in the year 1973–74. I can give the House an assurance that there will be a report in accordance with Section 35(5) of the General Rate Act, 1967, during that year, following the next valuation list.
The hon. Member for Rother Valley (Mr. Hardy) referred to a case where a road had passed near a slagheap and where borrow pits were dug and the slagheap material was not used. I should be grateful if the hon. Member would give me the facts of that case. I should like to consider. That is the sort of thing where we hope that we can use influence in asking the local authority—if it is a local authority road—to use the slapheap material. I can assure the hon. Member that if the Department is responsible for the road I shall look into the matter and see why the material was not used.
Finally, I was a little surprised at the failure of the right hon. Member for Deptford to give credit to the advance which has been made in matters relating to the environment. There is always more that can be done, but more has been done and more has been started to be done for the environment in the last nine months than was ever done in the previous five years.
§ Question put and agreed to.
That the Mines and Quarries (Valuation) Order 1971, dated 4th March, 1971, a copy of which was laid before this House on 4th March, be approved.