UNOCCUPIED PROPERTY (INCREASE OF RATE) (Hansard, 23 May 1972)

§ Mr. Geoffrey Finsberg (Hampstead)

I beg to move, That leave be given to bring in a Bill to amend the provisions of Section 17 of, and Schedule I to, the General Rate Act 1967 relating to the liability to be rated in respect of unoccupied property. I am grateful for such a full House for the introduction of my 10-Minute Rule Bill. [Interruption.] However, clearly its audience is diminishing rapidly.

The Bill would alter the rating of unoccupied properties. The General Rate Act, 1967, first introduced optional powers for local authorities to levy a rate on unoccupied properties of 50 per cent. Broadly speaking, this applied to commercial properties after they had been unoccupied for three months and to residential properties after six months.

The time has come to alter that in at least three respects: first, to make the system mandatory on local authorities, second, to increase the percentages and, third, to plug some of the loopholes that have been exposed.

I know from experience that the introduction of the scheme which is allowed under the 1967 Act, which binds councils to operate it for a period of seven years, needs very careful thought. In the London Borough of Camden, where we have operated the scheme since 1968, it is interesting to note that we have collected over £2,138,000 in empty property rates, at a cost of less than £85,000. No less. than £300,000 of this sum has come from the notorious Centre Point, the owners of which have shown naked and selfish greed throughout the years that the property has existed. I think that it is now accepted that if the percentage is right the scheme is workable.

In broad terms, under the Bill the percentages would go up from 50 per cent. to 90 per cent. after a further period of six months of unoccupation, and to 125 per cent. after a further 12 months, all subject to the safeguards of appeal which already exist in the General Rate Act, 1967, although clearly some alteration will have to be made in order to prevent some of the prevarication which can occur at present.

1239 There can be no reason for depriving the community, in the form of ratepayers, from its share of the revenue; nor, in my judgment, would most shareholders in a public company permit the waste of their assets which can happen and which, certainly in the case of Centre Point, has happened for far too long. Therefore, I believe that a full or penalty rate charge would achieve swifter results and would get the property into beneficial use much more quickly.

The time allowed for the introduction of the Bill permits me to illustrate only three of the loopholes which I should like to see plugged. The first is that empty shops which are let for charitable use should revert to their normal rating provision as soon as the charities cease to occupy them. At present, if a shop is occupied by a charity for the sale of Christmas cards, when it ceases that use it remains as a charitable use and the local authority cannot make its rate claim under the 1967 Act.

Secondly, nationalised bodies should not be exempted where property is normally owned and let by them. Where it is normally owned by them and let, and when the property has been rated for the same period as any other, the nationalised bodies, too, should become liable for rates.

Thirdly, the process of being able to divide a hereditament by letting, for instance, one floor out of three and then claiming empty rating relief on the two 1240 remaining floors with an entirely fresh period of grace must cease. On the balance of the hereditament the relief should apply only as if no division had been made.

I hope that the brief outline I have given of the purposes of the Bill will be sufficient for its introduction. If, as I fear seems likely, the House is good enough to grant me leave to introduce the Bill but does not find time for a Second Reading and the following stages, I hope that my remarks will enable the Government, in their promised review of local government finance, to remedy some of the existing defects and to adopt at least some of the ideas proposed in the Bill.