HC Deb 23 January 1974 vol 867 cc1676-83

'The General Rate Act 1967 as amended shall extend to every hereditament occupied or used by any department of Government, or occupied or used for any public purpose, notwithstanding that some may belong to or be vested in Her Majesty, Her heirs and successors, or any officer or department of state, or any other public officer, authority, or body ; and the department, officer, authority or body occupying, using or having the management of or control over the same shall be deemed to be the occupier for rating purposes'.—[Air. Oakes.]

Brought up, and read the First time.

Mr. Oakes

I beg to move, That the clause be read a Second time.

The clause is on the very old question of Crown rating. Crown property—by which I mean not only Windsor Castle and the property under the ownership of Her Majesty the Queen, but also any Government property, and any property held by nationalised industries, with few exceptions—is rated in an entirely different way from the ordinary rating system. All other industrial property is rated by a valuation officer. A valuation is fixed which can be argued between the owners of a property and the local authority involved. The matter can go to the valuation court to be argued, and ultimately to the Lands Tribunal, if there is a dispute between the local authority and the occupier of the premises. For Crown property the compensation figure in lieu of rateable value is not fixed by the district valuer, but by the Treasury. There is no appeal to any court or body against the figure which the Treasury fixes.

Local authorities have long felt aggrieved at this situation, which has continued for hundreds of years. I understand, from historical research, that it arose as long ago as the time when a petition was presented from the villages surrounding Hampton Court Palace. When the palace was being built they were aggrieved at the fact that when the men building it were laid off the parish rates had to suffer, by providing what was then the equivalent of supplementary benefit for the builders who were no longer being paid. It was a grievous burden on the parish. The then monarch gave a grant of £50 to the parish council for the relief of those labourers. From those innocent seventeenth century beginnings the whole edifice of Crown rating has arisen and persists even to this day.

5.0 p.m.

It is interesting that 100 years ago, on 30th March 1874, the Minister's right hon. and deceased Friend, Mr. Disraeli, told the House that he would shortly be able to give a definite reply on the anomaly of Crown rating. We on this side of the House have indeed been patient. I hope that the right hon. Gentleman will now tell us, 100 years later, that the Bill is the most convenient vehicle to get rid of this ancient, anachronistic anomaly of our rating system, which bears grievously at times on local authorities.

Local authorities are understandably irritated by the fact that there is no appeal against a Treasury decision. The Treasury fixes the sum and the local authority has to accept it.

In the days when the Post Office was under the control of the House, and Goon-hilly Down in Cornwall was therefore Crown property, it was rated at a ludicrously small sum. After the passage of the Post Office Corporation Act, about £40,000 was added to that rateable value, when a proper valuation was made by the valuation officer on its ceasing to be Crown property. There must be many other instances throughout the country.

Some of the effects are seen in my constituency at a level of local government that we rarely discuss in the House, important though it is, the parish council. In my constituency there is the parish of Halewood, within which there is a Ford Motor Company factory. It is probably one of the richest parishes in the country, because its 1p rate when levied on the Ford Motor Company produces sufficient for the parish to have two parish halls and all sorts of amenities. Yet other parishes within my constituency and within the same rural district of Whiston, one of them, Cronton, having a coal mine and another, Bold, having an electricity power station as well as a coal mine, are unable to gain benefit from those Crown properties, apart from the grant they receive from the rural district council, a subvention paid to the rating authority because the properties are not rated in the ordinary way. As a result there are great inequalities, which are nonsensical in this day and age.

There is no reason why all property, industrial, commercial and otherwise, whether or not in the ownership of the Crown, should not be rated in the ordinary way by the valuation officer. Valuation officers have very difficult rating assessments to carry out today in regard to aspects of industrial property that is not nationalised and is not Government property. They do their difficult calculations successfully. I see no reason why this major Bill, which will affect local government for a number of decades, should not be the instrument whereby the anachronism of Crown rating is abolished, so that each property in each local authority area would be valued in the ordinary way, and at least the local authority would feel that it had been properly dealt with and had a body to which it could appeal.

There should be no loss to the nationalised industries. If there was a loss, it would mean that they were being unfairly rated now. Local authorities would have the satisfaction of knowing that they could appeal to a proper court, as they can with regard to any other valuation of other hereditaments in their areas.

A hundred years after Disraeli's promise to the House, I ask the Government to give sympathetic consideration to doing away with this anachronism so that all properties, whether Crown properties or not, pay their just and fair share of rates to help the local authority in whose area they are situated.

Mr. Graham Page

The hon. Member for Widnes (Mr. Oakes) gave us some very interesting historical facts. He said that an amendment was promised 100 years ago, on 30th March 1874. Perhaps I should tell him to wait the hundred years, and that then we shall reconsider his amendment.

I cannot go even as far as that. The purpose of the clause, which I acknowledge is sponsored by local authority associations, is to make the Crown liable to rates on the property it occupies. As I read the clause, it would not affect properties such as those belonging to the National Coal Board, including the coal mines in part of the hon. Gentleman's constituency, because the board pays on a formula in the same way as the gas and electricity undertakings and other public enterprises do.

I know the great advantage which the parish of Halewood derives from the presence of the motor manufacturers there. It was only on Monday of this week that, very early in the morning in order to catch a plane for a speaking engagement, I drove through Halewood and the village of Hale, of which the hon. Gentleman is a Freeman as a result of the 1972 Local Government Act.

If the clause were accepted we should also have to repeal Section 37 of the General Rates Act 1967, which deals with entries in the valuation lists of property which is occupied by the Crown and on which contributions in lieu of rates are paid.

Currently, property occupied by the Crown is not liable to rates, though the Crown makes a contribution in lieu of rates calculated on the basis of a valuation placed on the property by the Treasury Valuer. The valuation itself is not subject to review by the courts. During the consultations on the Green Paper on the finance of local government the local authority associations were unanimously of the view that Crown property should be assessed and rated in the same way as other property. But in any case the associations considered that the assessment of Crown property should be open to appeal in the valuation courts and the Lands Tribunal in the same manner as other assessments. They considered that this change would be facilitated if responsibility for making the assessments were transferred from the Treasury Valuer to the Valuation Office of the Inland Revenue. I agree that if these suggestions were adopted, the present delay in the revaluation of Crown property, in the view of the local authority associations themselves, would be avoided. Certainly, that delay is an inconvenience, to say the least, to local authorities.

I know that local authorities have in the past consistently criticised the arrangements for contributions in lieu of rates on Crown property, but in practice the number of individual complaints about valuations placed upon Crown properties by the Treasury Valuer has been minimal.

The procedure is perhaps illogical, but it seems to work quite fairly. The case hitherto made by the local authorities in support of the full rating of Crown property is based mainly upon the proposition that the system should not only be fair but should be seen to be fair. In practice, it seems to be fair, and the Crown makes by way of contribution in lieu of rates the same sort of payment that it would make if the property were subject to rates.

This was shown in the recent change of status of the Post Office. In some cases the local authorities did not do so well out of Post Office property as they had when the Treasury Valuer was valuing it. Moreover, for security reasons it is not possible to bring all Crown properties, including defence establishments, within the present rating system. For these reasons the rating of Crown property has been resisted not only by this Government but by previous Governments of different parties.

We have not casually disregarded the representations made to us by the local authority associations. We have looked to see, first, whether there is a case for altering the system of valuation and, secondly, whether there are any grounds for the complaint that there is no appeal. We have sympathy with the point made by local authority associations and by the hon. Gentleman that there is no appeal. I am considering whether we can provide any form of arbitration or review if the contribution in lieu of rates seems to be unfair in any particular case. Such a procedure would be extra-statutory. It does not need statutory provision. I give the assurance that we are looking into it, although I cannot give an undertaking how the consideration will turn out in the end. The matter is not being disregarded, and I am in sympathy with what the hon. Gentleman said about the absence of any form of appeal.

Mr. Blenkinsop

I appreciate what the Minister has said about the inquiry that is being made into the possibility of an appeal procedure. May I go a little wider, to ask whether comparable consideration can be given to the related matter of agricultural rerating which, for understandable reasons, is not raised formally by an amendment but which still worries local authorities. A good deal of agricultural land is also Crown property. Local authorities are concerned about this, although the difficulties are well understood.

Mr. Deputy Speaker

The operative word is "hereditament", but I am prepared to overlook that if the right hon. Gentleman wishes to reply.

Mr. Graham Page

With the permission of the House, I merely say not in this Bill and not by this clause.

5.15 p.m.

Mr. Oakes

It could be dealt with otherwise than by the clause. I am very encouraged by what the right hon. Gentleman said about the review that the Government are making of the amount of contribution in lieu of rates paid by Government Departments and nationalised industries to local authorities.

The figures, which I have just received, concerning the satellite station in Cornwall, are sufficiently dramatic to give to the House. The valuation placed by the Treasury in 1969 on the Goonhilly Downs earth satellite station was £17,135. When the Post Office became a corporation and the satellite station was valued in the normal way, the valuation given to it was £40,070. Similar changes must have been repeated throughout the country. I therefore welcome what the Minister said about the Government's looking again at this question, and I ask them to do so urgently.

The right hon. Gentleman said that there are very few complaints, but when one is faced with a fait accompli and there is no one to whom to complain there are no complaints. The local authority cannot go to the valuation court or the Lands Tribunal. It must sit back and accept what the Treasury says. There is no formal channel for complaint unless it is to the Minister or the Chancellor of the Exchequer to complain about the conduct of civil servants in undervaluing a particular property. To say that there have not been complaints from local authorities is not a valid reason for saying that the procedure is satisfactory.

It is rare for all local authority bodies to be united on one object, but they are certainly united on this one. The towns and the countryside together all want assistance. I understand the right hon. Gentleman's argument about security at Army and Air Force bases. If the Government are not prepared to accept the cause, will they consider introducing a small Bill to give a right of appeal to the courts. It would be highly satisfactory to the local authorities concerned to know that there was an independent arbitrator to decide their claims.

I am delighted that the right hon. Gentleman went through Halewood and Hale. He knows that he will always be royally received in those two parishes because of their deliverance at his hands from the fate they feared under the Local Government Bill.

Many parishes are losing out. This may not arise directly from the clause, but it arises indirectly. In addition to considering appeals, I should like the Government to find a way in which parish councils could, directly and not through the district council, receive some form of assistance from the nationalised industries by way of a subvention in the same way as they can claim a parish rate from the industries established within the parish. Industries that create the greatest environmental difficulties in an area are sometimes the ones that do not pay a penny to the upkeep of the parish.

As the Government are prepared to look at the figures, I beg to ask leave to withdraw the motion.

Motion and Clause, by leave, withdrawn.

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