HC Deb 03 December 1975 vol 901 cc1823-49

10.1. p.m.

The Under-Secretary of State for Northern Ireland (Mr. J. D. Concannon)

I beg to move, That the Rates (Northern Ireland) Order 1975, a draft of which was laid before this House on 5th November 1975, in the last Session of Parliament, be approved. This Order amends the Rates (Northern Ireland) Order 1972, which consolidated and amended the then existing law on rating and valuation in Northern Ireland to achieve broad parity with England and Wales. However, it was not practicable in that Order to deal with certain kinds of hereditaments which are used for public utility purposes, or with the ratability of plant and machinery.

In addition the 1972 Order provided a temporary limitation of rates for playing fields, which ceases after 31st March next year.

The major purpose of this Order is to deal with these matters. Consultations have taken place with interested parties, including local government representatives, professional bodies, the Northern Ireland Electricity Service, the Gas Employers' Council and harbour authorities.

Article 11 and Schedule 2 deal with the ratability of certain items of plant and machinery. In Northern Ireland it has always been considered that plant in the nature of a fixture is ratable but recent legal decisions have thrown doubt on the view that the law regarding ratable plant had a wider interpretation than corresponding law in Great Britain.

In order to resolve such doubts and to achieve parity of assessment, Schedule 2 contains the precise classifications of plant and machinery as those in rating law in Great Britain. The new basis of assessment will not affect the continuance of the derating of industrial hereditaments.

Article 10 and Schedules 1 and 2 provide the new basis for the Northern Ireland Electricity Service and for gas undertakings. For each of the undertakings any houses, showrooms and administrative offices will be assessed as separate hereditaments in the normal way, that is, on an estimated rental basis. Each undertaking is deemed to occupy a notional hereditament for which an aggregate ratable value will be fixed by a formula based on throughput. It is proposed that discussions will take place with representatives of these undertakings to fix the basic aggregate ratable values and the formula for up-dating annually.

Article 11 and Schedule 2 provide the formula for calculating the ratable value of docks in Northern Ireland. Over the years there has grown up a what one can only describe as a hotchpotch of methods of assessing the major docks and harbours in Northern Ireland. The Belfast Harbour assessment is made on a tonnage basis, Larne Harbour on the "profits" or "accountancy" basis, Londonderry and Coleraine are exempt from rates, and Warrenpoint is assessed on a capital value basis. The proposed formula follows directly the present method used in England and Wales and will provide uniformity between docks in Northern Ireland.

The new basis of assessment will not affect the continuance of the derating of docks as freight transport hereditaments. This involves a reduction of 75 per cent. in the rate bill for qualifying hereditaments to be applied to keeping down freight charges.

Rev. Ian Paisley (Antrim, North)

Does this mean that the docks in Coleraine and Londonderry will now be paying a rate under this new assessment?

Mr. Concannon

This means that all the docks in Northern Ireland will be treated equally, and they will be treated on the same basis as the docks are treated in the rest of the United Kingdom.

Mines and quarries are given the same concession by Schedule 2 as that available on the mainland. In assessing the net annual value of this type of hereditament in Northern Ireland, only one-half of the royalties paid will be taken into account.

Article 6 and Schedule 2 empower the Northern Ireland Department of Finance to determine by order subject to affirmative resolution the method by which the net annual value is to be assessed for undertakings such as canals, natural gas terminals, railways and rediffusion. Any such Order will be made only after consultation with interested parties.

The last major change in the Order concerns playing fields. The temporary provision for relief from rates contained in the Rates (Northern Ireland) Order 1972 terminates on 31st March next year. Article 4 of this Order simplifies and makes permanent this relief by providing for a 35 per cent. reduction in the amount of rates payable in respect of playing fields which are occupied by non-profit-making organisations using the land wholly or mainly for open-air games or athletic sports. In addition, this article empowers the Northern Ireland Department of Finance to make an order extending the relief to other types of recreational use.

I will now turn to some of the minor changes in the Order. Article 7 removes any doubt which exists concerning the right to relief from rates for property used for charitable recreational purposes; that is, those involving social welfare and those used for public services. Article 9 extends the derating of fish farms to shell fish beds, and makes the ratable value of oyster beds two-fifths of the net annual value.

Article 12 provides a safeguard for an agent who is chargeable with rates as "owner" of a hereditament who is liable to the extent of the money he holds or has held for his principal. Any sums he has been compelled to pay in respect of public health expenses are to be ignored.

Article 13 provides a complementary rule where an agent charged with public health expenses has paid out money in respect of rates.

I commend the Order to the House.

10.7 p.m.

Mr. Norman Miscampbell (Blackpool, North)

I always understood this was a technical matter but until I heard the Minister speak, I did not understand just how technical. Northern Ireland should have some form of local representation if this is the way its rating system is to be commended to the legislature. I want to ask a number of rather more fundamental questions than the Minister has dealt with.

The order at least has the one commending grace that it does not increase expenditure in Northern Ireland, but it certainly raises issues of tremendous local importance. Local government in Northern Ireland was reformed three years ago and the 69 districts were amalgamated into 26. The whole basis of the reorganisation was that there would be a local Parliament in Northern Ireland. Housing, planning, health and education were removed from local authorities and taken into the central Executive, which no longer exists. The whole system of local government in Northern Ireland pivots on the pre-supposition that there will be a Stormont.

I accept that we cannot reform local government again, but there are a number of points the Minister should recognise. First and most important is the frustration felt in Northern Ireland at the moment. Most functions of local government have been taken into central hands and local control is now largely nonexistent. Rates are levied and imposed, but there is very little democratic control over the way in which the money is spent.

The rating system in Northern Ireland is based on two rates—the district rate and the regional rate. Is the Minister satisfied that the system of imposing a regional rate related to an English district is proving a satisfactory way of dealing with Northern Ireland? Or should there be some way in which Northern Ireland interests can be taken more seriously, with the rates related to Northern Ireland conditions and problems?

Are the Government satisfied that a 40 per cent. increase in the district rate which now faces many ratepayers is simply due to inflation, or is it due to increased expenditure in Northern Ireland? May we have an explanation about the differences which occur in Northern Ireland rates? The regional rate varies according to area, and that arose because when Stormont disappeared the old councils had different rates. Regional rate varies from one district to another. How great is that variation and how soon may we see the change?

Has any thought been given by the Government to the revaluation of property in Northern Ireland? I understand that the system is based on 1939 values, and I can assure the Government, having experienced two revaluations in my constituency, that nothing causes greater trouble than the use of old values and attempts to change them.

Mr. Concannon

A revaluation is in progress at the moment. It is due to finish on 31st December and will apply from 1st April next year.

Mr. Miscampbell

I am glad to hear that. I expect that when the revaluation takes effect the Minister will be glad that he does not have to depend on Northern Ireland votes.

In England there is a considerable uptake of rate rebate. How far has this been the case in Northern Ireland? Are the present troubles there and the obvious differences between the various areas making much difference in the take-up of rate rebate?

Ministers have discussed with the authorities in Northern Ireland the rebate which should be given for sports facilities there. They have been pressed on a number of occasions by the sports councils in Northern Ireland and those interested in sporting facilities. Surely if there was one place in the United Kingdom where it was essential to have sports facilities and to enable people to get out and do things together, like playing football, it is in Northern Ireland at the present time. What possible justification can there be for the fact that in English constituencies—I have looked them up—50 per cent. is the average that has been given and is the figure that has been recognised and recommended in the White Paper? Why is the situation in Northern Ireland not comparable with what is happening over here? Would it not be sensible to give to the Northern Ireland authorities the rights that are now open to authorities over here to give a grant up to 200 per cent. if necessary or to recommend that 50 per cent. should be given rather than 35 per cent.?

I hope the Minister can help us. I have no doubt that he will be asked a number of other questions and, in spite of the arid description of the Bill which he gave, will deal with what is really happening in Northern Ireland.

10.16 p.m.

Mr. J. Enoch Powell (Down, South)

There are two aspects, as always, to any measure on rating. One is valuation and the other is rating itself—the assessment and imposition of a rate. In considering this Order I want to deal with those two aspects separately.

The principle which underlay the reform embodied in the 1972 Order was that of a deliberate harmonisation of the principles of valuation as between Northern Ireland and Great Britain or, at any rate, England and Wales. Certainly we on these Benches would have no quarrel with that principle. We see no reason why plant and machinery in a firm in Northern Ireland should be assessed to rates or not assessed to rates on a different principle from a firm in any part of England. We see nothing peculiar about the difficulties of assessing public utilities to rates which would prevent a satisfactory, or fairly satisfactory, system, if it can be evolved, from being applied just as much in Northern Ireland as it is on this side of the Irish Sea.

When I refer to the assessment of public utilities to rates, I mean, of course, the problems of localising the value of a public utility which is itself not localised in its operations. It was quite a nostalgic experience for me to study this Order and the background to it, because it sent me back almost 20 years to the time when I remember chairing an interdepartmental committee on the exciting subject of the assessment of gas undertakings—perhaps one of the most complex subjects to which I have had to devote my mind in any Ministry I have ever occupied, but a subject which is essential if that which is the basis of the whole rating system—a sense of fairness to all concerned—is to be achieved. I remember being astonished to find how many different interests, aspects and points of view had to be fed into any solution, in order to arrive at a suitable method of assessing public utilities to rates.

This Order carries further the harmonisation which was instituted by the principal Order, if I may so call it—the 1972 Order. It does so, as the Undersecretary pointed out, mainly in the two areas of plant and machinery and of public utilities. As one studies the order, one cannot fail to be struck by the clumsiness of the procedure which we are using. After all, basically, if it is the general will of the House—and it is certainly, as I have already said, not a will from which hon. Members on this Bench would dissent—that there should be a uniform system of valuation for rating in the United Kingdom, the natural way to go about it, the simplest way, the most economical of parliamentary time and most productive of sensible debate with perhaps an even larger attendance than we are enjoying this evening, would be to apply the legislation to the United Kingdom, as indeed a good deal of legislation on domestic matters which goes through does apply to Northern Ireland. We had for instance a fisheries scheme only a night or two ago which in terms applied to Northern Ireland as much as to Great Britain.

For the most part, however, for reasons which I quite understand are partly historical and perhaps at this stage not wholly avoidable, we seem at present determined to build upon unsatisfactory and different foundations on the two sides of the Irish Sea. The Order before us and the principal Order are saturated, if I may so put it, with defunct constitutions. For example, in Article 2 we find a reference to the Interpretation Act applying to the Order as it applies to a Measure of the Northern Ireland Assembly". I do not know whether anyone today still remembers the Northern Ireland Assembly. I have become accustomed to refer to it by the perhaps more graphic description of "the Heath Robinson constitution". It was a constitution which those of us who knew anything about Northern Ireland knew would never work, which never did work, and which collapsed disastrously. Whatever difference of view there may be about the future government of Northern Ireland, one thing on which all, I think, will agree is that, though it is still on the statute book, although the coffin lid has only just been screwed down upon its scarcely cold corpse, there will be no resurrection of the 1973 constitution. [HON. MEMBERS: "Hear, hear."] Yet here in a necessary Order, in a piece of legislation which looks forward and of which the very object is to provide a system uniform with other parts of the United Kingdom, we find ourselves using these cast-offs, as it were, of "old, unhappy" things—not "far-off" things but things from the past.

Again, in Articles 4 and 6 we find that such-and-such an order is to be subject to affirmative resolution. Hon Members not expert in these matters who read that in the course of their detailed study of the Order must have been somewhat surprised to think that when orders have to be made upon such detailed affairs they will be subject to an affirmative resolution, moved, no doubt, by the Under-Secretary of State in this Chamber at some unearthly hour. They would be mistaken. There is no question of an affirmative resolution being required. These expressions relate to a constitution which is not in force and probably never will be in force again even in this respect. There will, therefore, not be an affirmative resolution required for these orders.

I hope I have it right when I say that in both cases, in Articles 4 and 6, there is the possibility of a Prayer in the House; but so complex is the matter that it is quite possible that I am wrong and that no parliamentary procedure whatever is available. Yet here we are solemnly directing that there shall be inserted into the 1972 Order provisions which we know are not in force and never will be in force.

Rev. Ian Paisley

Hypocrisy.

Mr. Powell

I hear my hon. Friend say "hypocrisy", but I do not think it is really that. I think that the Government find this as distasteful and as ridiculous as we do, and are scarcely less embarrassed than the rest of us by the detritus left over from the constitutional disasters of the preceding administration, for which they share only the qualified blame of having given it occasional encouragement.

Perhaps when the Under-Secretary of State replies he will be good enough to inform us whether the possibility of a Prayer still exists.

Mr. Concannon

indicated assent.

Mr. Powell

I see the Under-Secretary nods his head. I hope it is rather the nod of Olympian Jove than the nod of Homer. It seems, then, that even amongst the wreckage of the 1973 Act it will still be possible, should we be dissatisfied in respect of Article 4, for example, which deals with playing fields, to have a further debate in the House; and, indeed, there ought to be some possibility of debate.

Another matter, which has some seriousness attached to it, illustrates the clumsy method by which at present we are partly condemned to build on separate foundations in Northern Ireland—a procedure which produces unsatisfactory results. If hon. Members can bring themselves to look at page 17 and the following pages of the Order, they will see set out the principles dealing with ' notional hereditaments', an enjoyable concept much savoured by all who interest themselves in local government finance. Where we are dealing with notional hereditaments occupied by electricity or gas undertakings, the House, by confirming the Order, is confirming the express principles on which they will be charged to rates. When, however, we come to mines, quarries, docks—to some extent—and canals, we find that the principles are left open to be dealt with by departmental Order. Part XIII in page 19 provides: The Department may by order (a) provide that paragraph 2 which sets out the principles of the Order is to cease to have effect", so that in (b) some quite different method can be applied by Order. One finds something very similar applying to docks and canals in Parts XIV and XV.

I make no criticism of the object behind those permissive provisions. The development of the methods applied in Great Britain in these respects is still fluid, and it is desired that we should not, by enacting something rigid in the Order, fall out of phase once again with the methods of valuation which prevail in Great Britain. Yet because we insist on proceeding separately in Northern Ireland we are obliged to write into the Order these discretionary provisions which are objectionable in their width and scope. It does not arise from any desire on the part of the Under-Secretary of State or his colleagues to take excessive powers; it is that he wants Northern Ireland to keep in step with Great Britain in these matters—and so do we—but instead of proceeding in the normal way and producing enactments in due course for the whole United Kingdom, he is doing it at present in this double fashion, which produces a result unsatisfactory not merely in form but in substance.

I turn now from valuation to rating itself. As the hon. and learned Member for Blackpool, North (Mr. Miscampbell) found, it is this aspect which leads to the more serious and more politically-charged questions. When we come to the imposition of a rate, to the manner in which a rate is assessed upon the inhabitants of Northern Ireland, we are brought face to face with the consequences of the virtual destruction of local government, which was not brought about by this House but was accomplished in Northern Ireland before the demise of the old Northern Ireland Parliament and Stormont administration. It was that Parliament and that administration which virtually destroyed Northern Ireland local government and left the Province as it is today—with no representative local government above a district level restricted to a humble and limited range of administration.

The consequences were clearly brought out in a letter which the Under-Secretary of State was good enough to write to me a day or two ago. Struck by the fact that the ratepayer in Great Britain receives a detailed statement of the subjects on which the product of his rate is to be spent and the various shares which go to the various subjects, I innocently, and, perhaps the hon. Gentleman will retort, ignorantly—

Mr. Concannon

indicated dissent.

Mr. Powell

—the hon. gentleman is very charitable—put to him the suggestion that we might do the same in Northern Ireland. It will not be amiss if I read to the House the crucial sentence in the hon. Gentleman's reply. He mentioned that there are two rates, as there are two rates in the greater part of Great Britain, a district rate and—in Northern Ireland—a regional rate. He continued: In making the regional rate the Department of Finance is required to take into consideration the average amount required to be raised by means of district rates and, having done so, endeavour to pitch the regional rate at a level "— these are the crucial words— which ensures that the total rate burden is related to that in comparable areas in Great Britain. In other words, the regional rate is not a rate at all. It is an arbitrary imposition by way of a rate to bring about a certain equilibrium between the yield of rates and the rate burden in Northern Ireland and that in Great Britain.

In present circumstances, one would not necesarily have any criticism of that principle, but it brings one face to face with the reality of the destruction of local democracy. The essence of local democracy is that expenditure administered by the elected representatives of the people has its repercussions on the rate which they are obliged to levy to sustain their activities and thus completes the chain or circle of administration, taxation and electoral responsibility.

To some extent that circle works in Northern Ireland in the limited sphere of the district; but in the major areas it does not exist. There are no elected bodies in charge of the administration of the major services. Consequently, a notional rate has to be imposed so that the ratepayers in Northern Ireland neither get away with it lightly in comparison with the rest of the Kingdom nor have to bear a figure which is plucked from the air. Still, for the major services in Northern Ireland there is no relationship between the level of the rate and the efficiency, volume or quality of the service. That is the total negation of democracy; and again I venture to prophesy that whatever is to be the future form of administration in Northern Ireland it will not be possible—it will be a great mistake if we attempt it, and I hope we shall not—to dispense with the restoration of genuine democratic local government. I use the term "local government" in its natural, normal sense as we use it in Great Britain. It is an indispensable element in the totality of democracy, an element only less indispensable than proper representation in this House itself. This Order brings out very dramatically how deprived in present circumstances, as a result of the wreckage of past, even pre-1972, decisions, are the people of Northern Ireland in this respect.

Reference has been made to the rating of playing fields and of indoor sporting provision by non-profit-making bodies and the contrast in this respect between the system which prevails in Great Britain and that of Northern Ireland. This, I believe, will be dealt with in detail by my hon. Friend the Member for Antrim, South (Mr. Molyneaux) and others. My only point on it is that here again we suffer from the absence of local government; for the 50 per cent. relief to which the hon. and learned Member for Blackpool, North referred, which prevails in Great Britain, is an average derived from the freedom of the local authorities there to make such dispositions as they think fit, for institutions within a much wider ambit than is provided for in Northern Ireland.

I suggest that, even in this relatively limited case, Northern Ireland suffers from the fact of there not being the administrative discretion which can only be entrusted to a democratically-elected body that is itself going to take the electoral consequences of what it does in terms of a rate—no body which will have to go to its ratepayers and say "This is the cost in terms of rates of the reliefs we think fit to accord to various forms of activity, and we ask you to approve it or otherwise."

Finally, I want to put this question. I have reminded the House, in the Undersecretary of State's own words, of the principle upon which at present the regional rate is determined by the Department of Finance in Northern Ireland: …to pitch the regional rate at a level which ensures that the total rate burden is related to that in comparable areas in Great Britain. I believe I am right in saying that there is no unavoidable procedure which accompanies the making of the regional rate by the Department. If we refer to Article 7 of the principal Order, we do indeed discover that the order of the Ministry shall be subject to affirmative resolution of the Commons. But let us not run away with the idea that that means us. It is a "Commons" which has not existed for nearly four years now. If we look at Section 4 (5) of the Northern Ireland (Temporary Provisions) Act 1972, we discover that there is no procedure at all: an order is just going to be made, and we cannot even pray against it.

I put, therefore, to the Minister and the Department something which need involve no demand at all on parliamentary time, but something which I think they will agree is fair and necessary and, in addition, good public relations. I ask that at the latest when the rate is made, and preferably before the rate is made, they should publish a document—it need not be a formal document—which gives the statistics and the considerations upon the basis of which a particular figure has been selected as ensuring that the total rate burden is related to that in comparable areas in Great Britain. Let them indicate what they consider is meant by a comparable area. Let them give the reasons for the comparability. Let them give the figures which prevail in the comparable areas in Great Britain.

I do not say it will necessarily be appropriate for this to form the subject of debate under any of the procedures which we have; but I do not think the hon. Member would wish to deny that it is the kind of information which ought to be available to hon. Members of this House who authorise the imposition of a regional rate, or to the inhabitants of Northern Ireland who are to pay a rate imposed by unchallengeable ministerial order.

I hope the hon. Member will be able to indicate that favourable attention will be given to that request.

10.41 p.m.

Mr. Hector Monro (Dumfries)

I should like, in the context of Article 4, to make some remarks on sport and recreation, following the points made by my hon. and learned Friend the Member for Blackpool, North (Mr. Miscampbell) and by the right hon. Member for Down. South (Mr. Powell).

In the course of the most recent of my regular visits to Service men in Northern Ireland, I was, as spokesman on sport for the Conservative Party, able to spend a day with the Northern Ireland Sports Council. As a preface to my few remarks on Article 4, may I say that I am most impressed with what the Sports Council is doing in the broadest sense in Northern Ireland. I think that the Chairman, Donald Shearer, and his committee, and the Director, George Glasgow, deserve a very special tribute for their achievements. Such successes as the sports complex at Craigavon and the very welcome development of the Mary Peters track enable all of us here to say "Well done" to Northern Ireland.

Subsequent to my visit I wrote to the Minister of State and was very glad to have his reply. I think we are on the same wavelength, although he will understand that in my view more resources should be channelled to sport and recreation.

I appreciate that there is an overall ceiling, but within that concept of an overall ceiling there should be an element of flexibility in priority. I would certainly prefer to see rather more spent on sport and recreation and rather less on some of the measures in the Queen's Speech, such as nationalisation. I am talking in terms of £10 million for the whole of the United Kingdom for sport and recreation, as against the £2,000 million we spent in one day yesterday on the Bill before the House.

In the circumstances that I am putting forward, there should be rather more resources made available to Northern Ireland for sport and recreation. I want to look particularly at Article 4, relating to the relief of rates for sport and recreation.

Mr. John Biggs-Davison (Epping Forest)

Before my hon. Friend gets on to that, could I ask him whether, when he saw Mr. Shearer and Mr. Glasgow and others connected with the Sports Council, he had any discussion of my idea of an Ulster games meeting bringing together both Gaelic sports and British sports—an idea which the Minister of State put to the Sports Council? I am eagerly awaiting some word from the Sports Council or from the hon. Gentleman.

Mr. Monro

Only in superficial discussion of what seemed to be a very commendable idea, but perhaps the Minister of State might say more about that later on.

I accept right away that Lord Donaldson, when he saw the Sports Council in Northern Ireland, made a valuable concession in that he, subsequent to that meeting, accepted that indoor recreational facilities should be eligible for the 35 per cent. concession on rates which had previously been available only for playing fields and, presumably, for the pavilions attached to them. I welcome this move, but it is still far out of step with the remainder of the United Kingdom where, of course, discretionary derating is available and is commonplace, often up to 100 per cent. and usually at least 50 per cent. In paragraph 32 of the White Paper on Sport and Recreation, the Minister for sport himself recommends 50 per cent. Why is not the Under-Secretary following his colleague's advice and increasing the discretionary derating to 50 per cent. now, rather than the 35 per cent. mandatory recommendation in the Order?

As the right hon. Member for Down, South rightly said, numerous authorities in the United Kingdom give 50 per cent. to 100 per cent. derating, and yesterday a number of hon. Members saw a film of the tremendous work being done at Gateshead under the direction of Brendan Foster, which shows what can be done if an authority has the power to put its full weight and drive behind developing sport and recreation.

We should bear in mind also that there is substantial derating in Northern Ireland for charities, the arts and church halls. Why are there no additional resources for recreation and sport?

To demonstrate the magnitude of the problem, I mention two cases. The first is the McCallum Hall, in which badminton and squash are the main facilities. Last year, its rate bill was £1,350, even though it lost £300 over the year. This year it would be £1,650 if it were not for the 35 per cent. reduction which has been announced. But it will still have to pay more than £1,000 in rates, and, with rising costs, the Under-Secretary will see what is facing that body of volunteer sportsmen.

The other example is that of the Lisburn Racquets Club. It was derated as an open-air club, but subsequently it has been rated because it has indoor facilities. Even with the 35 per cent., it will still have to pay more than £300 in rates.

I want also to make a plea on behalf of other sports clubs which charge a modest gate, so making themselves ineligible for derating. I have in mind the Northern Ireland League, for example. I hope that the Minister will look at their position, too.

I conclude my remarks with a mention of paragraphs 4 and 66 of the White Paper on Sport and Recreation, which highlight the necessity of providing these facilities, especially so in the very special context of the problems facing Northern Ireland today. All in all, we are talking about facilities run by volunteers at no profit to themselves, and it is extremely difficult to raise funds through the traditional methods in Northern Ireland at present. Therefore, although of course it cannot be done in this Order, I believe that all hon. Members would support the Minister if he felt able to amend the next order to provide for a mandatory 50 per cent. derating or even make it discretionary at the earliest possible moment so that it could be increased to 100 per cent. where the case was deserving. The whole matter is too obvious to require a detailed explanation, but I believe that the Minister will be sympathetic about it. If he can assure us that he will go even further than the Lord Donaldson after his talks with the Sports Council, I am sure everyone will be very glad.

10.50 p.m.

Mr. James Molyneaux (Antrim, South)

My right hon. Friend the Member for Down, South (Mr. Powell) has put his finger on the most serious defect in both the rating system and the local government structure, or, perhaps more accurately, the lack of any local government structure in Northern Ireland.

It was put to me earlier today, by one who is long experienced in these matters, that we might be more honest in our approach if we were to scrap the whole idea of rating and settle for Schedule A income tax. I confirm my right hon. Friend's view that the blame for this situation in no way attaches to the present Government or, indeed, to their predecessors. I can well remember, and so can most of my right hon. and hon. Friends, the occasion when the Minister of Development of the day in the former Stormont Government rather arrogantly said that he would not be held up or in any way delayed in bringing in his new arrangements just because there was a queue of self-appointed advisers outside his office door. I suggest, and I think my colleagues would agree, that it might have been better for Northern Ireland had he listened to some sound advice.

Article 6 of the Order deals with the basis of valuation. I cannot help wondering how accurate that is likely to be. My doubts are, to a great extent, based on experience of the operations of the self-same valuation staff engaged in related matters.

Reference has been made to church halls in Northern Ireland. In the expanding town of Antrim which lies within my constituency, the valuation officers have arrived at the most extraordinary piece of arithmetic. The Antrim Parish Church sought to purchase a site the assessment for which was many times the amount which had been assessed for similar churches purchasing similar sites. I know that the valuer's actions have so far defeated the sincere efforts made by the Under-Secretary to resolve this problem, but I trust that he will accept my cooperation in perhaps endeavouring to see that in the near future this matter is brought to a happy conclusion. This is not a question of discrimination, sectarianism or anything else. Indeed, I would hasten to clear my hon. Friend he Member for Antrim, North (Rev. Ian Paisley) of any vested interest in this particular argument in Antrim town.

I am sure the Minister recognises that the Churches in Northern Ireland, despite all the unkind things said about them, without exception provide many recreational facilities and do a great deal of community work. In the new expanding towns it is important that the new communities take root quickly and easily. Therefore, it is all the more important that they should be facilitated in every possible way in establishing their structures and providing these services which supplement and complement what is being done by many other bodies.

One of those bodies is the Sports Council for Northern Ireland. We are gratified that the Government have seen fit to concede the point made in our submissions, as well as in many others, that certain sports grounds should be exempted.

I should like to draw the Minister's attention to the remaining two submissions. Submission 6:2 points out that in England local authorities have discretion to grant rate relief up to 100 per cent. My reading of the submission is that the White Paper gives local authorities discretion to apply relief of 50 per cent. or more if they feel that is justified. In Northern Ireland, local authorities have not, as the Order makes clear, been given such discretionary powers. Therefore, they are at a grave disadvantage when it comes to encouraging the provision of recreational facilities in their areas. This restriction on their iniative is difficult to understand.

One wonders whether it is imposed because it is felt that Northern Ireland does not have the same need for recreational facilities as the rest of the United Kingdom. I cannot believe that is the view of our present Northern Ireland Ministers. They have given every encouragement. There has been some confusion or muddle, and we may possibly strengthen their hand by highlighting this point tonight.

Is it because local authorities in Northern Ireland are so low powered that they cannot be entrusted with responsibility of this nature? I hasten to add that I do not think that is the view of Northern Ireland Ministers.

The Sports Council in submission 6:3 brings out the point about admission charges. That would seem to be an unfair restriction. There does not seem to be anything objectionable in a sporting organisation making a modest charge to cover expenses, provided the powers that be are satisfied that it is not engaging in a money-making operation or exploiting those engaged in the sport or spectators. I should be grateful if the Minister would look sympathetically at that point.

Another matter which concerns many people in rural areas is the upkeep of village halls and halls belonging to various voluntary organisations. They are in desperate straits. They find their rate burden escalating every year. It might be said that is their affair and they should be able to pay their way. However, we must recognise that they are placed at a disadvantage because in many areas in Northern Ireland primary and secondary schools are in direct competition with village halls and halls belonging to organisations as regards lettings. Those schools are being subsidised by ratepayers. In many cases the people who are responsible for the upkeep of village halls, by paying rates, are literally cutting their own throats because they are providing the capital expenditure, or a large part of it, to build the schools and contributing to their upkeep. The rents charged by schools are extremely modest and do not take into account all expenses, other than what can be computed for light, heating, cleaning, and so forth. It would appear that no consideration is given to the element which should be included if those schools were rated. We would like the Minister to examine that matter.

In a related category are halls belonging to the Royal British Legion. I am thinking of the Royal British Legion branch in the village which uses its hall for its annual meeting; for a meeting once a quarter; for organising its poppy sales; and doing charitable work for the Legion. I understand that the Area Secretary of the Legion in Northern Ireland has been in touch with the Department, but my impression is that it was not possible to put into the Order anything helpful to the Legion.

The Minister referred in his opening speech to charitable institutions. He seemed to draw the line rather tightly. He was rather narrow in his approach because he seemed to define them as those providing recreational facilities and engaging in community work. Many charitable institutions in Northern Ireland possess property but would not provide this kind of activity, although, nevertheless, they make their contributions to the well-being of the community.

Which of these articles provides for any kind of appeal against valuation? Will the procedure be clear-cut and simple? Can we avoid the very expensive kind of machinery we have now, which is largely ineffective? We seldom hear of anyone successful in a valuation appeal. One wonders why all this rigmarole is preserved, and why we are contributing to very expensive machinery which does not bring any benefit to the aggrieved ratepayers?

I look forward with fear to the coming months. In the first six months of 1976 50 per cent. of the mail bag of Northern Ireland Members will contain complaints about new rating assessments.

I trust that the Minister will see that we have some clearly defined procedure to handle complaints if there is not going to be a hard and fast appeal system.

11.4 p.m.

Mr. John Carson (Belfast, North)

I thank the Minister for the concessions made in this rating Order, especially in Article 9 relating to the derating for the fishing industry. The people of Northern Ireland will also be very grateful for the many other concessions.

There are a few questions I should like to direct to the Minister. In Article 6 paragraph (a) we have, to my mind, the rating department looking for a blank cheque for changing rates whenever it cares to do so. How difficult will it be, after this legislation, to modify the Order?

Would "recreational charities" cover citizens advice bureaux and community centres? We have heard from my hon. Friend the Member for Antrim, South (Mr. Molyneaux) that the Ministers in charge of community work in Northern Ireland have done a great deal towards this, and yet these community centres are being held down tremendously by the heavy rates being imposed upon them. Will the Order cover senior citizen's clubs under the heading "recreational charities"?

How many people are getting rate rebates? I have in my hand a list of some rebates for private property. It may be difficult for the Minister to give these replies tonight, but perhaps he will note the queries and let us know the answers at his earliest convenience.

How many people have benefited from rate rebates on commercial property and industrial property?

I should like to draw the Minister's attention to some areas of Belfast, especially in my constituency. Duncairn Gardens is one of the worst interface areas in Belfast. Some of the people living there have met the Minister in their fight in relation to the rates on commercial property there. Duncairn Gardens being one of the worst interface areas, unfortunately, people have been leaving the area very rapidly. The shopkeepers are trying to keep their doors open, but they are faced with tremendous rate bills.

With great respect to my hon. Friend the Member for Antrim, South, who spoke about Antrim as an expanding area and about my attention to Glengormley, no doubt at the next General Election my hon. Friend will have great joy in seeing his majority vastly increased. My hon. Friend the Member for Antrim, North (Rev. Ian Paisley) is trying to catch up, but with the rate of increase in the population of Antrim and Glengormley, I think that my hon. Friend the Member for Antrim, South will keep his lead.

However, in these areas the rates are the same as the rates throughout Northern Ireland. But people are leaving the district very rapidly. Small shopkeepers are fighting tooth and nail for a living. Day after day some are forced to close their doors because they cannot meet their overheads. The greatest overhead for many of them is rates.

Unfortunately, we cannot compare the situation in Northern Ireland with that in the rest of the United Kingdom. However, I should have thought that it would be possible in Northern Ireland to have a two-tier system of rating for commercial property. As I have said, in outlying districts which are expanding rapidly and are densely populated, districts which have experienced little or no trouble since the beginning of 1969, the shops are full and the people are spending money. Shopkeepers in such areas are finding that their businesses have had a tremendous boost, in outlying areas of Belfast and elsewhere. Yet they pay the same rates as those I have just mentioned in Duncairn Gardens and other parts.

I have said that Duncairn Gardens is the worst interface area in Belfast. I want to highlight one case involving a furniture store which is behind a security gate. Whenever any trouble erupts in the area, the gate is closed. That store is then completely cut off from the people. It has appealed against its rates, but the appeals system has to be seen to be believed. Solicitors and barristers have to be employed, and in 99 cases out of 100 the appeals fail. Such firms are having to pay exactly the same rates as companies elsewhere in Northern Ireland that are trading in peace and without hindrance or violence.

I realise that the Minister may not be able to give me the figures I have asked for tonight, but perhaps he will note my request and pass on the information in due course.

11.11 p.m.

Rev. Ian Paisley (Antrim, North)

I would like to emphasise what the leader of our coalition, my hon. Friend the Member for Antrim, South (Mr. Molyneaux), and my hon. Friend the Member for Belfast, North (Mr. Carson) have said about the rating appeal system. The Minister will have to put his mind to this problem. Rates soared as a result of the revaluation he mentioned, and we must have an appeals system in which justice is done to the individual and is seen to be done. That is not happening at the moment.

I have helped constituents with their appeals. Almost all of them are turned down. One feels they are inadequately investigated. No reasons are given and the arguments put to the valuation officers seem to be brushed aside as though the ordinary individual did not matter.

Many people from Belfast go to Newtownards to do business. It is an up-and coming business town, but the people behind the barricades in Belfast are finding life very difficult and, with the resurgence of IRA activity and bombs again being planted in the centre of Belfast, people who were coming into the city to do their shopping are being driven out again by these acts of terrorism. Something must be done to ensure equality in this matter.

11.14 p.m.

Mr. Concannon

By leave of the House, I will reply to the debate, though I think I may have to gabble through as much as I can. Most of the anomalies and the questions put to me in the debate basically stem from the rating system in Northern Ireland. I will come back to that, but I shall try to get some other points out of the way first.

Most speakers have referred to the sports field exemption of 35 per cent. In England and Wales local authorities can offer any figure from nil to 100 per cent. I have tried to frame this proposal in line with the situation in England and Wales under the present rating system. In Northern Ireland the rating system comes under the Department of Finance. There are no local authorities in that sense. I can hardly operate a nil—100 per cent. system which involves using my discretion, as a local authority would, in each individual case.

The local authorities in Great Britain vary from being very generous to being very tight. Some pay and some do not. We have calculated that the average figure is 35 per cent.

Mr. Miscampbell

Is the Minister aware that in the North-East of England, Bradford, Doncaster, Harrogate and Scarborough, relief of not less than 51 per cent. is granted? In general in the South of England 50 per cent. is the norm, and it is a rarity for an authority to offer less. It is all very well for the Minister to say that he cannot influence these matters, but in Northern Ireland, particularly, this is a most important factor. It is no good his merely saying that he cannot give 50 per cent. or 100 per cent. relief. We want to know why he cannot.

Mr. Concannon

I did not say that we cannot do it. I concede that from the broad range of cases the hon. and learned Gentleman can quote figures of 50 per cent. and more, but our figure takes in the whole range of relief offered between nil and 100 per cent. I can assure him that the average is slightly higher than 35 per cent. We could have exceeded that figure. Even at 35 per cent. there will be some winners and some losers, but not many either way. We are anxious to get this figure incorporated, because if it is not it will disappear by 1st March.

My noble Friend Lord Donaldson is consulting the Northern Ireland sports councils over the other matters, such as indoor sports arenas and bowls. The power is written into the draft Order to enable an extension of relief in subordinate legislation. Once the power is available and the consultations have been held, I understand that the matter will be brought before the House again.

The right hon. Member for Down, South (Mr. Powell) referred to motions under the affirmative resolution procedure in the Assembly. These are the same as the motions under the negative resolution procedure in Westminster, and they may be prayed against.

Rate rebates taken up in Northern Ireland number 42,000 or 10 per cent. Rate rebates to that extent are not allowed for commercial purposes. However, grievances can be taken to the valuation officer, who can re-examine the rate. I am surprised at what has been said about the appeals procedure in Northern Ireland, because every household in Northern Ireland will be sent a copy of this procedure in the form of a booklet which will deal with valuation questions.

Any matters that I fail to deal with will, of course, be dealt with and hon. Gentlemen will be contacted.

Almost every hon. Member who has spoken tonight referred to the rating system. The rating system in Northern Ireland was forced upon us by the reorganisation of local government. It throws up quite a lot of anomalies. However, I have conducted some research into this matter, and many of the questions which hon. Gentleman have asked tonight were asked by the Minister of Finance in the Assembly on 4th April 1974. In his speech he said that with the reorgainsation of local government quite a lot of the important local services were transferred into central Government. He said: In this new situation it was no longer appropriate, or even possible, to continue the old system and it was decided that the rate-payers contribution to the cost of these services should be made through a rate to be struck and collected by the Department of Finance at a uniform rate for the whole of Northern Ireland. It was also decided that the district councils—which replaced the former local authorities—should have power to raise a district rate towards the cost of the district services which they were to provide. We cannot use the same principle for the district rate. This is one of the difficulties, because the regional rate could not be linked in any meaningful way to the cost of the services being provided. We have to find some other method of rating in Northern Ireland.

The method that was chosen was to select a comparable area in Great Britain on the basis of information as to average, total, weekly household income contained in the annual family expenditure surveys. on the argument that ability to pay rates and the kind of house a person lives I[...] are related to personal household income. The United Kingdom Family Expenditure Survey for 1972, the latest year for which information is available, indicates that the areas in Great Britain which are most comparable to Northern Ireland are the North of England, and the Yorkshire and Humberside Regions.

Rev. Ian Paisley

Will the Minister not agree, with his experience of Northern Ireland, that there is no area in England that could be comparable at the moment with Northern Ireland in its present situation?

Mr. Concannon

That is certainly true at the moment. However, those carrying out the survey were looking for comparable areas with which they could equate the rates for the services being supplied. They picked these three regions because they were a broad cross-section of rural and urban areas and had the same sort of unemployment difficulties and the same relative lack of wealth as Northern Ireland.

The comparison of rates at that particular time for this area showed that the rates in Northern Ireland were 10 per cent. lower than those in the three areas. It might surprise hon. Gentlemen to know that at present rates in Northern Ireland are 27 per cent. below those in the areas named. Instead of the gap narrowing, as it should have done, it has broadened. Our information shows that an average increase of 14 per cent. was necessary, but it turned out to be nearer 30 per cent. Therefore, the differential widened. The differential between the rates in those comparable areas in the United Kingdom and what is being paid now on average in Northern Ireland is still 27 per cent.

Mr. Powell

These are interesting facts which the hon. Gentleman is giving the House. I hope that he will accept that this strengthens the case for a formal and detailed statement being made available when the rate is struck.

Mr. Concannon

That is why I am giving these figures and the intention behind them. At the time when it was done, there were great anomalies in area rates in Northern Ireland. For example, the domestic rate in the former Dungannon rural district was 70p in the pound, and in the former Banbridge rural district it was £3.06 in the pound. There was a great disparity, and some areas had to increase their rates more rapidly than others did. The difficulty is that one cannot equate the rate being levied with the services being applied.

It is fair to point out also that rates not collected as rates are collected in Great Britain will have to be paid, say, out of income tax, according to the formula which made up the rest of the addition to Northern Ireland.

Mr. Miscampbell

May I put a quick question, taking up the point made by the right hon. Member for Down, South (Mr. Powell)? Why make any comparison at all? Why not simply base it on what Northern Ireland needs to raise?

Mr. Concannon

One had to base the regional rate on something. Once this came into the Department, one could not work a rating system such as we have over here where there are local councils in a relationship to their regions. One had to reach a formula, and this formula was adopted from the very start. It may not be to everyone's liking, but it was a way of reaching an equitable rate value for people living in Northern Ireland on the basis of a relationship to similar areas in Great Britain, those areas being, as I say, the North of England, Yorkshire and Humberside, because of the terrain and characteristics.

I do not know whether that satisfies hon. Members to any extent, but I thought I had better spell it out, since this is one of the bases of a lot of the problems of rating in Northern Ireland. I agree that if we could have shown the apportionment in a memorandum or note to all householders in Northern Ireland, showing just how it fitted in with the services being applied, that would have been helpful. But the Department is now, in effect, the local government authority, we are acting as a top tier of local government, and one had to find a formula. It is not perfect. I agree that it raises anomalies, and deputations come to see us about it at various times.

It should be remembered that the valuation for rating system in Northern Ireland is now 30 years old, and this is the reason for some of the anomalies to which the hon. Member for Belfast, North (Mr. Carson) referred. But revaluation will not in itself increase the rates. Obviously, with inflation at its present level, there will be some increase in rates. but that will not be due to the revaluation. That will have nothing to do with revaluation, but revaluation will provide a fairer distribution of the total rate that is applied.

Reference has been made to the appeals procedure. Under the Act appeals can be made against valuations at any time, and the old procedure can be started again. Appeals will be made to the tribunals. The appeals that can go right through will be listed and sent out. All the information will be supplied. The people concerned will be told how and when they can appeal.

Mr. Biggs-Davison

The complaint has been made by the hon. Member for Belfast, North (Mr. Carson) that it is costly to make an appeal. He said that very often expensive legal advice is required. Does the Under-Secretary of State think that the brochures will make legal advice unnecessary, and that those concerned will be able to conduct their own cases adequately?

Mr. Concannonrose—

Question put and agreed to.

Resolved, That the Rates (Northern Ireland) Order 1975, a draft of which was laid before this House on 5th November 1975, in the last Session of Parliament, be approved.