HC Deb 11 November 1980 vol 992 cc395-9

Lords amendment: No. 112, after clause 131, in page 108, line 36, at the end insert—

"N.—(1) The following paragraph shall be inserted after paragraph 4 of Schedule 1 to the Land Compensation Act 1961 (descriptions of actual or prospective development of which account is not to be taken in assessing compensation or the effect of which is to reduce compensation payable in respect of adjacent land in the same ownership which has benefited by the development) and after paragraph 4 of Schedule 1 to the Land Compensation (Scotland) Act 1963 (which makes similar provision for Scotland):—
"4A. Where any of the relevant land forms part of an area designated as an urban development area by an order under section 114 of the Local Government, Planning and Land Act 1980.
Development of any land other than the relevant land, in the course of the development or redevelopment of that
area or as an urban development area."
(2) At the end of Part II of Schedule 1 to the Land Compensation Act 1961 there shall be added:—

"PART III

SPECIAL PROVISIONS AS TO URBAN DEVELOPMENT AREAS

10. For the avoidance of doubt it is hereby declared—

  1. (a) that, in assessing in the circumstances described in paragraph 4A in the first column of Part I of this Schedule the increase or diminution in value to be left out of account by virtue of section 6 of this Act, no increase or diminution in value is to be excluded from being left out of account; and
  2. (b) that, in assessing in those circumstances the increase in value to be taken into account by virtue of section 7 of this Act, no increase in value is to be excluded from being taken into account merely because it is attributable—
    1. (i) to any development of land which was carried out before the area was designated as an urban development area;
    2. (ii) to any development or prospect of development of land outside the urban development area;
    3. (iii) to any development or prospect of development of land by an authority other than the acquiring authority, possessing compulsory purchase powers.

11. Paragraph 10 of this Schedule shall have effect in relation to any increase or diminution in value to be left out of account by virtue of any rule of law relating to the assessment of compensation in respect of compulsory acquisition as it has effect in relation to any increase or diminution in value to be left out of account by virtue of section 6 of this Act.".

(3) In section 6 of the Land Compensation Act 1961—

  1. (a) in subsection (1)(b), for "4" substitute "4A"; and
  2. (b) add at the end of subsection (2) the words "and the provisions of Part III of that Schedule shall have effect with regard to paragraph 4A".

(4) At the end of Part II of Schedule 1 to the Land Compensation (Scotland) Act 1963 there shall be added:—

"PART III

SPECIAL PROVISIONS AS TO URBAN DEVELOPMENT AREAS

6. For the avoidance of doubt it is hereby declared—

  1. (a) that, in assessing in the circumstances described in paragraph 4A in the first column of Part I of this Schedule the increase or diminution in value to be left out of account by virtue of section 13 of this Act no increase or diminution of value is to be excluded from being left out of account; and
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  2. (b) that, in assessing in those circumstances the increase in value to be taken into account by virtue of section 14 of this Act, no increase in value is to be excluded from being taken into account,
merely because it is attributable—
  1. (i) to any development of land which was carried out before the area was designated as an urban development area;
  2. (ii) to any development or prospect of development of land outside the urban development area;
  3. (iii) to any development or prospect of development of land by an authority, other than the acquiring authority, possessing compulsory purchase powers.

7. Paragraph 6 of this Schedule shall have effect in relation to any increase or diminution in value to be left out of account by virtue of any rule relating to the assessment of compensation in respect of compulsory acquisition as it has effect in relation to any increase or diminution in value to be left out of account by virtue of section 13 of this Act.".

(5) In section 13 of the Land Compensation (Scotland) Act 1963—

  1. (a) in subsection (1)(b), for "4", where it first occurs, substitute "4A"; and
  2. (b) add at the end of subsection (2A) the words "and the provisions of Part III of that Schedule shall have effect with regard to paragraph 4A".".

Mr. King

I beg to move, That this House doth agree with the Lords in the said amendment.

The amendment deals with the compensation arrangements and adds a new case to schedule 1 to the Land Compensation Act 1961 along the lines of that land down for the new towns. It brings the matter into line with existing legislation.

1 am

Mr. Spearing

The Government are shovelling upon the House vast quantities of legislation. The amendment is only two and a half pages worth. I can understand the Minister when he says that it is necessary to fulfil some of the Bill's objectives. I understand that some parts of the amendment follow consultation with the local authorities. However, the amendment does not fulfil all that some authorities would require.

As I understand it, the purpose of the amendment is to deal with the compensation payable to persons on compulsory acquition of land by an urban development corporation. The present basis of compensation is that when land is purchased by a public body the purchase price does not include betterment that has been achieved by some form of investment by the authority. The land is acquired at a value that assumes that betterment has not occurred. That is what I understand to be the purport of the amendment. It brings into line in a complex way an urban development corporation with an existing local authority.

As we have learnt from the previous debate, in some circumstances one public authority so-called—the urban development corporation—will be compulsorily purchasing from another public authority, usually a borough council. I suggest to the Minister that in some circumstances the borough council will have invested money and will have contributed to the betterment of the land. In those circumstances, I am not certain whether the general rules apply. I understand that the amendment does not cover fully that set of circumstances.

An amendment was tabled that provided that the new clause would not apply to land that is compulsorily purchased by an urban development corporation from a borough council where the council has been responsible through investment for betterment in that land. That amendment has not been selected, and I understand why. It is extremely difficult in a precise and short form to devise an amendment that offers a satisfactory and equitable solution. It is always difficult to know how much investment has caused how much betterment. Usually, if there is a dispute, the Lands Tribunal considers these matters.

I suggest that the Lords amendment as it stands may not cover the point that I have raised. Local authorities could feel aggrieved, and aggrieved local authorities are the last things that the Minister says that he wants, although the Bill will not help them to feel contented in any respect.

Mr. King

I think that the hon. Member for Newham, South (Mr. Spearing) will accept the general purpose of the amendment. It is generally accepted that, where public money has been spent, any compensation excludes the value effect of development from that public money.

Although the amendment to the amendment was not selected, I can give the hon. Gentleman some reassurance which I think he will find helpful. Where the UDCs acquire land from other public authorities that have incurred higher expenditure than would be reflected in the compensation payable, there are established procedures for applying administrative discretion to achieve a balance of equity. If necessary, the Secretary of State could use his powers of direction to achieve that. I hope that that assurance will be helpful to the hon. Gentleman.

Question put and agreed to.

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