HL Deb 04 August 1905 vol 151 cc221-31


Order of the Day for the Third Reading read.

Moved, "That the Bill be now read 3a"—(The Marquess of Londonderry.)


My Lords, I desire to say a few words in opposition to this Bill, which considerably affects the County Council of Middlesex. In 1899 a Bill was introduced entitled the Local Government Bill, and in that measure a provision was made for placing Hornsey and a portion of Middlesex within the jurisdiction of the London County Council. When the Bill was passing through this House I was very anxious that no portion of the area within the jurisdiction of the Middlesex County Council should be handed over to London without some compensation being given and in order to find out whether it was clear that such compensation could be paid under the Bill I asked the then President of the Council, my noble friend the Duke of Devonshire, whether he was of opinion that compensation could be given in the case which I quoted without special words being inserted to that effect. The noble Duke's Answer was— Yes, certainly. The Local Government Board are advised that there is full power to compensate any authority for loss of rateable value. An Answer to a similar effect was given in the House of Commons by the present Prime Minister. The Bill passed without any amendment in this House. There had already been two cases in which compensation had been granted to county authorities on this ground; but in 1904 a decision was given by your Lordships' House which altogether precluded the idea of compensation being given in such cases. This measure, I admit, has already been before a Committee of this House, who decided against the insertion of any compensatory clause for the county of Middlesex. In 1900 the legal transfer of the parish of Hornsey was made to the County Council of London, and they have exercised jurisdiction there since that date. Therefore, as the arrangement had been come to between the two parties prior to 1904 there can be no doubt that the Middlesex authority have a claim in justice to compensation; but now that this judgment has been given by your Lordships' House they are precluded from getting compensation under the scheme. The matter is a very serious one for the county of Middlesex, because they lose something like £2,000 a year in rates. I hope this House will bear in mind the promise which was given by the Minister in charge of the Bill, and will recognise that it is not unreasonable that the Middlesex County Council should have the right of placing before the Commissioners any claim they may think they are entitled to make for compensation. I only ask that the County Council of Middlesex shall have the right to make that claim.


My Lords, the noble Earl has correctly said that this is a very serious matter, and I think we have some right to express surprise at this opposition being sprung on us at this late stage of the Bill, when it is down for Third Reading. The circumstances of the parish of South Hornsey are such that the Middlesex County Council derived by means of the county rate from that parish prior to its transfer a considerably larger sum annually than was expended by them on the parish, and therefore they claim that the London County Council ought to pay them a further sum by way of compensation for the loss of the rateable value in question. The noble Earl is pre-eminently a fair-minded man, and I would ask him, if that is to be done, whether it ought not to go the other way as well, and, if there is a loss, that the County Council should be recouped. It does not follow that because one rating authority suffers financial loss by the transfer of a part of its rating area that the authority which takes it over secures any gain at all. The London County Council does a great deal more for the benefit of those who live under its jurisdiction than the Middlesex County Council. For instance, they provide bands, open spaces, and parks, and there are statutory obligations in addition in regard to drainage, fire brigades, and the administration of the building laws. I submit, therefore, that if they are called upon to pay compensation for the loss of rateable value, they will have to pay twice over. Moreover, it would be a distinct premium on starving a district. I submit that this is not a fair proposal, and I hope the House will, in the interests of the ratepayers of London, pass the Bill as it stands.


My Lords, I do not often differ from the noble Earl who has just sat down, but on this occasion I differ entirely from him, and I will venture to put the case as it seems to me for the Middlesex County Council. When the London Government Bill of 1899 was passing through Parliament the Middlesex County Council was very much exercised at the doubtful state of the law with regard to this particular question, and were very anxious to get introduced into the Bill safeguards which would ensure their receiving compensation for any loss that might be incurred in rateable value owing to a portion of their area being handed over to the county of London. There were two pieces dealt with. There was a small piece in Clerkenwell handed over to the county of Middlesex, and South Hornsey was handed over by Middlesex to the county of London. The Clerkenwell portion was so small that it is hardly worth talking about, but there can be no doubt that the county of Middlesex suffered considerable loss in rateable value in respect of the portion of South Hornsey which was handed over to the county of London. The idea then was that in all these cases compensation would be given by the gaining body to the losing body, and two special cases had been decided under the Act of 1888 by the Court of Appeal. When this Bill was in the other House of Parliament two of the Members for Middlesex did bring forward an Amendment to safeguard their position, but an appeal was made to them by the Leader of the House, the present Prime Minister, who assured the Middlesex Members that under the existing law, which would be embodied in the Act, Middlesex could be compensated for any loss it might sustain by reason of the transfer; and he added— I understand it has been laid down by a learned Judge that it was the duty of the Local Government Board or the authority concerned to see that such redress was made. That was a considerable promise by the First Minister of the Crown in the House of Commons. The Bill in due time came to this House, and the noble Earl opposite, Lord Jersey, also proposed the insertion of a clause to safeguard the interests of Middlesex. On that occasion the Duke of Devonshire, the then Leader of your Lordships' House, said— I am unable to accept this Amendment. The subject was discussed in the House of Commons and a conclusion was arrived at, to which I adhere, that this is a matter which must be dealt with by scheme. Lord Jersey then asked— Is the noble Duke of opinion that compensation could be given in a case of this kind without special words being inserted to that effect? —and this was the Duke of Devonshire's reply— Certainly. The Local Government Board are advised there is full power to compensate any neighbouring county for loss of rateable value. This power has been exercised and there are reported decisions. Upon this Lord Jersey withdrew his Amendment, and it seems to me that the present Prime Minister and the noble Duke who was then Lord President of the Council and Leader of this House, are really bound to see that justice is done to Middlesex in the terms of the pledges they then gave. The Bill was eventually passed, and the question of adjustment of values between the two counties was referred to the Commissioners. The inquiry was completed, and there had been negotiations between the two parties with a view to coming to a settlement; but then came the decision in the House of Lords in what is known as the Caterham case. The Assistant Commisioner said that in consequence of that decision the Middlesex County Council were out of Court, that they had no grounds whatever for their case, and he declined to go any further into it. In the first place, the Caterham case did not arise out of the Act of 1899 at all, but out of the Act of 1888, and if you compare the clauses in the latter Act with those in the Act of 1899 you will find they differ considerably, and it is by no means certain that the same Judges having to decide on a case arising out of the 1888 Act and a case arising out of the 1899 Act would come to the same decision.

My point with regard to this Bill is this, that it was perfectly competent for the noble Marquess, in producing this scheme, to have introduced into it a clause that would have given some right of compensation to the county of Middlesex in fulfilment of the pledges of his colleagues. There are precedents for that. Bills hare been passed through both Houses quite recently containing similar provisions. Last year there was the Bristol Extension Act and the Portsmouth Provisional Order Confirmation Act, both containing clauses of a similar character to that asked for by Middlesex on this occasion, so that the noble Marquess would have had plenty of precedents for introducing such a clause in- to the scheme comprised in this Bill. I think Middlesex has a double grievance. First, I think it suffers injustice in not receiving some compensation; and, secondly, I think Middlesex has a still greater grievance against the noble Marquess for not supporting his colleagues in fulfilling the pledges which they most solemnly gave to both Houses of Parliament.


My Lords, the noble Lord who has just sat down has stated the case very fully, but I should like to remark that the noble Earl beside him, Lord Carrington, rather confused the issue, because the arguments he used were addressed to the amount of compensation which should be given. That, of course, is a matter which must be left to a tribunal. The point which we urge is that some opportunity should be given to the Middlesex County Council to state their case for compensation, and that there should be a chance of recovering whatever compensation is thought to be just and right. I confess that, after the pledges given in both Houses of Parliament by responsible Ministers of the Crown, on the authority of the Government, I cannot see how the Government can possibly decline to grant the request of Middlesex in this matter. The noble Lord who has just sat down said that in other Bills before your Lordships' House—in the Portsmouth Bill and the Bristol Bill—a proviso such as we ask for was inserted, but I do not think he insisted on the fact that this action was taken after the Caterham judgment. If it was right, after the Caterham judgment, to put a clause into Bills to ensure compensation, surely it must be right to put the same clause into a Bill which deals with a scheme that was passed years before the Caterham judgment was given, and passed on the pledge of the Government that what the Caterham judgment has upset was the law of the land. The Middlesex County Council have a right to be placed in as good a position as they would have been in before that judgment.


My Lords, until the noble Duke rose I could not help thinking that the debate was taking the form of the triangular duel of Mr. Midshipman Easy. Be that as it may, I hope that before I resume my seat I shall prove to your Lordships' satisfaction that the course which His Majesty's Government are taking in asking you to pass the Third Reading of this measure in its present form is really the only course which is open to them to pursue. The noble Earl opposite, Lord Carrington, seemed to assert that the measure had been sprung on your Lordships.


Not the measure. I was referring to Lord Jersey's opposition to the Bill.


If the opposition was sprung upon anybody it was sprung upon myself. This measure has gone through its various stages in your Lordships' House, and it was only the day before yesterday that I received notice from a private source that there was to be opposition to it. As my noble friend Lord Jersey has told you, under the Local Government Act of 1899, by means of an Order in Council, Hornsey was separated from the county of Middlesex and handed over to the county of London. Immediately after the transfer took place representatives of Hornsey and Middlesex met for the purpose of adjusting the many arrangements that necessarily arise under such a transfer, and included in those arrangements was the question of compensation. Those meetings of the representatives extended over three years. It has been hinted that if the Middlesex County Council had acted with rapidity it might have been possible for them to have obtained their compensation before the Caterham judgment was given. That is not the fault of the Government; it is the fault of the Middlesex County Council. For three years they sat round a table discussing this question, and they were continually reminded that time was getting on. The London Government Act Commissioners approached them, urging upon them the necessity of arriving at some conclusion, but they received an answer dated June 23rd, 1903, from the clerk to the council, stating that he hoped shortly to be able to send a draft agreement to the Commissioners. In reply to a further communication from the Commissioners, the clerk wrote a letter on October 22nd, 1903, the last sentence of which was as follows— I am, therefore, to ask that the Commissioners will be good enough to allow the matter to remain in abeyance for a short while longer. I think that shows that if the County Council of Middlesex had been a little more brisk in their operations they might have received compensation. The Commissioners continually urged them to come to a conclusion on the subject. Matters between the parties were not adjusted in 1904. The London Government Act Commissioners considered it necessary, after this delay, to hold an inquiry themselves, and at this inquiry the question of compensation for the transfer of course came in. It was while the Commissioners were considering the whole question of which compensation was a part that the judgment which is known as the Cater-ham judgment was given by your Lordships' House. I should like to correct my noble friend Lord Tweedmouth on one point. He seemed to think that directly the Caterham decision was given the Assistant Commissioner, Mr. Thompson, heard no more evidence with regard to compensation. That is not absolutely correct. He went on with the case, and it was subsequently that he became convinced that the Caterham decision invalidated any further evidence on the question of compensation. I do not intend to go into the Caterham judgment from the legal point of view, but if this debate continues I have no doubt the noble and learned Earl on the Woolsack will assist me by giving his version of that decision. The Caterham judgment overruled the Rochdale judgment, which in the Court of Appeal established the principle that compensation might be paid for rateable value. After the decision in the Caterham case the Commissioners were naturally unable to express any opinion with regard to the question of compensation.

I now come to the pledges given by my predecessor the Duke of Devonshire, and by my right hon. friend the Prime Minister, on which the Amendments that were moved on the part of Middlesex were withdrawn. At the time when these statements were made they were absolutely correct. The noble Duke and the Prime Minister were giving their opinion on the law as it existed at that time under the Rochdale decision, and I maintain that in the circumstances they were absolutely justified in what they said. I cannot allow that they can be accused in any way of bad faith. Your Lordships will remember that a scheme was subsequently submitted to a Committee of the other House, and to a Committee of your Lordships' House. Opposition was raised to it owing to the omission of any provision for compensation, but in both cases the Committee overruled the objection, and maintained that after the Caterham judgment the question of compensation could not possibly be considered.

It is important that this measure should be carried through without delay. There are other cases hanging on this Bill which will be influenced by the decision of your Lordships' House—Hackney and Edmonton, Hornsey Borough and London, Penge and London, Kent and London, Surrey and London, and Barnes and London. The hamlet of Penge, prior to the passing of the Act of 1899, formed part of the county of London, but was transferred for the convenience of administration to the county of Kent, and was made an urban district. It had at the time of its transference a rateable value of over £155,000, and contributed in proportion to that rateable value to the expenses of the county of London. It would be inequitable to make London pay compensation to Middlesex in respect of South Hornsey without making the county of Kent pay compensation to London for the loss of Penge. There are many other cases in which the same principle is involved. In consideration of the fact that other cases depend on the passing of this scheme, and in consideration also of the fact that the Commissioners will be very much hampered in proceedings now pending if your Lordships reject this measure, I must ask the.House to pass the Bill in its present form.


My Lords, I think after what my noble friend has said your Lordships will be glad to hear something about what is called the Caterham case. There is some misapprehension on the subject. The only question decided by the House of Lords was that the language of a particular statute on which a claim for compensation was founded was inadequate to give that compensation. Your Lordships held unanimously that the words "adjustment of income" did not include compensation. That was the sole judgment arrived at by your Lordships' House, and as it was arrived at in May, 1904, it is rather late in the day to be discussing the question on the Third Reading of this Bill when it is impossible to make an Amendment and your Lordships must either accept or reject the Bill. I protest against its being said that the House of Lords laid down the principle that compensation could not be given. No such principle was laid down. The question involved was the construction of particular words in a particular Act.


My Lords, I only intervene for one moment in this discussion to point out to your Lordships what is the position with regard to this Bill. This Provisional Order has been before a Committee of the House of Commons, and it has also been before a Committee of your Lordships' House, and your Lordships' Committee, which was presided over by Lord Lauderdale, had not only to decide whether or not, in their opinion, the Caterham case applied, but they decided the case on its merits. The question whether in this particular matter the relief prayed for by the petitioners should be given was most carefully considered by the Committee. I am sure your Lordships would not wish me to go into the details of the case. Suffice it for me to say that, after having gone into the question on its merits, apart altogether from whether the Caterham case applied or not, the Committee decided that, in their opinion, this relief ought not to be granted.


My Lords, as I was Chairman of the Committee of your Lordships' House which considered this Bill, perhaps I may be allowed to state the facts briefly. In the first instance, counsel argued at great length whether the Caterham case applied, and we decided unanimously that it did. Counsel then asked to be allowed to put the case before us on its merits. We consented, and the matter was fully gone into. We finally came to the conclusion that there was nothing special in this case to induce us to depart from the principle laid down in the Caterham case. That is really the A B C of what took place, and I thought I ought to state it. I do not think it is necessary for me to say more, as the noble Marquess (Lord Londonderry) has explained the matter very kindly to your Lordships, and the noble Earl who spoke last has also placed the case clearly before the House. I hope your Lordships will not agree to the Bill being rejected.


My Lords, I frankly admit the inconvenience of opposing the Bill at this stage, and I should not think of putting your Lordships to the trouble of dividing. I may say that no one questions for a moment the bona fides of the two Ministers who made the statement referred to in 1899; but I think what has happened must tend to diminish the value of statements made by Ministers in charge of Bills.

On Question, Bill read 3a, and passed.