THE EARL OF STRADBROKEMy Lords, I rise to ask the President of the Board of Agriculture and Fisheries whether the Board concur in the opinion given by the Law Officers of the Crown that, where county councils purchase small holdings for the purpose of their being let, the Act requires the rent to be fixed at such reasonable amount as will recoup the purchase money, as well as the interest, on the loan raised to provide it; and whether the effect of such recoupment would not result in county councils acquiring estates at the expense of the small holders; and further, whether the President of the Board will take immediate steps to remedy such an injustice.
My reason for putting these Questions to the noble Earl is that the county council of which I am a member are anxious to know their exact position before they enter upon any scheme for the purchase of land for small holdings. Since I first placed my Question on the Paper the Board of Agriculture have informed the County Councils Association that they will not raise any objection to county councils letting land to small holders, although the rent does not include any recoupment of the purchase money. But we must bear in mind that we have the opinion of the Law Officers of the Crown, in which they state clearly that the purchase money must be included in the rent charged to the small holders. We also have a Treasury Minute, issued on 31st December last, laying down certain rules and regulations which must be followed by county councils to put themselves in a position to obtain relief from the Imperial Exchequer for any loss they may incur in carrying out the Small Holdings Act. Your Lordships will remember that in the Act of 1907 there was a certain amount of overlapping of the Act of 1892 with regard to holdings that exceed one acre and do not exceed five acres, and it was left to county councils to decide whether those holdings should be considered as allotments or small holdings. In July, 1893, the Board of Agriculture issued a Circular in which they stated that they had obtained the opinion of the Law Officers of the Crown that the purchase money should not be included in the rent asked of allotment holders. Therefore, if county councils decide that a 1534 small holding not exceeding five acres should be considered as an allotment they can act under that ruling. If, on the other hand, the small holdings come under the Act of 1907 it will be necessary for county councils to put such a rent upon them as would cover the sinking fund for the purchase money.
It may, perhaps, be said that this is not a very large matter, and that the amount added to the rent would be inconsiderable; but that would be presuming that the full period of eighty years would be allowed for the repayment of the money advanced by the Local Government Board for the purchase of the land and for equipment. Of course we do not know that the full period of eighty years will always be granted; and there might be included in the purchase money the amount required, not merely for the purchase of the land, but also for the erection of houses, buildings, fences, etc., and, perhaps, for a water supply, so that the amount might be a very considerable one. It is for these reasons that I have ventured to put these Questions on the Paper, and I hope the reply of the noble Earl will be such as to enable county councils clearly to understand what position they are to take, and how they are to keep themselves within the law and within the Treasury Minute to which I have referred.
§ THE PRESIDENT OF THE BOARD OF AGRICULTURE AND FISHERIES (Earl CARRINGTON)My Lords, I am asked, in the first place, whether the Board of Agriculture concur in the opinion given by the Law Officers of the Crown, that where county councils purchase small holdings for the purpose of their being let, the Act requires the rent to be fixed at such reasonable amount as will recoup the purchase money, as well as the interest on the loan raised to provide it. The answer is in the affirmative. The Small Holdings Act of 1907 requires that the purchase money must be recouped, and the interest as well, by way of sinking fund. That was laid down in the Small Holdings Act of 1892. Clause 18, subsection 1, provided that—
A county council shall not acquire land save at such price that all expenses will be recouped, in the case of land let, out of the rent.1535 Parliament agreed that the term of repayment should be extended to eighty years, and spread over that period the amount does not constitute a very great addition to the rent.Next, the noble Earl asked whether the effect of such recoupment would not result in county councils acquiring estates at the expense of the small holders. Of course that is so, but to minimise the apparent hardship—it is not really a hardship—it is provided in the Act of 1907 that county councils should be able compulsorily to hire land for thirty-five years, subject to a renewal it the end of that term and a new rent to be determined by valuation. There will be no objection if the county councils choose to pay the sum themselves out of the rates; and I venture to think the ratepayers could hardly complain; as they eventually acquire this land at a small annual outlay spread over a very long period of years. Some county councils in England object to putting anything on the rates, and it was absolutely necessary, in order to get the Bill through, to give a distinct pledge that if a county council so desired there should be no charge on the rates whatever. It must be remembered, also, that county councils can borrow money at a lower rate of interest than private individuals, and this enables them to let the land at lower rents than would otherwise be the case. Finally, the noble Earl asks whether I will take immediate steps to remedy the injustice. I think I have shown that there can hardly be any injustice. The men all over England are perfectly prepared to pay the small annual addition to the rent necessary to meet the sinking fund charges. There is very little hardship, and certainly no injustice.
*THE EARL OF ONSLOWI am afraid I cannot say that I am satisfied with the answer which the noble Earl has given. The noble Earl minimised the whole matter as if it were a question involving the small holder in a very small expenditure. He compared the Act of 1892 with the Act of 1907, but the Act of 1892 enables county councils to buy land and re-sell it by instalments to the small holder, and, obviously, it was quite 1536 proper that a sufficient sum should be paid by the tenant to refund to the county council the cost of the purchase of the land as well as the rents for small holdings. But in the Act of 1907 there is no such power to re-sell, and yet we are told that the county council is only to let the land at such a rent as will recoup it, not only for the interest on the purchase money, but provide a sinking fund, so that, at the end of eighty years, the county council can enter into possession at the expense of the tenants. That seems to me a most extraordinary proposition.
§ EARL CARRINGTONThe noble Earl knows very well that if the Bill had not been brought forward in that form there would have been no chance of its passing into law. The answer to my noble friend is that there can be no injustice in the matter. The proof of the pudding is in the eating. Hundreds and thousands of applications for land are coming in, but not in one ease in a hundred is there a desire to purchase the land. The Act is working extremely well, and it seems an extraordinary thing at this time of day my noble friend should get up and throw stones at the Act which he was largely instrumental in passing.