HL Deb 14 November 1918 vol 32 cc95-103

Amendments reported (according to Order).

LORD STUART OF WORTLEY

I move the insertion of a new clause after Clause 1.

Amendment moved—

Insert as a new clause:

"Regulation of pension to retired incumbent.

". A pension to a retired incumbent of a benefice whether awarded before or after the passing of this Act which under the Incumbents Resignation Act, 1871, Amendment Act, 1887, is variable, shall from time to time vary with and be regulated by the average prices by which under this Act the sum payable in respect of any tithe rent-charge is ascertained.'—(Lord Stuart of Wortley.)

THE JOINT PARLIAMENTARY SECRETARY OF THE BOARD OF AGRICULTURE (LORD CLINTON)

This Amendment appears to remove some possible causes of hardship, and I am quite willing to accept it.

On Question, Amendment agreed to.

Clause 3:

Consideration for redemption.

3.—(1) The consideration money payable on the redemption of a tithe rentcharge on any land under the Tithe Acts, 1836 to 1891, or this Act, shall, in lieu of the amount authorised or directed by the Tithe Acts, 1836 to 1891, be such an amount as may be agreed by the owners of the land and of the rentcharge, and in default of such agreement as may, on the application of the owner of the rentcharge, or of the owner of the land or any part thereof, be determined by the Board of Agriculture and Fisheries, in accordance with the provisions contained in the Second Schedule to this Act, to be fair compensation for the redemption.

(2) An agreement made under this section may provide that the consideration money shall be discharged by an annuity payable yearly or half- yearly for such period, not exceeding fifty years, as may be agreed, consisting of interest at the rate of five per centum per annum on the Consideration money, and of such sum as would be sufficient if the periodical payments thereof were accumulated at compound interest at the rate of four per centum per annum, to produce an amount equal to the consideration money at the end of the said period, and in any such case the Board shall by order direct the discharge of the consideration money by such an annuity as aforesaid and shall charge the land therewith, and the order shall contain such provisions for giving effect to the agreement and for protecting the interests of persons interested in the rentcharge as the Board may think fit, and after payment of the first instalment of the annuity the rentcharge shall cease and be extinguished.

(3) An agreement by an owner of a rentcharge under this section shall not be valid—

  1. (a) if made by a spiritual person entitled in respect of his benefice or cure, except with the consent of Queen Anne's Bounty, or, in the case of a rentcharge affected by the Welsh Church Act, 1914, of the Commissioners of Church Temporalities in Wales; or
  2. (b) if made by a person (not being a spiritual person so entitled), who is not empowered to sell the rentcharge unless he obtains the consent of some other person, except with the consent of that other person.

(3) This section shall not apply as respects any tithe rentcharge with respect to the redemption of which proceedings are pending at the passing of this Act.

THE EARL OF SELBORNE had given notice to move, at the beginning of subsection (2), after the words "An agreement made under this section may provide," to insert "and in default of such agreement on the application of the owner of the land or any part thereof, the Board of Agriculture and Fisheries for the purpose of the redemption of a rentcharge for the redemption of which an application is made on or before the first day of January one thousand nine hundred and twenty-one shall determine."

The noble Earl said: I can shortly explain to your Lordships the purpose of the Amendment which I have put on the Paper. This Bill, if my noble friend will allow me to say so, is a very useful one. I was not able to be here at the time of the Second Reading, and I am glad to have the opportunity now of congratulating the Board of Agriculture upon it. By this Bill it will be a simple, and in many cases a very wise, transaction for a tithe-payer who possesses the cash to take advantage of the redemption classes, especially under the fixed provision of Rule 3 of Schedule 2. But we know that a great many tithe-payers will not be able to command the cash, and consequently, in another place, Major Courthope moved an Amendment allowing the redemption to take place compulsorily on annual payments extending over fifty years, in which, of course, a sinking fund was included as well as interest. The President of the Board of Agriculture, in another place, though in no way hostile to that Amendment, did not accept it, as I understand, mainly for this reason. He thought that if the tithe fell considerably in future years there might arise an agitation for the reduction of the annual payment. I confess that I do not share that anxiety, and I should have been very glad if the President of the Board of Agriculture could have seen fit to accept Major Courthope's Amendment. What he did was to accept an Amendment existing now in Clause 3, by which such a method of payment may take place by agreement, but it cannot be done compulsorily at the option of the tithe-payer who wishes to redeem. The Amendment which I hope the Government will see fit to accept, and of which I have given notice, would have this effect. It would give tithe-payers who wish to redeem the power to redeem compulsorily by payment of an annual sum for fifty years. It will give them the power to insist on that for two years only; that is to say, so long as the fixed amount of redemption defined in Rule 3 of Schedule 2 exists. I will remind your Lordships that Rule 3 of Schedule 2 is as follows— For the purpose of the redemption of a rentcharge for the redemption of which an application is made on or before the first day of January, one thousand nine hundred and twenty-one, the gross annual value of the rentcharge shall be the original commuted amount thereof, and the compensation shall be twenty-one times that amount after such deductions therefrom as aforesaid. I suggest by this Amendment that till the end of that period the tithe-payer shall be able to insist that the redemption should take the form of an annuity for a period not exceeding fifty years on the basis of 5 per cent. for interest and 3½ per cent. instead of 4 per cent. accumulation of sinking fund. I have reason to believe that that proposal is not unacceptable to those representing a Very large proportion of the clerical tithe, and that is the Ecclesiastical Commissioners. The reduction of the 4 per cent. to 3½ per cent. for sinking fund cases the position with them, and I understand—and I think my noble friend behind me would be prepared to say so—that so far as the Ecclesiastical Commissioners were concerned they would regard this as a fair proposal.

If that is so from the point of view of the clerical tithe-owner, let me show your Lordships the great advantage it would be to the tithe-payer who has not got the cash with which to redeem right away. I have had a calculation made, and by that I understand that, instead of paying £109 a year for tithe, as he would have to do under this Bill for seven years, and a larger tithe perhaps afterwards, his total payments under my proposal would Come just under £100 a year. That, therefore, will be a great advantage to the tithe-payer, and there is no doubt it would largely increase the amount of redemption, because it would enable a great number of persons who cannot find the cash to pay in one sum to redeem by this method.

LORD CLINTON

I quite understand the noble Earl's view as to the advantage of bringing in this system of paying off the redemption money by way of annunity. That has been accepted by my right hon. friend in another place, and I need not go into the matter. The effect of this Amendment is that this is made compulsory on the tithe-owner.

THE EARL OF SELBORNE

For two years

LORD CLINTON

For two years, and I do not think that the alteration is a satisfactory one. I am going to suggest to the noble Earl that there are one or two outstanding objections to it. He has told us that it would be convenient to a body like the Ecclesiastical Commissioners. I would agree with him so far as to say that it would be less inconvenient to a body like the Ecclesiastical Commissioners, because of the probability that they would have a large number of sums paid in for investment to pay off the redemption money, and they may be able to work it economically. But I ask my noble friend to recollect this, that, particularly of recent years, the number of tithe-payers has increased very rapidly owing to the sales of estates. You have a very large number of tithe-payers of the occupying-owner class now. The tithe has been split up into small amounts and the amount of each one of them is very small. It appears that as this is the case the cost of collection from this large number of small people will be very heavy. My noble friend is aware that the redemption money is fixed after deducting the cost of collection, so that there is nothing in the sum received which would be any set-off to the additional money they would have to spend in collecting these small amounts. Either it would affect the total accumulated funds at the end of the period and reduce them in amount, or it might upset the calculation which is made for the purpose of the sinking fund.

While that is an inconvenience and possibly a loss to a great body like the Ecclesiastical Commissioners, I should like your Lordships to consider how this compulsory proposal would affect someone in the position of a lay impropriator. He probably has a small tithe to collect. Is it possible for him to invest economically the very small sinking fund which would be necesssary to extinguish that tithe? To pay off a sum of £100 over a period of fifty years the sinking fund calculated at 3 ½ per cent. would be 15s. 6d. I submit that a private person is certainly not in a position to invest those monies in such a way that they will certainly return to him the expected fund at the end of fifty years. I think there would certainly be a loss on the calculated amount received. I am not asking for any sympathy or any special advantage for the lay impropriator. I do not think it is in the slightess degree necessary to give him any advantage; but at the same time this Bill does provide that a certain sum in redemption money should be paid to extinguish a tithe, and I do not think we ought to put into the Bill any provisions which would make it impossible that that sum will reach the accumulated amount at the end of the period of fifty years.

I think those are two reasons why it is not fair to force a scheme of annuity upon an unwilling tithe-owner. But if the noble Earl would accept an alteration at the end of his Amendment I should probably withdraw my objection to his Amendment. In place of the word "shall," after "twenty-one," put in "may if they think fit." That would give to the Board of Agriculture a certain discretion which I think it right that they should have, so that they could say that an annuity in the case of some of these very small tithes would be unfair to the tithe-owner, that he would not be able to invest it as it is necessary to invest it to pay off the whole sum at the end of fifty years, and they would be able to say in such circumstances "We decline to use compulsion."

THE EARL OF SELBORNE

With the permission of the House I would say at once that I think my noble friend's point is a perfectly fair one, and I will gladly accept that change and move my Amendment in that form.

Amendment moved— Page 2, line 15, after ("provide") insert ("and in default of such agreement on the application of the owner of the land or any part thereof, the Board of Agriculture and Fisheries for the purpose of the redemption of a rentcharge for the redemption of which an application is made on or before the first day of January one thousand nine hundred and twenty-one may, if they think fit, determine").—(The Earl of Selborne.)

On Question, Amendment agreed to.

Amendment moved— Page 2, line 17, leave out ("such") and insert ("a").—(The Earl of Selborne.)

On Question, Amendment agreed to.

Amendment moved— Page 2, line 18, leave out. ("as may be agreed").—(The Earl of Selborne.)

On Question, Amendment agreed to.

LORD CLINTON

The next Amendment means that the interest of this redemption money will be a rate not exceeding 5 per cent., and the money will be accumulated at compound interest at a rate not exceeding 4 per cent. This is to give the necessary elasticity in carrying out a proper scheme for redemption.

Amendment moved— Page 2, lines 18 and 19, leave out ("the rate of") and insert ("a rate not exceeding").—(Lord Clinton.)

THE EARL OF SELBORNE

I would like to ask my noble friend how that is affected with regard to the 4 per cent., by the acceptance of my Amendment. It was part of that. Amendment—the consequential part—that I was going to insert 3½ per cent, instead of 4 per cent. Does my noble friend propose that the words should be read "not exceeding 3½ per cent."

LORD CLINTON

No. I propose "not exceeding 4 per cent." I think that probably gives the noble Earl what he wants.

LORD PARMOOR

As I understand, that would really give greater security for the annuity; and that is the object of it?

LORD CLINTON

Yes.

LORD STUART OF WORTLEY

Everybody can see, of course, in the present financia1 conditions, and the rate of Income Tax being what it unhappily is at the present time and is likely to be for a long time to come, that the rate of 4 per cent. would be a total extinguisher to all redemption business.

On Question, Amendment agreed to.

Amendment moved— Page 2, lines 21 and 22, leave out ("the rate of") and insert ("a rate not exceeding").—(Lord Clinton.)

On Question, Amendment agreed to.

Amendment moved— Page 2, line 27, after ("agreement") insert ("or determination").—(The Earl of Selborne.)

LORD CLINTON

I accept that.

On Question, Amendment agreed to.

LORD STUART OF WORTLEY

The Amendment standing in my name is to provide that, in the cases in which it has to administer the accumulation of these annuities, the Queen Anne's Bounty should be able to say that the incumbent cannot have the whole of the 5 per cent., because the rest of the annuity may be required for the replacement of the sum raised for redemption at the end of the term.

Amendment moved— Page 2, line 30, at end insert ("In the case of any such annuity payable to Queen Anne's Bounty on behalf of any benefice or cure, Queen Anne's Bounty in determining the portion thereof payable year by year by way of income to the spiritual person entitled in respect of the benefice or cure may make any necessary provision for securing that the portion accumulated shall at the end of the term produce an amount equal to the consideration money").—[...](Lord Stuart of Wortley.)

LORD CLINTON

I presume that my noble friend has satisfied himself that the Queen Anne's Bounty require this Amendment?

LORD STUART OF WORTLEY

Oh, yes.

LORD CLINTON

I am advised that they might he covered by the words in line 27 of subsection (2) of Clause 3; but I will not raise an objection if Queen Anne's Bounty consider it is necessary for the protection of their own interests.

LORD STUART OF WORTLEY

I am so advised. After all it is only a general direction to make suitable provision.

On Question, Amendment agreed to.

Second Schedule:

2. The compensation for redemption shall be such sum as in the opinion of the Board is sufficient, after payment of the cost of investment, to produce when invested in Government securities a permanent annuity equal to the gross annual value after deducting from that value the average amount paid or payable by the tithe-owner in respect of the rentcharge for the three years immediately preceding the date of the application to redeem on account of rates and land tax, and such sum not exceeding two and a half per cent. of the gross annual value as in the opinion of the Board represents the necessary cost of collection of the rentcharge.

LORD STUART OF WORTLEY moved, in paragraph 2, after "value" where that word secondly occurs, to insert "a sum calculated on that value at the rate in the pound of." The noble Lord said: This is to provide that in arriving at what, after all, is an official valuation of a variable annuity—I am afraid that my language sounds of necessity rather obscure—you should not, in order to arrive at the net at which you wish to arrive, do so in relation to a gross annuity thus artificially valued, but upon some basis which shall have some relation to reality. If you deduct rating at the rate at which rates have been previously levied you would be deducting a rating which might be on a very high state of the tithe; whereas on all the conditions supposed by the introduction of this Bill you are producing, for at least seven years, a much more stable condition of tithe when it cannot rise above £109; and it is right therefore, in order to arrive at the net annuity, that you should not accept such rates as have a relation to that fixed value which this Bill proposes to establish.

Amendment moved— Page 6, line 5, after ("value") insert ("a sum calculated on that value at the rate in the pound of").—(Lord Stuart of Wortley.)

LORD CLINTON

I think that the Amendment of my noble friend really goes a great deal further than he has suggested to the House; because he proposes an alteration in the rating law. For the first time it is suggested here that rates should be levied on a gross tithe. In no other case, as far as I know, is anything but the net tithe considered. I do not know whether that is the intention of my noble friend, but that would be the effect of the Amendment. On the general principle of poundage against rates, my noble friend apparently thinks that his is a more scientific and accurate scheme than that which is in the Bill. I am not inclined to accept that view. I would accept the view that neither of them is scientific, but I do not know that we can get at any actual scientific principle. We have adopted the scheme in the Bill of deducting actual rates, partly because it is following the precedent of the Welsh Disestablishment Act, and partly because it is very much simpler, probably equally fair, and it does not require any fresh calculation at the time of each redemption. The amount of the actual rates that have been paid in the last three years are easily ascertained, and I am afraid that I must decline to accept the Amendment.

LORD PARMOOR

I hope that the noble Lord will not accept this Amendment. It would introduce a change in the rating law—namely, a matter of calculation instead of a matter of certainty; and I think that a three years average of that has been actually paid immediately preceding the redemption is the right principle.

LORD STUART OF WORTLEY

I am still prepared to contend that I am bringing the thing much more into relation to reality than the scheme of the Bill does. But I am aware that in order to defeat the Government you have to produce a wave of emotion, and, as I cannot do that in regard to so abstruse a matter as this, I beg to withdraw my Amendment.

Amendment, by leave, withdrawn.

Then (Standing Order No. XXXIX having been suspended) Bill read 3a, and passed, and returned to the Commons.