LAND SETTLEMENT (SCOTLAND) BILL.

HL Deb 11 December 1919 vol 37 cc891-931

Order of the Day for the Second Reading read.

THE LORD CHANCELLOR (LORD BIRKENHEAD)

My Lords, communications which have reached me from some of your Lordships show that it is necessary to make an explanation, however brief, of the provisions of this Bill. It is well known that this is the Scottish equivalent of the English Land Settlement (Facilities) Act, which became law last August, and in its main purpose and structure the Bill closely resembles the measure which has already received the assent of your Lordships. There are, as is inevitable from the nature of the case, points of difference, and I am informed that some members of the House who are highly qualified to offer advice in such a matter hold the view that in one or two respects the Act has been imperfectly adapted to Scottish purposes. Any such representations will naturally be carefully considered.

The main purpose of the Bill is to facilitate the settlement of suitable small holders upon land, with a preference in favour of men who have served in the war. The Bill consists in structure of five Parts. Part I, like that of the English Act, deals with the acquisition of land; Parts II and III, which correspond to Part II of the English Act, amend the existing law relating to small landholders; and Parts IV and V, which correspond to Parts III and IV of the English Act, contain financial and general provisions.

The differences between the two measures are due to the difference in the pre-existing codes applicable in the two countries, mainly contained as regards England in the Small Holdings and Allotments Act, 1908, and as respects Scotland in the Small Landholders (Scotland) Act,1911, and the Allotments (Scotland) Act,1902. Of these differences two ought to be particularly described. In England the power and duty of providing small holdings lies primarily with local authorities; in Scotland it lies with the Scottish Board of Agriculture. The second principal difference is that in England the small landholder becomes the tenant of the local authority on land purchased or hired by them for that purpose; in Scotland he remains the tenant of a private landlord, at a rent judicially fixed and with security of tenure. He is not the tenant of a local authority nor of the Board of Agriculture.

Let me shortly state the effect of the clauses. Clause 1 proceeds, as does Section 5 of the English Act, to confer power on the Board by way of extending the Small Holding Colonies Acts, 1916 and 1918, emergency measures which contained agreement powers only, and the consent of the Treasury and Secretary for Scotland are necessary. Clause 2 I think I need not deal with. Clause 3 confers powers of entry resembling those in Section 2 of the English Act, and also by sub-clause (1) gives force to Schedule 1, which contains the compulsory acquisition procedure and resembles the English code as simplified by Section 1 of the recent Act. Clause 6 is the equivalent of Section 11 of the English Act, and gives directions to the Board in the selling or letting of land acquired. As in England, the tenant is given the right to buy his holding after six years' occupation at an agreed or arbitrated price, unless the Board obtain the consent of the Secretary for Scotland to a refusal to sell. Clause 7 and Clause 8 need not be specially referred to.

Part II is headed "Amendment of the Small Landholders (Scotland) Act, 1911." That Act is the leading Statute which at present regulates the tenure of small holders in Scotland, and hitherto provided the means for the settlement of new holders. It will continue to do so after the temporary powers of purchase conferred on the Board by Part I have expired, and even during those two years it will provide an alternative means for the settlement of ex-Service men. Both, therefore, from the emergency point of View and with a view to subsequent administration this Bill provides means for the simplification and amendment of the existing law in the light of experience, just as Part II of the English Act is devoted to the amendment of the Small Holdings and Allotments Act, 1908.

The small landholders tenure in Scotland has its root in the local conditions of the North and West, where when Parliament came to deal with the matter in 1886 there existed large numbers of small tenants residing on and cultivating their holdings or crofts and paying rents which were often low because the improvements on the crofts, whether by building or by operations on the land itself, were usually made by the crofter himself; but the rents were liable to be raised on account of these very improvements. The Crofters Holdings (Scotland) Act, 1886, applied only to the crofting counties and to crofters as defined in the Act, i.e., resident tenants from year to year of arable or pastoral holdings at a rent of £30 or less. These were given security of tenure subject to statutory conditions at a rent which might be varied either by agreement or by the Crofters Commission established by the Act; subdivision and assignation of the croft were prohibited and a power of bequest conferred which was limited to one member of the crofter's family. The Crofters Commission had power to enlarge the holdings, but none to establish new ones.

Then came the Act of 1911, which instituted the Board of Agriculture for Scotland and substituted the Scottish Land Court for the Crofters Commission, substituted also the statutory term "small landholder" for the "crofter" of 1886, though "crofter" survives in popular language. Existing crofters became "landholders," and so did many tenants not previously crofters, because tenants under lease were included as from the termination of their leases, and the rental limit was raised from £30 to £50. It ought to be added that the Act applies not only to the crofting counties properly so-called, but to the whole of Scotland; but that great extension of the area did not in itself largely multiply the small landholder, because for that status the Act required that the tenant himself, or his predecessors in the same family, should have effected the whole or the greater part of the permanent improvements on the holding, and this outside the crofting area has usually been done not by the tenant but by the landlord.

The new Land Court had power not only to fix rents and to revise them every seven years, and to enlarge existing small holdings, but to form new ones, by compulsion if necessary. It is this compulsory constitution of new holdings which has in practice proved to be the least satisfactory provision of the 1911 Act, and it is the provision which in this Bill it is deemed most important to amend, in order that the settlement of new holders under this tenure may henceforth be facilitated. It has been necessary to give this somewhat tedious explanation of the situation in relation to crofters prior to the introduction of this Bill, in order that its proposals now shortly summarised may be understood.

Clause 9, which is the first clause of Part II, proceeds to deal with this change. It proceeds by Amendment of Section 7 of the Act of 1911, which contains the existing law on this matter. Under Section 7 of the 1911 Act the procedure is that the Board of Agriculture, where it deems new small holdings to be required and land to be available, shall first negotiate with the landlord and failing agreement prepare a scheme for the purpose, and if the landlord does not accept the scheme apply to the Land Court for a compulsory order confirming it. If that goes through the scheme becomes effective, the new holdings are formed and equipped, and suitable applicants registered as landholders, their rents being fixed by the Land Court. This is a lengthy and complicated procedure. It is amended and simplified under the terms of this Bill. Several subsections of Section 7 relating to negotiation and agreement are repealed, being unnecessary. Where compulsion is necessary the Land Court is now "cut out," except for the one purpose of assessing disputed compensation. Having prepared their scheme the Board intimate it to the landlord and any tenant or occupier concerned, and after hearing any objections may either drop it or themselves make an Order confirming it, subject to the consent of the Secretary for Scotland. If the scheme is confirmed the Board themselves fix the first rent for the new holders, although the Land Court may vary these at the end of seven years.

As to compensation, that is always a difficult matter so far as compensation to the landlord is concerned. It is particularly difficult in this case, because he does not lose his land but retains it, although the rents are no longer agreed rents. The 1911 Act sets out provisions about compensation which have proved to be a hindrance to land settlement by this method, leading sometimes to the abandoning of promising schemes and sometimes to heavy charges on the public funds administered by the Board. Under this Bill, if your Lordships will look at Section 9, subsection (11) these are replaced by provisions which are felt to be both clearer and fairer. Compensation for loss in selling value—hitherto often a heavy claim—is ruled out except in so far as it arises from loss in letting value: and the value of porting rights is to be estimated as the value which such rights would possess if the land were at the same time put to agricultural or pastoral uses. Any enhanced value due to clearances will not be reckoned. The assessing tribunal is to be the Land Court, without the present alternative of a judicially appointed arbitrator, in all cases where claims exceed £300. The Land Court has now had several years experience, and it is hoped that on the whole the new provisions may be accepted as a fair solution of a problem of the difficulty of which the Government is sufficiently conscious.

I do not think I need give any special explanation of the other clauses, which are not particularly difficult. I have only to say that I thought it desirable to give this short explanation because the matter is a somewhat technical one. If the debate in its course elicits any other points on which information or explanations are desired, I will do my best to supply them at a later period. I hope that in the main these proposals will not prove to be unacceptable to your Lordships, and I move the Bill be now read a second time.

Moved, That the Bill be now read 2^a.—(The Lord Chancellor.)

THE DUKE OF BUCCLEUCH

My Lords, the noble and learned Lord has alluded to Clause 9 and to the compensation clause of the 1911 Act. The latter has been found fair and reasonable, and there is nothing to show that what has been done under it was in any way excessive. The difference between what is provided in Clause 9 and what has been in operation in the past is that that portion of the cost of forming these holdings which has hitherto been borne by the public funds is now thrown upon the individual land owner whose land is taken. I will, however, deal with that aspect of the case later, As regards the Bill there is in the main no hostility towards it. It is, as the noble and learned Lord said, divided into two Parts, one the Land Settlement and the other an Amendment of the Small Holdings Act, 1911. I do not think it can be said that it is by any means on all fours with the English Act, which dealt almost entirely with the settlement of soldiers and sailors, and it was really unnecessary for that purpose to have this amendment of the Small Holdings Act of 1911. As far as the taking of land for these holdings is concerned, it practically means that in each case the land owner whose land is to be compulsorily taken is to be treated very much worse under the present Bill than he has hitherto been treated.

There is one rather unfortunate circumstance in connection with this. The question was discussed in February, 1918, when the Secretary for Scotland asked a very large number of land owners in Scotland to meet him in Edinburgh. Considering the difficulties of the time and that so many were away at the war there was a very large attendance. The Government then had not been able to formulate any proposals, but after some discussion and after various suggestions had been made a Committee was formed of land owners representative of the whole of Scotland. We understood that the Secretary for Scotland was going to consult that Committee regarding this measure, but that Committee was never called together or consulted, and I think that is very unfortunate, because had it been called and consulted a good many difficulties of the present Bill might perhaps have disappeared. It would also probably have brought about a better feeling between land owners in Scotland and the Board of Agriculture who, up to the present, have not been on so good a footing as they ought to be. I think that the cause of this, partly, was the suspicion aroused when the Board of Agriculture was first created, but of course for that no member of the present Government was responsible. Still a certain amount of friction has been going on, though I do not think it is so bad now as it was, and if the land owners in Scotland had been more in touch with the Secretary many of these difficulties would have been removed, and it would have been easier to draft a Bill that would have been readily accepted, and certain portions of this Bill would not have contained, as they do, great injustices to the land owners in Scotland.

Coming to the clauses, one important point is that the purchase of holdings for soldiers and sailors is limited to two years, and a certain sum of money is provided for it. It was said in another place that the time could be extended, but I understand that there were certain objections to that on the part of the Treasury, and I think that perhaps your Lordships would like to have some assurance that there is a prospect during these two years of this money being spent, and that there will be no delay in the purchase of land for the settlement of soldiers and sailors. It was also, I believe, stated that, although the two years applied to the purchase of land, the money would still be available for the equipment. If that is the case it does remove many of the objections which could be directed against limiting it to a period of two years. I hope that the noble and learned Lord will be able to give us some assurance that this money will be available for equipment when the two years are over.

Your Lordships will remember that whereas in England many authorities are engaged in settling these men on the land, in Scotland there is only one authority, and it is a very big job for that authority to purchase and arrange all these holdings, if there are to be a large number of applications, within two years of the passing of the Act. Some people have a suspicion, which I hope and believe is unfounded, that it is not proposed to use this money so much for the purchase, but to proceed more by the system that has been in operation in the past of settlement under the 1911 Act.

I will now deal with the most important clause in the Bill—Clause 9—which alters the whole procedure of taking land for small holdings. From the land owners' point of view the most objectionable part is subsection (11) (b) regarding the compensation payable. The noble and learned Lord said that this was going to be a fairer way of dealing with it than in the past, but I think that I have only to read to your Lordships the words themselves to enable you to see whether or not there is going to be proper compensation. At the bottom of page 6, line 32, there appear the words— The compensation payable under this subsection shall not include— (i) any allowance on account of the constitution of new holdings being compulsory. No one has any objection to that. But the second reads as follows— (ii) Any compensation for injury done to or depreciation in the selling value of the land comprised in the scheme, or of any estate whereof such land forms part, except in so far as the same arises from injury done to or depreciation in the letting value of the land or estate. … I think from the wording of that section that it will be quite evident to your Lordships that considerable damage will be done, and that that loss has to be borne by the land owner whose land is taken, instead of as in the past by the State, because obviously if there was no loss there would never be any compensation paid, and in certain cases under the 1911 Act that has been the case.

The Prime Minister said not long ago that the State, whether it was building or buying land or obtaining the labour it required, would pay a fair price for it. That is only what. is asked, and I hope that when we get to the Committee stage the Government will put an Amendment down to carry out that pledge. The Prime Minister cannot look into everything himself, and I cannot imagine that His Majesty's Government want to do anything which will break a pledge or the word given by the Prime Minister.

There are cases where losses have occurred. There is one that is perhaps the best known—the farm, of Ballencrieff in East Lothian. The rent was about £1400, the farm extends to 590 acres. Thirty new holdings were formed on that farm. It did not come to arbitration, and the compensation which was agreed upon between the seller and the Board of Agriculture was £8,000, which, I believe, included the value of the buildings. The farm was shortly afterwards sold and realised £12,500, making a total return to the owner of the land which had been taken of £20,500, including all compensations. Previous to the Board taking this farm the owner had had an offer from the sitting tenant of £25,000, or over nineteen years' purchase of the gross rent, and a neighbouring farm was sold at an even larger number of years' purchase. So there is a loss to the owner of £4,500, and probably if it had been sold in the open market the loss would have come to another £1,000. That loss was made even after the landowner had obtained the compensation which is now being done away with by this Bill. There was £1,800 to £2,000 for compensation, and therefore under the present Bill, as it stands now, the loss in that particular case would have been between £6,000 and £7,000, or possibly more if the farm had been sold in the market.

It has been said that many of these cases will not affect very large owners so much because they would not have to sell their land. But your Lordships must think of the somewhat smaller owner. Unfortunately during the war the owner of land has been very heavily hit. He has had greatly increased expenditure and taxation, especially in Scotland, where there are stipends and other burdens on the property, and against that he has had no increase of rent. whatever. Unfortunately, also, a very large number of properties in Scotland are heavily mortgaged. Take the case in East Lothian which I have mentioned. The farms on that property sold at something like twenty to twenty-one years' purchase. After it was converted into small holdings the price realised when these small holdings were sold was twelve years' purchase. It is obvious that on a small estate which has mortgages there has been very great loss of security to the landlord. Very likely loans will have to be called up, and he will have to sell at a very heavy loss, and the whole of that loss will fall on the owner instead of on the estate.

It may be said that the case that I have quoted was an exceptional one, but I will take another from the Report of the Land Court. This is a farm called Kinninghall, and the Land Court was not supposed to be particularly favourable to the landholders. The Report states— It seeems indisputable that Kinninghall itself, if now put up for sale, would not attract the same competition as it would have done prior to 1913. The ordinary landowner will prefer a property where he has control of his tenants, their rents, and their leases. The outsider who wants a small holding for his own occupation knows that after he buys he must undertake the disagreeable task of turning out the present tenant, and must pay some yet-to-be-ascertained sum for his farm buildings. The tenants themselves, if they purchase, at once cease to be under the protection of the Land Acts, and may find themselves called upon by the Board for immediate repayment of the money lent them for erection of buildings. These three classes constitute the most likely buyers of land in ordinary circumstances, and from none of them could keen competition be expected. There remains the ordinary investor who wishes good security and a fair return for his money. There is no reason why he should not find both as the owner of small holdings, but as yet perhaps this is hardly realised, and he may prefer another outlet for his surplus capital. We have accordingly found that the value of the estate of Cavers has been depreciated in one of its parts, namely Kinninghall, by the constitution of the new holdings and that to the extent of three years' purchase'' I think this is a case which, in all justice, should go back to the basis of the Act of 1911. That was settled after considerable consultation, and I think Mr. Asquith, who was then Prime Minister, went into the question himself and came to the conclusion that it was the only fair and reasonable way, in fulfilment of the pledges previously given by Sir Henry Campbell-Bannerman. All that is asked now is that the Government should back up the statement made by the late Prime Minister.

There is another point which this clause deals with in the next paragraph, which, it is true, affects the Highlands much more than the South of Scotland. I should like to point out that there is in the public mind a misconception about sporting rights. I myself am not particularly fond of shooting, and therefore it does not affect me personally. But in Scotland it has been found that the letting of shootings to Englishmen and others who can afford to take them for their autumn holidays is of great value to the community. Although I have not worked it out on my own property the value of the shooting rights would not be more than—it would be under—one to ten as compared with the agricultural rate, and I believe it was something like that before the war. Therefore it is absurd when people talk of any one, at any rate in the South of Scotland, doing this against agriculture and in favour of game; because the return you get from game is as nothing compared with what you get from arable land.

But to show you how it affects the locality, I may say that some years ago one shooting was let for £250 and there was not much return after the keepers had been paid. I asked the tenant what he spent in the last year, and he said that he had spent over £600 during his holidays. That meant a great deal of employment, and also helped to keep the population in the country districts. Over and above that, if there is anything done to destroy these sporting values, instead of getting the money which is made in London and in other large towns, and instead of their spending money in our country districts and helping the population to live there, the people who take the sporting rights will go abroad and all that money would be lost to us. I am pointing that out only with regard to the South of Scotland where it is an immense advantage to the population. With regard to the Highlands, with which I will not deal, it is a larger question and one that is mixed up with rating.

Small holdings are not a new thing; the question is a very old one, and one in which landowners have been interested for a large number of years, yet for some reason or other at the present time it is not thought necessary or desirable to consult them or to ask their assistance. As long ago as towards the end of the eighteenth century au ancestor of mine, the third Duke of Buccleuch, created small holdings in five villages. This was done without any Government assistance; it was carried out by a joint effort between the landowner and the tenants. The principle on which the landowner acted was that he realised what is not altogether realised at the present time—namely, that in the particular district the land was not sufficiently good altogether to maintain the population, and that therefore the principal livelihood of these small holders was to be by village industries. These villages were prosperous for a time, and then some of them went down; but there are two which are flourishing even now, one because a neighbouring manufacturing town employs the people, and the other because many visitors go there. But there are many advantages in this because, apart from the economic side, it enables anyone who has lived on the land and saved a certain amount of money and who is not capable of full work to take one of those houses with a small holding and get sufficient occupation for his age and capabilities. I think it is a pity in some ways that there has not been any effort to try to induce landowners to create more small holdings. If they do create them there is always the fear that they will be taken out of their control and put under the control of a Board of Agriculture and so on.

There are two or three other points in this Bill. In the former Small Holdings Bill there was a sanctioning authority. I admit that there is a certain desirability in "short-circuiting" (as they call it) the system because there was a certain amount of delay in forming the holdings—although the delay was not as great as it was represented—by matters having to go through these various channels. But your Lordships, and also the taxpayers of the country, must remember that if this Bill passes in its present form the Board of Agriculture for Scotland will start the holdings, draw up the plans, and also be the sanctioning authority. There is practically no control to see that the money is properly spent or that the schemes devised are the best possible. I should like to give an instance of a case of my own in connection with the operations of the Land Court. Negotiations were going on with regard to a farm which I said was not as suitable as it might be. The case was taken to the Land Court, and the Land Court, although they sanctioned the scheme, upheld my view and said it was not by any means to be looked upon as an ideal settlement; they did not think that the ground was sufficiently good. However, I did not wish to stand in the way of the Board and we came to an agreement about the matter. There should be, however, some supervising authority. Again, those people whose land is to be taken should have some sort of appeal. Every one wants to prevent unnecessary delay or correspondence, but there are some cases where it is reasonable that the owner of the land which is to be taken should have some right of appeal. So far as I have seen, this Bill does not give any appeal at all. The Secretary of Scotland, it is true, has to sanction the scheme, but it is obvious that he would not have the time to look into everything, nor is there any form of appeal to him.

Another point is that under the former Bill—now swept away—any owner claiming more than £300 had the option of going to the Land Court, or, if he did not like to do that, there was a method arranged for arbitration. I do not know that I myself liked that very much, but I think it would be better if it were left. Parliament has lately passed the Acquisition of Land Act, but it is curious that this Act, which was essentially one for taking land for public purposes, should be absolutely ignored in this Bill. If instead of all this leasing they were going to use the Acquisition of Land Act the whole difficulty would disappear but for some extraordinary reason there seems to me a rooted objection to purchasing the land. I mean by that not necessarily that they should be compelled to purchase, but that if the owner is not willing to lease they should have the option of taking it under the Acquisition of Land Act. It does not seem to be much use for Parliament to pass such an important measure as the Acquisition of Land Act if the various Departments do not make use of it. It surely is not right that each Department should have its own particular way of dealing with any subject of that kind. The probability is that the arbitrator appointed under the Acquisition of Land Act might be a better arbitrator to decide upon the value of the land and the compensation to be paid than the Board of Agriculture in the present case.

There is a further small point on which I should like information—namely, the question of home farms, and so on. In both the English and the Irish Bills on Land Settlement home farms are excluded from the operation of the Bills. Although it may not be of vast importance, if two years only are to be allowed for purchasing and it is possible that the time may have to be extended, I think it is only reasonable that that should be put into the Scottish Bill, and so make it on all fours with the Bills—now I think the Acts—for England and Ireland.

I am afraid I have somewhat wearied your Lordships with a good deal of detail in these matters. The real point is that the land owners of Scotland are anxious to facilitate in every way the settlement of soldiers and sailors. We are prepared to do what we can, and we appointed a Committee to go into these matters. We desire most strongly that the pledges given by the Prime Minister and also by the Leader of the House of Commons, the Leader of the Unionist Party, should be kept in this matter. We consider that certain parts to which I have alluded in Clause 9 are breaches—at least, they are not keeping their words in the spirit or even, in my opinion, in the letter. It is quite impossible, as I have said, for the Prime Minister to know what is going on, but I do sincerely hope that something will be done to meet our views in this respect, because, although it might not be so hard for a land owner who has a large extent of land, and who gets compensation for his loss in letting value (though no compensation in respect of capital value), it is a most serious thing for a small owner. I think it is very wrong that a person not particularly well off, whose land is taken for public purposes, should at the same time very likely be ruined and have to pay a very large proportion of the expenses which ought, undoubtedly, to be borne by the country.

LORD LOVAT

My Lords, I should like, before the Second Reading of this Bill, to say a few words in criticism of certain lines of unfairness so clearly brought out by the Duke of Buccleuch. We all listened, I am sure, to the statement of the noble Lord on the Woolsack, that he would consider certain views that we might bring forward, in order to see how far effect could be given to them in the Committee stage.

First of all I should like to say, with regard to Part I, that I believe, from what transpired at a meeting which I attended of those interested in the land question in Scotland, that you will find every support to pass Part I as it stands. Undoubtedly, as the Duke of Buccleuch has pointed out, we in Scotland are putting up with certain hardships as regards the acquisition of land which the land owners of England have not been asked to accept. We have perhaps less cultivated and less cultivable land. There is also the question that the body which is to decide compensation is altered, and we hope in future that the deciding body will give fairer decisions than have perhaps been given in the past.

As to Part III, which deals with allotments, I am perfectly certain that that will receive nothing but support from this side of the House. High prices and shorter hours have undoubtedly added enormously to the possibilities of the allotment movement. Speaking for myself, I can only say that I wish this particular Part had gone further, and that a larger sum had been voted for the increase of allotments, especially for allotments in the neighbourhood of towns and villages. I am certain, from the fact that the soldiers who return from the war have had periods of strenuous—one might almost say killing—work alternating with rest in rest billets, that it is much more a question, not of work shyness on their return, but a wish to escape from the dull monotony of one particular job for the whole time. I believe, therefore, you will find, with the shorter hours and the greater advantage to be got from allotments, that allotments, especially by soldiers, will be made the greatest use of, and I wish the sum of £4,000 allotted had been considerably increased.

Turning to Part II, on which the whole of my own criticism will be centred, I would like to ask the House first to consider whether it is necessary to have Part II at all. The 1911 Bill was a distinctly bad Bill. It was bad in itself; it was not too wisely administered as an Act; and it failed from the very start, because it did not accept the fact that in order to get settlement in land you want the co-operation of every single individual interested in land—that is to say, the land owner, the tenant, and the Board which has to administer. You are sailing on a very fine margin when you are dealing with small holdings in any part of Scotland. Unless you have the utmost co-operation between the three parties interested, I do not believe that they will succeed on the whole. I believe that if the noble and learned Lord on the Woolsack, had had the good fortune, or the bad fortune, to attend the meeting at which the Duke of Buccleuch presided and to which he has made a reference, he would have appreciated the wish that there is expressed by land owners in every part of Scotland to aid in the settlement of returned soldiers and to give every assistance.

By the 1911 Act it was only possible to get fair treatment by opposing a scheme which was put forward. The noble Lord made certain references to schemes being ruled out on account of expense, although the schemes themselves might have been good. Having had considerable experience of such schemes, let me assure him that a great many schemes were lost, simply because, in order to get your rights, you had to oppose the schemes under this most foolish Act of 1911. Whether it is necessary, as urged by the Government, for the special conditions of Scotland, to have a Bill based on the 1911 Act, I would only say, for my part, that we must be quite clear that justice covers not one bank but both banks of the Tweed. Furthermore, as far as Scotland is concerned, we must be sure that Part I of the Bill is not to be the camouflaged portion of it and Part II, which is merely a prolongation of partisan effort, the really effective portion.

I would commend to the noble Lord's notice that I think your Lordships will probably press to see that we have a quite clear definition as to how much action is going to be taken under Part I and under Part II. It is really extraordinary that a Government should produce one Part of a Bill which is mainly fair in its encouragement, and, in a second Part, an alternative scheme for the same subject which is grossly unfair in a great many respects. You must back one horse or the other. You must say either that you are going to deal fairly with land owners in land settlement, or that you are not going to deal fairly under Part II where you fail to pay the compensation which is due.

Before I deal further with Part II of the Bill I should like to touch on one point which I think is very important—namely, the actual amount of money which ought to be spent under Part I and under Part II. Under Part I you will get £2,500,000, which is the Scottish share of the land settlement money voted by Parliament. Under Part II you have to deal with money which comes under the Agriculture, Scotland Fund, which altogether is about £200,000. Therefore for the next two years you will have the £2,500,000, spent under the grant for soldiers, and £400,000 under the other head. Of this £400,000 you will have to spent £15,000 on housing, you will have all your ordinary upkeep expenses and salaried gentlemen to pay, and for the actual settlement of soldiers on the land I calculate you will have at the outside £150,000 to £200,000.

Therefore I submit is it worth while risking a chance of losing this Bill by insisting on certain provisions in the Bill in order to get 10 per cent., probably 5 per cent., of benefit which is going to come to soldiers under the Bill as a whole? It may be said that we are holding up land settlement if we oppose Part II of the Bill. I wish to make it abundantly clear that if we hold up Part II we only hold up at the outside 10 per cent., 5 per cent. would be much nearer, of the settlement of soldiers by the whole Bill as it stands.

It would be a pity if Part II was lost. It is going to quicken up the method by which settlement will be made. In the past there were references from the Board of Agriculture back to the Land Court, and the process was slow and cumbersome. Little was done. This is going to make the process much quicker; so quick that schemes may be passed which may be unfair. We have to take that risk, and it is a fair and legitimate risk. These men who fought for their country wish to settle on the land and it is important that as soon as legislation is passed action should follow. It would also facilitate settlement by consent, which I think is a most important consideration. The advantages which are going to be given to existing crofters have my entire sympathy.

There are other minor points in the Bill on which I do not think it is necessary for me to trouble your Lordships. It would be a pity if the Bill was lost simply on the two clauses dealing with compensation against which we can present the strongest arguments. I will not go into the question of the honour of the Prime Minister being absolutely pledged to see that a fair settlement is made and the proper and right interest in land regarded. I can point to the Glasgow speech of Mr. Bonar Law, the Leader of the Unionist Party, in which he made an equivalent statement. We have a right to hold that these election pledges, given at a time when a General Election was being held, should be made good. On the grounds of justice also there is no reason why land owners in Scotland should not be as fairly treated as land owners in England. In one-half of this Bill you treat them fairly; in the other half you treat them with grave injustice.

Another point, which is even more important, is the question of the absolute power it gives to the Board of Agriculture for Scotland practically to make bankrupt any unfortunate land owner in the Northern part of Scotland who derives most of his revenue from sporting estates. It places in the hands of this body the power to make or mar any individual in that area. It is not a question of what might happen; it is a question of what has happened. I can quote two cases. There is a certain property on which the Board of Agriculture insisted that £30 worth of grazing land should be taken by resident tenants. The value of that property was reduced from £1,200 a year to £750, and I am told that it has now been reduced to £450. The rateable value also came down from £1,100 to £450, and as the taxation in this area is going to be something like 10s. in the obviously£ the fall in rateable value will come on the local authority. The decrease in the value of sheep on this grazing land was between £500 and —600 and the amount produced from the area was much less than in the past. This is an example of how far folly can go if you give to a body absolute power to enter into any sporting area, deer forest or otherwise, and turn it inside out.

The Duke of Buccleuch made a reference to the question of taxation and its relation to sport. As you Lordships are aware, in the South of Scotland the importance of sporting values is not very great; but in the Northern areas the sporting values are very often in certain parishes 60 per cent. of the total rateable value. That is to say, if you abolish the whole of your sporting value you would double the existing rates. I am sorry to trouble your Lordships with this question of rates, but it is a very important one. In the county of Inverness-shire our police rates have gone up from £9,000 to £19,000 by a stroke of the pen. We had to adopt practically the same regulations which govern the police of London, and the Outer Isles policeman who perhaps does one day's work a week has got to have the same rest day as those who guard the streets of London every day. We have had to have an Education Bill which insists upon travelling expenses being paid, and has increased the rates in certain parishes from 1s. 4d. to 7s. in the £. In the particular parish to which I have referred I think I am correct in saying that the parish rates, which were 2s. in the £, are now 7s. 1½d. We have experienced, of course, the usual advances that poor localities have had on roads and lunacy, which have more than doubled the rates which in many parishes in the Highlands are approaching 10s. in the £. Now, if you halve your rateable value by the abolition of sporting values you necessarily double the rates, and you may, unless this Act is carefully worked, reduce our Highlands to the same condition as the Outer Isles.

I do not know whether many of your Lordships have travelled in the Outer Isles. I had the fortune or misfortune to recruit there for a good many years, and I am absolutely persuaded that the whole of the misfortunes of the Outer Isles turn to a very great extent upon the question of rateable value. Lord Balfour of Burleigh had dealt with the whole rating question of the Outer Isles and knows more about the subject than I do, but I am sure he will agree with me that if the whole of the Highlands were reduced to the same state as the Outer Isles we might say good-bye to prosperity. I do not wish for a moment that it should be thought that I do not believe that the deer forest question cannot be tackled with advantage. I am a whole-hearted believer in the abolition of a great many of the deer forests of Scotland. A great many of them should never had been put under deer at all. I have always thought that a good many could be used for sheep land, and others for forestry and grouse and sheep and the rates on those might be maintained. A smaller number, being in close connection with crofter ground, could be turned into small holdings or used for grazing extensions. It is necessary, however, to remember a few facts. In 1892 a Commission which held a survey only found 2,500 acres of arable land.

How many men are you going to settle on 2,500 acres? At the most you would be dealing with the settlement of 100 soldiers. Is it therefore worth while to risk the Bill by not paying adequate compensation, because the numbers of persons that you are going to settle on these lands will only be a very small percentage of the total number that it is hoped to settle in Scotland. I therefore would insist again that it is most dangerous to put it in the power of such a body of men, who from their very nature have no interest in the question of taxes and rates, to reduce the sporting value and therefore reduce the rateable value. You may say what is the connection between rateable values and compensation to landlords? It is the very closest connection. It is this, that if compensation is to be paid they will obviously in making schemes take those schemes which are something like economically possible. Without compensation there is no driving force to make them adopt those schemes which by their development, would give the maximum result to the small holders and cause a minimum of hurt to the people in the villages.

With regard to the remarks, which were made by the noble Duke—as to the drop in selling value—I believe that in the South, where small holdings are not so much understood as they are in the North, the drop in the selling value is considerable. In the Northern Highlands it is perhaps not so great, but whether it is great or small it is surely right that the loss should be undertaken by the Government equally in the case of those who dwell north as in the case of those who dwell south of the Tweed. I was particularly interested to hear the statement of the Lord Chancellor that he was prepared to listen to reasonable suggestions. I am sure that he will see that on this compensation question we have got every right to feel that we should be not less well treated than those who reside south of the Tweed. I believe there to be a considerable demand for small holdings. It is only right that the soldiers who fought overseas should be enabled if they wished to take the risk of small holdings, but I feel in justice that it is a liability which is a liability of the nation as a whole and not one which should be thrust upon any particular body of persons.

THE DUKE OF ATHOLL

My Lords, practically all the points against this Bill have been made by the two noble Lords who have spoken, but there are one or two on which I should like to say a few words. The Bill tinder discussion is intended to be a measure for settling soldiers on the land, and as such it must obviously receive our most hearty co-operation and support, so far as it fulfills that object and so far as the Government carry it out without injustice to any other section of the population. I do not know how far the demand for small holdings exists in Scotland amongst returned soldiers, for the very good reason that we find great difficulty in getting returns. In the crofting counties, about which Lord Lovat has just been speaking, no doubt there is a greater demand still for small holdings, and I quite understand the desire of the Secretary of Scotland to speed up the granting of these small holdings considering that we are to a certain extent three or four years in arrear on our programme on account of the war. In the Lowland counties I think there is really less demand for small holdings than there was before, and for very good reasons.

In what I say now I am not saying anything against the idea of small holdings, but I think there are certain facts that we ought to consider before we blindly pass a Bill which, as has already been shown, would inflict a certain amount of injustice on certain individuals. Wages are now very high in the country districts in the Lowlands, and men can make more money with shorter hours and with less labour than they could possibly ever make on any small holding, and they have no risks to their capital. A man simply has to go on the railway—it does not matter if he knows anything at all; no questions are asked—and he gets something like 50s. a week, and he certainly will not make 50s. a week when lie is seventeen or eighteen years of age on a small holding. Or he can go into the timber trade. Yon see boys of fifteen getting £3 a week for leading a horse up and down the road. Of course, that is a temporary wage, but generally speaking wages in Scotland, agricultural and otherwise, are so high now that it would probably pay a man better to be a labourer in some profession or another than to have a small holding, more especially when you remember that his family can possibly bring in £8 or £10 a week, whereas to a small holder helped by his family there would be nothing of that sort.

A Housing Act has been passed, and we have the promise, or hope at all events, that we shall get houses for workmen better than the houses that they have at the present moment, with reasonable security. I think these conditions are probably far better for the men who come out of the Army than are the small holdings which are proposed, for the small holdings are a perpetual grind from dawn to night, and there is a considerable element of risk about them. I do not think that this ought to be an experiment, but that the men who are put on to the land should know something about it. To put men on the land who know nothing about it means that they will starve. Future tenants, therefore, will require to have a certain amount of training. I think that we might well spend a certain sum in training them before entering into very large schemes. The men should have an opportunity of learning what the work is like, so that the preliminary training can act as a sieve. Those who cannot stand it will find out beforehand, and will not go on the land and become a burden upon it and to themselves.

Apart from the question of small holdings, your Lordships must remember that there is also the question of the general public. During the war we were living on a very narrow margin of food in this country. I am not talking of small holdings and deer forests in the Highlands, but of small holdings in the Lothians. If you are to cut up some of your best land in the Lothians into small holdings—and the small holder has to live on some of the best land—you will certainly diminish the food supply of this country, and also put up the price of food to individuals in the towns. The question of allotments is a very different matter. Allotments have my hearty sympathy, because I think the old soldier is far more suited to working on an allotment than he is on a small holding, and also it does not take up the whole of his time. He is able to take up some other work, and yet his allotment is sufficient to give him a great many not only of the necessaries of life but also to give him what I might call a stake in the country, and an interest in it, which he would not otherwise have. Certainly it would not tie him in the same way that a small holding does.

While supporting the Bill generally, I would like to go briefly into one or two of the chief defects, as I regard them. I am not going to make the charge that this Bill—an emergency Bill—is being used to alter the Small Landholders Act, which alteration could not be made had the Government tried to bring in Amendments to that Act in the ordinary way, though there is a suspicion of that. What is being done reminds me of what took place the other day in connection with a club that wished to get a cup for competition. They could not raise sufficient money in the club to purchase that cup until someone had the bright idea that they might call it a war memorial to the members who died during the war. The money was immediately forthcoming, and they got their cup, and members were able to compete for it. It is very much the same thing here. You are able to tack on the word "soldiers" to the first Part of the Bill, thinking that it will be rushed through in consequence, because everybody will dislike and resent doing anything that might not be to the advantage of soldiers, and you then add on the second Part of the Bill something which is an alteration to an Act, and which is hardly germane to the purpose in view. I do not think that that is a fair way of bringing in an Amendment to an Act. Nearly every one of the Amendments that are brought in are Amendments that were attempted to be introduced into the Small Landholders Act, and which were beaten in the House of Commons. The noble and learned Lord on the Woolsack will remember that we worked together and defeated those very Amendments, which are now brought into this Bill. And that was done in another place, which was certainly not at all friendly to the one and only landlord on the Committee.

The first thing we find is that the Board of Agriculture is constituted the sole judge of its own schemes. That was a point we fought before, and even that very strong Committee in another place had to admit the justice of our contention. It is surely not fair, if two people are in disagreement, that one of those two should be the sole arbiter. That is really what happens. It is quite true that there is an appeal to the Secretary for Scotland, but after all the Secretary for Scotland is the head of the very Department which is one of the parties to the action, and Chairman of the Board. Surely he should not be the man, in common equity and justice—though. I do not suspect his wish to be fair—to be the judge in the matter. But apart from that aspect of the matter, I think it is a very great mistake, and puts the Secretary for Scotland into a very invidious position. He is not always popular as it is. He has a great many things to do—a great many difficult things to do—and he cannot possibly have time to go into all these questions, and I think it is putting the chief Minister of State for Scotland into a most invidious position to put upon him the settlement of questions for the decision of which there are plenty of judges and courts, and plenty of other kinds of arbiters in Scotland.

Then there is the question of compensation. It is probably folly to own land, but so far it is not a crime, and if the Government want to acquire land, surely they ought to pay the full market value for it. That is in equity recognized everywhere, except perhaps in some parts of this country. If, for instance, the Government in the interests of the Army wishes to buy a large stock of clothing, and has to seize it, it pays the full value for it, and sometimes pays far too much. Why, then, because a commodity is land should the Government pay sometimes half the value of that land, and do everything it can to reduce its price for the Government's own purchase? I do not call that equity and fairness.

A short time ago the Government passed the Housing Bill to which one or two modifications were made in this House. We asked for one or two modifications in order to make it more suitable for Scotland. We were immediately met with the official reply that you could not possibly alter that Bill to make it suitable for Scotland because it was in the English Bill, and it was only right that a great. Bill concerning the two countries should have the same basis. On the other hand we now come here and ask for certain provisions in our Bill—all questions of principle which exist in the English Bill—and we are told that that is no argument. Perhaps the noble Lord on the Woolsack, when he replies, will inform us why we should not have the same basis of compensation in Scotland as we do in England. I am sure there is a very good reason for it, but so far we have not been able to ascertain it.

A good deal has been said with regard to the loss on selling land. Some noble Lords perhaps did not hear the very cogent way in which it was put by the noble Duke, the Duke of Buccleuch. In the English Bill compensation is allowed for the loss of capital and letting value. But in the Scottish Bill you are altering the whole system that we have had up to now, and we are only allowed the letting value and not the capital value for compensation. In the case given by the noble Duke an estate was cut up into thirty small holdings, and the rent dropped by about £1,000. That was all right; you got compensation for that. The sitting tenant had offered £25,000 for the estate. It was not accepted, and then the owner, not wishing any longer to hold an estate of thirty small holdings over which he had no control, and on which there was no sport left, sold his estate, and there was immediately a drop to £12,500. Thus by the direct action of putting small holdings upon the estate there was a loss of about £12,500. Why is the owner not to be compensated for that? Because it costs too much. If it costs too much that is not the proper place to put small holders, unless the Government are prepared to make up the loss. There are certain new features in this Bill. When there is betterment that is deducted from what is due to the landlord, but if there is "worsement" we do not get any compensation. The whole thing is—"Heads I win, tails you lose." The Land Court in these cases of compensation is made the sole judge of any single case. It is not only the judge—it is the jury, the assessor and the beneficiary. Surely that is not fair.

The Bill also cuts out a great deal of compensation from a sporting point of view. It does not nearly so much affect individuals like myself with large properties and deer forests which are perfectly unassailable for climatic and other reasons. But where there is a small deer forest you can understand that there may be some small portion of it that would keep a small holder. But that small piece of ground is probably the grazing area for the whole of the deer forest concerned, and therefore it is better business for the district and for the whole country that it should be under deer. It is possible you could put a small holding there, but to do that you would probably have to dispossess three or four people of their houses. Under this Bill you say that compensation is to be paid as if the rights of the landlord were put to the full possible use. If you put in the word "reasonable" use one might have understood it. It is perfectly possible for an odd sheep, or a few sheep, to stray into the forest, and that would be part of the "possible" use. We think this is far too sketchy a clause to be included, in view of the fact that it may mean the entire loss of compensation, because if you were to use it to its full use and allow three or four sheep right to the top of the hill it would mean that you would not merely have malicious chasing of sheep for the various purposes of the tenants but you would have great disturbance, with the result that there would be no deer there and no compensation for sporting value. That is perfectly possible.

I want to remind noble Lords also of the question of the rates. In my own parish a year or two ago I found the value of the "general subjects" and railways was something like £12,000, and the value of the "sporting subjects" £13,000. Therefore the sporting subjects paid considerably more than half the rates in the district. If you do away with valuable sporting subjects it means that you will raise the rates for every other individual in the parish, excepting the small holders who do not pay—for the grocer, the boot-maker, and every single individual who has a house. And the rates are so high now in Scotland that you will find it will be an extremely heavy burden on the people, and that rents will drop in a great many of these places. I take a place where sheep have been put into a deer forest during the war. The rental formerly was £450, and after sheep were put in by the Board of Agriculture the rental was £30. The result is that these rates have to be paid by the community in general. It is a question to consider whether, if there is a drop in the rates, that drop should not be made good by the Government, because this has become an intolerable burden in some of the Highland parishes.

The only other clause to which I want to allude is one on which I may possibly have more practical sympathy (if I may say so) from the noble and learned Lord on the Woolsack —I mean Clause 14, which I think is a mistake. That clause states that it be permissible to make small holdings within the borough boundary of any borough in the North of Scotland. It so happens that I took charge of an Amendment to the Small Landowners Bill in 1911 against this very point, and carried it, at the request of some of the boroughs in the North of Scotland. If you propose to put small holdings in the middle of these boroughs, you must remember that the boundaries of those boroughs are not very wide, that they contain small villas, and that the inhabitants are anxious to keep the amenities of their boroughs undisturbed because they depend almost entirely for their livelihood on summer visitors. Some people think that a small holding contains only vegetables, and beds of violets, and so on. Speaking from my own knowledge, the reverse is usually the case; you will have on them cattle, poultry, bees, and a midden. These are not pleasant things to have next to you. The inhabitants have no objection to, in fact they are in favour of, small holdings in the immediate vicinity of the boroughs.

When we come to the Committee stage I shall move the excision of this clause, and it is up to the Government to agree or not. I wanted to bring the point forward—it is perfectly altruistic—and I think we should have further information on the subject. I believe that this was put in at a time when the usual watch-dogs in Committee in the other place were absent. I trust that the questions I have raised will be taken into consideration when the Bill goes into Committee.

LORD BALFOUR OF BURLEIGH

My Lords, I start by giving your Lordships a definite assurance that I do not desire to prolong this discussion, but I am in this difficulty—that while I agree with almost everything that has been said from the Benches behind me, I shall be liable to misunderstanding if I allowed the discussion to close without saying that what has been said applies to all parts of Scotland and to give it such support as I can. Lord Lovat and the Duke of Atholl did not in the smallest degree over-state the difficulties which will be brought on those country districts if careful discrimination is not used in making schemes which interfere on a large scale with the deer forests and sporting interests there. That is one of the reasons why I object to the taking away of the right of appeal in the case of schemes which are promoted by the Board of Agriculture. At present there is a right of appeal; and I want to point out to the noble and learned Lord on the Woolsack, in case he has not had his attention directed to it, that the Board of Agriculture as a Board has no interest at all in the matter of rating. It does not matter to them how high the rates go up; therefore I am strongly of opinion that the Board of Agriculture ought to have the control over them of a Tribunal of Appeal in connection with their schemes. If they are reasonable I do not believe that the Court of Appeal would ever be brought into operation, but the mere fact of the existence of an appeal will tend to make them more reasonable than thee otherwise would be. I also strongly object to the, Land Court being supreme in judging matters of compensation. I am not in the least surprised that they want to get rid of the Court of Appeal, because I think in the majority of cases in which an appeal has been taken from their decision it has been defeated; therefore it is extremely natural that they would want to get rid of the Court of Appeal.

The only other point upon which I want to speak is the question of the compensation for settling small holders upon the land. I myself dislike the idea of their being put there as tenants. I think it is an altogether false relation, as between landlord and tenant, that the landlord (whatever his sins and errors may be) should have put upon him tenants in the selection of whom he has no voice. The certain result will be friction and difficulty. In ordinary circumstances the tenant has certain mutual obligations to his landlord, and in the majority of cases they work together. If you put down a number of people selected by an outside authority, who has no relation to the landlord at all, you are in my opinion certain to have a greater amount of friction than you would have in any other circumstances. If the finances of the country are such that you cannot produce money to purchase the land, why not give the land owner the annual rent on a fair arbitration, what it is worth one year with the other—what we call in Scotland a feu—for a long period of years? That wound be very much better than what is proposed in this Bill.

Let me give your Lordships an illustration. Supposing there is a farm of 400 acres for which 25s. an acre is paid, or a gross rent of £500. If the Tribunals in question enter upon that farm and take the whole 400 acres and put upon them ten small holders, if the gross rent of those ten small holders comes to the £500, there is no compensation, and no case for compensation. If the rent is in any way less than £500—say, for example, it is £450 for the ten small holdings —for that loss of annual value, even under this Bill, the landlord is to be compensated, and rightly so. But supposing you put the ten small holders on and they pay nominally £500 a year—the same as the present rent£you cannot deny that the capital value of that holding is depreciated. Take it how you like, you will find no one who will defend the position that the capital value is the same; because no one will give you the same number of years' purchase for a farm on which there are ten small holders that he will give you for a large and thriving holding occupied by a prosperous tenant who pays his rent in one lot of £500. What is the reason? Can the noble and learned Lord on the Woolsack defend the position that there is to be compensation in the one case and no compensation in the other? It seems to me absolutely absurd, and personally I hope that this provision will be put out of the Bill.

Then there is another point. I have had the argument put to me that it does not matter what the selling value of the thing is if the owner does not want to sell. There are cases where the owner does not want to sell but where he is obliged to mortgage. The mortgagee who goes into the market to find security for what he wants to lend, will not lend on an estate split up in the way I have described as much as he will lend on an estate consisting of large farms. Therefore, put it how you like, you are doing harm to the capital value of what you are taking; and I do not think it is fair that the individual should be prejudiced for what is a State service. I cannot for the life of me understand what the justification on the part of the Government is for treating the Scottish land owner worse than they are treating the English laud owner. I hope that this point will receive the careful attention of the noble and learned Lord on the Woolsack, and I shall listen with great attention to whatever ingenuity he can find to make a reply. I am not going to prolong the discussion; but, as I have said, unless I had said so much it might have been thought that I was sitting here and not approving, whereas on all the points taken by my Scottish friends I want to say that I am in hearty agreement.

LORD LAMINGTON

My Lords, with regard to the Lowlands, can the Government say whether any benefit—economic or productive, or social—has arisen from the small holdings created under the 1911 Act? The noble Duke, the Duke of Buccleuch, referred to the case of Ballencrieff. I have not visited the spot myself, but I know a good deal about it. The land that has been broken up there constituted one of the, best farms in the East Lothians, and its condition now compared with what it was before is such that it produces about one-half of what it produced as a large farm. I have had a farm broken up into two small holdings, the farm buildings cut in two, and fresh buildings put up, the walls of which began to crack within twelve months. To-day, that farm is not occupied by a greater number of people than would have been the case under a single tenant.

What has been the benefit to the country by breaking up a farm of that description? I pity the small holders, supposing there is any great fall in prices. They benefited from high prices during the war, but, in the normal conditions of agriculture which obtained before the war, I believe they would be ruined men. At the present time, one of the most favoured farms in East Lothian is going to be broken up—Thorntonloch—into forty small holdings, I believe. What is to be the cost of establishing these holdings on a farm which is in the centre of the best producing area perhaps in the United Kingdom, if not in the world? Where is the benefit? Can the Government say that the country has Prospered or benefited by the creation of these small holdings?

If there is any particular locality where it would be desirable to establish these people it would be competent for the Government, without the elaborate machinery under the existing Act and proposed under the present Bill, to go to the open market and buy any amount of land. They would be perfectly free to act as a landlord and under the condition which Lord Balfour of Burleigh described, that would be far better than forcing tenants on a landlord, when it is so essential in the whole conduct of agriculture that all parties should be concerned to get together the best results. Therefore, I hope it may be possible for any member of the Government who is going to reply to say what has been the result of the establishment of these small holdings under the 1911 Act.

THE DUKE OF SUTHERLAND

My Lords, it is my intention to-night only to deal with the general principle of this Bill. The details, I think, have already been dealt with by noble Lords who have spoken, and they will come up again in the Committee stage. This Bill is of very much greater importance than is generally realised. For a hundred years the Highlands have, from time to time, seen a series of land agitations. They have died down, only to rise again and to cause fresh unrest and trouble. Let us hope that this Bill, the fruit of a compromise with all parties, may be a way of laying that ghost of unrest which has haunted the Highland glens for so long. Is it an adequate Bill to fulfil the pledges that were made exactly a year ago by the Prime Minister and Mr. Bonar Law to the ex-service men, and to fulfil those pledges in fairness to all other parties and classes? On its face value, it seems to fulfil everything that is needed, but only by experience can it be found whether it will do so, or whether another measure will be required later to settle permanently the great land questions that have distracted Scotland for so long. At any rate, it is agreed, I think, that the present Bill should suffice at least to fulfil these pledges to the ex-service men.

Let us consider for a moment the position that will arise if radical changes are made in this Bill in your Lordships' House. The Bill will go to another place and very probably will be returned in the form in which it was sent to us. A serious constitutional crisis might then arise, and I remember that it is only a short time ago—a few years before the war—that in Scotland, at any rate in the Highlands of Scotland, the House of Lords was looked upon with anything but favour. In fact, my recollection is that it was considered to be the author of all tyrannical evil. The cranks and agitators very cleverly twisted the various acts of the House of Lords to represent everything as being against the people's interests. We do not wish for a similar state of affairs at this moment, when we should all be united against the many evils of Bolshevism and such like troubles that surround us. It is important that we should all pull together and act in fairness to all parties. I think, if I may say so, that Lord Lovat, in his excellent speech, made a very true remark—that the small landlords, who depend year by year on their rentals and sporting rentals, have every right to expect fair and honest compensation, equal to that which they would receive if no settlement scheme were to take place on their land.

What is the cry from the ex-Service men themselves in Scotland? At present they say that none of the pledges have been fulfilled; that they are still waiting for something more to be done; and that what has been done is comparatively trifling in its extent. That is quite true, and it is only by getting this Bill through, with reasonable speed and by allowing only reasonable amendments to take place, that this crying need will be met. Great discrimination is necessary to avoid mistakes that may be made. For instance, the wrong men may be selected and bad schemes may be adopted. Inefficient officials and ill-advised plans will cost the country much money and be a waste of time. The Board of Agriculture officials, who have such large powers under this Bill, should be chosen with the greatest care. They must be men of real practical knowledge. The Secretary for Scotland, who has a great responsibility under the Bill, must weigh well the consequences of everything he undertakes, and he must review in all its different phases every scheme that comes to him for consent. I think in the circumstances, and taking into consideration the conflicting interests, no better Bill could be evolved than the present one.

VISCOUNT CHAPLIN

My Lords, I have no direct connection with Scotland which would justify me in speaking on this question, but I have had a long experience of that country for many weeks every autumn for a number of years, and have learned a good deal about the sporting aspect of the case. I wish to express my entire agreement with the statement of the noble Duke, the Duke of Sutherland, when he feared that the administration of this Bill might not be in sufficiently practical hands. That is the one danger in these days we have to contend with in regard to all agricultural questions. There is a want of practical official knowledge in the Department of the Board of Agriculture for England, though I cannot say from my own knowledge what the position is with regard to the Board of Agriculture for Scotland.

I am entirely in sympathy with the views expressed by my noble friends in this debate. I believe them to be absolutely right. In no case are they more accurate than in what they have said about rates. I am perfectly certain that unless this Bill is administered with great care in this particular respect its passage will be the worst day for the rates and the ratepayers in Scotland that Scotland has experienced for a long time.

With regard to small holdings and allotments, if I do say a word on that subject I am sure the House will believe that I am perfectly genuine in my interest in small holdings. It fell to my lot in the House of Commons, many years ago, to be the author of the first compulsory Bill for allotments, and it was also my duty to introduce and carry the first Bill in the House of Commons providing for the addition of small holdings. Therefore, my views on that point may be already well known. But Scotland differs to a great degree, especially in the north where the deer forests exist, from the position in England in one respect which no one up to the present has mentioned. I will give any own experience.

For many years I had a forest in the middle of Sutherlandshire, in the very centre of that county, joined on one side by the deer forest of the Duke of Sutherland and on the other by the deer forest which now belongs to the Duke of Westminster. What did I learn from my sojourn there autumn after autumn for many years? I learned that it was very unwise to attempt to make a great outlay in that part of the world upon small holdings, and for this reason. You always have to contend with the weather and the seasons, and they are absolutely uncertain. In three years in succession the weather was so bad that the crops were never garnered at all, practically speaking they were wasted, and all the exertions and work given to them worthless. This is a consideration which does not appear to have entered the mind of the Board of Agriculture in Scotland, although they certainly ought to have known it.

Just another word on the question of deer forests. People who are not versed in the subject themselves do not seem to be aware how much food they produce for the people living in these sparse country districts. During the war the owners of deer forests killed many stags solely for the purpose of feeding the population who lived around them. I am sorry I have not the figures with me. I asked for some figures from Caithness which were given to me, but I have forgotten or lost them—it was three years ago. But the number of stags killed during the war was enormously great for the purpose of providing food for the people, and it is a matter which ought to be borne in mind in any legislation on the subject that the number of deer is now much smaller than it was at that time. I do not wish to delay the House but, having listened with the greatest interest to the debate and knowing a good deal of the subject, I thought it might be of interest to your Lordships to hear this side of the case from some one who has been thoroughly well versed in it for the last thirty or forty years.

THE EARL OF ANCASTER

My Lords, I am loth to continue the discussion on this Bill because it is a subject with which I am not very well acquainted, although, of course, I am interested in it. In listening to this debate—I do not know whether the Lord Chancellor is going to give us a reply—I could not recall to mind any other Bill which assesses compensation for land on the same principles. On almost every occasion in which land is taken for public purposes it is only human nature for the person whose land is being acquired to try and make out that the land is valuable and would let for a great amount of money. Under this Bill the position will be entirely altered, and any proprietor whose land is taken for small holdings must go and plead his case by saying that his land is most outrageously over-rated, try to make out that be has rack-rented his tenants and that he ought to have made a large reduction in the rent.

If I understand this Bill, the land owner is to receive compensation for any loss of rent but not for any loss of capital value. It amounts to this. If a proprietor is receiving £500 from a large farmer whose land it is intended to convert into small holdings he goes before the Land Court and says he has been dealing harshly with the farmer, that the £500 is a most absurd rent, and that as a matter of fact he ought to have asked the farmer £400 a year as the rent. If he is fortunate enough (as I understand the Bill) to convince the Land Court that this £500 is an excessive amount and that £400 is the proper rent, they will take his farm at £400 and compensate him for the £100 which he loses. If he says that £500 is really the true and fair rent the authority—the Land Court—will take the farm and not pay a single halfpenny as compensation. This is really the gist of the whole Bill. We know perfectly well that this farm land, for which a rent of £500, which was quite fair, was paid, will be cut up into small holdings, and we know also that at the end of seven years several small holders will not be making as big a success as they ought to be making, and that they will apply for a reduction of rent. We feel equally certain that the Land Court will say "Here is a disabled soldier, or an unfortunate small holder. It is true it is fair land, but still we are of opinion that he has not got the best bits of the farm which was cut up, and we will therefore reduce the rent by 25 or 30 per cent." The whole of the resulting loss of selling value will fall on the land owner. It seems to me that this Bill reverses the old order of things which has hitherto prevailed in arbitration cases, as regards the taking of land compulsorily, and that every man whose land is being taken will have to go into Court and try to prove that he is rack renting his tenants. I cannot believe that it will be a satisfactory solution of the question.

Part I of the Bill is, of course, a fair and proper way of dealing with the question, and Lord Lovat gave us some good figures to illustrate what very little difference it would make if Part II were left out altogether. In Part I everything is fair and above board, but it is not fair and just to put these small holders as tenants of the landlord and give no compensation at all, and then at the end of seven years for these small holders to be able to apply to the Land Courts and get their rents reduced. As we all know, if there is a change in agriculture and some of these small holders begin losing their money, the first thing will be a very large reduction in rent, and I personally consider that the loss should fall upon the State and the general tax-payer, and that certain landowners in Scotland should not be selected to have this experiment made on them by the State, and then be called upon to bear what loss may accrue from the creation of these small holdings. It appears to me, if you go into the question to the very bottom, that you had better put an annual levy upon all the land owners in Scotland in order to compensate those who may suffer under this Bill in future years, because undoubtedly certain land owners will have to pay the cost of creating these small holdings and other land owners who have not got small holders on their estates will escape. Equally the whole of the ratepayers and tax-payers will escape, which is a very different thing from what happens under the English Bill, where, as we know, if small holdings are not a success the loss falls upon the ratepayers of the county or else the State has to come in and provide compensation. As I have said, Part II of this Bill appears to me to be a complete reversal of the old order of things, and it hits certain people most unfairly in order to provide these small holdings.

THE EARL OF ELGIN

My Lords, I had no intention of taking part in this debate, but I think it has been proved that this is a subject of great importance, because it has occupied the attention of the House for a considerable time, and we have listened to the speeches of various noble Lords who are well acquainted with all the aspects of the question, including two ex-Cabinet Ministers. So far, although the debate has covered a period of over two hours, we have not had any reply from His Majesty's Government.

The subject, as I have said, is one of considerable importance, and is viewed as, such by His Majesty's Government—at least we presume so from the fact of the Bill having been presented—and all the noble Lords who have spoken this afternoon have expressed the desire, which I know is in the heart of every one of your Lordships, that we shall do everything we possibly can to help the settlement of soldiers upon the land of this country. I am quite certain that all of your Lordships who have served in any of His Majesty's Forces during the years of the war must have been impressed, in a way which is quite indelible, with the great value to the country of a love of the country to which we belong—that love which is so well-expressed in the peasantry of France. If we can by any possible means inculcate that same love of country in our own people, we shall be doing something to further the real betterment of this country in the future.

To-night we have had before us this Bill for the settlement of the people on the land of Scotland, and we have tried to consider it from the point of view of those who welcome it, and while supporting it we have only endeavoured to criticise it in a way that is reasonable. So far, however, we have not received from His Majesty's Government any indication of how far they are prepared to meet those Criticisms which we consider reasonable. It is only in order to point out that omission that I have risen to-night, and I hope that before the debate closes we shall receive some indication of His Majesty's Government's wishes.

THE LORD CHANCELLOR

My Lords, I thought it would probably occur to the noble Lord who has just spoken that it was usual for a Minister who introduced a Bill to reserve his remarks in reply until all other speakers who wished to take part in the debate had spoken. That is the usual course, and it is one which seems to me also to be convenient.

This observation falls to be made at once, that I have listened most attentively to all the speeches that have been made, and not one, as was to he expected, challenged in any way, even remotely, the Second Reading of this Bill. I do not believe there is a single member of your Lordships' House who would desire to raise his voice against the proposal for the Second Reading. It follows that all the points that have been made are points which will no doubt be made the subject-matter of specific proposals on the Committee stage, and upon which detailed discussion will naturally take place when that stage arrives.

I do not in the least exclude myself from making a few general observations upon some of the points that have been taken, but of course I guard myself against any expectation that I should commit myself with any particularity to any one of the single points raised. The whole object of a Second Reading debate is that the Government may be afforded an opportunity of explaining the general effect, a they understand it, of their measure, and that they may receive the advantage of hearing what is the general opinion, the expression of which is appropriate to that stage, that is entertained by members of the House. Certainly I cannot complain that I have not been afforded in full measure the advantage of learning what impression certain provisions of this Bill have made upon your Lordships. Those who have spoken have represented, as they always do represent, clearly, admirably, and ably, the great land owners of Scotland. I know of no body of men who can give expression more forcibly and more plainly to the views which they hold, and certainly they have given such expression to them to-night. I would only say by way of caveat at this stage that when Amendments are put down they will be carefully considered, while the interval between this stage and the Committee stage will be used by myself for the purpose of discussing with the authorities the various points which have been raised.

While that is true, it should, I think, be also remembered that this Bill was discussed in another place by a Committee which consisted very largely of Scotsmen, belonging to most classes in the community, and that it was afterwards considered and discussed on the Report stage with considerable care in the House of Commons by the whole body of Members, and it must not therefore be supposed that Scottish opinion has not hitherto been brought to bear upon the terms of this Bill. That does not in any way preclude the necessity of giving most exact care to the points which have been urged in the debate to-night with the object of deciding whether on any one of those points the fairness of the present course has been successfully attacked, and whether a further course can be substituted. Your Lordships may rely upon it that that course will be pursued, and that when Amendments are put down I will see if it is possible to discover whether any further purpose can be served by discussion.

Some specific questions were asked. I may in the first place deal with the suggestion made by the noble Viscount, Lord Chaplin, who said that it was enormously important that the Commissioners should be men of experience. It is, of course, an elementary principle that the Commissioners to be appointed should not only be able and experienced, but that they should be experienced in dealing with these very localities. It is to be reasonably expected that only such men will be appointed. The Duke of Buccleuch, if I understood him, asked whether the whole of the £2,500,000 would be utilised within the two years contemplated by the Bill. The answer to that is, it is the case that the fund can be used after the lapse of two years for equipment in the case of schemes which have been approved within two years, but which have not in fact been completed within that period, and it is thought that that provision will safeguard every case which needs protection.

One noble Lord asked whether the £2,500,000 was available for both Part I and Part II, and the answer is that it is so available. Lord Lovat developed a much wider attack upon Part II, and one with which I do not propose to deal to-night, because it would take me far too long. He attacked it upon the ground that the methods adopted in Part I were much preferable to those contained in Part II, and that the whole fabric of the Bill could easily be so, adjusted as to render Part II unnecessary.

LORD LOVAT

I only asked the noble and learned Lord why we should have Part I founded on equity and Part II founded on injustice.

THE LORD CHANCELLOR

What the noble Lord intervened to say does not appear to me to make what I said inaccurate. I said that the noble Lord had put forward a position that he would like to see Part II excluded from the Bill. I do not pretend to recollect verbally what the noble Lord said, but I think that I have done complete justice in substance to what he said. I do not feel called upon to quote the whole of the noble Lord's speech so long as I do not do him an injustice. I understood him to put forward the argument that Part II ought to be left out of the Bill because a preferable method was employed in Part I. I will deal with what I understood him to say. As I stated, the whole argument would be extremely lengthy, but I recognise that it is one which will have to be faced, and which the noble Lord is fully entitled to put. I merely said to him that he could put down a simple Amendment in the terms of his criticism—

LORD LOVAT

I must decline to have words put into my mouth which I never said. I thought that I made myself perfectly clear, that I was anxious that Part II should form part of the Bill. I saw a very great advantage in having the method there set out. My exact words, as far as I can remember them, were that I saw great advantage in having Part II included, especially having regard to the avoidance of taking a dispute from one Court to the other and so hanging up procedure, which has occurred under the 1911 system. I did say, however, in regard to compensation, that the proposal was not founded upon equity, and that I objected to it. I hope that the noble and learned Lord on the Woolsack agrees with that.

THE LORD CHANCELLOR

I am extremely sorry that I misunderstood the noble Lard. I understand now that there are some portions of Part II which in his judgement are not founded in equity. I can only assure the noble Lord that if he will indicate by Amendment precisely those points, and set out how they can be put right, any suggestions coming from him will receive my most careful attention and that of the Government. I misunderstood the full extent of the noble Lord's disagreement with that part of the Bill.

The Duke of Atholl equally made an attack upon the method of determining compensation which is adopted under this Bill, and that attack was afterwards repeated, with that great weight which he brings to bear on all Scottish questions, and indeed on all questions, by Lord Balfour of Burleigh. I know well, and those who framed this Bill realise, that the question of compensation is one of difficulty and of perplexity. They realise also that the method adopted is one which is open to attack, and was certain to be so attacked. I was asked why the method of compensation adopted in this Bill differs from the method which has been adopted in the English Bill. Whether the explanation is a complete one or not, it springs, of course, from the difference of system which in the past, not only in these Bills but any other Bills, has been adopted in taking land in the two countries. In England, where there is compulsory leasing, the land is leased by a local authority, and the rent is fixed by arbitration. That system, whether good or bad, has always been adopted. In Scotland, under the 1911 Act, tenants are compulsorily imposed on the land owner and rents are fixed by the Land Court. That that system is a good one I have never claimed. Indeed, I remember the occasion referred to by my noble friend, the Duke of Atholl, in which he and I were engaged elsewhere in attempting to resist many of the provisions of the Act of 1911. And many have taken the view that the methods adopted in the Act of 1911 are open to the gravest possible criticism.

The question whether it is possible in terms of this Bill to adopt a method which gives greater satisfaction to those who are affected, without at the same time inflicting an undue burden upon the community is another subject which will be, and ought to be, considered in Committee, and in respect to which the Government will certainly be prepared to give due weight to all considerations that may be urged. I need, I think, only add in reference to the criticism made by the Duke of Atholl upon Clause 14 of the Bill that this clause was most strongly pressed upon the Government in the House of Commons. I think it formed no part of the Bill as originally drafted, and the clause was inserted on the Report stage without a Division—and I think (though I speak only from memory) at the wish of Scottish members.

Lord Balfour of Burleigh also spoke on the subject of the appeal. I agree with him that prima facie in all these cases it is reassuring to know that there is an appeal. The Bill as at present drafted has adopted such safeguard as is afforded by the fact that the Secretary for Scotland must assent, if recourse is had to him. The Secretary for Scotland has, of course, every interest in questions of rating, and it is the view of those who presented this Bill that the right is preserved and that there is sufficient safeguard—but that, again, is not a point of absolute principle, and it may be discussed hereafter.

A question was asked by Lord Lamington as to whether the small holdings in a particular district in the Lowlands of Scotland had proved on the whole to be successful. I am not able without reference to documents to give him any exact figures, nor can I compare the actual productivity of the small holdings in the Lowlands with the productivity of the other lands which have not been split up. But I am informed by inquiries I have made since he spoke from those who represent the Department that in many cases in the Lowlands these small holdings have been extremely productive. Of course, the argument in their favour is not based exclusively upon relative productivity, although that is a very important consideration. It must also be based on the social conditions which have been urged in regard to the whole system of small holdings. But in regard to that point, as far as there are figures available, I will see that the noble Lord has them in the Committee stage. I have attempted to deal with such points as have been raised, and, whether we are able to accept Amendments which are proposed or not, your Lordships, at least, need not be apprehensive that they will not engage our careful and sympathetic attention.

Bill read 2^a, and committed to a Committee of the Whole House.