Lords Sitting of 3 December 1926

Preamble
The House met at a quarter before three of the clock, The LORD CHANCELLOR on the Woolsack.
STORNOWAY HARBOUR ORDER CONFIRMATION BILL.
Read 3ª (according to Order), and passed.

RATING (SCOTLAND) BILL.
Order of the Day for the Second Reading read.
THE PAYMASTER-GENERAL (THE DUKE OF SUTHERLAND): My Lords, this Bill, which proposes to unify and simplify the rating system of Scotland was first introduced at the close of last Session in order to give local authorities and others interested in its provisions an opportunity of considering them. As re-introduced in April last, the Bill gave effect to many of the representations and suggestions which had been received regarding it, and in its present form it may be said to commend itself generally to public opinion in Scotland. Its Third Reading was agreed to in another place without a Division. The need for a reform of the Scottish Rating system is admitted by all who are acquainted with its working. It is a duplicated system. It lacks uniformity; it contains many anomalies and in certain respects gives rise to considerable administrative trouble and difficulty. During the past twenty-five years it has been the subject of repeated Inquiries—for example, by the Royal Commission on Local Taxation, of which the late Lord Balfour of Burleigh was Chairman, and by the Departmental Committee on Local Taxation in Scotland, of which Lord Dunedin was Chairman.
The scheme of the present Bill follows closely the recommendations made as a result of those inquiries. There are in Scotland three main rating authorities, the county council, the town council and the parish council, each of which levies its own rates and employs its own rate
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collecting machinery. In every area the ratepayers have to pay rates to at least two authorities—namely, to the parish council and to the county council or town council, as the case may be. In police burghs, rates have to be paid to three separate authorities, certain rates being levied within such burghs by county councils. Moreover, in areas where the water supply is administered by a special water trust or commission, rates may have to be paid to a fourth rating authority. Such duplication is obviously uneconomical and unjustifiable. Stated at its minimum it means in every area the compilation each year, at considerable expense and trouble, of two separate assessment rolls and the preparation and issue of at least two demand notes for payment of rates.
The Bill proposes that there shall be only one rating authority in each area—namely, the county council in counties and the town council in burghs—and that the other spending authorities, parish councils, education authorities and district boards of control, shall obtain on precept from the county council or town council such sums as are required to be raised by rates. This proposal, it may be observed, follows the plan recommended by the Royal Commission on Local Taxation who, in calling attention to the large number of rates which are now separately levied and to the duplication of rate-collecting machinery, reported in the following terms:—
"This system involves much unnecessary detail and expense and we think that, from every point of view, it is desirable that there should be but one local rate in each area and one authority charged with its collection."
That authority, they recommended, should be the county council and town council.
The only cases in which there will be more than one rating authority will be those few areas where there is a separate water trust or commission. An exception had to be made in their case because it was found that the Local Acts under which their water rates are levied contain a number of special provisions granting rating exemptions and abatements which had been entered into by agreement with individual ratepayers when the Acts were passed and which, in equity, could not well be disturbed. To have placed these trusts and commissions in the position of precepting

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authorities would have greatly complicated the county council and town council books and in the circumstances it was felt that the best course was to leave the water rates in the few areas in question to be separately levied as at present. Provision has, however, been made in the Bill, at the suggestion of the trusts and commissions, whereby they may arrange with the county council and town council to have the water rates collected along with the other rates on a single demand note. Although, therefore, complete unification of rating is impracticable in these areas, the Bill contains enabling powers for securing unification of the rate-collecting machinery. Payment of rates to a single authority, instead of two or three authorities as at present, should be a convenience to the ratepayer. His convenience in the matter is being further met by the provision in the Bill allowing rates to be paid by instalments as shown in Clause 19 of the Bill.
There are at present about 1,100 separate rating authorities in Scotland. These will be reduced under the Bill to about 240. Unification of rating and reduction of the number of rating authorities, many of whom are exceedingly small, should tend to economy in the collection of rates, although the full effect of the economy will not be felt at the outset of the new scheme owing to the compensation that will have to be paid to the dispossessed collectors. It is estimated, however, that the saving in the cost of collection of rates effected by the Bill will be probably more than but at least£50,000 a year. The scheme should also make for efficiency inasmuch as it will enable whole-time officers to be employed in many cases where only part-time officers are employed at present. It is sometimes suggested that a parish collection of rates is more efficient than a county collection in that, the collector being on the spot, there is a smaller loss from arrears and from assessments written off as irrecoverable. But from an examination of the accounts for a few typical areas, it would appear that that suggestion is not borne out by the facts. There is, however, nothing in the Bill to prevent a county council from employing local collectors if it thinks fit to do so.
Besides securing consolidation of the rate levying and collecting machinery the
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Bill provides that all rates will be levied on a uniform rental basis. At present every ratepayer, in addition to paying rates to two rating authorities, is assessed by each of these authorities on a different basis, while in a police burgh the same property may be assessed to local rates on three different bases. This dual (and in some cases triplicate) basis of rating causes much unnecessary confusion both to ratepayers and local authorities, and the proposals of the Bill will therefore greatly simplify the system and make it more easily understood.
County rates are levied on the gross rental as appearing in the valuation roll, the only exception being agricultural land, which, in Scotland, is allowed a statutory deduction of 50 per cent. Burgh rates are also levied on gross rental except as regards such subjects as railway and tramway lines, underground gas and water pipes and arable land, which are allowed a deduction of 75 per cent. from their gross rental. Parish rates, on the other hand, are and have been since 1845 levied on a net rental arrived at by deducting from the gross rental an allowance representing the probable annual average cost of repairs, rates, taxes and insurance. In theory, each individual property is entitled to its own deduction but, in practice, the deductions are fixed according to classes of property, each class receiving a separate percentage deduction which is applied equally to the individual properties within the class irrespective of what their annual cost of repairs may be. Each parish council determines in its own area the percentage deductions to be allowed, and when it is realised that there are 869 parish councils in Scotland, the result, as might be expected, is that the deductions granted to similar classes of property in different parishes vary enormously. For example, the deductions sometimes range from 2½per cent. to 75 per cent. in respect of the same class of property.
The undesirability of leaving these deductions to be fixed at the discretion of parish councils, 869 in number, popularly elected and subject to local influence and pressure as they are, is universally admitted. The Royal Commission on Local Taxation in 1902, the Royal Commission on the Poor Laws in 1909, the Departmental Committee on

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Local Taxation (the Dunedin Committee) in 1922, and the Departmental Committee on the Rating of Machinery in 1925 have all recommended the repeal of Section 37 of the Poor Law Act, 1845, under which the deductions are granted. Moreover, among the parish councils themselves there is a strong, widespread feeling in favour of its repeal because of the trouble and difficulties to which it has given rise.
These difficulties have been greatly accentuated by a decision of the Court of Session in 1924 in the case of the Etna. Iron and Steel Co., Ltd. versus the collector of rates for the parish of Dalziel in Lanarkshire, under which it was held that a foundry which was entered in the valuation roll at an annual value of £1,396 was entitled to a deduction of£4,653 in respect of the cost of repairs, etc. In other words, the property had no assessable value at all and legally, therefore, if the company had insisted on the judgment being strictly applied, which however they did not do, they might have obtained complete exemption from parish rates. Such a result, apart from the equities of the case, would undoubtedly have been a reductio ad absurdum.
The present state of matters is therefore, I think your Lordships will agree, extremely unsatisfactory and makes reform of the Scottish rating system both necessary and urgent. The question arises: If the deductions for parish rates are abolished what system is to lake their place? The adoption of gross rental as the basis of assessment, however theoretically desirable it might be, would produce a very serious overturn in the incidence of rates at present borne by the various classes of property and, in particular, would inflict severe hardship on industry. For that reason it has been found necessary to abandon the idea of rating on gross rental. The Royal Commission on Local Taxation recommended that assessments should be levied on net rental as being in their opinion "fairer to all classes of ratepayers." That recommendation was concurred in by the Royal Commission on the Poor Laws.
The Dunedin Committee, on the other hand, recommended that all rating should be placed on gross rental, but they went on to say that, fating the adoption of the gross rental basis, they recommended that the deductions to be allowed in arriving
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at the net assessable rental should be fixed on a uniform scale by a central authority. Moreover, the Committee's recommendation for the adoption of gross rental was qualified by two important reservations—namely, (1), that the deductions allowed to agricultural land should be continued, and (2), that the differential rating to which railways are entitled in respect of burgh rates should be extended to county rates. The latest pronouncement on the subject is contained in the Report of the Committee on the Rating of Machinery and Plant, who recommended the adoption of the second of the Dunedin Committee's alternatives (that is, net rental), their reason for doing so being stated as follows:—
"We do not consider it necessary to express any definite opinion as to the theoretical desirability of the first of these proposals [rating on gross rental]—as to which, however, we are not at present convinced—because we feel that in the present state of industry it is now, and probably will be for many years, impossible to adopt this course without imposing an intolerable burden upon many industries whose plant and machinery are costly to repair."
The rating basis proposed by the Bill follows these recommendations very closely.
Section 37 of the Poor Law Act, 1845, with its variable deductions, and Section 347 of the Burgh Police Act, 1892, with its fixed deductions, are both being repealed, and there will be substituted for them a scheme which will apply to counties and burghs alike. As has been explained in the White Paper, houses and shops, which in point of numbers and valuation comprise the greater part of the rateable subjects of the country, will be assessed on gross rental, while certain' other classes of subjects will be assessed on a net rental arrived at by giving effect to the percentage deductions specified in the First Schedule. These percentages have been determined after careful examination of the deductions at present allowed for both parish and burgh rates, and they have been equated to houses and shops, being assessed on gross rental. Agricultural land will be assessed on the same basis in burghs as in counties, and the percentage deduction allowed will become permanent instead of being dependent on the continuance year by year of the Agricultural Rates Acts.

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In view of the wide variations in the deductions allowed at present and the proposed extension of the system of deductions in respect of county and burgh rates, it is impossible to frame a scale of deductions which will exactly reproduce the present incidence. The scale in the Bill, however, has been designed with the object of producing a minimum amount of disturbance in incidence, while at the same time imposing a minimum amount of work in its practical application. The estimated effect of the scale of deductions on the incidence of rates borne by the various classes of property is shown in the White Paper.
The scale of deductions will apply universally to all rates levied under Public General Acts, as shown in Clause 12 (1). It will also be applied by Orders issued by the Secretary of State for Scotland to rates (other than water rates) levied under any Local Act or under any Public General Act with respect to which there may be special provisions in the Local Act. These Orders may follow the provisions of the Local Act subject, however, to an important condition—namely, where in any case partial relief from any rate is given to a ratepayer by the Local Act the Order is to secure that the relief resulting from the general provisions of the Bill and from the provisions of the Local Act as modified and adapted shall, as nearly as possible, be the same as that given by the Local Act. That is in Clause 12 (2). Provision is also made for the issue, on application, of similar Orders, subject to this condition, which will apply to water rates levied under Local Acts. That provision is in Clause 12 (4).
An important change proposed by the Bill is with regard to the education rate. Prior to 1918, the parish was the area for educational purposes and each parish bore the cost of its own educational requirements. The Education Act of that year placed the administration of education upon a county basis but left the cost thereof, so far as requiring to be met by local rates, as a charge to be allocated among the several parishes in the county in proportion to their gross rental. One effect of that was to increase the education rate in rural parishes, in some of which the increase was of startling dimensions,
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especially in Drymen, Stirlingshire, where the total sum raised in the parish for education was£778 in the year previous to the Act, £7,236 in 1920–21 and£5,000 in 1921–22. The grievance which the increase occasioned was further aggravated by the fact that although the allocation of the amount required by the education authority was made on gross rental, it had to be assessed for (as in the case of other parish rates) upon net rental with the result that the increase fell with much greater weight on some rateable subjects than on others.
The inequity of the existing arrangements has been the subject of frequent representation and it was animadverted upon by the Dunedin Committee. Parliament itself has recognised the need for a change because in the section which governs the arrangement words were inserted to the effect that it is only to continue "until Parliament otherwise determine in any Statute amending the law of rating in Scotland." That is in Section 13 (2) of the Education (Scotland) Act, 1918. It is proposed under the Bill, therefore, that the cost of education, like its administration, shall be put upon a county basis and the education rate levied as a county rate. The financial effect of this change, it is estimated, will be to relieve landward areas to the extent of about £50,000.
There are other provisions of a subsidiary character in the Bill which will make for uniformity and simplicity in the Scottish rating system and which, although perhaps small in themselves, will have considerable cumulative effect. Of these provisions mention may be made of a certain number. In the first place, there is the power to be given in Clause 18 to a rating authority to levy a consolidated rate instead of levying separate rates for the various rate-supported services. This method, where adopted, will greatly reduce the amount of clerical and accounting work entailed in the levying and collecting of local rates. Then there is the abolition, under Clause 9, of the average rate payable by owners in counties. This stereotyped rate now bears a small proportion to the total county rates; it varies from about a 1d. to a little over 4d. in the pound; and its abolition was recommended both by the Royal Commission

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on Local Taxation and by the Dunedin Committee. The whole of the county rates will thus be equally divided in future as between owners and occupiers and this will result in simplification of the county council accounts
There is in Clause 10 the provision whereby the county councils, instead of levying rates in police burghs will accept on precept from the town council such sums as the burgh may be called upon to contribute towards county services. Police burghs will this be placed in the same position as that now occupied by the smaller Royal and Parliamentary burghs which make similar contributions towards county services. The arrangement, while it will impose little extra work on the town councils, will materially lighten the rate-collecting work of the county councils. Provision is being made by the Bill for rating burial grounds belonging to a local authority or to a company or persons selling the exclusive right of burial in lairs. Abolition of the exemption from local rates at present enjoyed by burial grounds was recommended both by the Royal Commission on Local Taxation and by the Dunedin Committee. In accordance with the usual practice, provision is being made (in Clause 27) for the payment of compensation to local officials who may be dispossessed from office or who may suffer loss of salary as a result of the passing of the Bill.
It may be observed that the scheme of rating which the Bill proposes to set up will fit in with, or can be readily adapted to, any changes which may be made at a later date for the reform of the Poor Law and local government services of Scotland. It will, I really believe, lead to great simplification of the rating machinery in Scotland. It will also be a convenience to the ratepayers; and, by producing a minimum amount of disturbance in the present incidence of rates, it will inflict the least possible hardship on the several classes of ratepayers. I beg to move.
Moved, That the Bill be now read 2ª—(The Duke of Sutherland.)
LORD MUIR MACKENZIE: My Lords, I only rise to say that I congratulate the noble Duke on the clearness of the statement which he has laid before the House.
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It is, I think, manifest that a Bill containing such provisions as he has mentioned deserves at leaves at least a Second Reading It is only to be regretted that, owing to the House sitting on what is now an unusual day, the attendance is hardly large enough to do justice to the many questions which are raised by this obviously important Bill Certainly, so far as my friends are concerned, there will be no opposition to this Bill being read a second time.
THE DUKE OF BUCCLEUCH: My Lords, I agree with my noble friend opposite that the noble Duke has explained this measure very clearly and, I think, very fairly. But, after all, what does it really come to? The Bill may have simplified the present system of levying the rates and, in one or two exceptional cases, it has done a little as regards the rural parishes which are very heavily hit by the cost of education. On the other hand, it carefully refrains from dealing with any of the important and pressing questions of rating in Scotland. So far as the Bill goes I do not think there is any harm in it, but I am a little bit doubtful, since it contains so little, whether it is worth all the time that Parliament must take in passing it.
This Bill follows, or is supposed to follow, the Bill which was before Parliament, I think, last year—the English Bill on rating and valuation. In England the Bill was a Rating and Valuation Bill and effected many important changes. This Bill is only a Rating Bill, and it practically does nothing to affect valuation. It was said by my noble friend, and also in the House of Commons, that the Bill was framed so that the existing incidence of rating should be altered as little as possible. In other words, no grievance or hardship would in any case be removed. Any Amendments dealing with cases in which rating was considered unfair or in need of alteration were systematically rejected by the Government in another place, and many other Amendments were rejected because it was said that they raised questions of valuation. If the Bill had been the same as the English Bill and had dealt with rating and valuation, it might really have been an important contribution to the law of Scotland and have put questions of rating there on a

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satisfactory basis. As it stands there is not much more to be said than has been said by my noble friend opposite—namely, that it has to a certain extent simplified the collection of rates.
As my noble friend said, in England the rates are raised in two ways—the county rate on gross value and the parish rates on net value. Under this Bill they are all to be raised on the net value, but there is the difficulty that, whereas in the past every parish council could say what the net value should be or what reduction should be made, it is now to be uniform over the whole country. The noble Duke also alluded to Section 37 of the Poor Law Act, 1845, and correctly said that, under a decision given in the Court of Session, people who interpreted it correctly could have practically put an end to the levying of parish rates, and therefore it was absolutely essential that something should be done. Although it makes for simplification that the rates should be levied by the county council, and the method will save a small amount of money—my noble friend said £50,000; I think it was put as high as £100,000 in another place—this saving will not take place for many years because the compensation to be given to existing officials will far more than wipe out any immediate saving made.
On the whole, however, I think that this scheme of levying by one authority is satisfactory, except on one point. At the present time the county council levy their rates and have their collector and the parish council do the same, but the education authority, although they can fix what they are going to spend, have to requisition the parish council to levy their rates. This work will now be handed over to the county council, but the great objection is that, though the county council will probably be in a position to do the work better than the parish council, there will be one authority which will levy rates and there will be two other authorities which will not levy the rates but will only spend them.
Up to the present experience has proved that the education authorities, which do not levy the rates, have shown considerable extravagance. The system does not work well, and expenditure on education in Scotland has been quite out
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of proportion to any increased efficiency. I am rather afraid that this system will encourage the parish councils to be less careful of their expenditure than they have been in the past. The parish council have always had to levy the rate themselves, they have had to go to the electors and there has been brought home to the ratepayers in the district exactly what they were spending. There is this to be said in extenuation, although I do not think that my noble friend mentioned it, that in the new demand note I believe it is to be stated what rates are for county, what for education, and what for parish work, and if the ratepayers will take the trouble to look they will see who is dragging the money out of them. But I feel very strongly on the point that if you want efficiency—I do not necessarily mean less expenditure—it is most desirable that those who have to pay the rates should know how the money is being spent and who is spending it.
There are several cases where gross and net value are so very different that particular parishes, especially rural parishes, were very hard hit by the education rate, and this will be modified to a certain extent. On the other hand, the Bill will by no means remove the grievance which is at present felt in the country districts that they are paying for the education in towns. Another point that has been alluded to by the noble Duke is that the rating of land in burghs is to be on the same basis as in rural districts, but he omitted to say that agricultural land in the burghs is going to be rated at three times the amount at which it has been rated in the past.
There is, I think, another mistake in the Bill, and that is that woodlands are to be rated on their gross value. I admit that that has been so in the past, but when all other classes of property, or nearly all, have some deduction, surely woodlands should have a reasonable deduction, especially at the present time, when, if not this Government, at all events other Governments have been saying that they are very anxious to have an increased area under plantation, and they wish cultivation to be encouraged. Whether or not it will pay the owner of the land in the end, one thing at any rate is certain, and that is that the more land under plantation the greater the employment

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will be in the rural districts, because far more employment is given in this way than by any other form of working the land in the particular districts where planting is likely to be any success. I think it is a mistake that the Government have not allowed some deduction on the rating of woodland. Another point on which I think the Bill is a bad one, although I suppose the Government had to follow the English Bill, is this—Government property is still free from rates. As the Government are from day to day acquiring more property, it is only sound that they should be rated on their property the same as everyone else.
Now I want to give some other figures, which really I must pun forward, although they relate to a matter which may be outside the scope of this Bill. I refer to the gross inequality of the relief given to local rates in Scotland as compared with the relief given in England. It is rather difficult to explain these figures. In 1896, when the first Agricultural Rates Act was passed, out of the share of Scotland £100,000 was taken from the relief of agricultural rates and used for other purposes. Under the 1923 Act, if Scotland had been treated the same as England she would have received another£400,000 per annum in relief of rates, and it, is only reasonable and fair that the agricultural industry in Scotland should have as great relief as that of England. The only possible reason that I can see against it is that perhaps Englishmen—I am glad to see my noble friend Lord Bledisloe on the Government Bench—consider that the Scotsman is able to farm much better than the Englishman. Failing that, there is no possible reason for this inequality, and it is a gross injustice. Perhaps I should explain to your Lordships how this occurs. It is rather difficult, but it is partly owing to the difference in the rating systems. In Scotland the rates are levied half on the owner and half on the occupier. As a matter of fact, I think it works out in most agricultural districts that about 60 per cent., or more, is levied on the owner and 35 to 40 per cent. on the occupier. In England, of course, the rates are levied on the occupier.
Now take the difference between the occupying owner in Scotland and the occupying owner in England. The
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occupying owner in England first of all gets 5 per cent. off the gross value and secondly gets 75 per cent. off his rates, or in other words he is only assessed on 25 per cent., or one quarter, of the annual value of his farm after the 5 per cent. has been taken off. The occupying owner in Scotland gets 75 per cent, off as occupier, the same as in England, but he only gets 25 per cent. off as owner. Therefore what it comes to is that on the whole the Englishman only has to pay on less than one quarter of the value of his farm, while the Scottish occupying owner pays on one-half the value of his farm. In other words, the preference to be given to the English farmer in rates over the Scottish occupying owner is something like 60 per cent. in favour of the Englishman. It acts pretty hardly and unfairly when you come to my part of the world, where one man on one side of an arbitrary border line gets 60 per cent. more off his rates than his neighbour on the other side of the border. It is a great grievance which I had hoped that under this Bill the Government would have put right. I am informed that owing to the way in which the Bill is drawn up—perhaps purposely—they were unable to do this. The sum which I believe this would cost is not less than £300,000, and it might be considerably more.
There is another point to which I would like to draw your Lordships' attention. I know it is said by a large number of people that it is very unfair that any landowner should be treated reasonably, it the same as other people, and I think that must have been in the mind of the Department when this Bill was drawn up. There is the question of stipends. Ministers in Scotland are better paid than they are in England. The burden of the stipends is far more than double the burden of tithes in England. In England the rates on the tithe are paid by the clergyman. In Scotland they are not; they are paid by the owner. Therefore, not only has the owner got to pay the rates on what he receives, but he has also got to pay the rates on what not only he does not receive but has to pay out. The stipends in Scotland amount to about£300,000 a year, and therefore on this sum, which is a burden on the land, rates have to be paid by the owner, who is not receiving them into his own pocket. Also,

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I think I am correct in saying that you will find many cases in Scotland where the owner's net return from his land is considerably less than the stipend of the Minister. Yet, out of that almost minus quantity, he has to pay this huge sum for rates.
Further points to which I should like to draw attention relate to the cost of education and the question of the roads. Before the Education Act, two years ago, the education rate was levied per parish, and each parish paid for the education of the children in the parish through the local school board. There was a certain objection to this, although the principle that each parish should pay for the education of its own children was a very sound one. That was altered, and what now happens, in country districts which are rated the same as the towns but which have small populations, is that they pay very much more; in other words, the country districts in Scotland are paying largely towards the education of children in the towns.
Then comes the other question of the roads. Education and roads are the two great burdens on rural areas, and especially those areas in Scotland of low assessable value, which comprise the greater part of the country. The road rate is a very heavy one. Who uses the roads? Who destroys the roads? Not those who live in the country districts, but those who live in the towns, with their charabancs and motor lorries, and so on. Whilst we in the country districts would gladly pay the same rate as the people in the towns for the education of their children, not a penny is paid from those places towards the cost of the country roads. And it is no good politicians saying they are in favour of agriculture and against food taxes, when they are going to put an unfair burden on the rural districts in rates and taxes, which eventually means that the home-grown food in this country is probably rated more highly than anything else in this country, except possibly alcohol.
These are points which really ought to be taken up, and the rating question, which, of course, requires a big Bill to deal with it, is a very much more serious one than the Government realises. It is to a large extent killing the rural districts, and the way in which the rates
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are levied is most unfair. In fact, it really comes to this, that the ratepayers in, these poor districts of Scotland are paying a considerable subsidy to those who are making profits by running motor lorries and charabancs. And this was made rather worse when only a short time ago the Chancellor of the Exchequer raided the fund which is used for the relief of the rates in road maintenance. My point against this Bill is that it does not go far enough. It fails to deal with the cases I have mentioned. I admit that they are very difficult, and perhaps the Scottish Office is wise not to stir up a hornet's nest.
As my noble friend said, however, it will to a certain extent simplify the levying of rates, and therefore is of advantage, but I do not think there is very much more to be claimed for this Bill. The Dunedin Commission suggested that the rates should be in the gross, which I think would have been much better. But that would not do, because it might put some burden on industries—that means the industries in towns, because the agricultural industry, of course, is never thought of. I have, however, nothing particular to say against this Bill. I fancy, owing to the Title, it would be somewhat difficult to amend here, and Amendments would be ruled out in another place; but I regret that the Government, when taking up this question, did not go further and apply to a greater extent the recommendations of the Dunedin Report.
THE LORD CHANCELLOR (VISCOUNT CAVE): My Lords, I do not think the Government have any reason to complain of the reception which has been given to this Bill. On the whole it has received a blessing from the noble Lords who have spoken. I should like to reply to one or two of the observations which have just been made by the noble Duke. He said, and said with perfect truth, that this Bill deals with rating, and not with valuation. That, of course, is the purpose of the Bill, but I believe it is in Scotland the more urgent question of the two. I have looked at the Report of the Commission over which my noble and learned friend Lord Dunedin presided, and I find that of the sixteen recommendations contained in that Report only three relate to valuation, and all the rest to rating;

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and, as regards rating, the Bill, subject to one exception to which the noble Duke has just referred, in substance carries out the recommendations of that Commission.
The noble Duke says it does very little. With great respect to him I think it does a good deal. It creates one rating authority instead of three, or, in some cases four. It provides for equal division between owner and occupier in all cases, abolishing a certain amount of differentiation which now exists. It standardises deductions, and that I think is a strong point. My noble friend has pointed out how unequally the present system works under which each rating authority settles its own scale of deductions, and he referred to one case in which the result was that the deductions to be made from the value were something like three or four times the amount of the rateable value itself. I have known similar absurdities occur in English rating, and this Bill, of course, will put an end to that, for it levies in every case on the net value, which is found by ascertaining the gross value and then making standard deductions according to the First Schedule of this Bill. I am told that the percentages specified in the First Schedule have been so drawn as to preserve as far as possible the existing exemptions and deductions on rates. The noble Duke says that the Bill does no harm, but I venture to say that the removal of the inequality of rating is an advantage, and the Bill is intended to remove that particular grievance.
The noble Duke pointed out—and I think it is true—that the effect of the Bill in respect of agricultural land in burghs is that the owners will be rated on a higher scale than at present. That is the necessary result of the very principle of the Bill, but, on the other hand, he will remember that there are countervailing advantages to the owners, for in burghs I am told that there will be some relief to them as regards buildings. After all, as regards burghs, buildings are more important than agricultural land. Then he said that the relief of agricultural land in Scotland is less than it is in England. That surprises me. I find it difficult to believe that the Scottish members of this and the other House would have allowed that condition to remain. At all events, I am sure that the Bill does not increase the disparity.
THE DUKE OF BUCCLEUCH: I think the Lord Advocate in another place admitted the sum of something like £300,000; but I may be wrong.
THE LORD CHANCELLOR: It may be as much as that; but at all events it is not increased by this Bill which preserves things in that respect as they are at present. I would only mention one other point. The noble Duke said that the Dunedin Committee recommended that the rates should be levied upon the gross and not upon the net. That must be modified by the subsequent Report of the Rating and Valuation Committee, and the Government in considering the matter, remembering that even the Dunedin Committee recommended that exceptions and modifications should be made, thought that on the whole the best plan was to put the rating on the rateable value; that is, the gross with the specified amounts deducted. If that course were not pursued it would mean a very heavy charge on industry which would be a very undesirable thing at the present time. I think, on the whole, your Lordships will see that the Bill contains some useful reforms, and I hope that you will give it a Second Reading.
On Question, Bill read 2ª, and committed to a Committee of the Whole House.
THE DUKE OF BUCCLEUCH: May I ask when the Committee stage will be taken?
THE DUKE OF SUTHERLAND: On Thursday next. I hope it may be taken before dinner, but it is more than likely that it will be after dinner.

HORTICULTURAL PRODUCE (SALES ON COMMISSION) BILL. [H.L.]
Order of the Day read for the consideration of Commons Amendments.
Moved, That the Commons Amendments he now considered.—(Lord Bledisloe.)
On Question, Motion agreed to.

COMMONS AMENDMENT.
Clause 1, page 1, line 24, after ("paid") insert ("or payable").
THE PARLIAMENTARY SECRETARY OF THE MINISTRY OF AGRICULTURE AND FISHERIES (LORD BLEDISLOE): My Lords, you will remember this little Bill,

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which has come back to us from another place and which relates to the sale on commission of horticultural produce. Four Amendments have been introduced in another place into the Bill which was initiated in your Lordships' House, and I am asking your Lordships to be good enough to agree to all of them.
I ought, perhaps, to remind your Lordships that Clause 1, which is the important clause of the Bill, provides that a vendor on commission of horticultural produce shall not only keep a register of his consignors and of the prices realised for the produce which he sells, but shall also send to the consignor an account which is to contain a statement of the prices, the vendor's commission and also the disbursements which the commission agent has to make on behalf of the vendor. The Amendment I am asking your Lordships to accept is the insertion of the words "or payable" after the word "paid," and it is intended to cover cases where disbursements, say, to a railway company recur, being always the same, and the vendor meets the disbursements probably after he sends this account to the consignor. It is really nothing more than a drafting amendment and I hope your Lordships will agree with it. I beg to move that the House doth agree with the Commons in the said Amendment.
Moved, That this House doth agree with the Commons in the said Amendment.—(Lord Bledisloe.)
On Question, Motion agreed to.

COMMONS AMENDMENT.
Clause 1, page 2, line 14, at end insert:
("Provided that in any proceedings under this section if the defendant proves to the satisfaction of the court that the offence was due to a bonâ fide mistake or accident, in spite of all reasonable precautions being taken and all due diligence exercised by the defendant to prevent the occurrence of such offence, or the offence was due to the action of some person over whom the defendant had no control, the defendant shall be discharged from the prosecution.")
LORD BLEDISLOE: My Lords, although this Amendment appears to be a long one it is to meet a very small point. In subsection (3) of Clause 1
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provision is made regarding penalties, and what I will now ask your Lordships to approve is an Amendment to the effect that where, I will not say a technical offence, but an offence, has been apparently committed under the Act, it will be possible for the commission agent to show that such offence was in fact no moral turpitude but was due to a bona fide mistake or accident. In such cases it is provided that the defendant shall be discharged from the prosecution. The words I ask your Lordships to agree to have already been introduced by your Lordships into the Sale of Food (Weights and Measures) Bill which passed through this House last summer. I beg to move that this House agrees with the Commons in the said Amendment.
Moved, That this House doth agree with the Commons in the said Amendment.—(Lord Bledisloe.)
On Question, Motion agreed to.

COMMONS AMENDMENT.
Clause 1, page 1, line 17, after ("salesman") insert ("before the sale").
LORD BLEDISLOE: My Lords, the next Amendment is to provide that under subsection (4) the provisions of the Act shall not apply to the sale of horticultural produce unless the owner or consignor sends to the salesman before the sale the advice note provided for in that subsection. It is really a drafting Amendment, and I beg to move that your Lordships do agree with it.
Moved, That this House doth agree with the Commons in the said Amendment.—(Lord Bledisloe.)
On Question, Motion agreed to.

COMMONS AMENDMENT.
Clause 3, page 2, line 39, leave out from ("at") to end of subsection and insert ("or before the sale of the produce—

(a) the salesman has received from the owner or consignor a direction in writing to the contrary; or

(b) the owner or consignor and the salesman have entered into an agreement in writing to the contrary;

and any such agreement may apply either to a particular consignment or generally to all such consignments as may be specified in the agreement").
LORD BLEDISLOE: My Lords, there is perhaps, a little more substance in the last Amendment on the Paper. The Bill as originally drafted enabled a consignor and salesman to contract out of the Act in respect of any particular consignment, and the Commons have introduced an Amendment, with the approval of duly authorised representatives of the growers of horticultural produce and the commission agents, which will enable the growers and agents to contract generally out of the provisions of the Act if they think fit. The Amendment is to the effect that such contracts can be made in general terms to apply to all consignments and not to one consignment only. I beg to move that the House agrees with this Amendment.
Moved, That this House doth agree with the Commons in the said Amendment.—(Lord Bledisloe.)
On Question, Motion agreed to.

BUSINESS OF THE HOUSE.
THE EARL OF PLYMOUTH: My Lords, I think it is right to remind your Lord-ships that the House will meet at 3 o'clock on Monday next.
[From Minutes of December 2.]
BRIGHTON AND HOVE GAS ORDER, 1926.
GLOUCESTER GAS ORDER, 1926.
CARK AND DISTRICT ELECTRICITY SPECIAL ORDER, 1926.
CREWE ELECTRICITY (EXTENSION) SPECIAL ORDER, 1926.
ETON WICK BOVENEY, DORNEY AND HITCHAM ELECTRICITY SPECIAL ORDER, 1926.
Report from the Special Orders Committee that no Petition has been presented praying to be heard against the Special Orders, and that there is nothing in these Orders to which they think it necessary to call the attention of the House. Read, and ordered to lie on the Table.

MERSTHAM ELECTRICITY SPECIAL ORDER, 1926.
Modifications proposed by the Special Orders Committee, laid upon the Table, and to be printed.
House adjourned at ten minutes before four o'clock till Monday next, three o'clock.