HL Deb 30 June 1948 vol 157 cc122-44






3.30 p.m.


My Lords, I rise to move that these Special Orders be approved. I think that, perhaps, it would be convenient if I were to say a few words in moving these Regulations, and then, if your Lordships will allow me, I will do my best thereafter to reply to any detailed points that may be raised. Your Lordships know, of course, that, the Town and Country Planning Act, by Clause 81, I think, contemplated that Regulations might be made. The application of the Act to minerals has always been, in my view, a most difficult feature. Regulations may modify the Act in certain respects, and it is always rather difficult to know where modification ends and where alteration of the structure of the Act begins. These Regulations, which have been promulgated, should be taken by your Lordships, if I may use the phrase which the Minister used, as "interim Regulations." They are in no sense final. I contemplate with confidence that further Regulations will be made dealing with all sorts of other matters. When discussion arose in another place, the Speaker pointed out that it would obviously be out of order to have a discussion on these Regulations by considering whit was not in them rather than what was in them. I have no doubt that your Lordships would think it proper that there should be perhaps a light touch on what is not in them, but I apprehend—though, of course, we make our own rules of order here as we go along—not a detailed consideration of what is thought to be lacking.

I think it will be found that, so far as these Regulations go, they are quite unexceptionable, though there are several points on which explanation may be deemed desirable. I think, broadly speaking, that the Regulations have been agreed, in the sense that it is felt that there should be other Regulations as well; but so far as they go, I think they are accepted as being right. I have been at some pains in this matter. I have seen the Minister and also the Chairman of the Central Land Board and have discussed the subject with them. As to some of the matters which I understand are going to be raised, I can at the outset, I think, relieve anxiety. With respect to existing leases in regard to which it may be necessary to fix a development charge, it is clear that not only the mineral undertaker but also the royalty owner should have the fullest right of consultation with the Central Land Board in connection with the fixation of the charge. I am authorised, not only by the Minister but also by the Central Land Board, to give your Lordships the assurance that so far as existing leases are concerned there will be the fullest right to have consultation alike on behalf of the mineral undertaker and of the royalty owner.

So far as it concerns me to make Regulations regulating references to a Tribunal, I shall certainly see that both the royalty owner and the mineral undertaker have the fullest right before that Tribunal, to appear, if they so desire, by counsel, and, subject to the Rules, to appoint their own representatives. I hope that will go some little way to remove anxieties in regard to the matter. I have limited what I have just said, your Lordships will observe, to existing leases. With regard to future leases, different considerations arise. I do not want to give any definite answer on future leases, because that is one of the matters which I anticipate may be the subject of further Regulations, which I hope will be agreed. All I can say with regard to these leases—here again I speak with the authority of the Minister and of the Central Land Board—is that we hope that consultations will continue (they are in fact now going on) between the Central Land Board and the representatives of the Federation of British Industries who, I understand, are specially enlarging themselves in order to include representation of all sections concerned and of the Central Land Owners Association. I hope that, as the result of those discussions, we shall be able to arrange some formula with regard to leases for the future. That is all I wish to say upon these matters at the present stage. If any of your Lordships has points which he wishes to raise during the debate, I will do my best to answer them. But this is such a difficult and technical part of the Act that I devoutly hope that no one will raise points of which they have not given me notice. If they do, I shall, at any rate, expect, and I am sure I shall receive, deepest sympathy from all sides of the House. In the meantime, I beg to move that these Regulations be approved.

Moved, that the Special Orders, as reported from the Special Orders Committee on Wednesday the 9th instant, be approved.—(The Lord Chancellor.)

3.36 p.m.


My Lords, I feel sure that your Lordships will welcome the remarks which the noble and learned Viscount has made in moving that the Regulations now before the House be approved. They are extremely difficult to apprehend, and indeed to a layman well nigh impossible. Nevertheless, as I understand them, they deal with matters of supreme importance, not only to the developer but also to the owner of mineral deposits and, ultimately, to the whole nation at large. I hope that before your Lordships approve these Orders by affirmative Resolution the noble and learned Viscount will be in a position to reply to a limited number of inquiries which, no doubt, other noble Lords, as well as myself, will wish to address to him.

Although, as the noble and learned Viscount has said, these Regulations apply the general principles of the Town and Country Planning Act to the special case minerals, I frankly believe that a number of them could, in point of fact, have found their way into the Act during the passage of the Bill through this House. It is true that we have an opportunity of discussing them this afternoon, but I believe that it would have been more convenient for the House generally if we had known at a far earlier stage what the Government had in mind in dealing with the whole question of minerals generally. Nevertheless, we have now the opportunity of discussing various points on the Regulations. I shall endeavour to put certain questions to the noble and learned Viscount, questions of which I hope and believe I have given him notice, and which, no doubt, will be enlarged upon by other noble Lords who will take part in our discussion. My first question is one of detail. It deals with paragraph 4 of the Schedule of Development Order which your Lordships approved some time ago. As I understand those Regulations, paragraph 4 does not apply to land which was to be developed by the winning and working of minerals, although such land is, in point of fact, covered by Part VIII of the principal Act. I am uncertain whether it would be correct to say that paragraph 8 of the Minerals Regulations, which your Lordships are discussing to-day, can, in point of fact, be overridden by paragraph 4 of the former Regulations, which your Lordships approved some time ago. I hope that the noble and learned Viscount may be able to give me some enlightenment on that point.

I now turn to Paragraph 7 of the Minerals Regulations, which deals with the assessment of development value for the purposes of compensation. As I read this very complicated paragraph, it lays down that in assessing development value the presence of any buildings on that or adjacent land shall be taken into account, but that the actual value of the buildings, as such, shall be disregarded. I have no objection to that. It seems to me both fair and equitable. But now I turn to the other point under the same paragraph, by which the developer has to pay development charge on a portion of the land which he proposes to work, and for which he has duly obtained a lease from the owner and, finally, erected the necessary works. Let us suppose that in ten years' time the developer intends to extend his mineral operations to the adjacent property. As I read this paragraph, the Central Land Board will be obliged to assess the development charge on the adjacent land at a figure which must be much higher, solely because of the presence of works which have been erected in the first place by the developer. In point of fact, the developer will be called upon to pay twice over. He will have paid a large sum of money for the erection of the works and he will again be called upon to pay for the value which those very works have created. I wonder whether the noble and learned Viscount could give me an assurance that this paragraph 7 will not be applied by the Central Land Board in the assessment of development charge. At the beginning of this week in the course of discussion of these same Regulations in another place, the Minister recognised that there was a prima facie case, and stated that this was one of the points for discussion between the Central Land Board and the industry. Will the discussions between the Central Land Board and the industry result in further Regulations which will, in due course, be before your Lordships' House? If they do not, I see great difficulty in assuring ourselves that in assessing the development charge the Central Land Board will take into account the problem that I have briefly covered.

I was going to make a further point, but the noble and learned Viscount the Lord Chancellor has already covered it, in saying that the landowner will now have an opportunity of appearing before the Central Land Board before the development charge is made. So far as I am concerned, that certainly meets me and I think it is a valuable undertaking to have received. That case, as the noble and learned Viscount said, dealt with the assessing of leases. I should have had much to say on future leases but, as I understand the noble and learned Viscount, further Regulations will have to be made on future leases, and therefore I do not see any necessity to cover that point to-day.

Finally, I should like to ask the noble and learned Viscount whether he can give us some indication of the Government's view concerning the restoration of land after the extraction of the mineral. Is this work to be in future the responsibility of the landowner, the undertaker or the Central Land Board themselves? Surely, in the assessing of the development charge, the Central Land Board must have regard to the restoration of the land. It seems to me that clearly they have a duty to ensure that the charge which is levied on the undertaker and paid for by the royalty owner is at such a rate that either the developer or the owner of land is left in a sufficiently solvent financial position to bear the cost of restoration. I do not want to weary the House with the Waters Report, with which many of your Lordships are no doubt familiar, but that very question of restoration was a subject to which they gave careful consideration. It will be remembered, in passing, that they commented at some length on the fact that no fewer than 3,600 acres in Northamptonshire alone were to-day lying absolutely derelict, with no charge and no opportunity of either one or the other party restoring the land to agricultural use or for afforestation purposes.

No doubt your Lordships will recall that, during the passage of the main Bill through your Lordship's House, pressure was put on the Government to deal with this question. I am sorry to think that they took no power at that time to cover the restoration of land, and that in these Regulations there is no mention whatsoever of restoration. I hope the noble and learned Viscount will be able to give me an undertaking that in assessing a development charge the Central Land Board will take into account the whole question of the restoration of the land. Those are the principal points that I wish to bring to the attention of the noble and learned Viscount the Lord Chancellor. As I have said, the right of the owner to make representations to the Central Land Board before a development charge is made, is a valuable assurance and I am grateful to the noble and learned Viscount for it. I should be equally grateful if he could deal with the queries that I have addressed to him, and so enlighten me and, no doubt, other noble Lords on these points.

3.48 p.m.


My Lords, this adds one more to the rather complicated group of Regulations which have resulted from the Town and Country Planning Act. As the noble and learned Viscount on the Woolsack has said, it deals with part of the Act which is perhaps rather more complicated than other parts, and that is saying a good deal. These Regulations are interim Regulations, as the noble and learned Viscount said. In doing so, he has merely repeated in other words, what was said by the Minister of Town and Country Planning in another place. It was contended with some force in this House, in passing the Bill, that minerals ought not to have been dealt with by this measure at all, and that the subject was one deserving of a separate Act of Parliament altogether. As the result of these Regulations one is led to the belief, first of all, that the provisions regarding minerals were put in the Bill without due thought. That is borne out by the fact that, even at this stage, conversations are only in progress with regard to very important details. It must be pointed out that this is not fair to mineral undertakers, who have to look a long way ahead, and it will undoubtedly do a great deal of harm to the industry in this country by keeping them in suspense, as they are being kept at this stage.

One point of a general nature which arises on these Regulations is, so far as I can see from the statements that have been made and from the Regulations themselves, that the Central Land Board are, in one way or another, to be given an immense amount of power. The Central Land Board are an excellent body of people; but the Act was passed by Parliament. The Act is a major measure of policy and, so far as one can see from the Regulations which I have studied, the policy so far is being dictated by the Regulations, which place upon the Central Land Board a great deal of the burden of decision, and take it out of the hands of the Government and Parliament who passed the Act.

I now come in some detail to the Regulations which we are considering at this moment. I am glad that the noble and learned Viscount has been able to say that there will be the fullest consultation with the royalty owner in the fixation of the development charge on minerals in the case of existing leases. There is no such provision in the Act, or in the Regulations. I hope that the noble and learned Viscount in his reply will be able to tell us whether what he has said in your Lordships' House will carry more weight than the words that were used by the Parliamentary Secretary to the Ministry of Town and Country Planning when he introduced these Regulations in another place last Monday and dealt with this particular point—namely, consultation with the royalty owner in assessing the development charge. He then said: The power is not contained in the Act or the Regulations. It is a purely convenient arrangement by the Central Land Board. A little later on he said: It is possible"— I ask your Lordships to note the word "possible"— for the Central Land Board to take such persons into consultation. That is something conditional, whereas, if I understood the noble and learned Viscount on the Woolsack aright, it is quite definite that they will be taken into consultation at the time of the assessment of the development charge. It is, in my view, very important that they should have the right at that stage to make representations.

Your Lordships will remember that, under normal conditions, in any case of development, it is the developer who pays the development charge. But in the case of minerals there is a further provision that at a subsequent stage the lease can be varied in accordance with the development charge; that is to say, that the developer will get some alleviation on his lease in the light of the development charge which he has to pay. It means, further, that the royalty owner will suffer as a direct result of the imposition of the development charge. So far as one can judge from everything one has seen and read with regard to it, it appears to be the intention that the whole of the burden of the development charge should be shifted from the developer on to the royalty holder. Therefore, he has a direct interest from the beginning in the assessment of the development charge. I hope we may have a very definite assurance from the noble and learned Viscount that his words will carry the further weight that is necessary, over and above those used in another place. With regard to I the second part—namely, representation before the Railway and Canal Commission, or the Tribunal, over the variation of the lease—I am very glad indeed that the noble and learned Viscount has been able to give us the assurance that the Regulations for which he will be responsible will contain the necessary provision I the royalty owner can make his representations. There, of course, he is directly interested.

I would like to refer to the point mentioned by my noble friend Lord Munster in regard to paragraph 7 of these Regulations, dealing with the question of taking into account the presence of plant, machinery and buildings in assessing the development charge. I will endeavour not to go over ground which my noble friend has already covered. In any claim that there may be against the global sum it has been made quite clear that the owner of the buildings is not allowed to take into account the presence of plant, machinery and building; whereas, when the development charge is being assessed, the presence of the plant, machinery and buildings is taken into account in addition to the value of the minerals for the development of which they were erected. That, in itself, seems to me to be inequitable. There is a further important argument that I think ought to be put forward. It is that the purpose—if I understood it aright—of the Town and Country Planning Act, and the development charge in particular, is that values created by the public should not accrue to the private individual, but should accrue to the public; and in the values created by the public is included the value of ungotten minerals. That is a principle, as I understand it, to which your Lordships' House agreed. Yet, in assessing the development value of minerals, it is proposed by paragraph 7 of these Regulations that there should also be taken into account the increased value owing to the presence of plant, machinery and buildings, put there, not by public money, but by the private individual. Again, it seems to me inequitable that that should appear at all in these Regulations.

There is one other point I would like to mention—namely, that the getting of minerals is a very important part of the economy of this country. It would seem that under these Regulations a great deal is being done to deter any form of private enterprise from obtaining the minerals. If that should happen, it may prove to be disastrous to the country. The noble and learned Viscount talked about further Regulations with regard to new leases. I beg of him to use all the influence he has in high circles when those Regulations are finally dealt with, before their being brought before Parliament, to ensure that they are not of such a nature as to deter future lessees or lessees from getting the minerals that lie beneath our soil. It may be said that it is an article of political faith, but in reality it is a practical statement of fact that we shall get more minerals out of our soil, and get them more cheaply and therefore be able to sell them more cheaply, by private enterprise than we ever shall by compulsory clauses in an Act of Parliament.

I should very much like to move that the House do not approve of these Regulations. I have not done so, because it would in fact vitiate much that we have agreed to in the Act. But it is a most unfortunate method of dealing with important problems connected with great industries, to pass an Act of Parliament subject to Regulations, and leave it to the Regulations to deal with all the really important features which concern those industries. Dealing with matters by Regulations means that there cannot be that real parliamentary scrutiny which can be obtained in the passing of an Act of Parliament through Parliament.

4.2 p.m.


My Lords, after what has fallen from my noble friends, I propose to confine my remarks to the extractive industries, because, as I have said before, I happen to be Chairman of the Cement Makers Federation, and that industry is very much affected by these Regulations. If I talk about the effect of the Regulations on the cement industry, it is only because I happen to know more about that industry than I do about the other great extractive industries. I think that everything I am about to say affects equally the steel industry, the pottery industry and other industries which, as the noble Earl who has just sat down has pointed out, are of vital importance to the economy of this country. Before I pass on to that aspect of the matter, may I say how much I agree with what the noble Earl, Lord Radnor, has just said about the menace to British liberties which results—no doubt unintentionally, but does in fact result—from the establishment of extra-Parliamentary authorities like the Central Land Board, which cannot be questioned across the floor of either House of Parliament though their actions may be of greater importance than the action of any Minister. They are not subject to the same scrutiny and cross-examination which all Ministers have to face in one House of Parliament or the other. It seems to me to be a matter of real and growing importance.

I do not quite know what the noble and learned Viscount on the Woolsack meant by saying that these were agreed Regulations. Certainly so far as the cement industry is concerned they are not agreed, and I am not aware that the steel industry has agreed to them either. We were assured, when the Bill was passing through Parliament, that the intention of the Government was that the undertaker—that is the industrialist—should be no worse off than he was before. That intention appears to have been completely destroyed by the decision that the Central Land Board is bound to assess the development charge at 100 per cent. of the increased value. It is this decision to take away all discretion from the Land Board in the great majority of cases that has had such serious effects upon the extractive industries. We had been led to believe that their case would be considered on a different footing from that, for example, of housing development, because the circumstances and conditions were entirely different. We believed that their case was to be considered on its merits, but instead of that we are faced with this decision that the development charge must be 100 per cent. of any increased value that results from, let us say, mining chalk out of a field that had previously grown wheat.

I must also allude to a point mentioned by both my noble friends, and that is the effect of paragraph 7 of the Regulations. That paragraph lays it down that the Land Board must have regard to any increase in the value of the land brought about by a factory. The noble Earl, Lord Munster, in his remarks, seemed to anticipate that that might be mitigated in some way, but I confess that I was not able to follow his argument. I would draw his attention to the words in the fourth line of paragraph 7 where it says: …regard shall be had"— it is like the 100 per cent.; there is no room for discretion— to any increase in the value of the interest arising from the presence of any buildings.… What does that mean? It is a vital point to a steel or a cement company. Cement is made out of very common minerals—chalk and clay or limestone and clay. There are immense quantities of limestone and clay soil in this country, the greater part of which is, of course, used for the purposes of agriculture. If a man decides to erect a cement factory which he knows must cost him over £1,000,000, he will naturally first either buy or lease sufficient chalk and clay to enable him to amortise the cost of his works—that is to say, he must supply himself with about eighty years' supply of chalk and clay; and he proceeds to go from field to field extracting the minerals that lie under them.

As the noble Earl, Lord Radnor, pointed out, the man is now to be charged on the increased value that his own factory has added to the field of wheat which overlies the chalk. That is clearly inequitable and monstrously unjust; it is, moreover, an exact reversal of the principle on which the Town and Country Planning Act is supposed to be founded. It is a case of the community appropriating a value which has been created purely by private enterprise. I should like to point out how this will actually work. The noble and learned Viscount on the Woolsack will correct me if I am mistaken, or if I make any misrepresentations—which I assure him would be unintentional. Let me take the example of a man who has either bought or leased his land on agricultural values. Suppose that he is paying a royalty of 6d. a ton on his chalk; and that the development charge is fixed at 8d. a ton. It is quite clear, in the first place, that the development charge cannot be passed on to the landowner because it is greater than the total royalty. I assure the noble and learned Viscount that a great deal of land has been bought or leased at low prices—which is one of the reasons why cement is so cheap. Suppose that the undertaker is paying a royalty of 6d. a ton and that a development charge of 8d. a ton is imposed. That is not the end of the matter, because it will be necessary that the land should be restored.

For the sake of argument, I think it would be reasonable to say that the landowner must receive the equivalent of 2d. a ton with which he will be able to restore his land after operations have finished. Therefore, you must add to the development charge of 8d. a ton a further 2d. for the restoration, which means that the cement manufacturer will have to pay 10d. a ton for his chalk instead of 6d. a ton. I believe that that is a fair statement of what is likely to happen, in a great many cases, under this Bill. I am taking what I believe to be a normal hind of case. I have chosen the case of a man who is leasing his minerals, rather than a man who has bought them, because it makes the illustration simpler; but the principle is the same, whether the man has bought his minerals or is leasing them.

What is the effect of that? The only possible effect must be to increase the cost of making cement, steel, pottery, and all the other products of these industries. Did the Government really want to bring about that result? What good will it do? It is the most amazing development of the social legislation of this Parliament. Just at the time when industrialists are being told to bring their prices down, and are urged to increase exports, the Government pass an Act of Parliament and Regulations the only effect of which on these industries must be to raise the cost of their products. It will mean that cement sold at home must be raised in price—no one is going to make cement at a lass. This will send up the cost of all building in this country. Do tie Government want that to happen? It will send up the cost of all housing, all new factories, all public works, dams, reservoirs, bridges, and roads. The cost of every one of these things will be raised.

The Minister may say that his intention is, after all, fulfilled, because the industry will be no worse off than before, since they can raise the price of cement. But that would certainly not be true of the export trade—and it is particularly to the export trade that I would draw your Lordships' attention. In the export trade there is no possibility of raising the price of cement, for it is fixed by the laws of supply and demand, and there is keen competition from foreign competitors. Is it really the desire of the Government to put a tax on one of our most important exports, to handicap our manufacturers in their competition with their foreign competitors? You might as well put a tax on coal at the port as do this. Some people may think that the difference which this charge will make will not be sufficient to be of real importance; but I can assure your Lordships that that is far from being the case. It may be said that it is after all only a matter of 4d. or 6d. or 7d. But the cost of cement is made up of four-pences; the whole cost of these products is made up of a large number of small items, and every item that is added to the cost of manufacture inevitably increases the cost of the product.

Therefore do not let us be under the illusion that this is a matter that will not have its effect. It will have its effect and, so far as I can see, the effect will be wholly bad. I do not see one redeeming feature about this, or one advantage that can come to this country, or to any section of the community, by putting a tax of this nature on these great industries. I do not believe that the Government ever intended that that should happen. If I am right in that belief, may I beg the noble and learned Viscount on the Woolsack to appeal to his colleagues that this matter should be given further consideration? I am aware that the Minister has held out hopes of further Regulations and further discussions but, as I understand this question, I do not think that you can get away from the difficulty that I have pointed out without an amending Bill. It is not really the Regulations; it is the interpretation of an Act of Parliament, an interpretation which, in the opinion of His Majesty's advisers, it is necessary to place on the Act of Parliament.

I cannot see how any Regulations can get over this difficulty, if the Act be interpreted in the way in which it apparently is interpreted. Therefore, the discussions to which the Minister and the noble and learned Viscount the Lord Chancellor have alluded, though no doubt very important in respect of other matters, in regard to this particular matter can be of no avail. What is required is an amending Bill. I hope that that suggestion will receive careful consideration. I notice that the Minister in another place has already suggested that in another connection an amending Bill may be necessary. He has already suggested that, although the ink is hardly dry on the Royal signature to the Act. If that is the case, if amending legislation is already visualised, I hope that the Government will consider the advisability of cutting out of this Act altogether the provisions relating to these extractive industries where the raw material derives its value from the factory that has been built for making the finished product, just as much as the air that is turned into nitrates by the works at Billingham derives its manurial value from the presence of those works. To apply the ordinary arguments on which development charges have been founded to such processes is, to my mind, a complete confusion of thought. If the Government will only cut the provisions regarding the extractive industries out of the Act altogether, I cannot see that the main purpose of their legislation will be in any way affected. They will be removing what must otherwise be a millstone round the necks of industries which are of the greatest importance, not only to our internal economy, but also to our export trade.

4.23 p.m.


My Lords, with your Lordships' permission, I propose to make one or two observations of a general nature in connection with these Special Orders. When considering the last batch of Orders which your Lordships approved a day or two ago—more than a hundred pages of them—the Special Orders Committee had the advantage of reports on them prepared by an Advisory Committee under the chairmanship of Sir William Spens. That Advisory Committee is an independent body, learned in the complicated provisions of the National Insurance Act, and, in accordance with the Act, the Minister placed Draft Orders before that Committee. No doubt, those drafts were then considered by the Departments concerned to be as perfect as they could be made, but your Lordships will have observed that in almost every case the Advisory Committee recommended amendments. Those amendments were accepted by the Minister and were embodied in the drafts laid before Parliament. There were, in fact, four stages: there was the preparation of a draft by the Minister, there was consultation with an Advisory Committee, there was a revision of the draft by the Minister in the light of the Advisory Committee's recommendations and, finally, there was the laying of the draft in unalterable form before Parliament.

In the case of the Orders before your Lordships to-day, there was no second or third stage. No Advisory Committee was consulted, and the language of the unalterable drafts laid before Parliament was the outcome of Departmental wisdom unaided by an independent Advisory Committee. If, as was the case, the National Insurance Advisory Committee found it necessary to recommend alterations in almost every Order drafted by the Department, it seems highly improbable that the Orders now before your Lordships would not have been improved if they had been considered by a competent Advisory Committee before the drafts were laid in unalterable form. It is not the function of the Special Orders Committee to consider the merits or the details of Orders and, even if amendments were permissible, I doubt whether the Committee would feel themselves competent to make them. By Standing Orders the Committee have only to report (i) whether the Special Order raises important questions of policy or principle, (ii) whether it is founded on precedent, (iii) whether it needs the special attention of the House, and (iv) whether further inquiry is necessary before the House proceeds to a decision. In view of the number and complexity of Orders in these days, I cannot help feeling that consideration by an advisory committee which can recommend alterations has become a necessary stage in the progress of such Orders through the House. That compulsory stage could presumably be secured by putting a suitable clause into every important Bill, but it might be worth considering the achievement of the same object by some addition to the Standing Orders of your Lordships' House. The matter seems to me to be of some urgency and importance. I hope that the noble and learned Viscount on the Woolsack will give it his consideration.

4.28 p.m.


My Lords, we have had an interesting and informative discussion. If this discussion had taken place in another place and if Mr. Speaker, with all the authority which he possesses, had been presiding instead of a mere person like myself, with no authority, I feel quite certain that 90 per cent. of our discussion would have been ruled wholly out of order. But, notwithstanding that fact, it was for me very interesting. I was asked some questions as to the meaning of what I had said about these being "agreed Regulations." This bears closely on the subject matter which was raised by the noble Lord, Lord Cozens-Hardy, who has just been speaking. These Regulations have been exhaustively and fully discussed by the Minerals Committee of the Federation of British Industries, which represents some 28 trade associations interested in the minerals industry. When these Regulations were in draft at least two meetings were held between the members of the Committee and officials of the Department. Independent representations were received from the Ironstone Royalty Owners' Association, who are not represented on the Federation of British Industries Committee, and from the National Council of Associated Iron Ore Producers and the Ballast Sand and Allied Traders' Association—they, I understand, not being represented.

I think it right to say that substantially all the points raised by these bodies have been met, so far as they were within the scope of these Regulations and, so far as these Regulations go—and I emphasise that—I think they are agreed. The disagreement comes from the fact that I cannot and am not entitled to claim that I have the agreement of all these people, because they wanted certain other Regulations made—Regulations which are not at present made, but which are to be the subject of further discussion. So far as I apprehend, there is no criticism by anybody concerned of any of the Regulations now before your Lordships; the criticism is limited to the fact that we ought to have taken the opportunity of dealing with other matters beyond that with which we have dealt. That is chat I meant by saying that the Regulations were agreed; they are agreed only in that sense. Of course, I will consider what the noble Lord who last spoke said about the question of new machinery for this House to consider this matter.

Now let me come to the questions of the noble Earl, Lord Munster. He asked whether paragraph 4 of the earlier Regulations would be used to deal with this topic, or whether it would be dealt with exclusively by the present Regulations. It is the intention to deal with this topic exclusively by the present Regulations and not to use Regulation 4 of the earlier Regulations at all to deal with it. Secondly, the noble Earl asked me about the meaning of Regulation 7, and, since this has been through the debate, may I point out to your Lordships that there has been a complete misapprehension as to the extent and scope of that Regulation. It starts with these words: For the purposes of Section 61 of the Act…in calculating the restricted and unrestricted values of an interest in any land… we shall do certain things. Section 6r of the Act is a section which is to be found in Part VI, and Part VI of the Act is that Part which deals with the measurement of the claim against the £300,000,000; that is all. Part VI of the Act has nothing to do with the fixation of the development charge; that is Part VII. Therefore, in its expression this Regulation has no application whatever to the fixation of the development charge. Whether or not a similar principle will in due course be applied is a matter which I will discuss in a moment. But it is quite plain and beyond argument that paragraph 7 applies only to Part VI of the Act; that is to say, the ascertainment of the claim against the £300,000,000 fund. I apprehend that everybody will agree with me here—and, indeed, there has been, if I understand it aright, some pressure to get it in for this purpose.

Of course, in dealing with this question of valuation, it is difficult to consider it, if I may use the phrase, in vacuo. Supposing that you are contemplating making a car park outside a large hotel, the question which the Commissioners will have to ask themselves is what development charge they are to levy for the right to make that car park. It is quite obvious that you cannot assess the development charge for making that car park without having regard to the fact that there is a large hotel in the neighbourhood, that being the whole raison d'étre of the car park. You cannot assess it as you would if it were to be in the middle of the Sahara. It is obvious that you must have regard to the surrounding circumstances. That, of course, applies to Part VII, the fixation of the development charge. I do not know whether a similar provision to what is Regulation 7, relating solely to the fixation of the claim against the £300,000,000, will necessarily be applied to Part VII—that is to say, the fixation of the development charge. Superficially, as the Minister said the other day, that is obviously a formidable and attractive case, but that is one of the very matters upon which discussions have been going on and will continue to go on.

Perhaps I may tell your Lordships this. I have for a long time known Sir Malcolm Eve as a very approachable man, and a man possessed of great common sense; and he would be the first to realise that if, in regard to these extractive industries or any other industry, they were to impose swingeing development charges the result would be a great misfortune to this country as a whole. One must assume that these provisions will be applied with some common sense and, therefore, I would say in answer to the question of the noble Earl, Lord Munster, that Regulation 7 does not deal with the fixation of development charge at all. It is necessary to have Regulation 7; you would have to apply this principle because you are considering what is the unrestricted value of a piece of land, and you must consider all the circumstances relating to the land.

Quite obviously, minerals such as those required for cement, chalk and the like, are of value if you have in the neighbourhood a factory at which you can deal with them, and are of very much less value if you have them situate in a place where it is impracticable to bring them to a factory. You cannot begin to ask yourself what is the value of the mineral unless you consider how it can be dealt with. The value means nothing at all unless you consider the surrounding circumstances. So you are told here in this Regulation, that, in order to assess the unrestricted value of the mineral, you must have regard to the fact that in the neighbourhood there is a factory which can deal with it. That, of course, tends to put up the value of the mineral, and consequently it tends to make the difference between the unrestricted value and the restricted value greater than it would otherwise be. Therefore, the fact that it becomes greater than it otherwise would be means that there is a higher claim against the £300,000,000. Whether and to what extent, in the case of minerals, that claim is to be the subject of what I call the preference claim is, of course, a matter which is not being discussed or debated in this Regulation, although it is obviously a matter which will have to be considered in the future. Therefore your Lordships will realise that, for the purposes of Part VI of the Act, in order to fix your claim against the £300,000,000 you must have regard to the existence of these facilities, and the fact that you have this regard means that the claim is larger than it otherwise would be.

As I have said before, it is exceedingly difficult to reduce to any formula the principles upon which the development charge is to be assessed; that is a topic which is not dealt with by this Regulation at all. It is very desirable, for the reason (among others) which the noble Earl, Lord Selborne gave, that you should, so far as you can—and I emphasise "so far as you can"—reduce to some formula, or indicate by some formula, what principles you are to apply. For that reason, it is very much hoped by the chairman of the Land Board that discussions will go on. The F.B.I. is now so enlarged as to incorporate practically all industries—certainly, if there are other industries, clearly, they can come in. The Central Landowners' Association, I think, are sufficiently extended to be able to deal with the whole of their side of the business. What is desired is that the Central Landowners' Association, the F.B.I. and the Central Land Board shall continue with their discussions to see whether they can hammer out something which seems fair and sensible to indicate the principles on which development charge shall be assessed. That is, certainly, something which is devoutly to be wished.

Let me point out again that these Regulations do not deal, and do not attempt to deal, with that topic at all. That is a matter for the future. There is another topic to which also these conversations ought, clearly, to extend; that is, the matter of the restoration of land. I am inclined to think that there has been some misapprehension about the Minister's statement dealing with this subject. Of course, on whatever basis you consider what ought to be charged by way of development charge, no person of elementary common sense can disregard the fact that there may be an onerous covenant. Take, for instance, the case of a man who has a right to develop on condition that having extracted mineral he restores the land to its original condition. Compare his case with that of a man who has a similar right but no such obligation. It is clear that in one case the right is much more valuable than in the ether, because in the former case the value of the right is depressed by the factor that there is an onerous covenant which it may cost a lot of money to carry out. Therefore, in assessing development value regard must be had to the position where there is an onerous covenant to restore the land.


Will the noble and learned Viscount forgive my interrupting him? In the case of a freeholder who is extracting chalk or clay, surely the obligation to restore the land will rest on him though in a different form. Do I understand what the noble and learned Viscount has said to mean that the freeholder would be regarded as having a more valuable property because he was not legally liable to this onerous charge, though, in fact, I submit that he would be?


The freeholder would clearly be in a different position. Of course, the whole question of restoration or after treatment of land is, I frankly concede, a very difficult one, and we have not reached final conclusions upon it. Indeed, I am hoping that discussions upon this topic will go on, and that your Lordships will contribute some valuable suggestions. There have been two Committees in recent years—the Kennett Committee and the Waters Committee. Broadly speaking, their recommendation was that the cost of restoring land where there was not an express covenant dealing with the matter (that is the sort of case which the noble Earl put to me) should be shared between the royalty owner, the extractor and the local authority. This, clearly, is a matter that must be considered, and it brings in wider considerations than the mere incidence of the development charge. That is why in considering this topic fundamentally it was not possible to deal with this—at this stage, at any rate—merely in Regulations, even if those Regulations deal with the mater of development charge—which they do not. So I will answer the noble Earl, Lord Munster, by saying that this matter, too, will, we hope and desire, be the subject of discussion. Of course, the noble Earl, Lord Selborne, is right in saying that the freeholder, just as much as the man with the lease, may be liable to restore the land, because he may be under that obligation by virtue of planning permission. Therefore, that is one of the matters we want to have discussed.

The noble Earl, Lord Radnor, seemed to think that we had not given due thought to this question of minerals. I deny the soft impeachment, and I think I may say—I do not know whether it is so or not, but I believe it to be the fact—that the F.B.I. and the Central Landowners' Association are going to meet the Central Land Board on these very matters. That will ensure that, whatever shortcomings there may have been in the past, there will be plenty of consideration given to this matter in the future. The noble Earl asked whether my words would carry more weight than the words of the Parliamentary Secretary. Modesty forbids me to give an answer to that question. I hope they will. At any rate, as I told your Lordships before, I have discussed the matter both with the Minister and also with the Chairman of the Central Land Board and, in a certain case, as the noble Earl pointed out, I must come in, because I have to make Regulations about the Tribunal. I think the noble Earl may well be easy in his bed on this score.

The noble Earl, Lord Selborne, made his speech about cement. I have heard him make that speech before, and each time I hear it I think it is a better speech. But, really, it has very little to do with these Regulations. As he himself said, he fought the Bill on this point and he now wants an amending Bill on it. Let me say frankly, this Bill introduces such a complete alteration in our whole system of land tenure that I shall not be surprised if, as time passes, we find that we have to amend it here and there. I shall not be in the least surprised if we find that to be necessary. If that proves to be so, I think that we should not feel in any way ashamed to come to the House and say that a difficulty has arisen here or there and that we want the help of the House to put it right. It makes a most far-reaching change in our law in this connection. I very much hope that the somewhat gloomy prognostications of the noble Earl will prove to have no substance. I hope and believe that this is a most worth-while measure. The activities of the cement manufacturers of this country, I agree, are most important alike to the export trade and the import trade. We cannot easily consent to another fourpence going on this commodity or another fourpence going on that commodity, especially if they are fundamental commodities. But I hope and believe that that will not happen at all, and that the cement manufacturers will find that they will not have to pay more than they have to pay to-day.

The broad scheme of the Act, in this connection, is this. The mineral undertaker who has to pay development charge will pay less, in consequence, to the royalty owner. The royalty owner, in his turn, will get compensation out of the Fund. In future the mineral undertaker instead of paying one sum to the royalty owner will pay two sums, one being the development charge and the other the payment to the royalty owner, the sum total of the two being equivalent to the amount of the one. That is the principle which we desire to establish, and it will be for us to see, in the working out of our Regulations, whether we can achieve something on those lines which will not greatly increase the cost of cement. With these explanations, I hope that your Lordships will now allow me to have these Regulations. I have described them as interim Regulations. I hope that when we have further Regulations before us I shall be able to take up some of the other points which have been discussed to-day.

On Question, Motion agreed to.