HL Deb 01 February 1951 vol 170 cc138-49

4.15 p.m

Order of the Day for the Second Reading read

THE LORDCHANCELLOR (VISCOUNT JOWITT)

My Lords, I rise to move that this Bill be now read a second time. This Bill is in essence an economy measure, the main object of which is to relieve the Tithe Redemption Commission of certain statutory obligations imposed by the Tithe Act of 1936, which have been shown by experience to be unnecessary. At the same time, the opportunity has been taken to make certain minor amendments to the principal Act, all of which are designed to facilitate administration.

Your Lordships will remember that the general policy in the 1936 Act was to abolish tithe, and this was done by extinguishing tithe-rent charge and compensating tithe owners with Government stock. I am bound to say—and I say it the more readily because the Tithe Act of 1936 was passed by a Government opposed to the present Government— that that Act was a very successful Act. In 1936, if your Lordships will cast your minds back, we had a burning controversy about tithes. There was the contest whether or not it was unfair that tithes should be paid to a church by farmers if they did not agree with the tenets or accepted services of that church. That controversy has been stilled. That was the main purpose of the Act of 1936, and nobody but a madman would want to re-open that controversy. I pay my tribute to that Act and the success which its framers had in passing it. It achieved its end, of course, by creating tithe redemption annuities which were payable for sixty years, and which were charged on lands previously subject to tithe rent charge. These annuities are applied to the servicing of the compensation stock.

The present Bill is not intended to change in any way the general policy and financial schemes of the 1936 Act. The former tithe owners, amongst whom the principal interest is represented by the Church Commissioners, will not be affected. They will continue to receive interest on the compensation stock which has already been issued to them. Similarly, the land owners will continue to pay the annuities charged on their land. To administer the arrangements under the 1936 Act the Tithe Redemption Commission was set up, and its chief duties were to deal with the immediate problems consequent upon the extinguishment of tithe rent charge and the creation of annuities, and to prepare registers and maps for every tithe district in England and Wales, to serve as a basis for the future collection of annuities.

I do not want to weary the House with a long discourse on the detailed points dealt with by the Bill, and with your Lordships' permission I will, therefore, confine myself to describing its main provisions as illustrating its general purpose. The main purpose of the Bill is embodied in the first clause. Under the 1936 Act, the Commission were required to prepare, in duplicate, registers and maps for each of the 11,000-odd tithe districts in England and Wales. These registers were to schedule the appropriate lands, the related charges and the names of the owners. They were to be kept up to date, which would in practice mean revision every few months, and the Act devised an elaborate procedure for compiling and altering the register of names. These registers were to be conclusive evidence that the annuities existed, and that the persons named were liable to pay the annuities. Owing to war-time reductions in staff, it was not possible for the Commission to perform this duty, and the experience of fourteen years has shown that there is little difficulty in arranging for collection and, where necessary, for recovery through the courts, in the absence of registers.

The preparation of registers for every tithe district would necessitate almost doubling the staff of nearly 650 people at present employed by the Commission. The additional staff would have to be trained, and even then it would take at least five years to complete the registers. In other words, twenty years or so would have elapsed from the passing of the 1936 Act before the registers were complete, and that is one-third of the period for which the annuities run. On the basis of present costs, this work would cost some £2,000,000, and the expense of maintenance would be at least £100,000 a year until the final date of 1996. Therefore, the provisions in this clause will, it is hoped, save the taxpayer some £6,500,000, apart from any interest which would be charged on Exchequer advances, and ignoring any possible rise in administration costs during the next forty-five years. Compliance with the terms of the 1936 Act would, therefore, at this stage involve a good deal of time and labour to no useful purpose. Clause 1 is accordingly designed to relieve the Commission of the statutory obligation to prepare these registers and maps, and to authorise them instead to prepare records confined to selected districts in which the existing records are complex or confusing, or to record the fact that no annuities exist where they have been extinguished. The preparation of these new records will facilitate administration and will be an incomparably smaller task than the preparation of registers as originally intended.

The object of the second clause is to bring an end to the possibility that rent charges which have been overlooked for many years may rank for compensation by way of Government stock, and that the Commission may be faced with the task of recovering the corresponding annuities back to 1937. The Commission has at present discretion to refuse compensation where particulars were not furnished within three months of the passing of the 1936 Act, and the Treasury can in certain cases waive the payment of annuities. It is, however, we think, desirable, instead of leaving action in such cases to the discretion of the Treasury and the Commission, to provide by Statute that no compensation shall be paid and no annuities charged in cases which may come to light in the future. As regards compensation, there can, I think, be no hardship in refusing to recognise claims that have been dormant for fourteen years, while the trouble and expense involved in recovering the arrears of annuities hitherto unknown to exist would not be balanced by any revenue that might be obtained.

The third clause is designed to simplify the complicated position at present obtaining whereby two or three annuities may exist in respect of one piece of land. We feel chat it is desirable both in the interests of land owners and also of economy in administration, to amalgamate such annuities so that any one tithe field shall be charged with one annuity only. This clause also gives the Commission power, where appropriate, to split a single annuity charged on farms consisting of several detached portions and relate the apportioned amounts to the separate fields. By this means there will be no heed for a fresh apportionment every time a detached piece of land is sold.

Another provision which will save a certain amount of trouble and expense is contained in subsection (8) of Clause 10. Section 14 of the 1936 Act provided in the case of agricultural land for the remission of so much of an annuity as exceeded one-third of the annual value of the land in respect of which the annuity was charged. This remission, however, did not apply to annuities which replaced extraordinary rent charges; that is, rent charges payable under the Extraordinary Tithe Acts, 1886 and 1897, in respect of hop-bearing or fruit-growing land. These extraordinary rent charges were always payable in addition to ordinary rent charges. This distinction in the 1936 Act has caused a good deal of duplication of work in more than 500 parishes, and the revenue involved was, frankly, not worth the trouble and expense involved. Clause 3 of the present Bill enables those different annuities on one piece of land to be amalgamated; and in order to bring the extraordinary annuities completely into line with the ordinary annuities we propose to remove the distinction, so that all annuities may be taken into account in calculating the remission allowable on the grounds that the total charge exceeds one-third of the annual value of the land.

The only other clause I would mention now is Clause 11, which deals with the transfer of the functions of the Tithe Redemption Commission to some other Government Department. When the 1936 Act was passed it was envisaged that the management of these annuities would be transferred from the Commission to the Inland Revenue after the registers and maps had been completed. As I have explained, this task has not been proceeded with; and, in any event, experience has shown that centralised collection with centralised records is a very economical arrangement. For the present, therefore, it is proposed that the Commission shall continue to function but, in time, as their duties gradually become simpler and more routine, it may be desirable to transfer them to some other Government Department, not necessarily the Inland Revenue. This clause replaces the original requirements by a more flexible provision, which will allow for transfer of the Commission's functions to such other Department as may be most appropriate whenever it is decided to wind up the Commission.

My Lords, as I said earlier, the main object of this Bill is to achieve economy in administration by eliminating work which the experience of the last fourteen years has shown to be unnecessary. I feel sure that your Lordships will agree that this is an entirely acceptable proposal, which makes some contribution, although on quite a small scale, towards the saving of man-power and the economy of administration which we all wish to achieve at this time. I move that the Bill be now read a Second time.

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

4.27 p.m

VISCOUNT SIMON

My Lords, not even the eloquence and power of exposition of the Lord Chancellor can make this dreary subject of tithe one which is likely greatly to excite your Lordships. I have in the past had something to do with the Acts and was one of those responsible for devising and carrying the Tithe Act of 1936. It would be churlish not to express my thanks to my noble and learned friend— and I am sure the noble Viscount, Lord Swinton, will join with me in this—for acknowledging that, after all, some good was done by the Governments between the wars. I think there is no doubt that we shall give this Bill a Second Reading and, so far as may be, a Second Reading with enthusiasm. We have been told the object of the Bill, which is a Government Bill. It is to secure economy and to reduce staff, and I do not remember any previous measure of this Government which was presented to us with those objects in view. If this is the first fruits of further reflection, very well; it will be properly associated with tithe, which itself is a kind of first fruits, or used to be. We are all grateful to the Lord Chancellor for putting on record an explanation of some of the clauses. Having looked at them as well as I could, I find myself in agreement with the general purpose of the Bill as set out in those clauses. It is only a machinery Bill, which does not alter at all any matter of policy.

I should like to take up just one or two matters and put one or two questions to the Lord Chancellor, and if he can say a few words in reply I shall be glad. I will take the three or four points to which I wish to draw attention in the order in which they come. Take, first, Clause 1 which, as the noble and learned Viscount has explained, effects the most important change made by the Bill and which will repeal what was provided fourteen years ago—that there should be made a register of annuities and maps. I am a little surprised at the fact—if I understand it aright—that the register and some of the maps do not already exist. I should have supposed that when the Tithe Redemption Commission—presided over, I may say, by a very distinguished civil servant who was once head of the Inland Revenue—tackled its job, beginning fourteen years ago, it would have taken steadily case after case under the procedure provided by the Act of 1936, for getting the correct area ascertained and the correct tithe redemption charge fixed, and in that way have steadily built up the material. But it may be that I have misunderstood that point.

A more important question, I think, is this—and I am sure it was in the Lord Chancellor's mind but I do not think he mentioned it: What is the purpose of such a register? I should have thought that one of the principal purposes of such a register, just like the Land Registry, was to enable people who might be contemplating either buying or selling a piece of land to ascertain whether there was any tithe rent charged upon it and, if so, how much—because that enters into every calculation as to what would be the reasonable negotiation to conduct. I thought that was the main purpose. Therefore, while agreeing that Clause 1 should be passed, I should like at some convenient time to know this: How are persons who are concerned to find out that information—anybody who tries to buy a piece of land may very well want to know whether it is charged with this impost—going to find it out in future?

The existing law, the law of 1936, was one which provided for the use of this register but it went on to say in Section 9, subsection (3): Entries relating to an annuity in an annuities register shall be conclusive evidence that an annuity of the amount thereof specified was charged in respect of the land therein indicated. That was the way of finding out what the actual situation was. It must have been the intention to provide that information as far as can be to prospective vendors or purchasers by saying to them, "There is the register and you are free to inspect it." At some future time it will be of importance to such people to know, with authority, what is the process by which they are to get this information in the future. Perhaps they are to apply to the Tithe Commission. Will it be the duty of the Tithe Commission then to give them the information if they can get it and will that information be regarded as conclusive between the parties? It is not a big point but I think it is a reasonable question to ask.

Another point which I do not think the Lord Chancellor mentioned is in Clause 8, where there is a provision to this effect: Section forty-five of the principal Act (which requires the Commission to cause a report of their proceedings to be laid before Parliament biennially) shall cease to have effect. I am all for economy, even for the smallest economy, but I have looked at the last report issued by the Commission —I think at first there was to be one in seven years' time, and after that every two years—and I find it is only a couple of pieces of paper. It contains a large number of figures showing exactly how the annuities themselves stand, and the extent to which various operations have been carried out. It is not very clear to me, nor, I think, will it appear to even the most devoted zealot of economy, that any very great saving will be made by saying "The Commission need not publish any further reports." I should like to know whether the proposed change has something to do with these periodical reports, what the Commission are doing, and what are the figures which represent these matters up to date.

There is another clause which gives me at least a great deal of concern, if only because I cannot understand how it will work. I refer to Clause 9. Though the point is a technical one, I think I can state it in a few sentences. The matter is not altogether without interest. Under the principal Act, the Act of 1936, it was, of course, necessary, having the proper procedure, to ascertain what was the property on which tithe rent charge was charged, and in some cases to arrive at the proper annual value of the agricultural land concerned. Of course, that was done after both sides had been heard. The Tribunal—who, very properly, as I think, because they were the most suitable, were the General Commissioners of Inland Revenue, about whom we know something, because they are the people who from time to time send us assessments to income tax—then decided the amount, after hearing the evidence.

This Clause 9 does a thing which I have never seen in any Act of Parliament before. It says that if either side dislikes the decision of the General Commissioners, the objecting party may demand what is called "a case stated." Some of your Lordships will know that that is the method employed if, for example, you want to challenge your assessment to income tax. But it is absolutely fundamental that a case stated sets out the facts, and that the only matter with which the court hearing the appeal is concerned is a question of law. Here is a most extraordinary provision. Clause 9 says that provided suitable notice is given, if either side is dissatisfied with the decision of the General Commissioners then—this is a very remarkable piece of drafting: subsections (1) to (3) of Section one hundred and forty-nine of the Income Tax Act, 1918 (which relates to the statement of a case for the opinion of the Court on an appeal under that Act) shall have effect in relation to that matter…. It it stopped there, Clause 9 would mean what one would expect—namely, that if there is a point of law which anybody wants to raise, provided that it is calculated according to proper legal principles it can be raised by case stated. But Clause 9 goes on to say that this well-known section of the Income Tax Act is to apply

but with the omission of so much thereof as confines the jurisdiction of the court thereunder to questions of law which appears to be a roundabout way of saying that the case stated may leave the court to decide questions of fact— (and with the omission of paragraphs (a) and (b) of subsection (1) thereof, which relate to the declaration of dissatisfaction and requirement to state a case)". I am sorry that the language may sound involved. I do not think that clause is badly drafted, but I confess that I do not understand what is meant.

If you are going to proceed by way of case stated—in this case it would be the Revenue Judge, in the; first instance, with appeal to the Court of Appeal or even to the House of Lords—you can raise a point of law, which is argued out; but the facts are taken as the facts that have been found in the first instance by the Commissioners, as a result of evidence heard. But if it is intended, as this clause seems to suggest, that the case stated shall come before the courts, who are to have jurisdiction on the facts as well as on the law, I ask the question (and I am sure the Lord Chancellor will meet it with candour): How can the High Court Judge, or the Court of Appeal, take upon himself or themselves the duty of ascertaining the facts? Are they going to listen to witnesses? I have never heard of a witness being called in connection with a case stated. Are they going to be told: "My Lords, I appeal from a decision of the General Commissioners;, and I wish to call three eminent valuers who will assist your Lordships to re-decide what the value is"? And supposing there is an appeal to the Court of Appeal, are the Court of Appeal to hear a great many witnesses all over again— perhaps different witnesses?

I may have misunderstood the clause, but it appears to me to be a complete puzzle. While I admire the ingenuity with which this is to be achieved, I doubt whether even the ingenuity is sufficient. When I look at Section 149 of the income Tax Act, 1918, which for this purpose is incorporated into this clause, I find that one of the things laid down is that the case stated shall set forth the facts— I think that is in subsection (1) (b). What is the good of the case stated setting forth the facts if it is proposed by this Bill to transfer in stages to the different courts of law the duty of deciding upon the facts? Therefore, in case I have quite misunderstood the nature of this draft I ask for enlightenment. I am not asking the Lord Chancellor definitely to decide the matter now. So far as I know, this is an entirely novel prevision (I speak in the presence of a member of the House who is himself an active Lord of Appeal-in-Ordinary) and I should be greatly surprised if anybody who is acquainted with this machinery has the least idea as to how this clause will work. It is not important but it is as well that we get it right.

Lastly, in regard to Clause 11, I should like to know at some time, whether or not there are precedents for the wording of subsection (1): His Majesty may by Order in Council provide for the transfer to any other Government Department of all or any of the functions of the Commission. My recollection is that in the Tithe Act of 1936 we provided that the Treasury could, if they thought fit, make an order to transfer the work of the Commission to the Inland Revenue Department. That seems to me perfectly proper, because they are dealing with exactly that sort of subject. But it seems to me to be rather a wide application of the provision to say that, now that Parliament is to have nothing more to do with the future of this Commission, it may, if it thinks fit, by Order in Council transfer the Commission's work to any Department desired. I should like to know what is the reason for that generality. I hope that these observations will not for a moment be construed as opposition to the passage of the Bill. I cannot say that I regard it as a very exciting subject, but I should like some information on those points. Perhaps the Lord Chancellor will be good enough to consider them, and will correct me if I am wrong. I do not claim to be an expert on this branch of the law, although I have made reasonable inquiries. Perhaps in his good time he will deal with the points that I have raised.

4.45 p.m

THE LORD CHANCELLOR

My Lords, if I may speak again by leave of the House, may I say a word or two for your Lordships' consideration on some of the points that have been raised? And between now and the next stage of the Bill the various observations made will receive my attention and consideration. Before I come to Clause 1, I will deal with the other points while I think of them. With regard to Clause 8, reference was made to the two-yearly reports. The position is as follows. The work of the Commission is, of course, principally directed towards the redemption of small annuities. That involves a great deal of apportionment and collection of larger annuities. Accordingly, we have now reached the stage when any report the Commission must prepare is almost entirely financial; therefore it must cover the same ground as the redemption annuities account which your Lordships will find provided for under Section 27 (2) of the principal Act and which must be laid before Parliament annually. Clause 8 is designed to avoid duplication, because subsection (2) of that clause provides, that where the proceedings of the Commission in any year include items referring to other than routine matters, a report thereof shall be appended to the account. So I think the answer is that so long as we preserve, as we do, the redemption annuities account under Section 27 (2) of the principal Act, and this provision that anything other than routine matters must receive special mention, we get in substance all that is required.

Clause 11 provides that by Order in Council we may transfer the work of the Commission to any other Government Department, not necessarily the Inland Revenue. Speaking for myself, I should think that at the present time we should all agree that the Inland Revenue is certainly the suitable Department. What will happen in years to come, whether it is to be transferred or not, I do not know, but I should like to point out to your Lordships, that before anything can be done under this clause, as it comes under the Statutory Instruments Act we have to come to the House; and the House, at the present moment, has to deal with it by negative Resolution. If it is considered sufficiently important, we can certainly consider the matter on the Committee stage and substitute an affirmative Resolution. But the case for the transfer to whatever Department is thought to be appropriate has to be made out. At the present time, if we proposed to transfer the work to a wholly unsuitable Department, the House could veto it by moving a Prayer against the Resolution. I think that is the position in that regard.

In regard to Clause 9, I confess I share the difficulty the noble Viscount feels in trying to see how it is going to work. The intention is laudable enough. Here questions of fact and of law may be so intermixed and intermingled that it is difficult to say which is which, and it was thought desirable that there should be a right of appeal to the High Court, both on fact and on law. That is all right; but I confess frankly that, under the machinery of a case stated as known to an experienced lawyer, that is an exceedingly difficult thing to do. I shall certainly look into that matter. Whilst I am anxious to preserve that which I think is in the interests of justice—namely, the right of appeal on fact—I recognise that it is very difficult to isolate law in these matters. I shall see whether this matter has really been sufficiently thought out.

That leads me to Clause 1, upon which I would like to say this: although much work has been done, it is a fact that so far as the registers are concerned they have not been commenced. What happens to-day is that reference is made to the original tithe apportionment maps, and in the vast majority of cases they contain all the information that can be required in relation to charges on land. However, there are some few areas in this country where the information is difficult to ascertain because there have been so many subsequent transactions that the original tithe apportionment map is cluttered up with all sorts of writings, and it has become almost a palimpsest. In these cases we propose to prepare a register. However, there are comparatively few cases, and in the vast majority of them these tithe apportionment maps are being constantly consulted and they will continue to be consulted. No difficulty is arising to-day in spite of the fact that we have not got these registers prepared.

I mention those matters merely in order that they may be considered by your Lordships between now and the Committee stage. In my turn, I will gladly look into the Bill in the light of the observations which the noble and learned Viscount has made, to see whether we cannot improve it in various respects. I am grateful to the noble Viscount for the trouble he has taken.

On Question, Bill read 2a, and committed to a Committee of the Whole House