DRAINAGE RATES BILL (Hansard, 5 July 1962)

§ LORD AMHERST OF HACKNEY
My Lords, this Bill was introduced in another place by Mr. Denys Bullard, Member for King's Lynn. It met with no opposition: in fact, I understand that there was no discussion on it at all. The object of the Bill is to save unnecessary work in the offices of drainage authorities and, at the same time, to ensure that those people who are paying their 1362 drainage rates pay no more. There are 400 internal drainage boards, and many of them are small. In many cases the ledgers and calculations are filled in by hand, and they have no elaborate calculating machines. The object of this Bill is to save unnecessary work.
I should like at this stage to assure your Lordships that it makes no change in the basis of assessment and, with certain possible marginal exceptions, no difference to the amount that a person pays in drainage rates. It merely gives the drainage boards an alternative way of working out the sums and doing their calculations. To explain what the Bill does exactly it is perhaps necessary to go back a short way. At the moment, as your Lordships know, the basis on which drainage rates are calculated is on the Schedule A value: in the case of agricultural land on the full Schedule A, and in the case of non-agricultural hereditaments on one-third of the Schedule A value. Those rates are paid under the Land Drainage Act, 1930.
During the passage of the Land Drainage Act, 1961, it became clear that under the method of using Schedule A calculations there were serious anomalies, particularly in the case of post-war built houses which were let. The valuations for Schedule A took place in 1935, but the post-war houses were assessed at present-day values. Therefore, those houses—and it applies to council houses and houses of that kind—were paying more than their proportion of the rates. So a new method was introduced in the 1961 Act, and as from April 1 next year non-agricultural hereditaments will be assessed on their rateable value; that is, on the value in the rating lists, which should be out by the end of the year. The rateable values will he higher than the Schedule A values. Agricultural land will continue to pay on the Schedule A, non-agricultural land on the rateable value. If nothing were done, obviously an undue proportion of the rate would be borne by the non-agricultural hereditaments, so to maintain the balance between the agricultural and the non-agricultural there was introduced into the 1961 Act something called the relative fraction, which is, in fact, the total Schedule A value of the non-agricultural hereditaments in one drainage board area divided by the rateable value of the same hereditaments. 1363 As a result of that you get a fraction, and the purpose of this Bill is to lay down how you apply that fraction to the rateable value to assess the amount that a person has to pay in rates.
Under the 1961 Act it was laid down that this fraction must be applied to the rate levied in the pound. This Bill, if it is passed, will give an alternative method of applying that fraction to the rateable value; in other words, it gives alternative ways of working out the sum. May I give an example? Suppose a person Who is going to pay rates has agricultural land valued at, say, £250, and has non-agricultural land or hereditaments valued at £90, and that the relative fraction is a half and the rates are 5s. in the pound. Under the present system you would take the agricultural land value of £250 and multiply it by the rate poundage, which is 5s. In the case of the non-agricultural land, you would first divide it by three—because non-agricultural land pays only a third of the rate of agricultural land—so that you would then have £30 for the non-agricultural hereditament. Under the present system you would then take 5s., which is the rate in the pound, and divide it by a half. To get the amount paid on the non-agricultural hereditament you would multiply the £30 by the half-crown in the pound. Under the new, the alternative, system, you take the agricultural land valued at £250. You then take the non-agricultural hereditament; divide it by three, which gives £30; multiply by the relative fraction, and then multiply the result by the rate of 5s. in the pound. Therefore, instead of multiplying £30 by half-a-crown, you multiply £15 by 5s.
That sounds very unimportant, but it is laid down in the present Act that you have to divide the rate poundage; you cannot do it the alternative way. The advantage of doing it the alternative way is that in making up the rate book you can put in your agricultural land at £250. You can then take your non-agricultural hereditament and apply the fraction to it, so that you put in your rate book the £15; and you can then add them together and multiply by the 5s. So you have only one rate in the pound instead of two to deal with, 1364 which means, in the case of one drainage board, that you can add all agricultural and non-agricultural land together because you have applied the fraction in the book, and you have to multiply it merely by the one rate. In the case of the smaller drainage authorities I understand that this will save them a very great deal of work.
It was realised that Clause 22 of the 1961 Act, when it was introduced, was going to cause a lot of extra work, but it was not foreseen that some of the work would turn out to be unnecessary. To give an example, if one particular drainage authority had to do the calculations under this Bill they could do them in nine columns, whereas to do the calculations according to the 1961 Act would require 14 columns. Many of these drainage authorities have to do a very great deal of work and do it in a short time. I should like to emphasise that it is not mandatory on a board to use either one of these methods; they can choose which one they use. Several of the larger authorities have very elaborate calculating machinery and will prefer to use the method laid down in the 1961 Act. On the other hand, there are many smaller authorities who wish to use the other method.
The result of using either method is, to all intents and purposes, the same, but there might be a slight marginal difference, because before doing the calculation the rateable values are either rounded up or rounded down, which means that if the odd shillings are below ten you take it to the pound below and if above ten you take it to the pound above. Therefore there can be a marginal difference according to which way you do the calculation, but the difference cannot be more than a few shillings. Therefore, assuring your Lordships that the Bill does not in any way materially affect the method by which the rates will be paid or the amount anybody will have to pay—it is solely to save unnecessary work—I beg to move that it be read a second time.

§ LORD WISE
My Lords, I want just for a few moments to say a word or two about this Bill, but I can assure 1365 your Lordships I do not propose to go into any figures or calculations. From this side of the House we welcome the Bill, and I speak on behalf of the Association of Drainage Authorities when I say this Bill will simplify matters in their offices and give assistance to them. As your Lordships can realise from what you have heard from the noble Lord who introduced the Bill, very great complications may arise in regard to calculations, but I am assured that it will simplify matters and on that score I wish to bless the Bill. Also it is in a way an inspired Bill, because it has been for some time in anticipation by the drainage authorities, and it has been produced, I understand, in collaboration with the Ministry of Agriculture. As the noble Lord said, it provides an alternative method of calculating the amount of drainage rates which should be paid. I hope, therefore, that the Bill will have a Second Reading and a speedy passage through the House. The passage through the other place was as speedy as it possibly could be, because I can quite understand that the Member who was behind the Bill probably thought it better to be very brief and to let it go through the House in a formal manner. I, therefore, hope the Bill will be passed by your Lordships this afternoon.

THE JOINT PARLIAMENTARY SECRETARY, MINISTRY OF AGRICULTURE, FISHERIES AND FOOD (EARL WALDEGRAVE)
My Lords, I think I should just say that the Government welcome this Bill as a helpful and beneficial measure.

§ LORD LATHAM
If only because they do not understand it.

EARL WALDEGRAVE
The Government understand this Bill perfectly, though I personally am not a Wrangler, senior or junior. I am full of admiration, as I am sure your Lordships will be, for the exposition which has been given by the noble Lord, Lord Amherst of Hackney, who spoke without notes, or without referring to notes, on this intensely complicated arithmetic.

§ VISCOUNT ALEXANDER OF HILLSBOROUGH
I have not any notes either, but I understand I shall pay a few shillings a year more.

EARL WALDEGRAVE
No, my Lords, that is not so; it is very unlikely that the noble Viscount will pay either more or less. This is a little measure, but very useful, which will help the drainage boards, who often have extremely limited resources, to apply the important provisions of Sections 22 and 23 of the 1961 Act with greater ease. That is all it is about. It is a machinery measure. It has the merit of allowing the drainage boards greater flexibility, so that when they do these sums, from the beginning of the next financial year, they will have the option of doing them in the way that this Bill allows or in the way laid down in the 1961 Act. It is not going to cost anybody any more or any less necessarily; the individual sums may work out a shilling or two one way or the other. This Bill is to enable the calculation to be done more simply. It does not alter the basic legislation. It does not alter the basic intention of the Act in any way at all. I hope that your Lordships will pass this Bill as a very useful measure.

VISCOUNT ALEXANDER OF HILLS. BOROUGH
If it is going to make all this saving, what will be the saving in staff?

EARL WALDEGRAVE
My Lords, I do not know what will be the saving in staff, but there are a number of these small drainage authorities who have not the advantage of even perhaps adding machines, let alone computers. They may write up their drainage demands in pen and ink in ledgers, in books which maybe they have been using for many years. They may be a little old-fashioned, but they are nevertheless very sound authorities, and it is going to be most complicated for them to use the procedure laid down in the Act. As the noble Lord said, it may mean sometimes that they will have to rule up their ledgers in 15 or 16 columns instead of 8 or 9. We think that it is reasonable that drainage authorities should be allowed this option, and that is the sole reason why we think that this measure should be introduced.

§ LORD AMHERST OF HACKNEY
My Lords, I should like to thank noble Lords for the support they have given to this measure. I am sorry if I gave the noble Viscount, Lord Alexander of Hillsborough, the impression that he 1367 would necessarily have to pay more. He might have to pay a few shillings more; he might, on the other hand, pay a few shillings less. I would again thank noble Lords for their support.