LOCAL GOVERNMENT (FINANCIAL PROVISIONS) (SCOTLAND) BILL (Hansard, 13 May 1963)

§ VISCOUNT HAILSHAM
My Lords, I beg to move that the proceedings on this Bill be adjourned till to-morrow and taken as first Order.

§ EARL ALEXANDER OF HILLSBOROUGH
My Lords, I think this is more of the brutality to the noble Lord who has come from Dundee specially for this Bill. This is an action taken deliberately by the Leader of the House, in spite of what has been said. When first the adjournment of the debate on the previous subject under discussion was moved, no explanation was given, and yet the adjournment was made. Nothing was said about what Business was to come after—not a word. This has been conducted in such a way as to try to get the individual Member of my Party, who wanted to speak in this debate, to take it on the nod and withdraw whatever he had to say. No word of this was mentioned to me, or through any of the usual channels, so far as I can find out. If this is the way that the Government leadership of the House is going on, I cannot have very much respect for it. The 1080 noble and learned Viscount the Leader of the House has made a deliberate attempt to punish my noble friend from Dundee because of what he said to-night, I suppose to prevent him from being here to see through what he ought to see through, the remaining passages of this Bill. He is the only active Scots Peer I have at the moment. The Leader of the House must know that. It is exceedingly unfair and unjust, and all I have to say is this: if this is the conduct which is now to be expected from the Government because they have to rush through unmandated legislation, then we shall know how we have to deal with the whole constitution and the future of the House of Lords.

§ VISCOUNT HAILSHAM
My Lords, I can only say that my sympathies are with the noble Lord, Lord Hughes. He has to thank his own Party for what has happened.

§ EARL ALEXANDER OF HILLSBOROUGH
Nonsense!

§ LORD HUGHES
My Lords, I must object most strenuously to that. I should think that what I have to say cannot possibly be ruled out of order, and I hope for the latitude of the House in what I am going to say. I did not propose to be particularly controversial about the Bill, especially in view of the circumstances which were related to me. The noble Lord, Lord Craigton, spoke to me at 6 o'clock and said that it appeared that it was most unlikely that we should reach the Third Reading of this Bill before half-past seven and asked whether it was possible for me to indicate the 1081 lines I proposed to take. In the circumstances, I did so, and said that I should not be speaking for more than ten minutes at the very outside and would confine myself to two clauses of the Bill—to the controversial Clause 3, which generally met with a great deal of opposition in Scotland and, as Members of your Lordships' House know, was vigorously opposed in another place, and to Clause 15.
The noble Lord, Lord Craigton, said that that was most acceptable to him and, in view of the fact that I was going to refer to Clause 15, he would stay on himself, because he did not think it fair to impose that on a colleague who had no particular knowledge of this aspect of the Bill. He proposed, therefore, to stay on himself. But after 7 o'clock, it reached a position where it was apparent that the noble Lord, Lord Craigton, would be doing himself a possible injury if he stayed any longer, and by agreement with him I said that, if anything, I would cut my remarks down still further. It is quite obvious that the Government are serving no useful purpose in what has now been moved by the noble and learned Viscount the Leader of the House, because, in fact, I am just making the speech I would have made.

§ VISCOUNT HAILSHAM
My Lords, let me say at once that if we could be assured that this Bill would receive the expedition which the noble Lord has indicated it is his desire to give it, I should willingly withdraw my Motion.

§ LORD HUGHES
My Lords, I do not know how my colleagues would feel in the circumstances, but I know this: until what took place a few minutes ago there was no intention that anyone on this side of the House would be speaking on the Bill other than myself, and if the Government had sought to get information instead of applying threats it would have been easily forthcoming to them. I have no reason to believe the situation is any different, although the noble and learned Viscount the Leader of the House could not be surprised if we were to change that situation. But, to the best of my knowledge, I am still the only speaker on the Third Reading from this side of the House.

§ VISCOUNT HAILSHAM
My Lords, may I say to the noble Earl the Leader 1082 of the Opposition that I am sure his noble friends would take any advice he proffered them, and I, too, am anxious to meet the convenience, not only of the House but of the noble Lord who has come so far to speak on this Bill. If I can be assured that this situation is as I am told now, I shall be only too glad to withdraw my Motion.

§ EARL ALEXANDER OF HILLSBOROUGH
My Lords, I think the noble and learned Viscount the Leader of the House might have thought of that before. If he had proceeded with his Motion we should have had to discuss it and vote against it, but if he is willing to see that the case of my noble friend is heard I am in agreement, if the noble and learned Viscount withdraws his Motion.

§ VISCOUNT HAILSHAM
On that understanding, I ask leave that the Motion be withdrawn.

§ THE MARQUESS OF LOTHIAN
My Lords, on behalf of my noble friend I beg to move that this Bill be now read a third time.

§ LORD HUGHES
My Lords, it is not my intention to add much to what I would otherwise have said if this Bill had been dealt with in the ordinary way. As I intended a few minutes ago, and still intend, I will confine my remarks to Clauses 3 and 15 of the Bill, and, if I might take them out of order, I would first of all refer to Clause 15. One of the least satisfactory features of the revaluation proposals in Scotland was that up and down the country assessors objected to appellants against revaluation quoting cases from other parts of the country, although, in many cases, it was the most obvious way to appeal a case, particularly where there were examples of firms building identical types of houses in many different parts of the country. Even where these were situated as close to each other as three miles, but in separate authorities, it was held by the assessors and accepted by chairmen of valuation courts that only comparable subjects within the area of the valuation 1083 committee could be used as the basis of an appeal. It was not, I believe, the view of the Government that that was the correct reading of the situation, but, of course, the Government are not in a position to advise valuation authorities of local authorities what their interpretation of the law is. The interpretation of the law, if it is tested, is a matter for the courts. The result was that the position more or less went by default.
In this Bill, Clause 15 makes it abundantly clear to everybody concerned that in appeals against valuation it will be proper to quote cases from other areas; either that the assessor may do so or the appellant against the assessor's valuation may do so; and I think that this is a move which will be generally welcomed by the people of Scotland. What I wish to suggest to the Government in this connection, because this is such a complete departure from what has gone on in the last three years, and as in many cases valuation appeal committees have part-time officers and are not always served by full-time officials of local authorities, is that it might achieve the best purpose of the Government's intention if the Secretary of State were to make arrangements that all valuation appeal committees were notified of the change in the law in this respect as soon as is practicable after the Bill receives the Royal Assent.
In relation to Clause 3, my remarks, as the noble Marquess would expect, come in a different category altogether. I started off at Committee stage by objecting to the timetable which was imposed in the Bill. I abandoned that, because it was obvious to me that it was a waste of time. I, like many other people, thought that the purpose of this Bill was to impose penalties on local authorities which were fixing the rents at an unreasonably low level, and it was only after I put forward the Amendment that I discovered, like many other people, that I was completely in error. In fact, there was no such penalty in the Bill at all. There is a depriving of local authorities of Exchequer Equalisation Grant, but, to my surprise, it worked equally whether they put the rents up or not. As I think I mentioned to your Lordships at Committee stage, the position is that in the first year of the Bill a notional percentage of 85 is imposed. If the local authority's 1084 rents are less than 85 per cent. gross annual value it is assumed that that figure is in existence and the difference between their actual rents and 85 per cent. becomes the measure of the percentage deduction of the Exchequer Equalisation Grant which they receive. If they increase the rents to the percentage stated in the Bill they are in exactly the same position, because an actual rent and an actual income product is substituted for a notional rent and notional income product, so that the end result is the same.
I felt a bit guilty about not having known that as late as the Committee stage of this Bill, but during the weekend I read up a large part of the proceedings which took place in the Scottish Grand Committee in another place, and I felt a little consoled for having done that, because I found that my ignorance of the Bill was shared by the Minister who was in charge of it in the Grand Committee. I think that if I conclude by reference to one or two things which the Under-Secretary of State said in another place it will show that I was in ministerial company in not knowing what the Bill meant, and this is after the Second Reading and two days spent on discussing the principles of the Bill in another place.
On February 7 this year (in column 184 of the OFFICIAL REPORT of the proceedings in another place) Mr. Leburn said: This clause does not fix rents. It leaves it to the local authority to choose whether to leave them low and suffer a reduction of grant under this clause or to raise them and make a large gain. The only gain the local authorities can make is the amount of the rent increase, and surely no one in this House would suggest for one minute that any Scottish local authority needs to have an Act of Parliament to draw its attention to the fact that if it increases rents by £100,000 it keeps the £100,000. What they assumed to be a large gain was a gain in Exchequer equalisation grant. On February 19 the Minister said: It can either keep its rents as they are or incur a deduction "— and I think the word "or" is a misprint for "and", because it does not make sense otherwise— under Clause 3 or increase its rents and avoid a deduction. 1085 In no circumstances can a deduction be avoided. On the same day, resisting another series of Amendments, he said: If we were to accept the Amendments there would be no reason at all for local authorities to increase their rents. I think I may be forgiven if I did misunderstand the intentions of the Government in this matter. If members of the Government themselves did not know what they were putting forward, a poor, ignorant Back Bencher travelling down occasionally from Scotland for the purpose must be given a little more latitude than they themselves would claim.
I would conclude by saying this. I am consoled in my inability to make any changes in this measure by the knowledge that my Party has stated quite definitely that when they are the Government they propose to destroy the present iniquitous grant arrangements and to return to the system of specific grants for specific subjects. When that is done, it will matter little that there are certain injustices to Scottish local authorities, and I think that possibly (if I might use a word which some Members of your Lordships' House will have to look up) they will thole it for the year in the knowledge that something better is coming along.

§ THE MARQUESS OF LOTHIAN
My Lords, I should like briefly, first of all, to apologise to the House, and particularly to the noble Lord, Lord Hughes, for the absence of my noble friend Lord Craigton to-night. As the noble Lord and the House know, my noble friend was not feeling at all well and has had to go home. In the circumstances I hope that the noble Lord will acquit me of any discourtesy if I do not follow him in his remarks to-night. As he appreciated, I have only just been handed the brief about this Bill, and, indeed, the Bill itself. But I will certainly draw my noble friend's attention to what the noble Lord has just said regarding Clause 3. I can assure him, regarding the matter which he raised at the beginning of his speech on Clause 15, that the information he required concerning local valuation appeals, will be circulated to local authorities throughout Scotland after the Bill becomes law. I conclude by thanking him for the way in which he has, with qualifications, welcomed this Bill.