Lords Sitting of 27 February 1969

Preamble
The House met at three of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Birmingham.
The Lord Harvey of Tasburgh—Sat first in Parliament after the death of his father.

DUTY ON IMPORTED MATCHES
VISCOUNT MONCKTON OF BRENCHLEY: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government what is the customs duty on imported matches from Sweden and the United States of America; and what would be the duty on imported matches from Malta.]
LORD BESWICK: My Lords, the rate of customs duty on matches imported from Sweden is 13s. 9d. per short standard of 7,200 matches. The rate on matches imported from the United States is 14s. 5d. per short standard, and that would also be the rate on matches imported from Malta.
VISCOUNT MONCKTON OF BRENCHLEY: My Lords, while thanking the noble Lord for that Answer (and, at the same time, I declare an interest) may I ask whether he thinks it right that a Commonwealth developing country should have to pay the same import duty as foreign countries, and more than those in EFTA? Following on that question, may I ask whether there is any progress in the talks going on in GATT in relation to matches in Europe?
LORD BESWICK: My Lords, so far as the general Commonwealth issue is concerned, we are here talking only about matches; there is a preference for other products. There is a differential here between manufacturers in other countries and those in the EFTA countries, who are on the same basis as United Kingdom manufacturers. It is only 1d for 900
1196
matches, if my arithmetic is correct—one twentieth of a penny per box—which I should not have thought was decisive. The noble Viscount spoke about the developing countries and the O.E.C.D. talks. I understand that yesterday it was suggested that matches might be included on the list of those items for which developing countries may be given a preference without contravening GATT, but this is a matter for further discussion among the other O.E.C.D. members and I cannot say what the outcome will be.
VISCOUNT MONCKTON OF BRENCHLEY: My Lords, I thank the noble Lords for that answer. On the first part of his answer, does he realise that in fact that difference, small though it is in cash, is a difference between profit and loss to a small country which is trying to export to our country which itself has a favourable balance of trade with Malta?
LORD BESWICK: My Lords, I am always greatly interested in Malta and I have tried in other capacities to encourage light industry there. But we shall see what comes out of the O.E.C.D. talks.

TRADE UNIONS AND RECOGNITION DISPUTES
3.7 p.m.
LORD SANDFORD: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government whether, in the light of recent experience in the steel industry, they believe that their proposals in paragraphs 60 and 61 of In Place of Strife (Cmnd. 3888) for the solution of recognition disputes between unions will work in practice.]
THE LORD PRIVY SEAL (LORD SHACKLETON): Yes, my Lords.
LORD SANDFORD: My Lords, I thank the noble Lord for that Answer, but may I nevertheless ask him whether he would not agree that experience so far in this recent dispute (one hopes that it is now at an end, but one fears that it may not be) indicates that it would be not only more democratic but also more decisive to ask the men concerned by

1197
secret ballot, grade by grade and plant by plant, what their view is about the union that should represent them.
LORD SHACKLETON: My Lords, I do not see how the noble Lord can draw a conclusion from the present difficulties into a future situation. The C.I.R. has not been operating. The whole detailed machinery for dealing with industrial problems is not yet functioning. I do not see that a ballot by itself would provide a solution to this particular dispute. I appreciate what the noble Lord is after, but I do not think he is making much progress.
LORD LINDGREN: My Lords, would not the noble Lord agree that in their negotiations most trade union leaders try to get the greatest good for the greatest number? Therefore, is it not essential that clerical, professional and technical workers should be represented in separate negotiations?
LORD SHACKLETON: My Lords, I naturally agree with the first part of my noble friend's question. On the second point, I am not sure that he is not putting his finger on the nub of the particular dispute, on which I think it is better if I do not comment.
LORD SANDFORD: My Lords, while hoping with the noble Lord that the decision of the British Steel Corporation will be the end of this particular matter, is it not true that everyone is now exasperated by the state of our industrial relations? We desperately and urgently need legislation. I submit that the time for consultation and the preparation of legislation has passed. Do we not urgently need legislation before us?
LORD SHACKLETON: My Lords, I must say to the noble Lord that I should rather prepare my legislation before I publish it.
LORD BYERS: My Lords, I would ask the noble Lord to bear in mind that we want as much consultation as possible before we have the legislation.
LORD SHACKLETON: My Lords, I entirely agree. I am not sure whether the noble Lord, Lord Sandford, is trying to be helpful or is trying to extract information, but I think he understands the situation well enough to acknowledge that we are confronted by very difficult problems
1198
in the field of industrial relations. The Government have produced their set of proposals, but I think any attempt to impose the proposals overnight would be very counter-productive.

F.A.O. AND LOCUST CONTROL
3.9 p.m.
LORD BROCKWAY: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government whether they will propose to the Food and Agriculture Organisation of the United Nations that concerted action should be taken, with financial contributions, technical aid and political co-operation from Governments, to meet the danger of massive destruction of crops in the Middle East and Africa from the extensive plague of locusts already on the move and for aid to the peoples who may suffer front this destruction.]
THE MINISTER OF STATE, FOREIGN AND COMMONWEALTH OFFICE (LORD SHEPHERD): My Lords, the Food and Agriculture Organisation has already acted. The 51st Session of the F.A.O. Council last October requested the Director General to appeal to all potential donors, including Governments, commercial firms and the United Nations Development Programme, for immediate assistance; agreed that locust control work should receive adequate priority in the allocation of the available resources of the F.A.O.; and adopted a resolution for consideration at the next Conference extending the emergency fund previously established for the control of livestock disease to cover also the desert locust. As regards aid to the people involved, the F.A.O. cannot act as a relief agency, but part of the resources of the U.N./F.A.O. World Food Programme are available for the provision of food in relief of emergencies.
LORD BROCKWAY: My Lords, while thanking my noble friend for that characteristically full reply, may I ask him whether there is later information that the grant by the F.A.O. for this purpose has been increased from £80,000? Is not that sum totally inadequate? Is he aware that experts now

1199
indicate that the locust plague may spread from India across the Middle East, across North Africa, down the East to Tanzania and down the West to Nigeria; and that it may cause more deaths by starvation than would a considerable war?
LORD SHEPHERD: My Lords, clearly the threat of locusts is something to which we must pay very great attention, but the fears of the noble Lord are perhaps, and I hope will prove to be, premature. In fact, we have had a period between 1963 and 1967 when the locust pest has been well contained. There is now a threat, but there is yet no real, serious threat. It is basically in anticipation of that threat that certain steps have been taken to deal with it.
LORD BROCKWAY: My Lords, is my noble friend aware that I very much hope that his attitude is more correct than mine? Is it not the case that the field organisation now is utterly inadequate; that the Desert Locust Control Organisation in Africa is limited to a few army tents, with magnificent, heroic service by Jim Tunstell and others, but utterly inadequate for this danger which at least experts say may be more disastrous than it has been for twenty years?
LORD SHEPHERD: My Lords, the policy of the F.A.O. in this matter is that it is very much a question for the countries concerned, although of course it participates in regional groupings and also provides assistance. We ourselves offered aid to the value of some £175,000—this was announced last October—to help the Desert Locust Control Organisation in East Africa, which is located in Ethiopia. We have also increased our own contributions to our own organisation in the field of research in this country, which is one of the most valuable contributions in this field.
LORD INGLEWOOD: My Lords, could the noble Lord either confirm or deny the rather disturbing story that we no longer have an official of the Ministry of Agriculture permanently in Rome combining the duties of Agricultural Attaché and Permanent Representative at F.A.O., such as was appointed a few years ago and I thought was deemed to be a success?
LORD SHEPHERD: My Lords, I am quite sure that that supplementary question has something to do with the original Question, but those who helped me prepare my supplementary answers did not anticipate it.
LORD OGMORE: My Lords, is it not a fact that one of the main areas for locust breeding was, and probably still is, in Southern Arabia? Was it not also the fact that in a previous time the Colonial Office used to be responsible for the control of locust breeding in that area? Furthermore, is it not a fact that the time to kill locusts is when they are hoppers; that is, when they are very young? Since we have gone from Southern Arabia, who has taken over the responsibility for that service which used to be performed by the Colonial Office?
LORD SHEPHERD: My Lords, the noble Lord has really put his thumb on the heart of the problem. Undoubtedly, the war in the Yemen has reacted on the improvements that took place between 1963 and 1967. The responsibility in this field, as I have said, lies with the countries concerned, but the F.A.O. is seeking through the regional committees to co-ordinate steps to be taken in dealing with this pest.
LORD BROCKWAY: My Lords, does not the question which has been put from the other side of the House illustrate that this matter cannot be left either to individual nations or even to regions? Is it not now an international problem? Moreover, is it not a tragedy that men should be killing each other in the Yemen and Southern Arabia instead of uniting against this threat which may mean that more people will be killed by starvation than in their silly war?
LORD SHEPHERD: My Lords, when I said it was the responsibility of individual countries I hope I did not lead my noble friend to believe that they are left to get on with it on their own. In fact, the F.A.O. itself makes sizeable contributions to the various regional groupings; and we ourselves help through our own research. This matter is clearly one of international importance and the F.A.O. has it in mind. The 51st Session of the Council took special note of the position and made certain recommendations.

HIGHLANDS AND ISLANDS DEVELOPMENT BOARD STAFF
THE EARL OF CROMARTIE: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government the number of civil servants now employed by the Highlands and Islands Development Board, and what has been the increase since the beginning of 1968.]
THE JOINT PARLIAMENTARY UNDER-SECRETARY OF STATE FOR SCOTLAND (LORD HUGHES): My Lords, the Board at present employs a permanent staff of 154 and a temporary and seasonal staff of 14. In January, 1968, it employed a permanent staff of 84 and a temporary staff of 5. Of its present staff 14 members are civil servants seconded by their Departments: this is an increase of 5 since January, 1968.
THE EARL OF CROMARTIE: My Lords, I thank the Minister for his full Answer, which will be of considerable interest to many in the Highlands and Islands. Would he not agree with me that there is a necessity to keep watch on any increases there may be, as there is a danger of the overlapping of functions, especially between the Board and the Scottish Tourist Board?
LORD HUGHES: My Lords, I can assure the House that there is no danger of the Highlands and Islands Development Board or any other of these bodies being able to get funds for staff very readily; but I think from his knowledge of the Highlands the noble Earl will agree that if there is any body which has been created during this century which has accomplished results in the Highlands it is the Highlands and Islands Development Board, and we ought not to put obstacles in its way. With regard to the reference to possible overlapping with the Scottish Tourist Board—and I presume the noble Earl's reference is to the proposed new Scottish Tourist Board—the exact relationship between the two bodies can be finally determined only when the new Tourist Board is appointed. This is a point which is already receiving consideration between my Department and
1202
the Highlands and Islands Development Board, and in due course it will be discussed with the new Tourist Board.
THE EARL OF CROMARTIE: My Lords, I should like to thank the noble Lord for that answer.
THE DUKE OF ATHOLL: My Lords, could the Minister consider publishing a table which would show where the increased staff are, because obviously there is a big difference between having an increase in the number of top staff and an increase in the number of secretaries? I am sure the noble Lord will agree with me that the important thing is not the number of bodies involved. Further, is the increase in numbers due to the fact that other areas bordering on the crofting counties are going to be sufficiently fortuate to be brought within the ambit of the Board?
LORD HUGHES: My Lords, I suggest to the noble Duke that if he will put down a Question on the subject of the increased staff I shall be glad to give him a full Answer.
THE DUKE OF ATHOLL: My Lords, would the noble Lord care to answer my second question?
LORD HUGHES: My Lords, I was so concerned about the first part of the question that I am afraid I did not notice what the second part was. Would the noble Duke care to repeat it?
THE DUKE OF ATHOLL: My Lords, is the increase in numbers perhaps due to the fact that other areas bordering on the crofting counties are going to be sufficiently fortunate to be brought within the ambit of the Board?
LORD HUGHES: My Lords, if the noble Duke likes to put that down as another Question I shall be glad to answer it.

COVENT GARDEN MARKET BILL
3.23 p.m.
Read 3ª, with the Amendments.
THE CHAIRMAN OF COMMITTEES (THE EARL OF LISTOWEL): My Lords, with the permission of the House, I should like to move the Amendments that are proposed to this Bill—namely,

1203
the Amendments to Clauses 3, 6 and 8—en bloc. These Amendments are all either drafting Amendments or are consequential upon Amendments which have already been made to the Bill. Therefore it might save the time of the House to take them en bloc. I beg to move.
Amendments moved—
Clause 3, page 3, lines 7 and 8, leave out "and this Act";
Clause 6, page 7, line 6, leave out "Prohibition" and insert "Penalisation";
Clause 6, page 9, line 1, leave out "the said";
Clause 6, line 2, leave out "the said";
Clause 8, page 10, line 13, leave out "insert" and substitute "there shall be inserted";
Clause 8, page 10, line 35, after "of" insert "the".
—(The Earl of Listowel.)
On Question, Amendments agreed to.
Bill passed, and returned to the Commons.

FOREMEN AND STAFF MUTUAL BENEFIT SOCIETY (APPLICATION OF RULES) ETC., BILL
Read 2ª, and committed to a Select Committee.

SHARING OF CHURCH BUILDINGS BILL [H.L.]
THE LORD BISHOP OF BIRMINGHAM: My Lords, the most reverend Primate, the Archbishop of Canterbury, who introduced this Bill and who has been responsible for it throughout its stages in this House, has asked me to express his apologies for being unable to move the Third Reading. Over a year ago he arranged to visit the Anglican dioceses in the West Indies at this time, and he had to leave to carry out this assignment after the Report stage of the Bill last week. The Archbishop has asked me to say how grateful he has been for the co-operation from all quarters of the House and to those who have spoken on behalf of the various Churches. I therefore move that the Bill be now read a third time.
Moved, That the Bill be now read 3ª.—(The Lord Bishop of Birmingham.)
On Question, Bill read 3ª, and passed, and sent to the Commons.

MINES AND QUARRIES (TIPS) BILL
3.26 p.m.
LORD BESWICK: My Lords, I have it in command from Her Majesty the Queen to acquaint the House that Her Majesty, having been informed of the purport of the Mines and Quarries (Tips) Bill, has consented to place Her interest, so far as it is concerned on behalf of the Crown, at the disposal of Parliament for the purposes of the Bill.
THE MINISTER OF STATE, HOME OFFICE (LORD STONHAM): My Lords, I beg to move that the Bill be now read a third time.
Moved, That the Bill be now read 3ª.—(Lord Stonham.)
On Question, Bill read 3ª, with the Amendments, and passed, and returned to the Commons.

AGRICULTURE (SPRING TRAPS) (SCOTLAND) BILL
3.28 p.m.
LORD HUGHES: My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.
Moved, That the House do now resolve itself into Committee.—(Lord Hughes.)
On Question, Motion agreed to.
House in Committee accordingly.
[The LORD MERTHYR in the Chair.]
Clause 1 [Use of spring traps other than approved traps no longer to be authorized]:
On Question, Whether Clause 1 shall stand part of the Bill?
THE EARL OF DUNDEE: This clause removes the power which was possessed by the Secretary of State under Section 50 of the 1948 Act, enabling him to give various remissions or exemptions from the prohibition against the use of spring traps. It has been decided in another place to carry this clause in its present form and I do not wish to challenge that decision.
I have been concerned in many ways over the last forty years, perhaps not directly but indirectly, in endeavours which many of us have followed with interest in the hope that some kind of humane trap which would effectively

1205
enable Highland sheep farmers to keep down the number of predatory foxes in their area could be discovered. I am afraid the fact is that up to now all the inventions which have been produced by various people who have had them patented have been judged by those who use them to be more dangerous to the trapper than to the foxes; and while we all continue to hope that some less inhumane instrument will soon be discovered I feel bound to say that I doubt whether this clause is realistic. I do not propose to challenge it, for two reasons: first, I do not think it would be practicable to do so, and, secondly, nearly everyone has the strongest reluctance to say anything which might seem to encourage or approve of the use of these spring traps, which people who think they are necessary all regard as a most regrettable and distasteful necessity. But I feel bound to put it on record that so far as I can see this clause is not wholly realistic.
I think that by the time 1973 comes, which is the appointed day under this Bill, it is probable that either we shall have to reinstate the Secretary of State's power of exemption or we shall have to contemplate a situation in which the Highland sheep farmers in Scotland will be unable to protect their stock. Naturally the farmers are very concerned about this situation, and we all know that when people are concerned about something like this they often overstate their anxiety, but I do think that is probable.
THE DUKE OF ATHOLL: I apologise to the noble Lord that I was unable to be in my place on the Second Reading, but I read what he said with great interest, and I wonder whether this; would be a suitable opportunity for him to tell us the position with regard to otters. I should have thought there was no reason at all why the use of the gin-trap should not be banned on otters as from the passing of this Bill. It is generally thought now in Scotland that otters do little, if any, damage; that they are few in number and probably diminishing, and that the sooner their persecution by the gin-trap is stopped the better. I have one slight fear about this Bill and that is that in Clause 2 it says that it cannot come into operation within two years. Does this
1206
mean that the Secretary of State will not have the power for the next two years to remove the otter from the list of animals on which the gin-trap can be used?
LORD HUGHES: The noble Earl, Lord Dundee, in talking about Clause 1 and the position that presently exists, of course reiterates what has been in the minds of many people during all these years. It is now 11 years since the Secretary of State made the Order under which the use of the gin-trap was confined to foxes and otters, and I think it is fair to say that during all this time it has been regarded as a temporary use of a detestable device and one which everybody concerned hoped could be brought to an end at the earliest posible moment. I have heard no one suggesting that the gin-trap is a desirable method to use against any animal.
The argument is that we have not been able to get anything to put in its place which will accomplish the result. That is true. But the Government have been persuaded and are firmly of the view that if we do not take action at some time to put an end to the use of this trap, the temporary situation is likely to go on and on and on; because, to put no finer a point on it, those who use the gin-trap have no incentive themselves to take measures to find an alternative. The steps are left to the research organisations, the Agriculture Departments and people of an inventive turn of mind. By placing a definite period of four years on the use of this trap we have increased very considerably by one stroke those who have in fact a vested interest in finding a satisfactory alternative, because every farmer whose stock may be attacked has just as much interest in trying to find a solution to the problem as the man who might collect £2,000 in reward from inventing a satisfactory trap. We think therefore that this is a justification.
In fact the Government, even in your Lordships' House, were under criticism, and the criticism can be justified, for waiting for so long as four years before putting a final end to the use of this trap. We have had to work very hard at balancing the interests of those who wish to put an end to cruelty immediately and those who say that the farmer, faced with this time limit, must be given some reasonable time to do something about it.

1207
And the Government came to the conclusion that two years was likely to be the very minimum in which this could be accomplished and that four years should be set as the maximum.
When the noble Earl made the remark about the Government of the day in 1973 being faced with the possibility of having to reverse this measure I hope that that is not to be taken as an indication that if there were unfortunately to be a Government of another complexion in Scotland or the United Kingdom at that time it would be the intention of the Conservative Benches to seek to reverse this measure, because I think that would be very regrettable.
THE EARL OF DUNDEE: All I said was that I thought that in 1973 the Government might be faced with the alternative of reinstating the powers of the Secretary of State which are removed by this clause or of dealing with a situation in which the farmers were unable to protect their stock. Of course, I hope they may have invented some other means of doing so, but I think that the alternative is likely to be the case.
LORD HUGHES: Put on a hypothetical basis, I cannot object to it. I wanted to be quite clear that I was not getting an advance warning. On the question of otters, on Second Reading I was rather pleasantly surprised at the reaction, and I undertook that if the noble Earl, Lord Mansfield, or others tabled an Amendment to deal with this situation I would give it careful consideration. No such Amendment has been tabled; so there has been nothing for me to consider. There are great practical difficulties. To answer the noble Duke's question, under the Bill as it stands, if there is no Amendment, it would not be possible for the Secretary of State to stop the use of the gin-trap for otters in less than two years.
THE DUKE OF ATHOLL: Would the noble Lord consider co-operating with me in trying to find some suitable Amendment for the next stage? Although the gin-trap is not used much on otters, I think it would be a very bad blot on this particular piece of legislation if it had the effect of stopping the Secretary of State from putting otters on the list for two years.
LORD LEATHERLAND: I wish to digress from this particular discussion to raise another point, and I suppose to be in order I should say that I support the Motion, That the clause stand part. In one of his answers to the noble Duke, my noble friend said, "If in 1973 there were a Government in Scotland". We have had many leaks of official policy recently, and I was wondering whether it was an accidental slip of the tongue or whether he is formally officially indicating in your Lordships' House that by 1973 Scotland will have Home Rule.
LORD HUGHES: No; it was no inspired leak. I rather thought the noble Earl, Lord Dundee, in talking about what might happen in 1973, was getting into the field of pure hypothesis and I did not see any reason why I should not enter into a similar unlikely field.
LORD BURTON: I thought from what had been said on the Second Reading that it was going to be possible under present legislation to ban the use of the gin-trap on the otter, otherwise I would have put down an Amendment for to-day. Do I take it from what the noble Lord has said that this is not now possible?
THE EARL OF DUNDEE: The case of otters is entirely different from that of foxes. Farmers may be anxious about damage to their flocks from foxes in 1973, but otters do not do any harm to sheep; and surely, in view of the general opinion of naturalists now, it would be reasonable to prohibit the use of spring traps for otters in less than two years?
LORD HUGHES: It is perfectly true, so far as I know, that otters do not do any harm to sheep, but there are a number of people, particularly in fisheries organisations, who suspect that they do a certain amount of harm to salmon. Even the very guarded remarks I made on Second Reading about being willing to consider an Amendment if the noble Earl, Lord Mansfield, put one down, brought an almost immediate reaction from the people concerned that they had agreed, with some reluctance, to what was in the Bill only because a certain amount of time was to elapse before it came into effect, and that if

1209
any such Amendment either to bring the ban forward or to make it operative immediately were brought in, it would be a grave breach of faith on the part of the Government. So in this matter also there is no unanimity. We are in danger of mixing up two things here. We are seeking to prohibit the use of the gin trap because it is a cruel method of killing animals, and the reaction on Second Reading of at least some noble Lords concerned was really on the question of the desirability of preserving otters, not of finding an alternative way of killing them. Listening to some noble Lords, one would have almost thought that the Bill was for the conservation of otters. That may be a very desirable thing, but it is not one of the functions that we are seeking to cover in this Bill.
LORD BURTON: Surely under the 1948 Act it was possible to abolish the trap for any specific animal or at any specific place, if there was an alternative. If the number of otters is reducing, surely it proves that there are quite adequate methods, because I am sure the gin trap is not used very extensively on otters at the moment. Can you, therefore, not ban it under the 1948 Act?
LORD HUGHES: It is the case at the present time that if a suitable trap can be devised the Secretary of State has power to ban the use of the gin trap, either for otters or for foxes, right away, but he cannot ban it under existing legislation unless he is satisfied that there is a suitable alternative. So what we are seeking to do in this Bill is to give the Secretary of State power as from 1973, or, alternatively, from 1971, but not earlier than that, to ban it, even though a suitable alternative humane trap has not been found.
LORD BURTON: Surely the point is that there is a suitable alternative. It does not say a "suitable alternative trap". There is already a suitable alternative, and therefore I should have thought you would be able to ban it under the existing legislation.
LORD HUGHES: No, it is a suitable alternative humane trap which the Secretary of State is obliged to find.
THE DUKE OF ATHOLL: Could the noble Lord say specifically which organisation it was which felt, with reference
1210
to the otters, that there should be at least two years before the gin trap was banned? Because I have teen led to understand that modern thinking is that in the fisheries otters do almost as much good as harm by the number of eels and other coarse fish they take, although it must be admitted that they do take some salmon parr, too.
LORD HUGHES: I am very sorry; offhand I could not state the name of the organisation. I could state the name of the lawyer in Aberdeen who is its Secretary, but I do not know that that would be helpful to your Lordships other than to those who know Aberdeen lawyers.
Clause 1 agreed to.
LORD BURTON LORD BURTON moved the following Amendment:
After Clause 1, insert the following new clause:
Use of spring traps under license
".—(1)Notwithstanding anything in section 50 of the Agriculture (Scotland) Act 1948 after the appointed day a licence may be granted to any person by the Secretary of State authorising that person for the purpose of killing or taking animals to use spring trays other than approved traps subject to compliance with any conditions specified in the licence.
(2) A licence granted under this section may be revoked at any time.
(3) Any person who contravenes or fails to comply with any conditions imposed on the grant of a licence under this section shall be guilty of an offence and shall be liable on summary conviction to a fine not exceeding £20."
The noble Lord said: Knowing as I do the intense desire of many of your Lordships to see the end of the gin trap altogether, I have introduced this Amendment only after very much consideration. As things stand at the moment, as the Secretary of State said only a matter of three minutes ago, there would be serious loss if no alternative were found to the gin trap and it was banned completely. The noble Lord said that he wished to do away with cruelty, but, after all, if we are going to have an excess of foxes we are going to have a great deal of cruelty to lambs. I do not know if this point has been considered. You try and do away with cruelty on the one hand, and you will introduce increased cruelty on the other.
There is no reason why the trap should not be banned in a great deal of Scotland. It would be quite reasonable to ban it at

1211
the present time in any place where it is possible to use a snare, but there are large tracts of Scotland where the snare is not feasible. There are areas where there is no alternative, and serious difficulty will occur in those areas if these traps are banned. I discussed the position during the last fortnight at branch and area meetings of the N.F.U., and they were all unanimous that an Amendment on these lines was essential. I gather that N.F.U. headquarters have also backed it and sent a circular to certain noble Lords.
The Government have expressed their desire for the complete abolition of the trap. If your Lordships approve of my Amendment it still need not result in the trap being used again after 1973, because if the Government really got down to finding an alternative the gin could be banned straight away. Certain noble Lords suggested that the amount of the prize should be increased, and some noble Lords suggested that the universities should be engaged in this work. It is most disappointing this afternoon to hear the noble Lord say that the prize still stays at £2,000.
The Amendment would restrict the traps to very limited areas, even if no alternative is found, and one hopes it will be found by 1973. The Amendment would permit the Secretary of State to stipulate that the trap could be used only for foxes, and, further, he could stipulate exactly how it was to be used. For instance, he would probably stipulate that it could be used only in pools, on what is called the "island set" although I think it is really on a peninsula, where the fox would fall into the water and be drowned. To my mind it would be causing more cruelty by not permitting the use of the trap in this very limited sense unless an alternative is found. Therefore I have much pleasure in moving this Amendment, because I am certain that your Lordships would not wish to involve the Highland sheep farmers and others in a great deal of excessive loss.
LORD HUGHES: I have naturally listened with interest to the arguments advanced by the noble Lord, Lord Burton, in moving this Amendment, but I must tell your Lordships right away that the new clause would be fundamentally at variance with the principle
1212
on which the Bill is based. That principle is quite simply stated. It is that the gin is too cruel a device to be tolerated beyond the minimum reasonable period of notice to those who at present rely on this means of control. The noble Lord, Lord Burton, said as a sort of balancing factor against the cruelty of the gin trap against the fox that we did not consider the cruelty that would be inflicted on lambs. I do not think there can be any comparison between the two. The lamb which is attacked by a fox meets an instant death.
SEVERAL NOBLE LORDS: No.
LORD HUGHES: Let me put it another way. There is no question, when a lamb is attacked by a fox, of its lying for anything up to four days dying slowly because there is nobody to come to its assistance. If the gin trap could be guaranteed in all circumstances to kill as quickly as the fox generally kills, it would perhaps be an argument for the toleration of its use. But the fact is that a fox may be a long time in dying and spend the whole of that time in the most intolerable agony which nobody could justify if this happened in front of witnesses. Those which may get away from the trap by gnawing off the trapped limb, may then die a slow death because, owing to their physical disability, they will not be able to get their natural food. For these reasons so many people have clamoured over the years for the removal of the trap. There is a definite difference between the two problems.
The noble Lord envisages the issue of licences to use the gin trap in a limited way. My advice is that what would be involved would be the use of the gin, on a considerable scale, in those areas of Scotland where control by other means is difficult. The noble Lord's Amendment does not mean that a few dozen Highland sheep farmers would be allowed to use the gin trap. It means that in practice the gin trap would continue to be permissible as an instrument in large areas of Scotland. Frankly, we consider that the only way to stop this cruelty is to go ahead in the way suggested in the Bill.
Apart from the objection of principle, there are two sound practical reasons why the new clause is not acceptable. I have drawn attention to the hopes which were repeatedly expressed that the four-year

1213
waiting period before the appointed day will be used by all concerned to make preparations for control by alternative means. Does the noble Lord, Lord Burton, really think that if the new clause were accepted, those at present using gin traps would apply their minds vigorously to the problem of devising alternative measures? Would the fox club with which he himself is closely concerned do this? It may be that they would, but I must express doubts about this being the likely outcome of getting a licence to continue the use of the trap. It is more likely that, if a licensing system were introduced, there would be a general presumption that the majority of those at present using gins, particularly in the Highland area, would be allowed to continue doing so. That is not what the Government want. Our intention is to tell the fanning community clearly that gin traps are on the way out; and that with every encouragement from the Government they must make preparations for control by other means. I am sure your Lordships will agree that after waiting some fifteen years from the passing of the Pests Act 1954, and eleven years after the making of the Order, for a decision on this issue, the time has come for the Government to make a clear and unequivocal decision.
There is, finally, the point that illegal use of the gin is very much more likely if its use is still permissible in some circumstances. We have already evidence of this in the relatively frequent reports of the illegal use of gin traps for the purpose of taking birds and other creatures. Under the Bill as it stands it will from the appointed day be an offence to use, or knowingly permit the use of, a gin trap, or to possess or sell a gin trap with a view to unlawful use. If a gin trap is discovered set by any person so as to take any creature, there will be evidence that an offence has been committed. Moreover, when the appointed day arrives there will he some incentive for those possessing gins to get rid of them; or at least there will be no incentive to keep stocks readily available and in good working order. I ask your Lordships to contrast that situation with the situation which would be created if the new clause were accepted. There would still be a demand for these cruel instruments. Supplies would be readily available; it would be lawful to sell them.
1214
Enforcement of the law would be difficult, since any licensee using the trap for illegal purposes would be able to claim that this was not his intention. He could say that he had not set it to catch an eagle, but to catch a fox, and that it was unfortunate that the other animal or bird got into the trap.
In all these circumstances, we have come to the conclusion that the only way to put an end to the illegal use is to put an end to the legal use. The one thing which legal use and illegal use have in common is that the gin trap is a despicably cruel instrument which Scotland, through economic circumstances, has permitted to be used for ten years longer than has been the case in England and Wales. I refuse to accept that it is beyond the wit of the Scottish farmer, with another four years' leeway, to accomplish what has been accomplished by those even in the difficult areas of England and Wales. Those areas have managed for ten years to do without the pin trap. What they managed to do in 1959, Scotland should at least manage to do by 1973.
3.56 p.m.
LORD BURTON: The noble Lord, Lord Hughes, has by his speech illustrated some of the fallacies under which the Government are working. He stated that he thought lambs would be killed quickly. I have with me a letter from a shepherd, which was written as a result of our Second Reading debate. He says in his letter that he has had very many lambs still alive after being savaged by foxes. He goes on to say that there is clear evidence of lambs having had their legs chewed off and virtually having been skinned alive; and that it is a pity that photographs of wounded foxes could not have been backed up with pictures of these lambs. He goes on:
"It is perhaps possible to imagine the feelings of a shepherd when he finds a lamb in this state, and the feelings of the shepherd's wife when she has to try to doctor the poor little beast. The principle of reduction of cruelty whenever possible is inescapably right …".
This makes quite clear the position with regard to lambs. Under this Amendment the trap would be used only where it was essential.
In his reply the noble Lord, Lord Hughes, said that this use of the trap under licence would apply in large areas

1215
of Scotland. At one moment he says, "We are going to ban it", and at the next he says that it is essential. The position is that the Secretary of State would issue a licence only where it was essential to use the gin trap. And the noble Lord says that this would relate to large areas of Scotland. He further said that the trap would have been banned long ago in Scotland had it not been for economic considerations. He now says that the Government are going to cause economic difficulties, not only in the Highlands but in large parts of Scotland.
LORD HUGHES: The noble Lord is entitled to a good deal of licence, but he cannot be allowed to get away with misrepresentation of this kind. I did not say anything of the sort. In the first instance I withdrew the remark that the lamb never had a lingering death. I substituted for that remark that I accepted that this could be the case, but I pointed out that the animal caught in the gin trap always had a cruel death. There is no comparison on that basis.
On the economics of the matter, I said that over the years the Government had accepted that the economic situation required them to continue to allow this dispensation, overlooking the cruelty aspect. The Government have now accepted that the community in Scotland must put itself on the same basis as that in England and Wales. We are giving it four years in which to find a way to deal with the situation. We are giving the people concerned a very strong vested interest in allying themselves with attempts to get a solution. That is a very different thing from saying that we now accept that we are ignoring the economics of the matter.
It is said that at one moment I say this does not involve much, and that I then say there will be large areas of Scotland involved. But the point is that when Governments are dealing with matters like the issue of licences they cannot deal with them on the same basis as an individual might do, where you give someone a licence because you like the look of his face, but do not give a licence to a person whose face you do not like: you have to give licences on the same sort of basis. If the Amendment means anything at all it is that
1216
those people who, in the absence of a humane trap, could show that in their particular case it was essential that they should be allowed to use a gin, should therefore get a licence for it. We should thereby be removing the encouragement to find an alternative, and almost everybody, over large areas, would be able to make as good a case as the next person. Licences either have to be issued on a wholesale scale, almost repeating the existing position, or should not be issued at all. We prefer that they should not be issued at all, and the straightforward method is to do what is in the Bill; that is, to make them illegal.
4.2 p.m.
LORD FERRIER: I apologise for having been at a meeting and not having heard the noble Lord, Lord Burton, speak. I appreciate that I speak with some risk, but I am an extremely tenderhearted and sensitive animal lover who lives in the country and I cannot forget what the noble Earl, Lord Haddington, said about the fox that had a gin-trap on its leg. I have seen a fox which has been blinded by being shot at at long-range with small shot, which has been wandering about until it was destroyed. Also, of course, snares still have their brutal effects on animals.
What makes it right for me to speak is that as I read the Amendment, I thought the Government would have power to give the most limited number of licences, and only to skilled people who would not do wholesale trapping such as the noble Lord, Lord Hughes, described. I am one of those who agree that any fox caught in a gin-trap must inevitably have an end infinitely worse than being bowled over by a pack of hounds or being "chopped" in cover, but the economic side is a very serious aspect in country where gassing is impossible. I disagree with the noble Lord, Lord Burton, that there are large areas of Scotland concerned.
LORD BURTON: That is what the noble Lord, Lord Hughes, said.
LORD FERRIER: I missed that point owing to not being here earlier. I should have thought the only difficult areas were those with corries and rock dens, where gassing will not work. All sorts of animals have been mentioned, but I am a little surprised that we have not heard

1217
more about the otter. However, that is another matter. So far as this Amendment is concerned—and I imagine that the noble Lord, Lord Burton, will withdraw it, which will be a pity—I ask the noble Lord, Lord Hughes, to think again. I also ask him to think of another matter which I raised on Second Reading, and that is the point about the reward for an improved trap. It has been said that there will be four years in which to invent another trap, and yet I think the noble Lord told me that he thought a reward would be liable to tax. If he is sincere in his desire for an improved trap—and I am one of those who long for the day when there will be one—and if the amount of the reward has now been cut down from, I think, £5,000 to £2,000, I really believe that what is left should be tax-free in the hands of the recipient. It must be worth while for him to give time and trouble to the purchase of materials and to experimentation; and, as we all know, it is the experiments which fail which are the costly items in any invention. Will the noble Lord give that matter some thought before another stage?
VISCOUNT MASSEREENE AND FERRARD: I certainly cannot support this Amendment, but I will not repeat my Second Reading speech as I spoke at some length on this subject. I should like to take up the observation of my noble friend Lord Burton, who quoted a letter from his shepherd about foxes chewing the legs off lambs. I understood him to imply that those lambs were left alive. But if a fox attacks a lamb he usually kills it outright. The fox is a quick killer and lambs whose legs have been chewed are nearly always stillborn lambs, or are very weak lambs which have died within an hour or two of birth. I cannot believe that a fox—if, in fact, he attacks a strong lamb—will chew its legs off without first killing it.
On the question of otters—and I quite agree that they are not covered by this Amendment—may I ask the noble Lord, Lord Hughes, whether he could use his great ingenuity and that of his Department who are behind him, to try to devise by Report stage an Amendment to enable the otter to be saved from being caught by gin-traps? I have found it impossible to devise such an Amendment, but the noble Lord might be able to think of one.
1218
If so, I sincerely hope that he will bring it forward on Report stage.
LORD MOWBRAY AND STOURTON: I thought the noble Lord, Lord Hughes, was slightly unfair to my noble friend Lord Burton, when he said that the whole country had to be covered and that there always were cases of cruelty involved. In his Amendment my noble friend took the trouble to include the words:
"subject to compliance with any conditions specified in the licence."
If we do not have an efficient and humane trap by 1973—and after ten years we still do not have one, so it is not beyond the bounds of possibility that we shall not have one in four years—it will surely be possible for the Secretary of State to limit the use of traps to certain counties, such as crofting counties.
As I pointed out on Second Reading, the island set, to which my noble friend Lord Burton referred, accounts for about half of the foxes killed in the crofting counties al the moment, and 99 per cent. of the time the foxes are drowned. So there is no long lingering death. It is a little unfair of the noble Lord, the Minister to say that there is always a long, lingering death, because than is not the case in the crofting counties. Under this Amendment, the Secretary of State would have power to limit the use of traps to one or two counties where the foxes cannot be kept down by other means, and if he wished he could specifically limit the use to the island set.
THE DUKE OF ATHOLL: The noble Lord, Lord Hughes, is basing much of his argument on the respective cruelty which the gin commits to the fox and which the fox commits to the lamb, and saying that the former is much greater than the latter. I hope I am not misquoting him. But he appears to have forgotten that very often the fox commits this cruelty not to one lamb, but to quite an appreciable number of lambs before it is caught. I strongly suspect that if one totted up the amount of cruelty committed to all the lambs by one fox it might easily amount in aggregate to as much as, if not more than, the gin commits to the fox. Therefore, I should have thought that this argument was, to put it mildly, somewhat fallacious.
LORD BURTON: I apologise for rising again, but I had not in fact finished; I merely sat down for an interruption. My noble friend Lord Mowbray has answered the question about all the foxes dying a cruel, lingering death. This is just another example of the mis-thinking of the Government on this matter. This again, I am afraid, is where we in the countryside suffer from urban thinking, as opposed to those of us who live and know what happens in the rural areas. My noble friend Lord Dundee said that it might be necessary to reintroduce the trap in 1973. This, I am sure, is not what any of your Lordships want. If my Amendment is accepted, although it might never have to be used, if it were necessary to use it then it would permit the trap only on a very limited scale, not on the scale which my noble friend suggested.
We keep coming back to the question: Why has it not been missed in England? I thought I answered this question on Second Reading. Practically all the areas in England which are not suitable for the snare are hunted over, and the hunting controls the foxes in England. In the Highlands of Scotland, you cannot go in a short distance from sea level up to 3.000 feet on a horse at a gallop. If you are going to do this, you have to be jolly fit and you have to use a sort of John Peel pattern. It may be that this is what we shall have to come to; but, equally, this may well be something which a good many people who are trying to abolish the gin trap will not like. Also on Second Reading, dealing with cruelty, I mentioned the old fox who was left with only his front teeth and who sucked the blood of the old ewes in killing them. This must be cruel. I am equally anxious, as most of your Lordships are, to see the end of the gin trap; but, equally, I must look at the other side. I must look at the economic position, and I must look at the cruelty which would otherwise take place. On Second Reading I also mentioned mange, which would be a very slow and lingering death for the fox. I am quite sure that your Lordships' Committee ought to accept my Amendment.
LORD HUGHES: I did not actually finish advising your Lordships not to accept the Amendment, although your Lordships may have gathered that I am
1220
against it. The noble Lord, Lord Mowbray, took up the suggestion made by Lord Massereene and Ferrard that I might be possessed of a certain amount of ingenuity. I can assure the noble Lord that it would be exceedingly difficult so to devise the issuing of licences that the issue could be confined to a comparatively few people, because if the noble Lord does not know it I can inform him that the ingenuity of the Highlander in finding reasons why anything which applies to anybody else can be equally applied to him will beat any Minister any day. So it would be impossible to restrict this. I have at least reached a point where the noble Lord, Lord Burton, agrees with me, if nodding his head means anything.
I am pretty certain that the noble Lord, Lord Burton, is going to withdraw the Amendment, but I am in a position to answer two points which were raised on the Question that Clause 1 stand part, and I think that perhaps it is desirable that your Lordships should have the information. The answer to the first point is that the organisation which wrote on the subject of immediate action against otters was the Salmon Net Fishing Association of Scotland. On the subject of the Secretary of State having power to ban the use of the trap immediately, he has the power to ban it immediately under the existing law if a suitable alternative is devised. That power will remain, because this Bill merely puts an end to the Secretary of State's power to keep on deferring it. It limits it to four years at the outside; and he cannot put an end to it in less than two years unless the existing law is being complied with.
There are two traps being investigated at the present time, and if it should turn out that the Humane Traps Panel decides that one of these is a suitable alternative to the gin, then under the existing law the Secretary of State has power to ban the use of the gin as soon as this other trap can be brought into operation. So there is the possibility that we might be able to deal with the situation before the four years are up. If that were the case, and if there was a satisfactory alternative, then I think everybody would be satisfied. I mention this point as showing the way in which the Government have acted. They are giving the maximum

1221
possible time to the farmers. At the same time, they are not depriving themselves of the power to act if a suitable alternative should present itself before the end of the four-year period. I hone, therefore, that in all these circumstances—although I have no doubt at all that the noble Lord, Lord Burton, has not been persuaded by what I have said—that he will accept that it would not be reasonable to press his Amendment.
Loan BURTON: I am in some difficulty, because I suspect that I should be heavily defeated here, and I am not sure that when I return North the Highlanders would not slit my throat if I had withdrawn the Amendment. I know they feel very strongly on this matter—and I do not know whether I could show my face at another N.F.U. meeting.
LORD HUGHES: I think the noble Lord could take the risk, although I must say that when he talks about the dangers to Highland lairds of cantering about after foxes at 3,000 feet, there are at least some people in Scotland who would have accepted that the possible death of a few Highland lairds fox-hunting was a reasonable price to pay for eliminating cruelty to the fox.
On Question, Amendment negatived.
Remaining clauses agreed to.
House resumed: Bill reported without amendment.

REPRESENTATION OF THE PEOPLE BILL
4.18 p.m.
Report received.
Clause 6 [Other Amendments as to proxy and postal voting]:
LORD BROOKE OF CUMNOR LORD BROOKE OF CUMNOR moved Amendment No. 1:
Page 5, line 23, at end insert—
("() In section 23(7) of the Representation of the People Act 1949, as amended by paragraph 7(2) of the Seventh Schedule to the Local Government Act 1958, the words 'rural district' shall be omitted.")
The noble Lord said: My Lords, I beg to move Amendment No. 1. Its drafting, I fear, inevitably fails to make crystal clear its real purpose, so I shall endeavour to explain that. The Representation
1222
of the People Act 1949 gave to invalids and certain other categories of people the right to vote by post at Parliamentary elections, and also at all kinds of local government elections except those for rural district councils and parish coup, ells. That means that people who are entitled under the law to vote by post can do so if they live in an urban district or a borough or a county borough; but if they happen to live in a rural district they cannot vote by post at rural district council elections. That has been the law since 1949. My Amendment suggests quite simply that the time has come to alter it.
Ten years after the 1949 Act was passed, the Local Government Act 1958 created a new form of local authority, called a rural borough, which has a mayor but otherwise only the power of a parish council. That Act excluded rural borough councils also from postal voting. When I first tabled my Amendment I got it wrong. I forgot the 1958 Act, which was silly of me, for I was responsible for putting it on the Statute Book. When I remembered, I revised the wording of my Amendment and I hope that it is right now. My intention is, if your Lordships will accept this Amendment, to legalise postal voting at elections for rural district councils but not at those foe parish councils or for rural borough councils which, as I have said, are mere like parish councils. I appreciate that there may not be the equipment to organise a postal voting system successfully for every parish council throughout the land, but I am sure that all the rural district councils could do it by now.
The precise reason for the exclusion of rural district councils in 1949 is somewhat obscure, if one reads the debates, but it seems as if the Labour Government of that time were doubtful whether the staff of rural district councils could manage the machinery of postal voting. At that time postal voting, even at ordinary Parliamentary elections was a new thing; it was quite untried. But now we have had twenty years' experience of it, and everyone concerned with every sort of election, down to urban district council elections, knows how the postal vote should be worked and administered. I am quite sure that the clerks of rural district councils could deal with it equally well, and therefore

1223
I am urging that the discrimination between urban district councils and rural district councils should now end.
My Lords, there is an additional reason. Rural districts mostly extend over much larger areas than urban districts, and distances to a polling station can be correspondingly much greater. So it may be that it is that more difficult for elderly people, if they are not too fit, to get to the polling station. Why should they be disfranchised just because they live in a rural district? I gave notice on Second Reading that I should like to see the Bill amended in this important respect. In winding up that debate the noble Lord, Lord Stonham, mentioned various objections to making this change. Honestly, I do not believe that these objections are valid, and I greatly hope that the Government will have second thoughts and will now grant this act of justice to people in rural districts: people who for one lawful reason or another cannot get to the polling station to cast their votes for whichever candidate they want to represent them on the council. I am sure it is of common interest to all your Lordships that the poll at local government elections should be as high as possible. I am calling attention here to certain classes of people for whom at present it is made almost impossible to cast their votes. I think there is an extremely strong case for justice for those people. I beg to move.
THE EARL OF GAINSBOROUGH: My Lords, I should like greatly to support the noble Lord, Lord Brooke, in his Amendment. I know that there are difficulties, rather serious difficulties, and that this argument has gone on for a good many years. But there are many people who think that justice should be done by giving the postal vote to those living in rural districts. I know that there are a number of technical difficulties, which I have no doubt the noble Lord, Lord Stonham, will tell us about in a few minutes' time, but I hope that this matter be given further thought, even if it cannot be dealt with at this particular moment. There is no doubt that conditions have changed in country areas and that the old idea that postal voting was not necessary, because people had every opportunity of voting without postal voting, does not apply to-day—as the noble
1224
Lord, Lord Brooke, has pointed out. I hope that the Government will be able to give this favourable consideration and that the noble Lord, Lord Stonham, may consider wearing his hat as Vice-President of the R.D.C.A. for a few minutes, even though he may have to take it off again very shortly afterwards.
LORD STONHAM: My Lords, in moving his Amendment the noble Lord, Lord Brooke, said that the drafting failed to make the purpose of his Amendment clear. That may be so, because the Amendment refers to sections of the 1949 Act; but I would assure him at once that, purely as a matter of drafting, it is immaculate. There will be no problems arising therefrom. As the noble Lord said, its object is to provide for postal voting at rural district council elections, which is excluded as the Act stands at present. The noble Lord, Lord Brooke, proposes to achieve his object by removing the elections of rural district councillors from the exceptions named in Section 23(7) of the 1949 Act. But by virtue of Section 23(3) the Amendment would also have the effect of making it possible for qualified civilians to vote by proxy at those elections, quite apart from having a postal vote.
There was no postal voting at any local government elections in this country before 1948. In 1946 the Oliver Committee on Electoral Registration recommended:
"That so far as practicable provision should be made for postal voting at local government elections by all the classes of civilians who are entitled to vote at parliamentary elections, with the exception of persons who no longer reside at the address for which they are registered."
As the noble Lord, Lord Brooke, mentioned, in 1948 the then Government, in deciding to provide votes for electors at local authority elections, decided against providing them at elections for rural district councillors. The noble Lord said that their reasons for so deciding were not very clear: but in fact the decision was taken on practical grounds. It was then considered desirable, on account both of likely administrative difficulties in some areas and of expenses to local authorities, to keep the procedure at these elections as simple as possible. It was thought that postal voting at those elections would add an administrative complication out of all proportion to the needs of the

1225
case and a heavy burden on the staffs of authorities which were in any case, in the main, small authorities with small staffs.
But the Rural District Councils Association, of whom the noble Earl is President, and on whose shoulders most of the work would fall, are now wholly in favour of the introduction of postal voting at rural district council elections. They told us in the Home Office, in a recent letter:
"Since rural and parish elections are conducted together it would seem sensible to extend postal voting to both of them."
But they added:
"On the other hand this Association's principal concern is of course with rural district council elections and if it were for any reason found impracticable to extend voting as widely as to include parish councils it would still he this Association's wish that it should extend to rural district council elections."
The noble Lord, Lord Brooke, made a very valid point about travelling in rural districts where, generally speaking, voters have to travel greater distances to record their votes than people in urban areas do. Therefore, by any computation, people living in rural areas have as much, and probably more, need for the right of the postal vote than people living in urban areas. Since those who do the extra work are also in favour, the Government are convinced that this is an improvement which the electorate will welcome and that we should make it. Therefore, I would advise your Lordships to accept the Amendment.
LORD BROOKE OF CUMNOR: My Lords, I am deeply grateful to the noble Lord, Lord Stonham, for what he has said. I appreciate that he must have had to go into the matter carefully to satisfy himself that the objections, which had seemed to be cogent over the past twenty years, were no longer so pressing as they were. I agree with him that this will be a substantial improvement for a large number of people who for one reason or another would not be able to reach a polling station in person but would be entitled by the general law to cast their votes by post. I express my gratitude to him. I should also like to put on record that here is a case where your Lordships' House, the non-elected Chamber, is able to be instrumental in bring about a material improvement in the system of democratic election for the country.
On Question, Amendment agreed to.
Clause 8 [Limit on, and declaration and publication of, election expenses]:
4.33 p.m.
LORD STONHAM LORD STONHAM moved Amendment No. 2:
Page 7, line 10, leave out ("doubled") and insert ("twice or, if there has been a previous increase under this subsection, three times what it would have been but for any increase under this subsection;").
The noble Lord said: My Lords, I beg to move Amendment No. 2 and with this Amendment, I should like to discuss Amendment No. 3. Clause 8, as amended in Committee, provides for the expenses of the surviving candidates at an election which has been countermanded or abandoned, on the death of a candidate, under Clause 13. The further Amendments are necessary to make it clear that in the event of a second death of a candidate the permitted expenses of the surviving candidates would not again be doubled, so as to entitle them to four times the amount permitted in the case of a poll held in the ordinary way, but would be increased to three times the normal amount, which is the right figure.
Amendment No. 2 operates on subsection (2) of Clause 8, which deals with candidates' expenses. Amendment No. 3 operates on subsection (3). This prescribes the maximum amount of election expenses at ward elections in the City of London and, as amended in Committee, applies to those elections the provision made by subsection (2) for additional expenses for surviving candidates at a further election.
On Question, Amendment agreed to.
LORD STONHAM: My Lords, I beg to move Amendment No. 3.
Amendment moved—
Page 7, line 19, leave out ("doubling") and insert ("increasing").—(Lord Stonham.)
On Question, Amendment agreed to.
Clause 19 [Timing of elections, and of steps at elections]:
LORD STONHAM LORD STONHAM moved Amendment No. 4:
Page 15, line 24, at end insert:—
("() In relation to the period within which any local government election is to EH; held, and in relation to the day of election at any local government election, section 295 of the Local Government Act 1933 shall haw effect as if the days mentioned in section 295(1)

1227
included any day of the Christmas break, the Easter break or a bank holiday break within the meaning of rule 2 of the local elections rules as amended by subsection (3) above; and in section 295(2) (under which, if an election is postponed, the day on which it is held is to be treated as the day of election for all purposes of that Act) the reference to the purposes of that Act shall include the purposes of the Representation of the People Acts.
This subsection shall apply to elections of elective auditors as it applies to local government elections.")
The noble Lord said: My Lords, I beg to move Amendment No. 4. This is a technical Amendment, required to bring Section 295 of the Local Government Act 1933 into line with the Representation of the People Acts 1948 and 1949 as amended by Clause 19 of the Representation of the People Bill. Section 295 of the Act of 1933 deals with computation of time for the purposes of that Act, including local government elections. The provisions of the Representation of the People Acts 1948 and 1949 operated on by Clause 19 of the Bill also deal with computation of time for the purposes of elections, including local government elections. As a result of the amendments made by Clause 19, Section 295 is now in conflict with the relevant provisions of the Representation of the People Acts 1948 and 1949. This Amendment will resolve that conflict.
In view of the earlier discussion we had on gin traps, I should say that the Amendment does not, and need not, apply to Scotland. There is no conflict between the Local Government (Scotland) Act 1947, Section 366, and the Scottish Local Elections Rules, which appear as Schedule 3 to the Representation of the People Act 1949 and which are not affected by Clause 19 of the Bill.
On Question, Amendment agreed to.
Clause 22 [Summary prosecutions of offences at local elections]:
LORD STONHAM LORD STONHAM moved Amendment No. 5:
Page 16, line 14, at beginning insert—
("(1) In section 155 of the Representation of the People Act 1949 (which, in relation to parliamentary elections, makes provision as to the prosecution of offences committed outside the United Kingdom by British subjects or citizens of the Republic of Ireland) in subsection (1) the words 'so far as it relates to parliamentary elections,' shall be omitted.
(2)")
The noble Lord said: My Lords, I beg to move Amendment No. 5. The purpose of this Amendment is to extend to local government elections in the United Kingdom the provisions in Section 155 of the Representation of the People Act 1949 about prosecutions for electoral offences committed outside the United Kingdom. Hitherto the Bill has provided, in paragraph 20 of Schedule 2, for Section 155 to be extended to offences at local government elections in relation only to broadcasts from outside the United Kingdom. Such broadcasts are, by Section 80 of the Representation of the People Act 1949, illegal ill respect of Parliamentary elections, but Clause 9(4) of the Bill extends Section 80 of the 1949 Act so as to make it apply to broadcasts from outside the United Kingdom relating to local government elections. It has been thought advisable to generalise the application of Section 155 of the 1949 Act to all offences at local government elections, rather than make specific mention only of offences against Section 80.
On Question, Amendment agreed to.
Schedule 2 [Consequential and supplementary amendments of Representation of the People Act 1949]:
LORD STONHAM LORD STONHAM moved Amendment No. 6:
Page 27, line 3, at end insert:
("(2) In section 8(2) proviso there shall be omitted paragraphs (a) and (b) (which make provision against a person being registered as a local government elector more than once in any area or being registered as a non-resident if entitled to be registered as a resident).").
The noble Lord said: My Lords, I beg to move Amendment No. 6. This is a largely technical Amendment, the purpose of which is to remove paragraphs (a) and (b) of the proviso to Section 8(2) of the Representation of the people Act 1949. With the abolition of the nonresident franchise and the bringing of the local government franchise (Peers apart) into line with the Parliamentary franchise, these paragraphs are no longer required or, as regards paragraph (a) in particular, workable.
On Question, Amendment agreed to.
LORD STONHAM: My Lords, this Amendment is consequential on Amendment No. 5, which we have just approved. I beg to move.
Amendment moved—
Page 31, leave out lines 28 to 34.—(Lord Stonham.)
On Question, Amendment agreed to.
Schedule 3 [Repeals]:
LORD STONHAM: My Lords, I beg to move Amendment No. 8. This is a purely drafting Amendment, which corrects a clerical error.
Amendment moved—
Page 38, line 23, column 3, leave out ("paragraph 2") and insert ("sub-paragraph (2)").—(Lord Stonham.)
On Question, Amendment agreed to.
LORD STONHAM LORD STONHAM moved Amendment No. 9:
Page 38, line 46, column 3, leave out from ("proviso") to second ("and") in line 48, and insert ("paragraphs (a) and (b)").
The noble Lord said: My Lords, I beg to move Amendment No. 9, and with your Lordships' permission I should like to include in this Amendments Nos. 10 and 11. These three Amendments are additions to the repeals Schedule of the Bill, and they are consequential on the Amendment to page 27, line 3 of Schedule 2. I beg to move.
On Question, Amendment agreed to.
Amendment moved—
Page 39, line 24, column 3, at end insert ("subsection (2)(d),").—(Lord Stonham.)
On Question, Amendment agreed to.
Amendment moved—
Page 39, line 29, column 3, at end insert ("and the following words").—(Lord Stonham.)
On Question, Amendment agreed to.
Schedule 4 [Insertions authorised in Representation of the People Act 1949 in revised edition of Statutes]:
LORD STONHAM LORD STONHAM moved Amendment No. 12:
Page 41, line 49, at end insert ("and, in the Scottish local elections rules, substituting for the word constituency' the words 'electoral area'")
The noble Lord said: My Lords, lines 45 to 49 on page 41 of the Bill provide that, in any revised edition of the Statutes published by authority, Clause 6(5) is to be inserted as Rule 4(1A) in the Scottish Local Elections Rules (Representation of the People Act 1949,
1230
Schedule 3) with the omission of the words "at parliamentary elections". However, Clause 6(5) also contains the word "constituency", and in inserting the provision of the Statutes it would be necessary for this to read "electoral area". That is the purpose of this Amendment. I beg to move.
On Question, Amendment agreed to.

PENSIONS (INCREASE) BILL
4.43 p.m.
LORD SHACKLETON: My Lords, I rise to move the Second Reading of this Bill. This is another in a series of measures which have been introduced from time to time to relieve the burden on public service pensioners and their dependants from rises in the cost of living. It is the seventh major measure of its kind since the war, and much the most substantial both in terms of cost and of numbers covered. When account is taken of retired members of the Armed Forces, who will receive corresponding increases by Instruments issued under the Royal Prerogative, the total cost will be some £34 million a year. This may be compared with £25 million for the 1965 Act so that, when full allowance has been made for the increase in the Index of Retail Prices since that Act came into effect—a matter of some 13 per cent.—the new Bill still represents a substantial increase in real terms in the cost of public service pensions.
The growing numbers of public service pensioners have meant that there is also a substantial increase in the numbers covered. The 1965 Act affected about 710,000 persons. The present Bill and associated Royal Warrants will bring increases to over 786,000 pensioners, including 260,000 from the Civil Service, 141,000 from local government, 98,000 teachers, 63,000 from the National Health Service, 63,000 from the police and fire services, 26,000 from the former India, Pakistan, Burma and other overseas services, and 6,000 from a large number of other public offices; and, in addition, 130,000 from the Armed Forces. The field covered is much the same as before, with a few minor extensions of which perhaps the most important is the inclusion within the scope of pension supplements provided under Regulations made by the Minister of Overseas Development

1231
of former overseas service officers who on retiring remained resident in the territory in which they were serving. Until 1965 these pensioners could qualify for supplements only if they were living in the United Kingdom. The 1965 Act extended eligibility to those resident in a third country and we believe that it is now right—and I am sure your Lordships will agree—to take the final logical step of removing the residential qualification altogether.
The main provisions of the Bill are set out in Clause 1 and Schedules 1 and 2. The increases to be provided are set out in full in Part 1V of Schedule 1. Your Lordships will see that they follow a scale descending from 18 per cent. on all pensions which began not later than July 1, 1955, to 2 per cent. on pensions beginning in the year ended July 1, 1967. This follows the pattern of previous Acts, with two important differences. First, the maximum increase has been set at 18 per cent., as compared with 16 per cent. in the 1965 Act, and 12 per cent. with a flat rate addition not exceeding £20 for the over 70s in the 1962 Act. Secondly, the scale, or "escalator" as it is commonly called, falls by 1 per cent. a year from 18 per cent. to 10 per cent. and then by 2 per cent., whereas in previous Acts the annual movement has been 2 per cent., throughout.
The purpose of the new escalator is to enable us to give the largest possible increase to the pensions of longest standing. This was the wish of the pensioners themselves, and while some understandable regret has been expressed that we have not found it possible to give more substantial increases (a point to which I will revert later), the policy of concentrating as much as possible of the available resources on the oldest pensioners has been generally welcomed. The earlier Acts have done much to protect the smaller pensions of longest standing against rises in the cost of living. Nevertheless, while there are inevitably irregularities in the pattern over so wide a field as the public services, and some examples can be found of pensions of long standing that have already overtaken those of more recent date, it remains generally true that the oldest have fared the worst.
Perhaps I may give some examples which show that the Bill will bring substantial
1232
benefits to these people. A clerical officer who retired at the end of 1948 will have had his pension increased when the Bill takes effect by 123 per cent. as compared with an increase in the cost of living of about 114 per cent. For the postman, the increase will be 139 per cent., as compared with the 114 per cent. Turning to a different field, a male graduate teacher who retired at the end of 1950 will receive an increase of about 104 per cent. in his pension as compared with a rise of 100 per cent. in the cost of living. I must admit, though, that the position is still rather less satisfactory at higher levels. The assistant secretary who retired at the end of 1950 will have had his pension increased by no more than 77 per cent. but the Bill will nevertheless give him an additional £247 a year.
It may be objected that, while the increases for the oldest pensioners are substantial, and rightly so, those who have retired more recently are receiving inadequate compensation for the rise in the cost of living in the last few years. I do not deny that there is something in this point, but I believe that its weight can be over-emphasised. Certainly, if resources were unlimited, the argument that no one should receive less than full compensation for the rise in the cost of living would have few opponents. But the resources are not unlimited and we are compelled to consider carefully what our priorities should be.
This must mean looking at the pensioner's total position. It is fair to have regard to the fact that almost all of those who have retired in recent years also qualify for the National Insurance pension when they reach the prescribed age. With this in mind, let us look at the position of the man who retired at the end of 1964. Here, one might think, is a hard case. He retired a little too late to qualify for any increase under the 1965 Act and he will be eligible for no more than 6 per cent. under the present Bill. And since he retired the cost of living has gone up by 18 per cent. But if he were a clerical officer, his total pension income when the Bill takes effect, taking into account the National Insurance retirement pension at the married rate, will be 76 per cent., over three-quarters, of the current pay for the grade—or 63 per cent. at the single rate of National Insurance pension—and he will

1233
stand to benefit from the review in the National Insurance pension rates which is to take place later this year. The pension income of a man retiring from the Administrative and Professional Grade V in local government service at the end of 1964 will be 63 per cent. of current pay (or 55 per cent. if the single rate of National Insurance pension is assumed), and for the principal in the Civil Service, the figures are 54 per cent. and 50 per cent. respectively. None of these figures takes into account the lump sum payable on retirement. I think we can agree that these are still substantial pensions by any standard, as compared particularly, for the most part, with pensions outside. Of course, many people in fact have no occupational pension at all. While the Bill admittedly falls well short of providing these people with full compensation for increases in the cost of living since they retired, I do not think that it can be said that they are being treated at all harshly.
For similar reasons, we have felt it necessary to retain the concept of a cutoff date before which pensions must have begun if they are to qualify for any increase. Here again, I am well aware, as I am sure other noble Lords are, that the increase of 8 per cent. in the cost of living since the cut-off date of July 1, 1967, is by no means inconsiderable. But the fact remains that those who have retired within the last 18 months or so have pensions that are much closer to current levels than the great majority of the older pensioners and when account is taken of the National Insurance pension their total pension income is in most cases a high fraction of the current pay of the grade from which they retired. It is also fair to point out that by no means all of those who have retired most recently will yet be old enough to qualify for the National Insurance pension. Nevertheless, the general argument remains a valid one and I do not think that it could seriously be suggested that larger increases in this whole context should be provided for those below the National Insurance retirement ages than for their former colleagues of more advanced years.
I have said that the Bill as it stands, together with the corresponding increases for the Armed Forces, will cost £34 million a year. This is a very heavy commitment for the Government and the
1234
country to shoulder at the present time, and it is the Government's judgment that this is as far as we can responsibly go now. Therefore, this can only mean that to do more for those most recently retired would frustrate our aim of giving really worthwhile increases to their fellows who are both older and less well off. I cannot think that that would be right. For the same reason, we have felt unable to accept proposals that the qualifying age for increases in pensions should be reduced from 60 to 55. This would add another £6 million to the cost. But I should make it clear that if a pensioner retired because of ill-health, or has become unfit for regular full-time work since retirement, increase is paid regardless of age. A widow receives increase from age 40; and a widow or woman pensioner with a dependant receives it regardless of age. A reduction of the general qualifying age from 60 to 55 would benefit many who are gainfully and fully employed and are much better able to maintain their living standards than are the older pensioners whose working days are over and who are wholly dependent on their pensions. Equally, I acknowledge that there are some who may have found it difficult to get employment. Here again we have to choose and make the best effort to get the right priorities, and I think we are justified in asking the younger men not to press their claims at the expense of those of more advanced years.
May I turn now to say a few words about the future. I must apologise to the House for taking up some time on this matter, but we are unlikely Ito have a Committee on the Bill; and it is an important Bill and we need to look also to the future. Your Lordships will have noted in the recent White Paper, National Superannuation and Social Insurance, the proposal that under the new State pension scheme the Government will be bound to review the main rates of pensions and other benefits in payment every two years and to provide increases which will at least compensate for any rise in price levels since the previous increase. We have always said that the development of any new system for increasing public service pensions must await completion of the Government's review of the social security system as a whole. Now that we have the White

1235
Paper, we intend to get down to a study of the whole question of pensions increase to see whether we cannot devise more satisfactory arrangements than the present system of ad hoc legislation. I am sure that your Lordships and others who have been concerned with this matter, either in some of the civilian Departments or, indeed, in the Service Departments, will understand that this is a fairly complicated task.
While I do not think it wise at the moment to attempt to prejudge the study in any way, I think it is widely recognised that there are major obstacles to parity; that is, to a system of automatic adjustment that keeps the pension up to the level of pensions currently being awarded for similar service. The cost, at the moment anyway, would be prohibitive: it would add £75 million to the cost of the Bill. I acknowledge, of course, that some of your Lordships support parity—and I well understand the force of, and am sympathetic to, the argument—but I think they are also aware of the difficulties. Nor do I think there is any simple solution to be found by adopting partial parity, but if your Lordships wish I will deal with that in my winding up speech.
There are also some fairly obvious objections to the straightforward adoption for public service pensions of a system parallel to that proposed in the White Paper; namely, that the new State pension scheme would be directly linked with the cost of living and this would mean that present relativities between public service pensions would be frozen. While much has been done through the escalators in successive Acts to bring the oldest pensions into a closer relationship with those of more recent date, I doubt whether anyone would want to argue that the position now reached is entirely satisfactory; that relativities need no further adjustment and that all that remains to be done is to adjust all pensions in step with the cost of living.
My Lords, I think I have said enough to demonstrate that there is no simple solution to this problem. We have to study it in very great depth indeed, and it would be misleading if I were to suggest that we could reach some conclusions within a short period of time. This is a job which must be done very well
1236
indeed, and it is more important that it should be done well than that it should be done quickly. We recognise, however, that there is general dissatisfaction with the present situation in which the Government, while keeping the position of these pensioners under continuous review, have accented no commitment to take any action at any specific time. This is again a matter that has been argued about before, and therefore I am glad to be able to repeat the undertaking given by my right honourable friend and my honourable friends in another place during the earlier stages of the Bill, that we shall review the change in the purchasing power of the pensions to which the Bill applies as at April 1, 1971, and if that purchasing power has been reduced by more than 4 per cent. the Government undertake to make a statement indicating the extent of the reduction in the purchasing power of the pensions and what action they propose to take.
I think it is right that we should accept this obligation and I am sure that noble Lords, like the noble Lord, Lord Bourne, who has been so interested and active in this field—and we all recognise the work he has done in relation to officers' pensions—will agree that we must accept the obligation to take the initiative in bringing the matter before Parliament after a reasonable period. We shall be able to take stock of the position if there is a considerable rise in the cost of living. There is no commitment to introduce further legislation in 1971 and I am sure that the Opposition, as they did in another place, will agree that it would be wrong to bind the Government in advance to that extent. But the pensioners now know that Parliament will have an opportunity to consider their position in two years' time without their having to mount the sort of campaign which I know they must have found rather distasteful in the past, and I think it will be generally agreed that this is a useful step forward.
In conclusion, may I say that the people who are covered by this Bill are people who have given long and honourable, and in some cases gallant service to their country during their working lives, who are now dependent on us to see that their standard of living in retirement is not severely eroded by rising prices as the

1237
years go by, and who deserve well of the Government and of Parliament. I do not say that the lot of the pensioners will be entirely satisfactory as from April 1 next, or that if we had unlimited resources at our disposal we should not prefer to go a good deal further. But given the situation as it is, and accepting that it is not just as we should like it to be, I believe that this Bill offers a major improvement in the position of many of our pensioners and, in particular, those who have suffered most from rising prices in the past, and I do not think that at this moment we could have proposed going further in present circumstances. Therefore I commend this Bill confidently to your Lordships. I beg to move.
Moved, That the Bill be now read 2ª.—(Lord Shackleton.)
5.5 p.m.
LORD BROOKE OF CUMNOR: My Lords, this is a subject of almost impenetrable complexity, as I discovered to my cost when it fell to me to carry through another place what became the Pensions (Increase) Act 1956. When I started on the framing of that Bill I began in the same optimistic spirit which I expect has animated all Ministers in all Governments who have thought of preparing a new Pensions (Increase) Bill. One began with the idea that the sensible thing to do would be to cut away all the old jungle of previous Acts and to start afresh. Like all Ministers concerned, before and since, I discovered that was quite impossible, unless one was to create all kinds of anomalies which would be intolerable in practice. That is part of the difficulty here. One not only has to do justice between different classes of people but also between one individual and another, without the creation of new anomalies. In the 1956 Act I was successful in making two new departures which have been accepted in all subsequent Acts; that is to say, in the first place to extend pension increases right up to the highest pensions, and in the second place to get rid entirely of the means test which was a feature of the early post-war Pensions (Increase) Acts.
We are all grateful to the noble Lord the Leader of the House, no doubt in his capacity as Minister of the Civil Service, for taking the trouble to come down to the House and explain the Bill to us this afternoon, and it seems to me that
1238
his explanation was not a word too long. This is an important Bill for three-quarters of a million people, and it is right that Parliament should take proper cognisance of it. If I may say so, I did not quite understand his argument that because this Bill is going to cost £27 million a year, according to the Financial Memorandum, that proves that it is more than making good the erosion caused by the rise in the cost of living since the last Act. Maybe I have failed to follow the arithmetic; if so, I think he will forgive me, because none of the mathematics of this subject is easy.
The noble Lord also said that this was the seventh Pensions (Increase) Bill since the end of the war. From the figures given in the Explanatory Memorandum, I make it the eighth. There were five Conservative Pensions Increase Bills, and I think he will find that this is the third introduced under a Labour Government. The important fact is that under all Governments it has been customary for the Opposition to help to speed Bills of this nature on to the Statute Book, and I promise him that this will be no exception. This is not certified as a Money Bill but it is all about money. The noble Lord said that there might not be a Committee stage. I would remind him that before now Pensions (Increase) Bills have been amended in your Lordships' House, but of course I accent at once that it would be inappropriate for your Lordships' House to seek to make substantial changes in the financial arrangements. However, if there are minor improvements which should be considered I hope they will be brought forward. The noble Lord also made it clear that this Bill covers only civilian pensions and does not extend to Service pensions. They are dealt with outside the scope of legislation by Royal Warrant, though it is customary that what the Royal Warrant contains shall be in line with the decisions of Parliament on the civilian legislation.
I have a few questions to ask. The increases under the Bill are to be payable on April 1; can we be assured that they will actually reach the pensioners without delay? Are all the necessary preparations being made to get the new and increased pensions in payment from the beginning of April? Most of the pensioners concerned will be waiting eagerly for them, for, as the noble Lord

1239
indicated, there has been a 13 per cent. rise in the cost of living since the last Pensions (Increase) Act took effect on January 1, 1966. One can see that the Bill quite rightly seeks to give greater help to the older pensioners, and the scale set out in the Schedule runs from 18 per cent. for those who retired 14 years ago and more to 2 per cent. for those who retired two years ago.
One notices that the Government have gone back entirely to the percentage increases, whereas the Conservative Act of 1962 introduced what I thought was a good new idea of granting as well as percentage increase a flat-rate addition of £20 to all the older pensioners; I mean not those who had retired the longest, but those over 70 years of age. Would it not have been a good plan to extend that idea and give special help to the older pensioners by increasing that flat-rate £20 to £30 or £40 to everyone over 70? Why is it that the fiat-rate addition has not been followed up in subsequent Bills?
I, for my part, am not going to advocate parity; that is to say, bringing all pensions up to the pension which the pensioner would receive if he retired now. I suppose I know too much about its complications. My experience is that when one looks into that one finds it impossible to apply, and in so far as it was possible it would create fresh anomalies between one pensioner and another. That is unfortunate, because it is the simple solution which commends itself at first sight as the fair thing to do.
I think the Government should try to do still more for the people who retired many years ago. The noble Lord gave examples of some smaller pensioners who retired 20 years ago and have received relatively good compensation for the erosion of their pensions by the rise in cost of living. But he was very frank and honest with the House, as one would expect, and he admitted that there were others who were not so fortunate. It is the older pensioners who have been hit tragically hard by the rise in cost of living. In addition they can see their successors in similar posts drawing far higher pay now than they ever did and thereby qualifying for much higher pensions when they retire.
1240
The second class of pensioner I want to mention are some of the most recent. I think the last Pensions (Increase) Act awarded no increase to anyone who retired after April 1, 1964. These pensioners will have received no increase at all in their public service pension, until this new Bill comes into operation and it is increased from April, 1969. Since April, 1964, I think the noble Lord will agree, the cost of living has risen by over 21 per cent., so the pensioners who retired in 1964, at any rate those who retired after April 1, 1964, have already had the purchasing power of their public service pensions eroded to that extent. Yet this Bill offers them at best only an 8 per cent. increase.
Those who retired in July, 1967, have, as the noble Lord frankly admitted, already suffered considerable loss of purchasing power through inflation, and this Bill will do nothing for them at all. An Amendment to ameliorate that by altering the cut-off date from July, 1967, to July, 1968, was moved by the Opposition in another place, but it was rejected on a Division, and as it is a money matter I think it would be useless to reopen it here. I would ask that future Pensions (Increase) Acts will realise the hardships liable to be suffered by those retiring just after the cut-off date, and will therefore bring the cut-off date nearer still to the date of introduction of the new Bill.
I should like to ask why July 1 is taken each time as the critical date. Surely among public service pensioners the month of July is the commonest date for retirement. It must be the commonest date for teachers, who, as the noble Lord said, represent a very substantial percentage of those who stand to benefit. When next a Bill is in preparation—or whatever may take its place under the new thinking—I wonder whether October 1 might be considered as a better time of year than July 1 for what I have called the critical date. That might be a simple way of somewhat lessening the hardship to which I have referred.
I am not proposing to table Amendments for the Committee stage. The Bill was very thoroughly worked over in another place, and I should like to pay tribute to the exemplary manner in which

1241
Mr. Patrick Jenkin, leading for the Opposition there, did his work. I know the Government spokesmen themselves, for their part, took great trouble to deal with the points raised in Committee. I have read it all, and it seems to me to have been a very thorough examination of the Bill. That being so, it would be inappropriate to repeat the same examination here. One welcomes the Bill for what it does, and yet one cannot help noting how far it falls short of the hopes which the Prime Minister himself raised in the minds of public service pensioners during the 1964 Election campaign as to what a Labour Government would do. He said then in a letter to a public service pensioners' organisation:
"We have also called for public service pensions to he linked to some economic indicator, so that the pensioners are not only compensated for rising prices, but also receive their full and fair share in rising national prosperity."
Not only have they not received their full and fair share of rising national prosperity, if any, but the figures quoted show that the majority will not have been compensated for rising prices, even when this Bill takes effect, the second Increase Bill which the Government have introduced.
I have one other question. Can the Government say whether it is the intention of the nationalised industries to follow up this Bill by producing similar increases in their own pensions? Will the Government encourage them to do that? I ask this with feeling, especially for the railway superannuitants. It so happens that I am one of the few surviving ex-directors of the pre-nationalisation main line railway companies, and therefore I am specially anxious to see the older railwaymen fairly and generously treated in present days.
Finally, let me say how glad I am that the Government, in response to Opposition pressure in another place, have agreed that there should be another review in April, 1971, if the cost of living has risen by 4 per cent. or more by then. That was the pledge to which the noble Lord drew attention at the end of his speech. By April, 1971, there will be a new Government in power, which I am certain will fulfil its predecessor's undertaking, and the Conservative Party has
1242
indeed pledged itself to carry out further reviews every two years.
Meanwhile the Government, as the noble Lord has said, are pressing forward with a fresh inquiry to see whether these matters can be dealt with in any other and simpler way. I expect he has in mind that there might be some device other than repeating ad hoc legislation that has to be taken through Parliament, to ameliorate the situation for public service pensioners affected by the rising cost of living. As I said, all this up to now has been done by common consent between Governments and Oppositions, and I am sure that if this Government go out of office before that inquiry is completed the work done on it will become available for their successors. I am not altogether hopeful that we can bring about, any of us, a radical simplification here, but I entirely agree that it is well worth making yet another effort to try to reach that desirable end. I believe that there are only two ways to set limits to the hardship suffered by these public service pensioners. One is to bring inflation to a complete stop. The other is to ensure the upward adjustment of public service pensions at closer intervals than has been the case up until now, and that is declared Conservative policy.
5.23 p.m.
LORD BOURNE: My Lords, I will try not to cover the same ground as has already been covered by the noble Lord the Leader of the House and by the noble Lord, Lord Brooke of Cumnor. At the outset I have to declare an interest, in that I am a public service pensioner and also Chairman of the Officers' Pensions Society, which has 33,000 retired members of the Armed Forces, including 4,000 widows.
I will try to bring out two or three points. The first is parity; the second is regular reviews; and the third is cases of real hardship and unfairness. Lastly, I will make some suggestions. I will not re-define "parity" because we all know what it is. The reason it takes care of these awful anomalies which have been mentioned, and which were described in the very thorough debate in the other place (I agree with the noble Lord, Lord Brooke, that the Members of another place devoted great attention, great care and considerable skill to this

1243
highly complicated subject) is that it is designed to take care of erosion of pensions by rises in prices and to provide also for a rise in living standards as reflected in the pay of the rank and file of the day.
I need not remind your Lordships that the Prime Minister said exactly as he was quoted, but he pointed to these two things before the Labour Party came into power. Consequently, I was very glad, when reading the recently published White Paper, National Superannuation and Social Insurance to see that these two elements were specifically mentioned in paragraph 101. I think perhaps I ought to quote what it says, because it is very much to the point. First:
"The increases, which will always come into operation in the autumn, will compensate for any rise in price levels since the previous increase."
And lower down:
"Pensioners and other beneficiaries will also continue to share in the nation's rising living standards."
My Lords, it could not be better expressed, and I am thankful to see that parity is coming at last in the national earnings-related scheme.
I think it would be unfair on public service pensioners not to mention that seven of our allies—West Germany, France, Italy, Luxembourg, Belgium, Holland and the United States of America—are able to afford parity: not exactly, but for all practical purposes. We are told that we are in a period of economic distress and cannot afford it; that we have to understand that and must put up with these anomalies. I have been told many times, when I have pressed the Government, that when one takes account of National Insurance as well as the public service pension our pensioners are equally well off. It does not happen to be true. What defeats me is why the Government should provide a system of National Insurance based on parity, and something quite different for the public service and the Armed Forces. I have never been able to understand that. I should like to have it explained.
Now I come to regular reviews—and at last, after eleven years, we look as if we are going to get them. Ever since the Grigg Report was adopted and endorsed by Parliament for biennial reviews of serving pay (incidentally the Civil Service,
1244
I think, have their pay reviewed every year; the Armed Forces every two years), we have asked for similar treatment for retired officers and their widows; but we have not got it. Now, it is to be statutorily obligatory, under the new earnings-related scheme—which will presumably pass into law pretty soon. I will not quote the right honourable lady, the Paymaster General, on this point because she has already been quoted, but I should like to quote what she said a little later on in the debate in the other place. She expressed the hope that
"the work now going on … will ensure that we can avoid having to come to the House from time to time, whichever Party be in power, with a Bill of this kind. We want to replace that system with something much better, with something which guarantees to the public service pensioner regular increases when he ought to have thern."—[OFFICIAT REPORT, Commons, 17/2/69, col. 136.]
I think the noble Lord the Leader of the House mentioned this point, but I give your Lordships exactly what the Paymaster General said in another place because it is very much what we have been waiting for. I sincerely hope that the promised review on April 1, 1971, will develop into regular reviews for retirement pay.
I think at this point I ought to mention the lost three and a half months, which have not been mentioned. Previous Pensions (Increase) Acts have become operative on January 1: this one becomes operative on April 1, and is based on index figures for the middle of December, 1968. If we do not catch up, either now or when the next review takes place, the three and a half months which are not provided for at the moment, we shall have lost this for ever. It will be at least 1·5 per cent.—probably a little more.
The noble Lord the Leader of the House gave some examples of how pensions are, in many cases, keeping pace with the cost-of-living increases. Of course, I accept that. But as the system is highly complicated, and absolutely bristles wih anomalies, may I give a few examples in the opposite direction? Amendment No. 4, which was brought in in another place on Third Reading, was designed to level pensions, and had the following rates of increase—and it will be seen that whereas the rates in the Bill go steadily downwards, in that Amendment they increase: 25 per cent., 18 per cent., 14 per cent., 20 per cent., 10 per cent., 5

1245
per cent. In other words, there is a jump in the middle to take account of anomalies which unfortunately exist and which, historically, are not our fault.
I should like to give three examples in the opposite direction. The noble Lord, Lord Gridley, is to speak after me so I shall not give examples of overseas pensioners, with whom no doubt he will be dealing. I shall give examples as they affect members of the Armed Forces, and in many cases they are paralleled by civil servants. A major who retired pre-Second World War with a pension of £407 per annum has received an increase of 125 per cent., which brings his pension to £917 per annum. During this time the cost of living has risen by no less than 223 per cent. Unless he has private means, he will therefore have had to lower his standard of living by about 50 per cent. And, incidentally, he would not be entitled to the National Insurance pension. On the other hand, the man who retired twenty years later will receive increases which approximately keep his pension in line with the cost of living. To make matters worse, under this Bill, he will on April 1, 1969, be getting an increase of £4 more than the pensioner whom I have just quoted. What possible justice can there be in this? Why must the Government continue to penalise pre-war pensioners and their widows, most of whom are over 70?
A captain in the Army, a junior officer, under the 1919 Code (which covers some 6,000 pensioners and their widows) after the 1962 Pensions (Increase) Bill was £99 behind an equivalent officer on the 1956 Code. To-day, after the new increase provided for in this Bill he is £130 behind, and so the gap has widened. This unfairness applies to most officers and their widows on the 1919 Code. It relates to people who retired pre-war. In the case of a major-general there is a widening gap of some £29, and he is getting further and further behind. To take a different example, that of a provincial commissioner in Tanganyika, an example which was given in Committee in another place, he is now drawing a pension of £1,740, compared with the man who retired in 1960, some 15 years later, who is drawing £3,354—almost double. I think that I have given enough examples to prove that the anomalies go deep. Although I accept Lord Shackleton's
1246
contention that many people are keeping pace with the cost of living, the men and women I have mentioned who retired pre-war are not. If they do not catch up now, they never will.
I should like to mention two special categories of widows who are hardly treated. First of all, there are the widows who did not marry until after their husbands retired, and who get nothing. Then there are the widows who were married to serving officers and were widowed, who then married again and were widowed a second time. They get nothing unless they go through a means test. The noble Lord, Lord Brooke of Cumnor, said that the means test had been abolished, so those widows must be in an exceptional category. One is always told that a widow can draw supplementary benefit, but it is hardly fair that the widow of a lieutenant colonel who was killed in World War I has to draw supplementary benefit in order to live.
I suggest that there is only one fair way of treating these older men and women. Although they are very elderly, and, therefore, most of them do not draw National Insurance pensions or get the terminal grant which was introduced much later, they are not dead yet, and we ought to help them by a levelling up based on stages, which will be called partial parity. I know that there are objections to this suggestion, bat the fact remains that a levelling up would remove the anomalies up to 1956, if not afterwards. I suggest that Parliament should remove these unfairnesses. I accept the generous intention of the Government in spending £34 million per annum, of which £7 million goes to the Armed Forces, and that the Government have taken a great deal of trouble over this new Bill. Nevertheless, it still leaves unresolved the unfair matters which I have mentioned.
I suggest that the Government should level up public service pensions to 1956. I believe that they have carefully considered this matter, and they no doubt have good reasons for rejecting it, but the chief consideration has been that of cost. It will cost about £1¼ million, probably more, for the Services, which is not a great deal of money. If it cannot be done because of the expense, then the next best thing is to level up to 1945, thereby removing all anomalies up to that date. Involved in this bracket are about 40,000

1247
civilians and 55,000 members of the Armed Forces. That would cost only £300,000 for the Armed Forces. It is chiefly the officers who are hard hit.
If these two suggestions are impossible because this is a money Bill and we are not able to make this kind of Amendment, or because the Government are unable to spend money on that scale, I am inclined to agree with the noble Lord, Lord Brooke, that we ought to increase the fiat rate grant by £20 for the older people who are quite defenceless in this matter and deserve our sympathy. It is nearly the last chance to help these elderly people. It is getting late, but we ought to take this chance. I have suggested these figures to relieve the hardship, if the levelling up is impossible.
5.38 p.m.
LORD GRIDLEY: My Lords, as the noble Lord, Lord Bourne, has said, it is customary in your Lordships' House to declare one's interest in any subject of debate. I have an interest to declare as a former Colonial civil servant now drawing pension. I am also a member of the Council of Her Majesty's Overseas Services Pensioners Association, and we come into contact with the problems of pensions on varying matters.
I was interested to hear the tribute paid by the noble Lord the Leader of the House to the people who are affected by this Bill and I shall not repeat what other noble Lords have said. There is great force in what the noble Lord, Lord Bourne, said about the position of pensioners who started drawing their pensions in 1945 and who are not affected by the present proposals. There is no doubt that a great number of persons in that category are suffering very much to-day.
I went into pensionable service in 1928 or 1930, and people who elected to serve in the Colonial Service, in the Armed Forces, in the postal service in England or in the police force, elected to go into service of that kind expecting not to run the risks which they might have to face if they tried to attract a larger salary in industry. As a corollary of that, they accepted a lower wage or salary with the security of a pension. What I am most concerned about in this post-war age is that since 1945 it has been customary to look at the conditions of people in this country, not necessarily those in
1248
Government service or similar employment, who were never considered for a pension 25 or 30 years ago. I sometimes think that, in spite of the humanitarian ways in which we look at these matters, we overlook the conditions under which people first took up service in this country or abroad.
As the noble Lord the Leader of the House said so kindly just now, there have always been very high conditions of service to be followed. Pensionable status is never automatic. If a person is in the police force, he may be on probation for a certain number of years and in every way has to be worthy of his pension. He has to be recommended for pensionable service and has to satisfy his authority that he is the right type of person to draw a pension. It is that kind of person whom we are considering under this Pensions (Increase) Bill. I welcome what the Government are doing. I agree with the remarks made by the noble Lord, Lord Bourne, and I appreciate the observations of my noble friend Lord Brooke of Cumnor. We accept this Pensions (Increase) Bill, and we are grateful for the assurance that there will be further reviews of the cost of living position in 1971.
5.44 p.m.
LORD SHACKLETON: My Lords, I am much obliged to noble Lords for the reception which they have given to this Bill and for the helpful and constructive remarks that have been made. Running through all the speeches was the feeling that, whatever we may have done for some—and I think we all agree that some are fully compensated—there are others about whom we should feel a good deal easier in our minds if we had done more. I should like to pick up a number of the points that have been made. First of all, I appreciate what the noble Lord, Lord Brooke of Cumnor, had to say about myself and the fact that I have come down to the House to present my own Bill. It is happy that I have this double-hatted role. I also appreciate the tribute which he paid to my right honourable and honourable friends in another place. It was unusual for them to find themselves in the position, with which we are so familiar here, of having to steer somebody else's Bill through the other place, which they did extremely well.

1249
While I am paying tributes, it would not be wrong, relevant to the remarks of the noble Lord, Lord Brooke, about whether the necessary arrangements will be made, for me to pay a tribute to those who have the responsibility of working out these schemes—a most onerous job. I am very conscious that my own officials who have been involved do a really brilliant job of steering a way through the utmost complexities. Nearly all the arguments which have been advanced to-day require some sort of decision, and this very difficult area of decision and of then applying it as a result of inter-departmental discussion—because everybody is fighting to do the best he can—calls for great skill and perseverance.
As a former Paymaster General, it was interesting to me to visit the Crawley headquarters of the Paymaster General's Department. Much of the burden is thrown on the people there, but how extraordinarily efficiently they cope with it!I have always wanted to pay a tribute, since I saw that rather unusual group of men working with their own computer. When I say "their own computer", I do not suggest that they built it themselves, but they certainly had to learn how to operate it. It is a very skilled task to make all these payments, conscious that it must be done in time and that people must receive them. Generally, the public service, both there and elsewhere, renders a very real service. We are apt to grumble about the fourpenny post and that sort of thing, but here is an area where pensioners and others get paid despite the complexities. The position is very much better now. During the War, when I was promoted my pay stopped altogether, but thing go smoothly now.
LORD BROOKE OF CUMNOR: My Lords, may I, too, be allowed to join in this tribute, because I am also a former Paymaster General?
LORD SHACKLETON: My Lords, I rather thought the noble Lord was. He probably did not, however, have the opportunity to visit the Department in their new home, to which they have recently moved.
There are a number of interesting points and I shall try to answer as many as I can, but if I leave any unanswered I shall, it necessary, reply in writing. First
1250
of all, I said that this would be the seventh major Act. The noble Lord has made me confused, but I think I said it was the seventh. The Act of 1954 was a very minor amending Bill so, technically, I defend my position. Let me now deal briefly with the question of flat rate additions. This also ties in a little with the position of very old pensioners of long standing. The truth of the matter is that the flat rate additions can produce some very awkward anomalies, and the pensioners themselves did not like the flat rate addition in 1962. Indeed, the Opposition in the Commons argued against special increases to give extra assistance to specified groups of pensioners. One can argue about every system but, on balance, I am convinced that percentage increases are the fairest system.
The noble Lord, Lord Brooke, asked why July 1 should be the date chosen for steps in the escalator. I have some very full reasons which are essentially technical, but if the noble Lord wishes I will provide them. Basically, however, the date is determined by the interval that it is necessary to interpose between the effective date, April 1, and the cut-off date, 21 months earlier. There is also advantage in moving from the April date in the previous Acts, since those who retire just after April will on this occasion fall the right side of the line. When the noble Lord has studied what I have said, and when I have re-studied it, I think we shall understand the reasons for this date.
On the subject of nationalised industries, I appreciate the noble Lord's concern. This is a matter for the Boards themselves, and they have to reach their own decisions. They will no doubt note the increases provided by the Bill. It would be wrong for the Government to issue directions to the Boards in this matter, but the Boards will no doubt have noted what the noble Lord and others have said. The noble Lord referred to the hopes expressed by my right honourable friend the Prime Minister. Let me say two things on that point. Reestablishing a new and comprehensive system of pensions in the national field is a very complex task, and I am sure nobody knows that more than the noble Lord, Lord Brooke. It is necessary to produce a scheme for public service pensions which will be in harmony with

1251
this; and although one would have liked to see an advance to the comprehensive scheme earlier, I am afraid it is necessary that we first get published the major reorganisation which I mentioned and which is contained in the White Paper issued by my right honourable friend Mr. Crossman, and then work on adapting this particular scheme, like other occupational schemes, to the new system.
I do not think it is quite fair to blame the present Government for not making good all the earlier erosion. I would say just this to the noble Lord, Lord Bourne—and this is not to diminish the force of his arguments. Since October, 1964, the cost of living has gone up by 19 per cent. Since that same date, 1919 Code pensioners had an increase of 16 per cent. in 1965 and will have an 18 per cent. increase under this Bill. Although this does not restore the position—I acknowledge what the noble Lord has said—it improves it relatively.
The noble Lord, Lord Bourne, spoke about parity, and even argued in favour of partial parity. I would only say to the noble Lord that there are powerful arguments against it. I do not believe it would be a simple solution, as I am sure he does not, and I can well understand his trying to find some method. But if we adopted some such date as 1956, we should get an even more absurd pattern as a result. We have already noted the variation in the pattern of pensions that is to be found over the public services as a whole, and there is no one year in the past which offers a logical base line free from anomalies. In fact, the anomalies would become more serious and more acute than at the present.
For example, with the enactment of this Bill and its parallel—I take a civilian example—clerical officers who retired between 1939 and 1948 will already have pensions at about the 1956 level; and even at the executive officer level (which is roughly equivalent to a captain in the Army) the gap is quite small—only a matter of 2 per cent. or so. I am not suggesting that their pensions are the same, because, of course, retirement ages are different, but it is widest at the highest level—and these are the pensions which would stand to gain the most. I do not think that would matter in the context
1252
of full parity, and I accept the arguments which the noble Lord, Lord Bourne, made on this point. Does the noble Lord wish to interrupt?
LORD BOURNE: In a moment.
LORD SHACKLETON: But so long as resources are restricted, many of the small pensions must still remain some way behind current levels. It seems doubtful whether it would be right to concentrate this proportionately large increase on pensions, many of which are substantial by most standards and very substantial by some of the examples which the noble Lord himself mentioned.
My Lords, I have here a number of figures which I could quote comparing the different rates and showing how some people are better off in relation to the increase in the cost of living. I have particular examples which show that even those who retired on, say, December 31, 1956, are in fact better off than they were in relation to the cost of living. But it would not help any of us very much if I merely tried to show that some people are as well off or are better off, when we know that in fact there are those who are not better off. I would therefore say to noble Lords that we have considered very carefully what is right. We acknowledge the anomalies in the system; and I have noted again the position of overseas pensioners. The noble Lord, Lord Gridley, did not make any particular points beyond stressing the fundamental principle.
I would only say, therefore, to all noble Lords, that we all wish that more could be done. We all hope that the review, which is a very complex one, will be conducted as quickly as possible and that in the future Governments and the public as a whole will recognise their responsibilities in this area. I will not branch off into the field of incomes policy and some of these difficulties, but it is important, of course, not only that Governments should recognise this and do something but that other citizens should not just support it in the abstract but genuinely recognise that they have obligations in this area. But that leads me into a field where we are seeking more social justice—
LORD BOURNE: My Lords, I hope the noble Lord the Leader of the House will forgive me, but he is getting very

1253
near the end of his speech and I wanted to say something before he finally wound up the debate. May I go ahead?
LORD SHACKLETON: Yes.
LORD BOURNE: The noble Lord the Leader of the House quite rightly mentioned that my suggestion for partial parity, levelling to 1956 or levelling to 1945, which would be a cheap operation, would introduce still more anomalies than we already have—and, of course, that is a disadvantage. It is a matter of opinion whether there are numerous anomalies or not, and I have to accept the Government's ruling on that. But I should like to make the point that this is the last chance to help these people before they are wrapped up and slightly forgotten in the new pensions earnings-related scheme. It does not affect them, and they are very liable to be forgotten. In their interest, I would suggest that it does not matter about introducing quite a number more of anomalies between now and April, 1967. I would put up with the anomalies, because we have been living with them for goodness knows how long and I think that a few more would be very acceptable if it were in their interests. I like the suggestion of a flat-rate increase very much—perhaps another £30.
LORD SHACKLETON: My Lords, we could obviously discuss this matter at very great length, but, basically, if it were possible to do more for them there are other ways in which I think it could be done more effectively. It might well be better to increase or vary the amount of the escalator rather than to do something which further increases the anomalies and disposes of some of the limited resources in directions where it would not be of as much value. I accept the noble Lord's concern for those for whom, as he points out, it may be too late to do anything, and I will certainly consider what the noble Lord has said. He is very active in representing his views to the Government, and I know that the Government listen, and listen sympathetically. People do not just say, "What a nuisance—here he comes round again"; they recognise his concern. I can only say to the noble Lord that I have certainly taken a note of what he has said, and I hope that the proposals which are contained in this Bill will go some way
1254
towards ameliorating the lot of those whose need is very great.
On Question, Bill read 2ª, and committed to a Committee of the Whole House.

THE LAND COMMISSION AND BETTERMENT LEVY
6.0 p.m.
THE EARL OF KINNOULL THE EARL OF KINNOULL rose to ask Her Majesty's Government whether they are aware that the Land Commission levy in certain cases is proving excessively burdensome and whether they consider the Land Commission itself is now achieving one of its original objectives of making development land cheaper. The noble Earl said: My Lords, I think it may be said of this House that it has something of an advantage over another place when discussing the Land Commission by virtue of the fact that, besides the wisdom of the noble Lord, Lord Silkin, we have also the noble Lord, Lord Kennet, who is in the unique position of being the only Minister who has not deserted the helm since helping to pilot the Land Commission Bill through Parliament in 1967. He therefore has the advantage of being something of a father figure; and, as a father figure on a more personal note, he is of course well qualified.
My Lords, in asking this Unstarred Question on the Land Commission, I hope very much that the noble Lord will be able to give us a more positive and helpful reply than that given by the Government in another place during the debate on February 6. As the House knows the Land Commission have now been in operation for just over two years.
The Commission's original objectives were set out in the White Paper of 1965. They were:

"(1) To secure that the right land is available at the right time for the implementation of national, regional and local plans;

"(2) To secure that a substantial part of the development value created by the community returns to the community and that the burden of the cost of land for essential purposes is reduced."

It is the effect of the second objective, in other words, the betterment levy under Part III of the Act, to which the first part of my Question relates.
As the House knows, and as I am sure the noble Lord, Lord Kennet, is aware, the betterment levy and the way in which it is operated have been the direct cause over the past year of a rapidly growing number of cases of acute and sometimes inequitable hardships falling on individuals. Almost every day one can pick up a newspaper and see a report of yet another case of a young couple, or perhaps an old retired couple, who face a large bill from the Land Commission on an assessment that they did not understand and had not anticipated; an assessment often based on a valuation and calculations meaningless to the recipients, many of whom feel that they cannot afford professional advice. The result of these hardship cases is always the same: the young couple or the old couple are unable to proceed with their plans to improve their homes and to enjoy that little more comfort for which they have saved, perhaps for many years.
It is easy to paint an emotional picture of these cases of hardship, but I do not intend to do that to-night. I am personally aware of over twenty individual cases of hardship caused by the levy, none of which I intend to go into in great detail to-night but all of which I can make available to the noble Lord, Lord Kennet, later if he so wishes. I am sure that he is aware of most of them. All of them have a fundamental point in common. All are cases involving a fairly low levy tax—under £2,000, I think; all are cases affecting people's homes, some under Case "c" of the betterment levy where people have improved their own homes with their own labour. I hardly need add that the reason for this is the development charge under Case "c". Many of the people affected are apparently totally unable to meet this levy tax, even by instalments. It may mean in some cases that they have to sell their house; and many of them feel so strongly about the injustice of their case that they have said that they would rather go to prison than to pay.
My Lords, this unhappy atmosphere has not, I believe, been helped by the indecisive attitude which the Government have so far adopted. In the debate on February 6 last in another place the reply by Mr. MacColl, when he was pressed about hardship cases, was as follows:
1256
"We must consider such cases to see what we can do to improve their lot and let the Land Commission machinery get into operation. We should not start tinkering with that machinery until we see the best way to tackle it."—[OFFICIAL REPORT, Commons, 6/2/69, col. 707.]
I should have thought that by now the Government had ample evidence of these cases and ample time to get the Land Commission to assess them and to formulate changes in the levy. Perhaps at this point I might ask the noble Lord, Lord Kennet, whether the Land Commission have submitted lists of suggested alterations and exemptions from the levy. As the House knows, the Government have the power, under Section 63 of the Act, to add by statutory order any exemptions of levy. But this power, so far as I am aware, has not yet been used. But unless the Government take action soon I believe that, with the intense feeling of injustice, and often sheer physical worry, that surrounds these cases, there may be a tragedy on the lines of the Pilgrim case.
It is true to say that it is easy to be critical and often more difficult to be constructive; but I should like to put forward to the noble Lord, Lord Kennet three cases which I believe could qualify for exemption from the levy or for delay of payment. The first is that the levy shoud not apply below a minimum figure. I am sure that the noble Lord, Lord Silkin, will support me in this, for he moved such an Amendment during the passage of the Bill. The Government reply at that time was that it would lead to widespread abuses. I am told on good authority that, with careful drafting, the Government fears of widespread abuses could be met. If the noble Lord would so wish it I should be happy to furnish him with such a draft. If this minimum figure were accepted by the Government it would, in my opinion, kill two birds with one stone.
First, it would relieve many cases of hardship (which I am sure the Government are as anxious to relieve as we are), and, secondly, it would save a great deal of time and expense on the part of the Commission in the collection of these small amounts. The Commission stated recently that they anticipated that the costs of collection of levy for last year would exceed £2 million. I think it would be of interest to-night if the Government or the noble Lord could advise us what

1257
studies, if any, have been made on the cost of collection and what proportion of the collections are of a low figure—say £2,000. The second change that I would advocate has already been pressed in another place. That is the exemption of the owner-occupier. This would fall in line with the legislation on capital gains tax. The third change that I would submit to the noble Lord relates to the Case "c". It is particularly relevant, I believe, to the example that has become known as the "Sweeting case", where a young couple were given a barn by an uncle. With their own hands, they converted the barn into a house. Under Case "c", they were charged a development value levy of £900, a sum which, I am told, amounted to something like 50 per cent. of what they had actually spent on the house itself. If one accepts that Case "c" is justified, would it not be possible to provide that the charge should not become operative until the property was sold? That is when the profit is in fact made.
The last point I would make to the noble Lord concerns professional fees. Here I perhaps should declare an interest. At the present time, under Schedule 6, paragraph 19, the full cost of professional fees is not allowed as a deduction in the assessment of net development value. I have no idea how this restriction arose and perhaps the noble Lord could explain it to us later. Yet for capital gains tax purposes it can he deducted.
May I give a short example of how this operates at present? There was a case some time ago when a gentleman purchased a property, after April 5, 1967, at £2,250 and a year later sold it for £2,400. The net development value on this purchase and sale amounted to £150 and the levy was assessed at £60. The gentleman incurred fees on the initial purchase of the property which amounted to £60 and incurred fees on the sale of the property amounting to £186. Therefore, he made a loss on the whole operation of £36, and as he was charged a further £60 this made a total loss of £96.
I would make one final point. It is no exaggeration to say that this new tax has proved at the lower end of the scale to be a pernicious and cruel tax. It has already caused many terrible cases of hardship, involving quite innocent
1258
people. These cases multiply monthly. They are no longer one or two exceptions; they may now, I believe, run into three figures. The Land Commission have a very large backlog of cases, all fairly small, and all must be physically uneconomic to collect. In many instances, the Land Commission must be paying more to collect the money than they are receiving. No one seems to benefit. Everyone seems to lose.
The Government so far have said that they are willing to look into every case. Can the noble Lord tell us how many cases they have looked into and what the results are? The Chairman of the Land Commission is reported as saying that he can only work within a framework of legislation. Of course, that is correct. As the noble and learned Lord the Lord Chancellor is present, I could refer to some of his words, when moving the Second Reading of the Land Commission Bill he said:
"For too long the property speculators have bled white those of our people who wanted a home to live in.—[OFFICIAL REPORT, 14/11/68, col. 1088.]
I think that one could now adapt the phrase "bled white" to this tax. I believe it is time that the Government took action. Enough has been seen of the way the tax works in smaller cases.
I turn briefly to the second half of my Question. The House will recall that besides administering the levy tax, the Commission have two other prime duties: to see that the right land is made available at the right time and that the cost of land for essential purposes is reduced. Some of us who have had dealings with the Land Commission realise that they work under difficult conditions and I am afraid that they are going to work under more difficult conditions in the near future. The, live under a cloud of uncertainty—uncertainty as to their role as a land bank, uncertainty as to their relations with the local authorities, uncertainty as to their relationship to planning and uncertainty as to their future in the next Election.
We were told by the Minister of Planning in another place a fortnight ago that there are many myths surrounding the Land Commission. That was one of the few remarks in his long speech with which I found myself to be in complete harmony. One of these myths which I

1259
hope the noble Lord can clear up tonight is the precise instructions given to the Land Commission as to the jobs they are to perform. Are they, for instance, to tackle city centre redevelopments and the twilight areas? This, I think, must be an urgent priority. Or are they simply to take part in the rapid expansion of new residential development areas which the Minister of Housing has been calling for? If they are to tackle the city centre redevelopment, may I ask what areas they have under consideration at the present time?
Another myth of Land Commission policy, which many people consider almost sinister, is that they have suddenly begun to advertise in the national Press for 100-acre blocks of white land. One immediately asks: what is the purpose of this? Are they implying that they will be able to accelerate the planning consents for development use of land? In other words, are they receiving preferential treatment over individuals? So far as we know, they have no powers of planning and an application of theirs stands or falls alongside any other application. Here the implication seems to fall in this way. The Commission, in their wisdom, are intended to purchase what is known as ripe land. One assumes that that is land ripe for development. Suppose the planning authority turns down the application from the Commission. Of course, the Commission can then appeal, as a normal individual can, but the appeal is to the Minister to whom they are responsible. What happens then? Is political pressure going to interfere with sound town planning? Even if it does not, there is always a suspicion. And I should be grateful to learn from the noble Lord, when he answers, how many acres of white land the Commission have already purchased or are in process of acquiring and whether they have made any planning applications for this white land.
Perhaps the biggest myth of all is about the effect the Commission have been having on building-land prices. There is no doubt about it that at the time legislation was going through this House most of us were under the impression that the Government stated that the Commission would result in a reduction in building-land prices. I am sure that no one in
1260
this House, not even the noble Lord, Lord Kennet, needs to be told what in fact has happened. Land prices have risen, in some cases by 60 and even by 80 per cent. above 1967 levels. I should like to know what the Government put this down to. Is it, as I suspect, partly due to the levy and partly due to shortage of land available, or is there another reason? The effect of the increases in land prices has been yet one more difficulty for the housing programmes to cope with. The increasing cost of land, the increase in building costs and now an acute shortage of mortgage facilities, are the present ingredients of what must rapidly be becoming a pretty sickly housing programme. It seems to me that the Land Commission are doing precious little to assist. The term "myth" I believe describes the Land Commission very well. They seem at present to have a white mist surrounding their purposes and a black cloud surrounding the tax they impose. I hope that both of those can be cleared up to-night by the noble Lord, Lord Kennet.
6.40 p.m.
LORD SILKIN: My Lords, I should like to congratulate the noble Earl on having asked these important questions and on having dealt with this matter in a relatively moderate manner. When one compares the language he used with the language used in another place, one must be grateful that the noble Earl has put forward the points he has made in a really practical way. I think he has gone a little wider than his Question, which deals with two specific matters. I propose to deal with the two specific points in the Question, and if my noble friend wants to deal with any extraneous matters he can do so.
The first point is that of the excessively burdensome amount of the levy in certain cases. The noble Earl was not suggesting, in any case, that the Commission were going outside the terms of the Act. His complaint was really about the Act itself. He made three points altogether, and I think his major point was that it would be an advantage if there was now a de minimis provision so as to exclude small claims. That, of course, is not a criticism of the administration; it is not even a criticism of the Act. It is something which has emerged as the result of

1261
two years' experience, and certainly I, for one, should be grateful if the Government were prepared to reconsider some form of a de minimis provision, provided that it could be done within the terms of the Act itself. I believe that the Government have taken powers to modify the levy in certain respects, and if it were possible to do this I should be grateful.
The noble Earl referred to a dozen cases of hardship. There may well be a dozen cases of hardship, and many more; but this does not mean that the levy is wrong. Cases of hardship occur when one receives an income tax demand or any other demand for payment to the Government. There are always these cases of hardship, and particularly when people are just outside the borderline. Cases of hardship will arise even if you have a de minimis provision, because there will always be people who are just outside the provision, and we could then well have the noble Earl coming along and saying that something ought to be done about those people.
The Act contains provision for a great many exemptions, and perhaps I may mention some of them. Housing associations, charities and statutory undertakers are exempt. But particularly, so far as individuals are concerned, any person who owned land before September 23, 1965, on which he proposed to build a single dwelling-house is exempt from the development charge. But it has to be for the owner's own occupation, or for the occupation of a wife or husband, a daughter or a son, including an illegitimate child or an adopted child, or a father or mother of the owner. That is a pretty wide range of exemptions. But you will always find somebody who acquired the land in October, 1965, and who is therefore outside this exemption.
I do not see how the Government can deal with a case of that kind. As I say, there will always be borderline cases which noble Lords can represent as hardship cases which ought to be dealt with. I shall leave my noble friend to deal with the various suggestions which the noble Earl made for dealing with these hardships. However, as I say, I should be willing to support a de minimis provision if that were practicable, mostly on the grounds which the noble Earl put forward: that it would save a great deal
1262
of effort, and that the small sums are not worth collecting. I think he made that his major point rather than the alleviation of hardship.
As a matter of fact, even today the Land Commission have the opportunity of mitigating hardship by accepting instalments. They can be small instalments, and they can be spread over a long period of time. These matters are entirely within the discretion of the Land Commission, and I understand that they exercise this discretion quite freely. But, of course, they cannot waive a charge: if a charge is payable, they have to enforce it. That is all I wish to say about hardship. Having looked at this matter quite objectively, I feel that there is rather a tendency to exaggerate the hardships. I do not say that hardship does not exist—no doubt there are cases of hardship—but I think it is really much more a matter of hard luck that people happen to fall just outside the limits laid down in the Act; and, as I have said, there will always be hardship so far as those who do not happen to come within the limits are concerned.
The noble Earl dealt also with the question of the cost of land. I quite agree with him that when the Bill was going through the House we all had the belief that somehow it would have the effect of reducing land costs, and that, generally speaking, land costs have risen. I would, however, make the point that the Commission themselves are not liable for the levy. They are able to acquire land at 40 per cent. below the cost that other people would have to pay. They can, and do, exercise that advantage in disposing of land to developers at a cost which is lower than the market price. But one has to face the fact that land to-day is being dealt with at the market price. Like everything else, it conforms to the law of supply and demand, and the demand is much greater than the supply, with the normal results.
One reason for this is that not enough land is being released by the local authorities for development. Local authorities, generally speaking (and I have had a good deal of experience of local authorities, even recently), have an unfortunate tendency to say "No" rather than "Yes" to an application for development. Sometimes they can be forced by persistence

1263
to give way; but the trend, wherever possible, is to refuse permission to develop. No doubt they have their reasons. I am bound to say that the Minister himself far too often supports the local authorities on appeal; seldom does he go against a local authority, even in cases where one might think that land could quite properly be released. While the Minister is constantly saying that land should be released for development, his actions are quite contrary to this; and when it comes to an appeal against the decision of the local authority, generally his decision is in support of the local authority.
I would submit that if more land could be released and made available for development, this would have the normal effect—and this we find in all cases where the supply is increased to meet the demand—of reducing the cost of land. To-day we know that developers are so eager to get on with development that they are prepared to pay very high prices for land—an action which is not justified—with the inevitable result that dwellings and other buildings are much too costly. Furthermore, the Land Commission have not yet full authority to acquire all the land they would like to acquire. Their powers at the present time, during the first stage of the operation of the Act, are somewhat restricted. When we come to the second stage, which the Minister can declare at any time he thinks right, the Land Commission will have much greater freedom to acquire land. They will be able to acquire land of a category, perhaps in advance of requirement, and have it readily available for developments, and to acquire land on a much bigger scale. That will again have the effect of reducing the tension, making more land available and, consequently, of reducing the cost.
I should like to express my gratitude to the noble Earl for giving us the opportunity to have this preliminary discussion on the workings of the Land Development Act. I should like us to have at some stage during this Session a full-scale debate on the whole question. There have been suggestions that the Land Commission might be abolished. I should like to have this matter freely discussed. I believe that this House is essentially the kind of place where we can have this question debated without prejudice on
1264
either side, with a view to obtaining what is the wise and correct decision. There are other matters, such as those on which the noble Earl has briefly touched, outside his Question which one would like to discuss at greater length. I hope that that will be possible. Perhaps the noble Earl himself will put down a Motion on this subject for debate on a day when we can have a full day's discussion on it. I am sure that it would be well worth while. In the meantime, I am afraid that my own support for the point of this Question is somewhat limited. I feel that it might be possible to have a de minimis provision, but I doubt whether it would be very helpful for the kind of people he is referring to. Apart from that, I am afraid that I cannot give it very much support.
6.33 p.m.
LORD HENLEY: My Lords, I do not want to say much about the hardship side of this particular question because I think that that has been dealt with fairly completely by the noble Earl, Lord Kinnoull, and by the noble Lord, Lord Silkin. But I should like to say a few words on the second part of the Question, which is the matter of making development land cheaper. I have always belonged to that school of thought which felt that this was a very doubtful proposition in any event. It is possible to make something cheaper by increasing the quantity of it, and thus reducing the cost, but in the prevailing circumstances of land in this country that is not possible. All one can do, as the noble Lord, Lord Silkin, suggested, is to make planning authorities disgorge a little more land. Again, I am not really sure whether this is either necessary or desirable.
The noble Lord, I think, feels that demand is greater than supply. On the other hand, there is a considerable body of evidence—notably from the Chartered Land Societies Joint Committee—to suggest that the demand is no greater than the supply and that the system has in fact been working perfectly adequately. However, that is the only way of increasing the quantity of land: by causing the planning authorities to disgorge more. In this respect the Land Commission have failed. They have tried to make the planning authorities release more land for development, but have not succeeded.

1265
I strongly deprecate any attempt on the part of a body such as the Land Commission to try to bring pressure of this sort to bear upon planning authorities. It is not the job of the Land Commission to get planning authorities to act in this way. As I say, I do not believe that we can make land of itself cheaper; one can only redistribute the cost. It is possible, as the noble Lord, Lord Silkin, has mentioned, to buy land at an artificially low, compulsory price and to sell it at an even lower price. This is a practice known as, "Robbing Peter to pay Paul". If it is felt that Peter is too rich and Paul is not quite rich enough, this is a perfectly reasonable course to take. But let us not kid ourselves that it is making land itself any cheaper; it is not. It is merely redistributing the cost of that land.
Even if the Land Commission were able to make land cheaper I myself doubt whether that would have very much effect on the cost of houses. I think that Dr. Denman has shown that in fact it has a marginal effect here and indeed that this was the basic fallacy which led to the Land Commission's being set up. But we are not talking about whether cheaper land makes houses cheaper, but about whether the Land Commission have succeeded in making land cheaper. It is clear from their own Report that they do not think they have, and that they also feel they are spending a great deal of money in not making land any cheaper.
There are indications that the Land Commission are going to try another tack. I refer here to the point to which the noble Earl has already drawn our attention: that is, the advertisements which have recently been appearing in the professional papers on behalf of the Land Commission. The Land Commission, as he told us, have been advertising to try to get owners of white land to sell it to the Commission, and they have said that they have a preference for 100-acre blocks. Why do they want land in 100-acre blocks? Why not, on the other hand, in small and scattered blocks; in blocks which have access problems; in blocks where, for reasons of this sort, planning permission might not be readily granted but where planning might be granted for a scheme which was a comprehensive whole and a phased operation? It seems to me that it is not
1266
the 100-acre blocks where the Land Commission could be useful. They could be useful, on the other hand, in scattered blocks which need to be dealt with as a comprehensive whole and where the Land Commission, by acting as an agent, would be performing some useful service. Similarly, in circumstances of this kind the land owner might feel he was glad to sell to the Land Commission. But I do not quite see why a land owner should want to sell to the Land Commission in 100-acre blocks of white land.
Again, this raises a question which we discussed on the Second Reading of the Bill—and I hope that at this point I have the ear of the noble Lord, Lord Kennet. I think that both the noble Viscount, Lord Gage, and myself asked the noble Lord what the proposals were for the Land Commission to manage those large areas of land which they were going to buy. The noble Lord said that this issue would never arise, because the Land Commission were not going to buy and hold on to white land; they were merely going to turn over land ready for development, and turn it over quick. That is what the noble Lord told me in the Second Reading debate, and it may at the time have been a perfectly sound assessment of what the Land Commission were proposing to do.
But the Land Commission are now proposing to do something else. As they are proposing to do something else I want to know the answers to the questions we put then. Will they manage the land with a staff of their own land agents; will they put the management of this white land out to firms in general practice, or will they lease back the land to the owner? The latter might be an attractive proposition to owners; the Land Commission are obviously anxious to be friends with owners, and they have indicated that they hope to be able to buy and sell land to the advantage of all parties, if they wish to do this we should like to know how they propose to do it and what are the implications to land owners if they accept the invitation of the Commission to sell land.
I think it might help if the Land Commission were themselves to be a little more forthcoming and to say exactly what their reasons for this form of advertisement are. Why do the Commission want to buy land by agreement which

1267
has no planning consent for development and, on the face of it, is unlikely to receive any consent for some years to come? The noble Earl made a suggestion which I hope is not the reason, and that is that they want to do this as they will find themselves in a better position to exert pressure on planning authorities to give planning permission on white land which at the moment is held in baulk by not having planning permission and for which, if it was owned by the Land Commission, the pressure would be such that the planning authorities might in fact give that permission. I hope that is not true, but it is part of what landowners want to know about what the Commission are aiming at, if they are to know whether the propositions being offered to them by the Land Commission are attractive ones.
For instance, how will the Commission go about deciding what white land to buy and what not to buy? If they do not get blocks of white land voluntarily as a result of their advertisement will they resort to compulsion in order to build up an estate of white land? Will the Commission give publicity to their decision so that neighbouring owners may know what material development may take place, and when, on land acquired by the Land Commission? I am not asking the noble Lord to answer these questions, because I know he cannot do so.
LORD KENNET: My Lords, I can.
LORD HENLEY: My Lords, if he can, I am very surprised indeed, because some of these questions have in fact been put to the Land Commission and they are unwilling to answer any of them. The only question I can think of at this time that the Land Commission have answered specifically is whether they will make public the number of offers they have had and the total acreage and, if not, whether they will also keep that information private from Government Departments. The only answer they gave to that was that they could not give any undertaking, which is a rather negative kind of answer.
The position is that the Land Commission feel that they are falling down on their job—or I suspect that they feel this. They are trying a tack which they
1268
have not tried before, of persuading landowners to sell white land to them voluntarily. They want to create a state of affairs in which they have a friendly relationship with landowners in order that they may do this, and in order that they may buy and sell land, as they suggest, to the advantage of all parties. But if they are going to do this, if they are going to attract landowners to accept this invitation to sell white land, preferably in blocks of 100 acres, then they will have to answer some of these inquiries a little more readily, otherwise I cannot see landowners selling them the blocks of land which they require.
All that the Commission have said is that in connection with managing their affairs they will adopt normal commercial practices, as would any other prudent investor. In other words, the Land Commission are going into business as ordinary land speculators. I am not sure that I see anything wrong in that. A great many people said on Second Reading that if this was going to work at all it could only work by the Land Commission becoming speculators, buying white land and holding it either until it became ripe for development or until they could persuade the planning authorities to make it so. That is as it may be, but I do not think it will make land any cheaper.
6.45 p.m.
LORD AIREDALE: My Lords, I wish to touch upon only one rather narrow aspect of this subject. The question I wish to ask is what effect will the Land Commission's betterment levy have on the conversion grant scheme on which the Government have shown themselves to be extremely keen? It is a scheme whereby land owners are being urged to convert buildings which are not at present houses into houses, and large grants are to be held out as an inducement to these land owners to do these conversions to provide houses. The Government are clearly in earnest about it. May I just quote two sentences from last year's Housing White Paper. Under the heading "General policy" on page 2, it says:
"Local authorities must take the lead and drive the policy forward in each town and district. Each authority will need to make up its mind to secure results."
So, my Lords, if this policy is pursued people will be offered grants, which I

1269
think are to be up to £1,000 a time, as inducements to convert buildings which are not at present houses into houses.
I have studied as best I can the booklet put out by the Ministry of Housing and Local Government called Betterment Levy: an Explanatory Memorandum. I would not call it exactly "a child's guide", but from understanding it as best I can it seems that in most of these cases, if not all, where a building which is not at present a house is converted into a house, betterment levy will be chargeable The question I wish to ask is this: at what stage, if any, is the applicant for a conversion grant going to be told that if he accepts it and does his conversion he will be caught for betterment levy? It will not, I think, be a very healthy state of affairs if large numbers of people accept grants of £1,000 and enter into conversion schemes, only to find that they are then caught for perhaps £1,200 a time for betterment levy. I do not know what the exact figures will be, of course, but what I suggest, in order that there will not be widespread disquiet about this matter, is that in every case where a local authority inform a developer that his application for a conversion grant is accepted they shall at the same time furnish him with a certificate which shall state the maximum amount which may be chargeable as betterment levy on that conversion, so that the developer will know exactly, from the outset, what his financial position is going to be as between receiving a generous grant of up to £1,000 on the one hand and being liable for betterment levy of I know not how much on the other hand.
I dare say I may be told by the Government this evening that all this can be discussed when the Housing Bill which is now before another place comes before us, but I hope that perhaps the Government's thoughts about this may be forthcoming this evening. After all, the Government wanted our thoughts about that present Housing Bill—that is why they published a White Paper about it last year—and therefore I hope that this matter will have been considered and that something may be said now, so that we shall be better prepared, when the Housing Bill comes before us, to deal with this rather narrow aspect of the betterment levy. Nevertheless, it is a very important one, in my submission, and one
1270
which, if it is not dealt with clearly and firmly, may cause a great deal of disquiet and annoyance as the conversion grant scheme develops.
6.50 p.m.
THE PARLIAMENTARY SECRETARY, MINISTRY OF HOUSING AND LOCAL GOVERNMENT (LORD KENNET): My Lords, may I take up as many of the questions as I can—so many questions have been raised, all of them useful, that I cannot be as short as I should wish to be. With regard to the question raised by the noble Earl, Lord Kinnoull, and my noble friend, Lord Silkin, of the de minimis provision, both noble Lords, I think, had forgotten that there is one in the Act. It is the famous 10 per cent. Development levy bites only on the development value. What is the development value? It is that which is not the existing use value. Existing use value is market value plus 10 per cent.
Lord Kinnoull asked about hardship cases and I think he mentioned the possibility of using Section 63 to alleviate individual hardship. The problem is that this power is not a power to give exemption in individual cases but is a general power if it becomes necessary to give exemption in any defined set of circumstances to a class of cases. The levy applies generally where development value is realised, and the Commission have no power, and Parliament gave them no power, to waive it because of the personal circumstances of the levy payer. While the working of the Act is under review it has to be accepted that it is not a personal tax—but a tax on realised development value, whoever realises it. If the operation of the levy reveals any general circumstances suggesting a change, the Government will consider them.
That is what happened over cases where the purchase had taken place in the interim period after the Land Commission White Paper. The Commission recommended changes in those circumstances and the Government have announced two rather far-ranging extra statutory concessions which will be put into legislation as soon as possible. These have dealt with the class of hardship cases arising from the famous absence of last transaction base value in the interim period. But where development value is realised in the ordinary case of a sale of

1271
land a profit has been made, so there is no question of exempting this profit from its due taxation in the form of this levy because of the personal circumstances of the levy payer. That is hard, but it is not unfamiliar in law.
THE EARL OF KINNOULL: My Lords, under Case "c" the property is not realised and therefore there is no profit in the hands of the vendor. I do not think the noble Lord covered that.
LORD KENNET: I hope and believe I am coming to that point. It is difficult to remember which is Case "c" and which Case "f". On the question of costs, there is an allowance for costs reasonably incurred in making any valuation or apportionment required in the levy calculation. Sales of land are now liable to levy on development value and to capital gains tax on increase in current use value. Conveyancing costs, as opposed to valuation costs, are allowed against capital gains tax. We did not make another allowance for conveyancing costs against land levy because this could have led to the same costs being allowed twice, and, in any case, there is the 10 per cent. upwards on the existing use value which I just mentioned, which not only is intended to be de minimis but also might be regarded as looking after the incidental costs not already allowed against the capital gains tax.
I was asked about the question of white land, and it is true, indeed, that in addition to acquiring land for early development—that is, land for which there is planning permission or for which the Commission can obtain planning permission—the Commission have decided, subject to the scope of their capital investment programme, to acquire for long-term holding areas of white land; that is, land not allocated for any particular use in a development plan. The success of this policy will depend on the Commission's ability to buy the land by agreement, since unless there is a planning permission for development the Commission's compulsory purchase powers are not available to them. I think this answers one of Lord Henley's major points. The Commission are thus seeking only to buy land offered to them or coming on to the market, and the Commission
1272
will exercise their own judgment as to the development potential in the land in the reasonably long term, say, seven to ten years. The Commission will not receive preferential treatement.
I come to the complaint of my noble friend, Lord Silkin, that the Minister does not uphold developers on appeal. It is absolutely impossible for me to answer that as a general charge. I should have to know what cases he had in mind. With regard to the question raised by Lord Airedale about conversion grants and improvement grants (I hope he will agree to my treating them together), the case he mentioned was of the conversion of something which is not a house into a house. That is a case which in circumstances set out in the Bill will attract levy because there is an increase in the development value and it is right that since that increase has been generated by the planning permission, and not by an act of the owner or developer, 40 per cent. of that increase should go to the community. What Lord Airedale was wrong about was in linking this matter to the Government's drive for conversion and improvement of urban property. I say urban property, but it could be anywhere. This drive is not for the conversion of barns or windmills or warehouses into dwellings; it is for the conversion of one large old Victorian house into two or more flats, and it is for the improvement of existing houses, many millions of which lack basic amenities up to decent modern standards. In those two cases, conversion of a dwelling into more than one dwelling and improvement of a dwelling to modern standards, no liability to levy arises.
LORD AIREDALE: If a developer gets a grant of £1,000 towards a conversion, will he not be told at the time that he will be liable for betterment levy? Will he be given an idea of how much the levy is going to be so that he may balance the £1,000 on the one hand against the levy on the other? He is entitled to know.
LORD KENNET: This is going to be a very small class of cases in the great improvement drive coming up. The conversion of your warehouse or mill is going to be very much a sideline, but I will go into it and write to the noble Lord. This is a welcome opportunity

1273
to correct a number of misconceptions which seem to be prevalent about this levy. They fall on opposite sides of the fence. One is that it is a tax designed only to tax the profits of the big land speculators with no application to the small man. The other opposite misconception is that it is an all pervasive levy on all transactions. I think I have made it clear that by means of the 10 per cent. de minimis provision it is not the latter. The levy means that anyone going in for land transactions or development of land must in future take into account the question of the levy and in making his calculations consider what his obligations will be just as he does in normal familiar taxation matters. He would in any case be needing professional advice when it is a question of transferring land, and it would be convenient to seek advice on the levy aspect at the same time. This is what people do, and what people should do.
It is of course a principle of the levy that it is not charged twice on the same increase in development value. The Act provides that the price paid for the land on a previous transaction can be used as a deduction in the assessment of levy, the so-called Schedule 5 base. This ensures that in the great majority of cases where a person buys land for the purpose of building a house for himself and pays the full market price for the land, he will have little or no levy to pay. The liability for levy normally arises only if he has paid a low price for the land, or has received it as a gift—as in some of the cases which have recently been given publicity. In these cases, despite appearances and the fact that the levy seems to have come as a surprise, because no money has in fact changed hands on the transfer of the land, and the levy is then asked for as a lump sum, the levy payer has to reflect that he is, in spite of everything, better off than if he had bought the land at the normal price. If he had paid the full market value for the land he would have paid the whole of the net development value in the price, and the vendor would be liable for levy. If he receives the land as a gift, he pays 40 per cent. of the net development value, and nothing else. This is a case which has given rise to a certain amount of Press comment recently.
1274
I should also say a word about the cases where the land was bought, during the interim period. This was the matter to which I referred earlier. Some of the cases which have been brought to the notice of my right honourable friend are those where the person called on to pay levy has sold his house and garden. In the average case of such a sale any profit made is in current use, and no question of development value, or, therefore, of development levy, arises. It is only if there is land adjoining the house—perhaps part of the garden—and this land possesses development value, that the question of levy arises.
We have heard of poor people and old-age pensioners, and of young couples with families, who thought they had made a good lump sum with which to pay for improvements on their house, or even for another house. I have already mentioned the exemption through the capital gains machinery for such a person to be exempt from tax on any profit on the sale of his house for continued use as a house, but this does not, of course, cover the sale of a garden, or part of a garden, on which planning permission has arisen and which therefore obtains development value and attracts levy. I am afraid that in the case of such a family, whether their means be small or great, there is an accrual of development value which is in no way due to the work or to the enterprise of that person. It is due to a decision by the community in giving planning permission, and it is as right in the case of a small man that he should pay 40 per cent. of the windfall as it is in the case of the large one.
I have spoken in general terms because I think, and I believe the House will agree, that it is undesirable to debate in detail the private financial affairs of individuals, and no noble Lord has sought to do so. To sum up this matter of the levy, I think the long and the short of it is that it surprises people; it hurts people; it gives rise to Press comment, much of it grossly politically slanted and unjustified, but not all of it. This cannot be avoided when Parliament imposes a new tax. It happened when income tax was first imposed; it happened when purchase tax was first imposed. When any new charge is first placed on the people it surprises them until they get used to it. One may have the greatest

1275
possible sympathy with those who are surprised. The Government must, and do, do all they can to inform people of the way the levy works, but I believe that in time, if this levy continues (and I note that the Opposition have no proposals to withdraw it), people will become as used to it as they have become to income tax, and it will just become part of the surrounding which is accepted as a basic act of social justice.
My Lords, I have not much more to say. I remember that on the Second Reading of the Bill which has become the Land Commission Act your Lordships showed nervousness that the compulsory powers provided in the Act would be irresponsibly used. But I think that any disappointment this House may feel at the extensive purchases by which the Commission can influence the price of land by bringing more on to the market must be tempered by the feeling that the Commission have not taken advantage of their powers by taking land indiscriminately, and I do not believe that they will do so.
More generally, on the price of land, the charge that the Land Commission have themselves caused the price of land to increase is, of course, totally unsustainable and is not supported by any evidence known to me. Because of the variability of land price it is not possible to estimate trends in such a short period as the Land Commission have been in operation, and even if it were possible to estimate trends in general over that short period it would be quite impossible to quantify the effect of the Land Commission's own operations on those trends. They have been small as yet, as the House knows. What can be said is that the average annual increase in the price of private house-building land in England and Wales has been far lower from the end of 1964 to the middle of 1968 than it was in the early '60s. The average price of public sector housing land showed a national increase from 1961 to 1966, since when it was fairly stable until the middle of 1968, the last date up to which it has been possible to assess it.
Of course, there will always be individual cases where a high and increased price is paid for land, and these are
1276
the ones which hit the Press. But it is quite wrong to base on these cases a general charge that land prices are showing a general substantial increase. In fact, as I have said, it was in the early '60s—when the Party of noble Lords opposite were in power—that land prices rose so substantially. The job of the Land Commission is to make land available for development while working within the planning system, so as to meet the danger that scarcity of land for development will otherwise lead to rises in price. The Opposition have not, that I have heard, any suggestion to offer as to how they can meet this risk better than the Land Commission are doing.
THE EARL OF KINNOULL: My Lords, I wonder whether the noble Lord could answer one question which I asked him. In another place the Minister undertook to look into all these cases of hardship, and the question I asked was: how many has he looked into, and what has been the result?
LORD KENNET: My Lords, I regret that I am not in a position to tell the noble Earl exactly how many cases have been looked into by the Minister, and how many not. It is only the duty, and indeed the natural impulse, of the Land Commission to look into them first, and I should expect the Land Commission to formulate the first recommendations for any changes which may be necessary in procedure and submit them to the Minister. The Minister, of course, keeps a watching brief on all that is going on.