HL Deb 19 February 1970 vol 307 cc1292-303

3.36 p.m.


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 Kennet.)

On Question, Motion agreed to.

House in Committee accordingly.

[The EARL OF LISTOWEL in the Chair.]

Clause 1 [Ascertainment of gross value of dwelling-house]:

LORD BROOKE OF CUMNOR moved Amendment No. 1: Page 2, line 12, after ("list") insert ("as a whole").

The noble Lord said: This is an obscurely technical Bill, and I must frankly admit that my Amendments to it are obscurely technical, too. I do not imagine that they will attract popular attention through the mass media publicity. Nevertheless, they are all intended to protect the interests of the general public and therefore I do not apologise for asking the Committee to consider them. It might save time if your Lord-ships were willing for me to explain Amendments Nos. 1 and 2 together because they are linked.

On Second Reading I questioned the last six lines of the new subsection (2A) to be inserted in the 1967 Act, that is to say, lines 9 to 14 on page 2 of the Bill. I raised the question whether the insertion of this provision was really necessary. Having considered what the noble Lord, Lord Kennet, said in reply, I accept the value of it; the only purpose of my Amendment is to clarify it and to remove possible doubts. In tabling these Amendments I am fortified by the fact that the Minister of State, in Standing Committee in another place, where this provision was questioned, said: I understand the Committee's concern. I will look at it again. He was referring then to the drafting of these lines and to the; question whether they might remove a certain protection from the ratepayer who wished to appeal. Nevertheless, at the Report stage the Minister did not table a Government Amendment, and the matter was not further considered in another place.

As I understand it, the "valuation list", mentioned in lines 11 and 12 on page 2, is a collective term. It connotes the valuation list as a whole, and not the valuation list considered as an assemblage of a great number of individual assessments. Conversely, in line 13 I understand that the word "dwelling-houses" to be intended to mean particular dwelling-houses and not the whole complete assemblage of all the dwelling-houses in the rating area. If it meant that, then this provision, presumably, would authorise the valuation officer to assess the whole of the dwelling-houses in one area solely by reference to other dwelling-houses, which, ipso facto, must be outside the area. I do not think that is what it means. My two Amendments—to insert the words. "as a whole" in line 12 and the word "particular" in line 13—are designed to put beyond doubt what it means and not to make any difference to the meaning as the Government doubtless intend it to be.

My concern about the wording as it stands is lest this particular provision should be used in an argument, or in the discussion of appeals, for a purpose different from the one intended. I believe I am right in saying that the lines 9 to 14 are desired to be inserted by the Government as a protection against the whole of the valuation list being challenged, and possibly set aside, in circumstances such as occurred in the Petrie case. If Parliament approves the inclusion of the six lines in the new Act, then the valuation authority will not be at risk of having the whole of their valuation list set aside in such circumstances.

My fear is that if we keep the six lines in and do not amend them as I am suggesting, the provision may be read as conferring a sort of sanctity on each individual assessment in the valuation list, thereby rendering it more difficult for the ratepayer who is appealing against his individual assessment to succeed in his challenge. I do not believe that that is what is intended, but certainly the considerable discussion which took place in Standing Committee of another place indi- cated that there were uncertainty and dubiety about it in some very well-informed minds; and the Minister of State himself thought it was worth looking at again. I hope therefore that the Government will be able to give me a considered and friendly reply, because I am sure that there is no difference at all in the object which we are both seeking to achieve. I beg to move.


I think there is little question that we are after the same thing. The noble Lord wishes to achieve the greatest possible clarity with his Amendments, but I think that the Amendments would change the effect of the Bill as drafted. Whether he means that or not, of course, depends on what he thinks the Bill as drafted says. This is a complicated matter, and let me do my best to explain it. The two Amendments (I agree that we should discuss them together) would not affect the protection given in respect of the whole valuation list but would still permit attack upon any scale which would be less than that of the whole list—that is, on an individual assessment or on individual assessments forming part of a list. Thus the protection which we seek to give by this Bill would be nullified to a greater or lesser extent. I think that the main object of the Bill would be put in danger by accepting these Amendments. I do not think, it is the noble Lord's purpose to do that, but that, it seems, would be the effect of them.

Let me say again, as I said on Second Reading, that the existing wording of the Bill does not say that an assessment made by reference to all the evidence mentioned in the Bill is unchallengeable. Individual assessments can still be taken to appeal on the ground that they are individually wrong. The Bill merely prevents the possibility that an individual assessment, some individual assessments and, in an extreme case, all those which make up the entire list, could be invalidated on the ground that they had been made by reference to particular kinds of evidence with which the Bill deals. I should like the noble Lord and the Committee to be quite clear about this. If the Bill goes through unamended, ratepayers will still be able to challenge an individual assessment on all sorts of grounds, except the ground that this wider type of evidence has been taken into account. A ratepayer can challenge it on the ground that, though it has been taken into account, it has been wrongly applied, or on any of the familiar traditional grounds. The Bill makes no change in that. It says simply that it is not sufficient ground for throwing out one assessment, or indeed the whole list, that a wider sort of evidence has been applied to it.

The noble Lord spoke of conferring a sort of sanctity on individual valuations, but I think that he and I are together in hoping that this will not be the case; in fact I assure him that, according to the Government's understanding of the Bill, that will not be the case. My honourable friend the Minister of State in another place said he would look at this again to see whether clarity could be increased, and that has been done. I should hesitate to say that the clarity is at its maximum, since it may have misled the noble Lord—and, as we all know, he is lynx-eyed in this respect. The noble Lord's Amendment would do more than increase the clarity; it would change the effect, which I do not think he wants. We will have one more look at the clarity. If we can find clearer words, and perhaps if he can help us to find clearer words, we may revert to it at a later stage.


I hope that my noble friend will consider this point carefully, because evidently it has caused a great deal of perplexity to lawyers. I have received some representations about it from the Law Society, who do not find it at all clear. I confess that I still do not see any very good reason why the last six lines of this clause should be there at all. I appreciate the point that it is not intended to prevent any individual ratepayer from appealing against his assessment on any ground whatsoever: that, of course, must be abundantly safeguarded. The object of this Bill is merely to enable a new kind of evidence to be used when there is a dispute about a valuation; it is just that and nothing more, and in that respect I am entirely in favour of it. It has long been a mistake in our law that evidence of this kind could not be used. Surely it is sufficient now to say that it may be used, without trying to draw a whole series of consequences from that.


I am grateful to the noble Lord, Lord. Kennet, for his helpfulness on this matter. I assured him that I had no intention by my Amendment of changing the law. He spoke about Amendment No. 1, and I do not think he mentioned No. 2. But I should like to accept his offer. Already it is clear that this passage has been examined by great authorities on the drafting of Parliamentary Bills, and I certainly am not capable of challenging them on their own ground. But the support I have had from the noble Lord, Lord Douglas of Barloch, encourages me to think that we may make one more effort to increase the clarity of the meaning and purpose of this passage. Therefore, with the prospect of further talks with the noble Lord, Lord Kennet, I am happy to beg leave to withdraw my Amendment.

Amendment, by leave, withdrawn.

Clause 1 agreed to.

3.50 p.m.

LORD BROOKE OF CUMNOR moved Amendment No. 3: After Clause 1, insert the following new clause:

Amendment of s. 9 of General Rate Act 1967

". In subsection (1) of section 9 of the General Rate Act 1967 the words "the rating authority may refund that amount or a part thereof" shall be amended so as to read and shall be deemed always to have read, "the rating authority shall refund that amount or the appropriate part thereof and the amendment of the valuation list on which a refund under paragraph (a) or in appropriate cases paragraph (c) is made shall be deemed to have had effect as from the commencement of the period in respect of which the refund is made."

The noble Lord said: I beg to move Amendment No. 3. This new clause would do two things. First of all, it would render mandatory on the local authority the refunding of rates that had been paid in excess. That situation may arise particularly when an entry in a valuation list has been found to be excessive and has consequently been altered. The curious thing is that the General Rate Act 1967 says that in such circum-stances the local authority "may" refund that amount or a part thereof. It would be most churlish of any local authority to refuse to refund rates that have obviously been paid in excess, and I can see no reason whatever why the word should not be "shall" refund rather than "may" refund. I do not know whether there have been cases of a local auhority refusing to refund rates that have been paid in excess, but I am sure there would be grave Parliamentary trouble if the Commissioners of Inland Revenue refused to refund tax that had been paid in excess, relying on a statement in the law that they "may" refund it and not "shall" refund it. The first part of the new clause, therefore, is relatively simple.

The second part is more complex and goes back to a discussion that we had on the Report stage of the Housing Bill last Session, on July 22. At that time the noble Lord, Lord Kennet, asked me not to press the matter. He hoped that I would agree that it should be pursued, if pursued at all, on some other occasion, because it was really too late to do so at that stage of the Housing Bill; and I accepted his suggestion. The matter has been carried somewhat further since then by a decision in an appeal that came to your Lordships' House and was recently decided against the appellant. The second part of my new clause suggests that the law as it stands, and as it was applied by the House, is not really fair to individual householders, and in those circumstances this is the appropriate time to consider whether it should be amended as I suggest. I know that the noble Lord, Lord Kennet, will be very familiar with the facts, and I am not at all sure that I can succeed in making them crystal clear to other noble Lords in this Committee, or even to myself.

Briefly, the facts are that the Rent Act says that the determining date for deciding whether a house is subject to regulation is March 23, 1965, and if the valuation in London on that date was not more than £400, or not more than £200 in the rest of the country, then the house should be subject to regulation. On the other hand, if on that date the valuation was more than £400 or £200, as the case may be, then the house should not be subject to regulation and the tenancy would not be protected.

The case which came to your Lordships' House on appeal was a case where the valuation had been found to be excessive and had been altered back to a lower figure as from April 1, 1965, because the appeal against the assessment had been originated in, I think, May, 1965, and the law says that the entry in the valuation list shall be corrected back to the beginning of that financial year. But, of course, it was accepted by all concerned that the person had been paying excessive rates right back to 1963, the time when the new valuation came into effect. No alteration had been made in the house between 1963 and 1965, and the local authority, under the permissive power about which I have just been speaking, was giving a refund of rates back to 1963. It was therefore beyond doubt that the valuation of the house should have been at the lower and not the higher figure right back to April 1, 1963. But the law does not allow an actual alteration in the valuation list to be taken further back than the beginning of the year in which the appeal is initiated. Therefore the reduction in the valuation list could not be carried further back than April 1, 1965, though it was accepted that the valuation had been excessive for the two years previous to that.

The result is that a householder in such a position is debarred from taking advantage of the protected tenancy which would be available to anybody whose valuation on March 23, 1965—nine days before April 1, 1965—was below £400 or £200, as the case may be. The purpose of the second part of my new clause is to rectify the matter in both those respects: first of all, when a reduction in the valuation list has been approved to authorise its being carried back in the valuation list to the original time when the house was in the condition in which it was when it was revalued; and secondly, to make that effective for the purpose of protection under the Rent Acts from the critical date of March 23, 1965. I am not sure whether I have managed to explain that in terms which any other noble Lord in the Committee will under-stand. Having debated some aspects of this subject before with the noble Lord, Lord Kennet, I have no doubt that he is familiar with the point at issue, and I hope that he will give it his sympathetic consideration. I beg to move.


On the first purpose of this Amendment, that is, making mandatory the reimbursement for rates which are later found to have been overpaid, I would say that it depends how far back you want to go. It is already mandatory to the point when you first thought of making your proposal for a lowering of the original value of your house. May I give your Lordships a straightforward example of the way the 1967 Act works? Where a house was assessed at a rateable value of £150 in 1963, and then, say in October, 1966, the occupier makes a proposal to have it reduced to £120. The matter takes some time to settle because of appeals to the courts. It is finally fixed in 1970 at £130. The ratepayer is then entitled to a refund on the difference between £150 and £130, going back to the 1st April, 1966 (that is the beginning of the rate period in which he first thought of making his proposal), and that is mandatory now. It is conferred by Section 79 of the 1967 General Rate Act. Moreover, the valuation list is altered with effect in this case from 1st April, 1966.

If the ratepayer then applies to the authority for a further refund going further back to before the time when he first thought of it, the rating authority obtain a certificate from the valuation officer to the effect that in his opinion the house ought to have been assessed at £130 for the earlier period. They can then, at their discretion, make a refund going back not to 1963 but to 1964, because Section 9 of the 1967 Act restricts refunds to payments made not more than six years previous to the application. In other words, if it is more than six years before the application it is statute barred. In those circumstances, the amendment to the valuation list is not made effective from the earlier date. So what the noble Lord is asking us to do with this Amendment is so to alter the case that I have been describing that the man has a right to the refund, not merely back to the moment when he first thought he wanted one but beyond that, back to the moment when his house was first uprated, or to six years before the time when the settlement was finally made, whichever is the later.

I have two things to say about this proposal. First of all, we have no evidence at all that the present system, whereby he must get his refund back to the moment of his proposal and may get it before, is giving rise to any hardship. Local authorities can pay right back to six years before, and from the evidence we have they are doing so in all cases where the ratepayer thinks that they ought to do so. This is a matter of common sense. If we were to amend the law so as to make it mandatory right back to the year "dot", then we should have to define the classes of people who could obtain it in much more detail than is done at present, when it is only discretionary and is left to the common sense of the rating authority to soft the matter out.

There is another aspect to it. Those things cut both ways, and rateable value assessments can on the proposal of the rating authority be valued upwards, as well as downwards on the proposal of the owner of the house. If one is going to extend the mandatory duty of the rating authority to pay back overpayments further into the past, one would have to consider whether one should not also extend the mandatory duty of the ratepayer to pay back to the local authority underpayments over the same period. At present both these matters are left to discretion.

I turn now to the second purpose of the noble Lord's Amendment, which is this matter of rewriting the value in the list back to an earlier period than at present obtains, when it has been lowered on a proposal for a reduction. I accept the noble Lord's account of the present state of the law and of its effect on the Rent Act and the Leasehold Enfranchisement Act. I will not burden the Committee by going into that again. Lord Brooke referred to the recent case which has come before this House in its judicial capacity, in which it was held that the procedure under Section 9 of the 1967 Act had no effect on the value in the valuation list for the purpose of determining whether a tenant had the benefit of a protected tenancy under the Rent Act 1965. That was the point the noble Lord had in mind. In his judgment at that time the noble and learned Lord, Lord Pearson, said: If such a refund could affect the status of a dwelling-house for the purposes of the Rent Acts, a dwelling-house which had been unprotected for several years might suddenly become protected and great complications might ensue. Such consequences cannot reasonably be supposed to have been intended by Parliament. The noble Lord, Lord Brooke, says that that is a confirmation of the present law as we all thought it was, but it is not a statement having anything to do with the desirability of changing it. I take it that that is Lord Brooke's position. This judgment is extremely recent, and I do not think it would be right for me to give any considered reaction to it yet, or to the matter as a whole. But it occurs to me to say that I am not sure that Parliament ought to do anything which this House, in its judicial capacity, has found that it cannot reasonably be supposed to have intended at any time in the past. We have this judgment handed down that to have done otherwise would have created such confusion that Parliament could not reasonably have been supposed to want it. That, of course, is true; and if we now change it we shall create precisely that confusion. This is, as I say, a new judgment, and I would ask the noble Lord to let it ride a little longer while we have a look at it. I do not think, at first blush, that there is now a case for changing the law in this respect which was lacking earlier.

4.7 p.m.


I am indeed grateful to the noble Lord, Lord Kennet, for having taken so much trouble in replying to an Amendment of mine. I want to apologise to the Committee for having made confusion worse confounded in my first speech by using the word "appeal" in two different senses. In the second sense I should have used the word "proposal" and not "appeal". I am a little doubtful about the noble Lord's argument that a statement in a judgment to the effect that certain consequences cannot reasonably have been supposed to be intended by Parliament should act as a barrier to future attempts to change the law because Parliament is always supreme, and the fact that Parliament did not intend certain effects when legislation was passed some years ago should not debar Parliament from considering with an open mind whether it would now be desirable to make certain changes.

I hope that in his further consideration of the matter the noble Lord will not rely on the argument which he used to convey any suggestion to his own mind that this is not still an open question. I feel sure that the feeling of the Committee would be that Parliament should still retain the right to look at it again, whatever had been said about the past intentions of Parliament. I appreciate the noble Lord's difficulty about reaching a clear and conclusive decision now within the Government. I should like to give him time, yet I do not see how it is possible for me to do so, unless he is going to postpone the later stages of the Bill. It appears to me that this is the only Bill likely to come up in this Session dealing with the matter. Once it leaves your Lordships' House none of your Lordships will have any further opportunity, I should think, of pressing the matter again. Is seems highly unlikely that the Government, in its crowded programme, will introduce a one-clause Bill to deal with this matter, and it would be far too late for a Private Member's Bill to get through both Houses. Can the noble Lord indicate to me what timetable he has in mind? If he would do that, I should be very willing not to press the matter further now. I think he will understand the difficulty in which his kind offer places me.


First of all, let me specify again that it was not the fact that the judgment found that Parliament could not reasonably have intended this that made me think Parliament ought not, at this moment, to begin to intend it. The reason why the judgment found that Parliament could not reasonably have intended it was that such terrible confusion would ensue. If that was so when the judgment was given, that would be so if new legislation were introduced to give effect to what the noble Lord, Lord Brooke of Cumnor, desires.

I do not think it would be right to give the noble Lord any specific timetable about considering this matter further; indeed, I cannot. We have, of course, another stage on the present Bill, though, as he said, that is likely to be very shortly. While I agree that the judgment is no barrier to Parliament's changing its mind, yet the opinion of the confusion which would ensue is one that I must share, and I think all reasonable men must share, and this would seem to be something which ought to be considered pretty much in depth before any Government, or indeed any Private Member of either House who had the same thought, invited Parliament to change the law in this respect.


I must confess that I do not see my way ahead very clearly. I am sure it would be wrong for me to press this new clause now. Therefore, I must respect the noble Lord's argument that this judgment was given by the House, in its judicial capacity, a relatively short time ago. Doubtless it needs consideration. But I hope that he, for his part, will bear in mind the point I made in my last speech: that I think it would be unfair treatment of me, or any other noble Lord moving a new clause of this kind, if he was first of all asked not to press the matter because the Government needed further time to consider it, and then found a situation arising in which all the Bills in which the change could be incorporated during passage through your Lordships' House had already passed away from your Lordships' House. However, I feel sure that nothing would be gained by our debating this complex matter further this afternoon, and, having put on the Record what I have put on it, I beg leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Clause 2 agreed to.

House resumed: Bill reported without amendment.