THE NATIONAL HERITAGE

HL Deb 09 March 1977 vol 380 cc1039-150

3.13 p.m.

The Earl of MANSFIELD rose to draw attention to the continuing threat to our national heritage as exemplified by the proposed sale of Mentmore Towers and its contents; and the related problems posed by the export of works of art from this country; and to move for Papers. The noble Earl said: My Lords, this is the first debate in your Lordships' House devoted to the heritage since that which occurred in 1974—in the month of June, I think—in the period between the two General Elections which were held in that year. By a coincidence, this debate falls upon the very day upon which Heritage Education Year is being launched. Much has happened in the fields of both taxation and inflation since June 1974. Because of recent events to which I shall turn, I think that it is timely for these matters to be discussed in your Lordships' House.

It is right that I should declare an interest in this debate. My family owns an historic house and I presently reside in it. I have drafted the Motion in fairly wide terms, probably a little too wide for the noble Lord, Lord Donaldson of Kingsbridge, and the noble Baroness, Lady Birk, who are responsible for different Departments but who share—at least I assume that they share—the same ambitions: that is, the preservation of much that is beautiful and aesthetically valuable to us as a community. It is partly because their responsibilities are so interlocking that I have worded the Motion in the way I have. Indeed, one of the complaints which may be made is that because of the different Departments and personalities involved it would seem that situations can develop, so far as the heritage is concerned, where public debate is desirable, followed by meaningful action. That should happen but apparently, in certain circumstances, it does not.

The situation has been sharpened by the events in the last year or so as regards Mentmore Towers, which culminated, so it would seem, on Monday with a Written Answer from the Secretary of State for the Environment to a Question in the other place. These events present a sombre and, indeed, a melancholy picture of what may be all too likely to happen in the future unless we try to improve on our present-day procedures. What I intend to do, therefore, is to divide my remarks into three differing but complementary parts. First, I am going to discuss the present position facing historic houses. By that I should say that I mean historic houses in private ownership. Secondly, I want to touch on their contents. Thirdly, I want to suggest ways in which we can avoid a similar situation in the future as has occurred and is occurring at Mentmore at present.

I would not wish this debate to degenerate into continuous, carping criticism of the Government. There will be constructive criticism, of that I have no doubt, but it is idle not to acknowledge the difficult position in which the Government find themselves. They are having to navigate the ship of State, if I may use the phrase—rather waterlogged some may say—between the rocks of increased public expenditure on the one side—I might call that the Scylla—and the Charybdis, the whirlpool of political feeling among the Government's own supporters on the other. Whether the ship will reach port, at least with the present Government at the helm, before it sinks, is a matter which perhaps is problematical, but it is idle not to acknowledge the difficulties.

What, then, is the situation which faces the owners of historic houses now? In the debate which I mentioned, on 26th June 1974, I remarked that irrespective of estate duty concessions which existed at that time, which was before the introduction of capital transfer tax—and those concessions affected the private house—a combination of capital and income tax, plus inflation, would bring about the demise of houses in private ownership within a matter of a generation or so. I see no reason to detract or renege from that opinion which I held in 1974.

Capital transfer tax made the position of the historic house rather more hazardous than it was previously. That may be regarded as a contentious remark, but I hope that in a few moments I shall justify it. This is because, although the house and its contents may be exempted from the tax, there will, since the tax applies to property other than the house and its immediate contents, be less to devote to its upkeep and maintenance. Therefore owners, for one reason or another, will have less and less of what I might call a disposable income—in other words, an income to dispose of as they see fit upon the historic house—and less and less by way of capital resources to devote to its welfare. At the same time, as everybody knows, prices have escalated sharply so that the costs of preservation and maintenance have reached the stage where they are becoming beyond the reach of most owners to contain.

I do not claim that the Government are insensitive to these problems. This is illustrated by paragraph 39 of the Green Paper on the wealth tax, which begins: The Government recognise the danger that the wealth tax could lead to the dispersal of the national heritage. They intend to see that this does not happen and that instead our heritage becomes more readily available to the public generally". These are admirable sentiments, in so far as the Government perceive the dangers. However, one must comment that, while in relation to one piece of proposed legislation of a redistributive nature the Government are anxious that the national heritage should not be dispersed, over another piece of redistributive legislation—that is, the taxation of capital on death or other transfer which will result in pretty well the same situation, namely the same kind of dispersal—the Government seem content to wring their hands without being in a position to offer a solution or to do anything about it.

However, to revert to the maintenance of historic houses, noble Lords will know that the situation facing such houses, their contents and their owners was considered by the Government and that this was reflected in the Finance Act of 1975 and, indeed, that of 1976. I have mentioned that estate duty has been replaced by capital transfer tax and, although some relief has been provided which on the surface would appear to go a long way to saving the house and its contents—or at least a major part of them—there are a number of drawbacks which will act as what I might call an inhibition when owners are faced with a decision as to whether they small seek conditional exemption.

At the same time, in the 1976 Finance Act, the Government instituted a scheme enabling individuals to endow an historic house and its contents by placing funds in a maintenance fund under Section 84 of the Act. For the purposes of this debate, I shall call that a maintenance fund. This concept of an entity consisting of a property—a house, if you like—with its contents and adjoining land being free from capital taxation, funded, at least for a period, by a capital source which is extraneous to it but at the same time part of it, is an important step forward and I give the Government every credit for it. Unfortunately, I do not think that the scheme has been sufficiently thought out and I believe that there are dangers that, because of a number of drawbacks, both as regards various features contained in the scheme and as regards income tax, owners and possibly their properties will not stand to benefit very much, certainly in the long run.

It may be asked why it is important to discuss these matters now rather than in the future when drawbacks such as I have suggested (if there are any) will no doubt be revealed and become apparent. The reason is two-fold: first, in November of 1976 at the annual general meeting of the Historic Houses Association, Mr. Joel Barnett, First Secretary to the Treasury, addressed the Association and, in effect, told its members that he considered that historic houses and their contents now had as much consideration from the Government as they are entitled to for the time being and that it was the Government's policy to wait for some little time to see how matters developed. I have not quoted the Minister, but I think that is a fair and, indeed, an accurate summary of what he said.

The second consideration is that the other place has unaccustomed time on its hands. If I may digress for a few moments, I do not believe that the Scotland and Wales Bill will be dug out of the ground very quickly, if at all, and, so far as Direct Elections are concerned, the noble Lord Lord Harris of Greenwich—who I see is not in his place—was not able to respond to my gentle probing the other day by producing a crisp timetable of the Government's legislative proposals in a manner which he and I would no doubt have liked. So there is time for these matters to be considered and there is time for such consideration to be acted upon if it is thought desirable. The Government are in a position to take steps to improve upon this concept which, indeed, I have praised, and they will have the time to do so when the Finance Bill comes to be debated in the other place. Alternatively, one hopes that honourable;[...] Members in another place will take up the cudgels during the passage of the Bill through the Commons. I appreciate that remarks about taxation will fall outside the portfolios of both the Ministers on the Bench opposite. They may not feel able or inclined, or they may not have been briefed to make much in the way of comment on what I am saying. However, since most of the difficulties which beset the heritage stem from a mixture of taxation and inflation, I hope I may be forgiven for commenting upon the taxation aspect of these matters now.

In any event, it helps to illustrate the curiously haphazard way in which we arrange matters in this country. Historic houses and works of art are governed by two totally different Ministries, while the finances are controlled by a third. Recently I have seen it suggested that what we need in this country is a Ministry of the Heritage—I think that that is what it has been called—and I am inclined to think that it is not at all a bad idea. At any rate, it is a matter that I shall come back to at the end of my remarks.

By way of setting out the headings under which urgent action is necessary, perhaps I may describe them in three parts. First, maintenance funds—that is, settlements as I have described them, under Section 84 of the 1976 Finance Act—are unattractive and unlikely to be effective because of their irrevocable nature. Moreover, the fact that the sums within such funds will be effectively lost to the historic house, at least in England and Wales, after a period of 80 years; that those funds will be taxed on the basis of investment income at the highest rate of the settlor or the later beneficiaries; and that the benefits of the old "one estate" election will be lost, all combine, in my submission, to make this, at first blush, attractive idea unlikely to succeed.

Secondly, there are inhibitions which will discourage the owners of properties from attempting to have them made conditionally exempt because of the continuing uncertainty with which the owner of the house and his descendants will have to live. There are complex technical considerations with which I shall not weary your Lordships during this debate, but I think it right that one's anxiety about them should be placed on the record.

Thirdly, there are taxation difficulties which are related to houses which are in fact open to the public. I speak here of income tax, of course. Some noble Lords may know that a house in such circumstances may be taxed under Case VI or Case I of the Schedule according to particular circumstances which vary from case to case. Taking the matter shortly, unless the house falls under Case I—in other words, is a business properly conducted as a business and run with a view to making a profit and, for obvious reasons, not many properties qualify—the owner cannot, in the event of a loss, devote income from other dissimilar sources to the property unless it has paid tax at the full rate. At the same time, expenses which may be essential for the preservation of the house and its contents may not be paid out of the gross income derived from opening to the public unless they are directly attributable to the opening. Of course, this is in the event of Case VI but, more important, unless the historic house achieves a Case I status, the income from a settlement may not, in effect, be devoted to the welfare of the house without paying tax at the full rate.

That is really the nub of the argument. Many owners of such houses may not be in a position to run their homes as business ventures as a result of their own position, their age or, indeed, their inclination, or they may perhaps be governed by conditions relating to the size and geographical position of the house in question. Nevertheless, I suggest that it is unsatisfactory from the point of view of preserving the heritage that these Case VI owners should receive less sympathetic consideration so far as taxes are concerned—and certainly so far as income tax is concerned—if only for the reason that, possibly, they are in need of greater help.

It is my contention that consideration should be given to the introduction of a new case. In fact reform is long overdue. At least the proceeds of showing and the income derived from a Section 84 settlement should be available to meet the costs of the enterprise and proper maintenance and repairs before tax. I am perfectly certain that the Government are more than aware of all the matters which I have been speaking about. In fact, I believe that in April 1975 Mr. Harold Lever was asked by the Prime Minister of the day to report fully on financial problems affecting heritage, and I have reason to believe that he did so in June 1976. Whatever his findings were, they have never been published, and I gather that the matter was abandoned in August 1976.

My Lords, I now turn to works of art and art collections. Just as in the past owners of houses have sold land to pay capital taxes, the same applies to works of art within the houses. Two considerations apply here. First, if a work of art of sufficient importance has to be sold, the question arises as to what if to happen to that work. While some provisions of the Finance Acts help to preserve the unity of the property in thus context, equally others are designed to destroy it. The sale or gift of chattels in satisfaction of tax is a case in point. The Inland Revenue may accept the chattel in satisfaction of tax, or alternatively the owner may sell by private treaty to a number of institutions at what is called a special price.

This may be financially advantageous to the owner, but in all these cases the chattel concerned may not remain at the historic house where it is situated; that is to say, if the historic house is in private hands. This is so whether or not the house is open to the public. It follows from what I have said that a chattel in such circumstances has to be removed to a building which, basically speaking, is public property. It is no part of my intention to deprive our museums and galleries of their just entitlement. What I say is that where the work of art the subject of such a sale is situated in a location which is open to the public, is accessible, and is in a setting which is at least as appropriate as any public building, then at least discretion should be given to the Treasury to allow it to remain where it is, even if its ownership has passed to the nation in the circumstances I have described.

By way of example of a work of art which is situated in the setting expressly designed and eminently suitable to contain it, I could mention the Doddington Reynolds. But there are many others which spring to mind. In any event, I ask the Government to give consideration to the matter. It may be that I shall be told, "You cannot have your cake and eat it", but it should be realised that any chattel which is made exempt in terms of the old estate duty or capital transfer tax, if on the last death or transfer there was a high rate of tax, is perhaps up to four-fifths already owned in effect by the community; so, if the finger is to be pointed, it is really not a very proper one to point.

My Lords, salvation of individual works of art, as opposed to houses, comes within the province of the noble Lord, Lord Donaldson. In addition to the point I have already made, there are two fields of difficulty which perhaps should be examined. The first relates to collections which may be the subject of a sale. The Evelyn Library is a good example, I suggest. If the Library is sold and there is not a tax liability, except, obviously, capital gains tax, then no question of acceptance in lieu of tax can arise. Equally, if the buyer wishes to export the Library abroad, which may well be the case in the example I am giving, as I understand the position, the Reviewing Committee cannot deal with the Library as a whole but only with export licences in respect of individual books. There would, therefore, seem to be a need to examine this situation.

The other difficulty is this—and I am rather compressing my remarks. To anyone who reads the Twenty-first Report of the Reviewing Committee—and here I should like to pay tribute to the noble Earl, Lord Perth, who, I am delighted to see, is to address your Lordships later on—it is obvious that the system of review has worked tolerably well in the past. This is because of the co-operation of the owners of the works of art, and not least because of the assiduity and the expertise of the members of the Committee. One asks, therefore, whether, with the prospect of a good many more works of art coming on to the market with destinations abroad, the Committee will be likely to be able to continue its work at its present high standard. In paragraphs 10, 11 and 12—which I shall not relate to your Lordships—a warning is sounded, particularly in the last sentence of paragraph 12: We are sure the losses of great works of art to the country far exceed any gains ". My Lords, the situation of Mentmore, or rather its contents, is in point here. If they are put on the market, there may be at least 50 works of art which may be the subject of export licences. One wonders whether in the circumstances the Committee will be able to cope, bearing in mind that the total number of articles with which it dealt in the Report under consideration was, I think, 22. This is quite apart from financial considerations relating to the funds available.

I now turn to the present situation, which I suggest is not wholly satisfactory, and also the continuing story of Mentmore. My complaint, in so far as I have one, is not so much at the Government's decision not to acquire the house and its contents except in circumstances and under conditions which are impossible of fulfilment. My complaint is rather at the manner and the way in which the decision appears to have been taken, at the apparent lack of advice which the Government have received, the lack of public debate which has occurred—until really there was very little point in having any debate—and, finally, I think complaint may be made at the manner in which the public have been informed of the decision.

My Lords, in view of the very considerable and differing accounts of events which have occurred in the Press, I thought it appropriate and suitable to ask the help of Lord Rosebery and his advisers, so that I could at least satisfy myself as to the train of events. I am sure your Lordships will accept it from me that I have no axe to grind and no interest in the matter, except to see that a rather more satisfactory situation emerges in the future, if that is possible. Taking the matter, I hope, fairly crisply, the late Lord Rosebery died on 30th May 1974, and that date is important for many considerations, but particularly because it started a three-year cycle after which, if Lord Rosebery is to sell part or whole of the contents, or indeed Mentmore House itself, different tax considerations will apply, at which he will be disadvantaged.

I understand that Mr. Roy Strong of the Victoria and Albert arranged in late 1974 to go down to the house, and indeed he went in early 1975. Following his visit, the proposals for a possible sale of the house and most of the chattels were raised with the Department of the Environment on 6th February 1975. In April of that year, the Department stated its requirements, and taking the matter shortly, I think the questions they asked were, "What do you want to sell?" and, "What price do you expect to get for it?" From April 1975 to January 1976 the advisers, and indeed Lord Rosebery, had to labour to compile an immense inventory and valuation of all the treasures which were in that house. It was, as I have said, a massive work in three very large volumes, and it took up a great deal of time and no little expertise. I do not suppose anybody would blame him for any time it took to do that work.

On 6th February 1976, all this information was supplied to the Department, and that also became the time at which what has been termed the first offer—in the Press it has loosely been called the £2 million offer—was made. I shall not go into the minutiae of figures, but I think it should be said, out of fairness to Lord Rosebery, that whatever the Press have said about a £2 million offer, the advantage which would have accrued to him and his family if it had been accepted would have been substantially under that figure.

In May 1976 members of the Historic Buildings Council inspected the house on the instructions or at the invitation of the Department of the Environment, and presumably reported back. I am equally delighted to see that my noble friend the Duke of Grafton is in his place in your Lordships' House this afternoon and no doubt will tell your Lordships about the matter at a later stage. In July 1976—and we must realise that the time was ticking on from 30th May 1974—notice was given on behalf of Lord Rosebery to the Department, requesting a decision to be taken before the end of September 1976. This was to enable Lord Rosebery, if the Department indicated that it did not want to purchase the house and the chattels, to make other arrangements for a sale. Then, in either November or December (I am not sure which) the noble Baroness paid a visit to Mentmore Towers and no doubt she will be able to tell your Lordships of the impressions that she there gained. On 16th December a letter was written on behalf of the executors to the Minister to the effect that if the offer made by Lord Rosebery was not accepted by 12th January 1977 it would be withdrawn and the property sold elsewhere. Attempts were made in the form of a quasi-official application to the Board of the Inland Revenue to discover whether the three-year period could be extended, but that application was not successful and I need not take that matter any further.

I come now to 1977. On 18th January this year the Department indicated that it was not prepared to make an offer for the purchase of the house and its chattels.

It is right for me to pause here for two reasons. First, almost a year has elapsed since the first offer was made on behalf of Lord Rosebery and, secondly, it has taken the Department very nearly a year to react. I do not necessarily say that in a spirit of criticism because there might have been very good reasons for the offer and the refusal being so far apart. I am saying that the effect of this timing was to make the operation of finding outside sources of finance very hazardous indeed if the house and its contents were to be saved intact.

At some stage there should have been some kind of public debate. There should have been some sort of warning by the Government that things were not going well for Mentmore Towers and its contents. As I am informed, many organisations would have been anxious to try to raise money, to have suggested courses of action, or at any rate to have given advice. However, the lamentable part of this whole affair seems to be the lack of advice which has been taken. I know not whether it was offered but there is no record that the public were told that advice was taken. Whether the Government or anyone else initiated the public debate, it started. Then it was thought right on behalf of Lord Rosebery that in view of the length of time that had elapsed a new offer should be made which would take into account, first, inflation, secondly, the fall in the value of the pound—meaning, in effect, that the collection was a good deal more valuable in cash terms than had been thought—and, thirdly, the fact that Lord Rosebery had been put to considerable expense in maintaining the whole operation for another year. On 2nd February 1977 the Department was informed of that position. This second offer was known to the Press as the "£3 million offer". Whether or not it is accepted, whatever accrues to Lord Rosebery's family will be substantially less than that figure.

There was a meeting in the Department of the Environment on 21st February of this year at which it was indicated that the Department would be unlikely to be in a position to sign any agreement before 5th April 1977, that being the cut-off moment when Lord Rosebery had in those days, and still has, to male up his mind whether the sale should go ahead. From what I have been told—and I hope that Ministers will confirm this—real flexibility was shown by Lord Rosebery's advisers on the basis that Lord Rosebery would consider deferring the Sotheby's sale provided that he received an acceptable indemnity from the Government if the three-year period elapsed and he thereby incurred loss. I understand it was suggested that if the Government did not wish to pay for the house in one lump sum, it was inconvenient to the Land Fund Fund that it should do so, arrangements might be made to have the payment on a continuing basis. My point is that at all stages a certain flexibility has been shown and offered to the Department. Nothing further happened thereafter until two events on last Monday, 7th March. First, in the absence of The Times we opened our Daily Telegraphs to see what the noble Baroness had had to say; and, secondly, at 4.15 in the afternoon there was the Written Answer by the Minister, Mr. Shore, to a Question by Mr. Andrew Faulds.

That is the timetable of events. I have Lord Rosebery's authority to say that even at this very late hour he would still be prepared to re-open negotiations with the Department for a possible sale of the house and the chattels. However, the three-year period continues and that offer is conditional upon an acceptable agreement being reached before 5th April this year or, in the alternative, a suitable indemnity being offered to cover him against subsequent loss. Every available assistance will be placed at the disposal of the Department by Lord Rosebery and his advisers should there be any way in which the matter could now go forward.

My Lords, I fear that I have taken considerable time to relate these matters and for that I ask the forgiveness of the House. It is an important matter. I say that for a variety of reasons. First, as I have said, there has been a considerable furore in the Press, for which I do not know whether anyone is to blame, which has had certain unfortunate consequences. I believe that the noble Baroness, for whom I have considerable regard, did not wish to appear so ungenerous to Lord Rosebery as she is held out to be when she is reported in Monday's Daily Telegraph as saying: It is right that there has been inflation relating to the difference between the two offers and that it is his right to ask what he wants. But it is clear also that Lord Rosebery's affection for the national heritage is less than his affection for getting a good price for the house".

The PARLIAMENTARY UNDER-SECRETARY of STATE, DEPARTMENT of the ENVIRONMENT (Baroness Birk)

My Lords, perhaps the noble Earl will allow me to put that right in order to get it out of the way. I have already spoken to the noble Earl, Lord Rosebery, this afternoon. I have a point of view on this, which I shall express but, in view of the concertinaing of the report, I would say that I did not express myself in such an inelegant way. Lord Rosebery and I have made our peace. He also tells me that he did not say that I was acid. Those words were put in his mouth.

The Earl of MANSFIELD

My Lords, I would never accuse the noble Baroness of being inelegant. However, I should say—and it is right that it should be said in case others, who are less elegant than the noble Baroness, take up the same point—that we must make some sort of a value judgment. I am informed that if there is a sale of the house and its contents to the Department before 30th May, Lord Rosebery and his family will receive about half a million pounds less than they will if he throws up his hands and allows it to go to auction—at the end of which he would, as I say, be half a million pounds better off and still own the house and the grounds, for what that is worth. I think that that is the proper way of putting it. Of course it depends on what prices are realised at the auction, and one cannot do better than say that these are minimum figures.

I come penultimately to the Land Fund. There has been a considerable amount of misappreciation of this mysterious Land Fund in the last few weeks, possibly because it is a misnomer. There are certainly a number of people who believe that following its introduction in ringing terms by Dr. Dalton in the other place in 1947, there actually exists a fund of money which can be used for the purchase of land, or indeed of chattels in certain circumstances, by the public in lieu of tax. As we all know, in fact nothing of the kind exists.

We then come to this ridiculous situation that if the Department of the Environment buys Mentmore and its contents, then the very next year the noble Baroness's Ministry will be docked by that amount in its vote in order to top-up the non-existent Fund. If nothing is done about it and the chattels go to auction, then there will be a considerable interest in a number of items, some of which will be pre-eminent, a great many more of which will have to be acquired by national or regional museums, and the cost so far as the Land Fund is concerned will then the following year be docked from the Ministry of the noble Lord, Lord Donaldson of Kingsbridge. Therefore, we have the two noble compatriots on the Front Bench either of whom is going to suffer so far as their Ministry is concerned in the next financial year.

There is only one point on this. I am not going to hazard or try guesses as to what is to happen if Mentmore and its contents are sold by public auction, but it is not difficult to come to the conclusion that the cost to the nation in net terms may be more expensive if the contents have to be bought at auction for the nation, or a proportion of them, than the house and its contents in terms of the second offer. I say no more than that. If that is what it comes to, it will be a pity and something that we should avoid in the future.

What of the future? I have criticised the lack of consultation. I have criticised the lack of debate. I should like to think that there would be in future some sort of consultative committee set up which would be representative of a great deal of the expert and valuable opinion which is available to advise the Government in these circumstances, and that when a situation similar to Mentmore arises, or seems to be arising, it should be the duty of the Minister in such circumstances to consult that consultative body. Otherwise we shall have the similar slightly inelegant posture of the noble Baroness being unwilling to save Mentmore because she cannot but keep Chatsworth and Blenheim in the back of her mind. That again is what is attributed to her in the papers. I have no doubt that it is not entirely accurate, but one can see the position that if the Government are always having to look over their shoulders at the next situation, they can never make up their mind effectively about the present one.

Finally, may I say that I believe that all of us are concerned with our heritage: most of us probably because of some kind of finer feelings well beneath the surface; a few of us from the rather more commercial sense because we think that our heritage provides a place where some of the 10 million visitors or so to these shores can go and spend foreign currency. That is a base reason, but nevertheless it is a valid one, and in our impecunious state as a nation we cannot afford to ignore it. I think that there should be a continuing debate, not in your Lordships' House after this afternoon but in the country as to our objectives and the criteria which we wish to apply in our present straitened circumstances. That is the way in which I think we should approach this problem. My Lords, I beg to move for Papers.

3.56 p.m.

The MINISTER of STATE, DEPARTMENT of EDUCATION and SCIENCE (Lord Donaldson of Kingsbridge)

My Lords, opposite to me is a phalanx of noble Lords which really could well have been here in 1911 or 1912. It is rather refreshing to see that the landed aristocracy has such splendid powers of survival in really the most difficult 60 years that they have ever had. So far as I am concerned, good luck to them. May I begin by saying that I think we are all looking forward to hearing the maiden speech of the noble Duke, and the maiden speech of the noble Marquess. I am looking forward to the latter more than most people because he used to be my fag at school!

My noble friend Lady Birk and I are grateful to the noble Earl for the opportunity which he has given the House to debate a subject which has attracted considerable public interest; that is to say, the future of a remarkable country house and the notable collection which it contains. But the interest of the debate lies wider than the particular very pressing problem of Mentmore. Economic conditions are such that it is inevitable that owners will, from time to time, find it necessary to dispose of their historic houses and the often irreplaceable contents. But can the State possibly afford to absorb each and every one? It is estimated there is about £3 billion at risk in this way—where to draw the line is the crucial question, and I hope we can clarify our ideas a little in today's debate.

The Motion which the noble Lord has put down falls into two parts and, while these are related, one part—if I may say so, the difficult part—properly falls into the field of my noble friend, who will speak to it; while the more general one of export control of works of art and other items which belong to the national heritage is my responsibility. I am rather relentlessly going to discuss this in some detail because it is important that it should be fully understood by all concerned exactly what are the opportunities for people in this position.

The Government's arrangements for the protection of the national heritage are complex. There are really four stages of defence, in a system the aims of which are to make the best use of the limited Exchequer resources which are available. The first line of defence is to encourage the owner to keep and, where possible, to show to the public the works of art which he possesses. If agreement can be reached along these lines, then no capital transfer tax or capital gains tax is payable unless and until the article is actually sold; also arrangements can be made under which the owners of historic houses can be encouraged, by means of grants made on the recommendation of the Historic Buildings Councils, to keep their great houses in repair and to show them to the public.

The next line of defence arises if objects have to be sold. Here there is an arrangement under which exemption from tax is not lost if objects are sold or given to public collections or to certain bodies connected with the preservation of the national heritage. As many noble Lords will have noticed from recent correspondence in the Press, these circumstances enable a price to be negotiated which is both favourable to the seller (compared with what he might have received from a sale at auction) and favourable also to the public collection which acquires the object.

Noble Lords will not mind if I explain in some detail how this private treaty system with the public collections works. Let us suppose that I have a painting which a public collection wishes to acquire and has the resources to buy it. The object is one which has been conditionally exempt from capital transfer tax at the death of a previous owner. If I sell the object to any person or body other than a public collection in this country, I have to pay the tax from which I have been conditionally exempted because I have broken the conditions of exemption. Let us suppose the public collection is ready to pay me £100,000 for the work. On selling to the public collection I get the £100,000, but I am also entitled, under the existing very generous arrangements, to a further 25 per cent. remission of the tax from which the object has been exempted; this is what has been described as the douceur.

As against this, if I sell to the public, for example at auction, the price which has to be realised is not only the £100,000 but also the whole of the tax from which I have been conditionally exempted, and the expenses of sale, and the douceur of 25 per cent. How much these sums would be depends on the position of my estate, which is of course a confidential matter; but it will be clear to noble Lords that the price would have to be very substantially in excess of the £100,000 before I would do as well as by selling the object to a public collection. There have been three or four instances of this, with figures quoted, in the last six months.

Any owner who decides to sell at auction—and a number have recently done so—would have to obtain a price which would not only offset the loss of tax exemption but also cover the expenses of sales which in many cases are not inconsiderable. I earnestly invite all owners of such objects to consider carefully their interests before deciding how their objects should be disposed of. A note on the tax position of gifts to the arts and on sales of artistic objects was issued by my Department on 17th February last and copies are available in the Library.

The third line of defence consists in the not inconsiderable sums which the Exchequer makes available to the public collections to acquire objects which are offered for sale. The total acquisition grants of all the national collections, including the national libraries, amounts to £6.1 million per year, and in addition funds amounting to another £500,000 are administered by the Victoria and Albert Museum, the Science Museum and the Royal Scottish Museum to help provincial collections to acquire new objects for their collections. In parallel with these arrangements, there is the provision under which specific objects of outstanding merit can be acquired by the nation in lieu of the payment of capital transfer tax. This applies only to objects of the most outstanding merit and the remitted tax is carried, as the noble Earl said, by the Land Fund. I think the noble Earl was not correct to say that my Department, in so far as we accept objects which are paid for by the Land Fund, is asked out of our grant immediately to make that up, but I should like to have a look at that.

The Earl of MANSFIELD

The next year, my Lords; the next Vote?

Lord DONALDSON of KINGS-BRIDGE

Yes, I shall do so in due course, my Lords. It is only when all these defences have been breached that the fourth line of defence—the export control—becomes relevant. The pattern of the control stems, as many noble Lords will be aware, from the Report of the Waverley Committee in 1952. It was a fundamental principle of the recommendations of that Committee that export control should be confined to limited categories of objects of high importance, and the Committee laid down the three criteria for assessing this importance which have stood the test of time and are still in use today. I will repeat them, although of course many noble Lords know them. First, is the object so closely associated with our history and national life that its departure would be a misfortune? Secondly, is it of outstanding aesthetic importance? Thirdly, is it of outstanding significance for the study of some particular branch of art, learning or history?

Any objection to export will depend on whether the object meets one or more of these criteria. The Government adhere to the fundamental principle and are indeed firmly convinced that a highly selective system is likely to be more effective in protecting the heritage than one which attempts to catch also a wide range of less important material. This is quite apart from the advantages to this country's balance of payments of a flourishing art trade.

In the 20 years and more since the export control was introduced it has had some notable successes in enabling public collections in the United Kingdom to buy works which, without the control, would have been lost overseas. Probably the most well-known of these works is the Titian painting "The Death of Actaeon" acquired by the National Gallery in 1972. A more recent example, which has also received a good deal of publicity, is the Van Dyck painting of the Madonna and Child bought by the Fitzwilliam Museum a few months ago. The vast majority of the objects which the Reviewing Committee on the Export of Works of Art have held to be of national importance have been retained in this country, either because they have been bought by public collections or, in a few cases, because the owners preferred not to sell but to retain them in their own possession here.

There have over the years been occasional cases of breach of the export control. Probably the most important of these was the export in 1961, without a licence, of a portrait of Dr. William Harvey, for which offence those concerned in the export were prosecuted and required to pay a substantial amount in damages and costs. Sixteen years later—only the other day, in fact—this case has had a happy outcome in the repurchase of the portrait from the American owner by the National Portrait Gallery, where it is now on show, and I recommend a visit because it is a very fine portrait.

In all cases where there is prima facie evidence of a breach of the export control regulations, the Department of Trade and the Customs and Excise Department are asked to consider whether there is a basis for legal action. Short of a detailed physical search of every piece of baggage, every consignment of goods, going through British ports, which would paralyse the whole trade of the country, it is not possible to ensure that no breaches of the export control regulations occur. But I can assure the House that when evidence of a breach arises, the matter is pursued in whatever ways are possible.

Lord ROBBINS

My Lords, before the Minister continues, may I ask him a question on a matter of fact? He has illustrated his argument in terms of valuable paintings, but he has from time to time made reference to the Land Fund. Do I understand that the Land Fund is accessible for the purchase of valuable paintings?

Lord DONALDSON of KINGS-BRTDGE

My Lords, the noble Lord should understand that the Land Fund is accessible for those paintings or other objects which are so highly valued that the Treasury will accept them in payment of capital transfer tax. If the noble Lord reads that tomorrow, he will find that it is perfectly clear.

I have shown how the export control is the last in a series of defences of the country's cultural heritage. The resources which can be applied to the protection of the heritage are not unlimited, and it is unreasonable to expect that they ever can be. Our task is therefore to make the best possible use of those resources which are available, a task which becomes particularly important in times when, perhaps for reasons of financial pressure on owners or exchange conditions which encourage overseas buyers, there is extra pressure to export items which have come to be regarded as belonging here.

The export control system has served this country well for many years. Some alterations have been made in it, although not in the basic principles, and many more have been suggested but rejected by Governments of both the major Parties. I do not think any case has been made for a fundamental re-examination of the whole structure. None the less, I shall be surprised, from the conversations I have had with him, if the noble Earl, Lord Perth, does not ask for a thorough investigation. As I am speaking before him, I would say that my reply is that I doubt the wisdom of setting up an inquiry into anything which has, in general, worked so well. But I promise him that, in collaboration with the Committee and my own officials, I will review the position carefully and take account of the 20 years' experience we have now acquired.

Too much cannot be expected from a system of export control. It depends on the co-operation of the art trade (which I freely acknowledge) and on the avoidance of excessive pressures to sell. Only in a totalitarian country would it be possible to attempt a more comprehensive control. Some countries who have tried it have found themselves faced with growing illicit trade because, as I have already said, it is not impossible to evade it (though the arm of the law is very long in such cases) but also the cost of administration would be wholly excessive.

I am advised on these matters by the Reviewing Committee on the Export of Works of Art, whose distinguished chairman the noble Earl, Lord Perth, was for a number of years, who have helped the Government in innumerable ways to make the control as effective as it can be. We are all deeply indebted for their devoted work and I shall continue to listen to their advice for improvements in the working of the system. I certainly regard it as an important part of my function to act as one of the curators of the national heritage. There are however limits to my powers and to my resources. The owners and trustees of collections are free citizens and short of evading the export controls can do what they will with them. There are instances, such as that, as quoted by the noble Earl, of the Evelyn Library—which I know is a matter of concern to many and of great concern to me—where the trustees seek no help from the Government, and unless they do there is very little action that I can take to help preserve the collection intact. As I have already mentioned, it is estimated that private collections in this country might be worth some £3,000 million and even in more prosperous times than the present it would clearly not be possible for the Government to find the resources to purchase within a short period all those whose unity is endangered.

The magnitude of our heritage is such that my task, on which I am advised by the national collections, is to weigh very carefully in each case how far we should devote resources to keeping a collection together in one place which might save a much larger number of individual treasures for posterity. Having said this, I believe that we have in the system which I have described a well thought out and comprehensive system which has stood the test of time in very difficult situations where we are no longer one of the richest nations. I have to admit that the suggestions made by the noble Earl of 50 pieces from Mentmore coming before the Committee at once will clearly create a problem; let us hope that this is not what arises. The export committee is not a thing which could not be enlarged, though I think there are difficulties and it is far better small; but if we run into a difficult period we may have to adopt slightly different methods. I will not go too deeply into the philosophic arguments which lie behind the protection of the national heritage. There are those who would argue that those objects of European art which this country was fortunate to acquire as a direct consequence of the revolutionary movements in the 18th and 19th centuries in Europe do not belong to our national heritage at all. As in other matters, I take a moderate view on these things, and accept the view that when an object has adorned this country for 50 years or more it might properly be so regarded and our export control is based on this assumption. But we who took so much from Europe in the last century cannot now complain if other richer nations now take some things at least from us.

There is however one other comment which must be made. This relates to the objects in the national collections which have come from abroad: examples are the Elgin Marbles from Europe and Benin bronzes from Africa. There is a new and strident school of thought that argues that because these objects came originally from abroad, they should now be sent back because they "belong" there. I should like to make it emphatically clear that any such objects which are in the national collections were legally acquired and properly paid for at the time. The public collections and this Government respect the export control of other countries on works of art and will have nothing to do with objects which are alleged to be illegally imported into this country.

We offer the facilities of our courts to enable any country in the world to secure the return of any such objects. But we must distinguish illicit trade from objects which have been properly acquired. If we had not lawfully made these collections in the past, the probability is that many of the objects concerned would have perished, and that the great collections which were established could never have been put together for the benefit of scholars and the public all over the world. In presenting them properly conserved and catalogued, and in a way which facilitates their appreciation and study, the trust[...]ees of our national institutions perform a service for the world.

May I throw out one or two questions for further discussion this afternoon. What, for example, do we mean by a collection? By what criteria does the whole become more important than the parts? My brother-in-law has collected Japanese ceramics all his life and has amassed a collection second to none in this country. Last year he sold a fifth of it. He got bored with it, wanted some money and why should he not do so? This is his right, just as it is Lord Rosebery's right to remove some of the pieces from Mentmore to one or other of his country homes. Let us face it, collections are live things, at least as long as the collector is alive. On the other hand, there are some frozen collections dispersion of which we should all deplore; I think of the Wallace Collection and the Soane Museum and there are many others. There are difficult philosophical and economic problems here, and we are very well adapted to discuss them in this House. This is the kind of matter to which I hope noble Lords will give some attention in the debate.

Then there is the question of historic houses, which falls into my noble friend's field rather than mine. But I am inevitably concerned with what is in them. Should they be run, for example, by the National Trust, with those objects that have always been there preserved in situ, or should they, like Osterley, be furnished with the finest period objects that the nation possesses and become an outpost of an existing national institution?

In answer to a point raised by the noble Earl, concerning objects accepted in satisfaction of taxes and so, in effect, paid for by the taxpayer, there are good reasons generally for not allowing them to remain in private houses or private collections, where they may not have the resources of the national collections and the best provincial collections in terms of security, and facilities for conservation and repair. But when a private trust can comply with suitable arrangements for care and public access and an important collection might otherwise be broken up, the Government are not inflexible on the point and would be prepared to consider in any case whether there were particularly strong reasons why an exception should be made, and whether satisfactory agreed arrangements for surveillance and general responsibility by a public collection could be made.

This takes us a step further than we have been up to date, and I am very glad to give this as the Government's view. My Lords, I am not going to deal with the detailed discussion of the Mentmore case. I shall leave my noble friend to deal with that, partly because she knows more about it and partly because it is rather difficult. In relation to one of the points which the noble Earl raised on the question of taxation and inflation in relation to money taken for visiting houses, I think there is a point here which needs to be looked at, and also the question of taxation for the Case 6 owners. Both are points to which I shall draw the attention of my colleagues in the Treasury, and I want the noble Earl to realise that I take those points seriously.

My Lords, for the vast wealth of our national heritage there are many solutions. The one overriding problem is the problem of money. We cannot do everything, and like all other branches of national life, we have to make decisions about priorities. This is what I hope this debate will be about. May I, in conclusion, say that nobody could have worked harder over the past weeks than my noble friend who is to reply to the debate.

4.20 p.m.

Viscount NORWICH

My Lords, I should like to start, as I started some months ago when your Lordships debated the wealth tax, by declaring lack of interest, which is that I am one of the relatively few speakers here this afternoon who does not own one single square inch of land anywhere, nor a single work of art that could conceivably be described as important. My only positive qualification, apart from an interest in, and indeed I like to think a love of, the subject, is that I am a member of the executive committee of the National Trust, but it is not in that capacity but only in my private one that I am speaking to your Lordships this afternoon.

We all owe the noble Earl a great debt of gratitude for allowing us to talk about this extremely important, and at the same time, extremely tragic situation over Mentmore, and indeed other possible future Mentmores. When the noble Earl put down his Motion it looked as if there was still possibly a fairly good chance that something might emerge. Now since last Sunday, or indeed last Monday's Daily Telegraph, I am afraid that the prospects for Mentmore look bleak indeed, and it is my duty to say that I think this is nothing short of a tragedy. There can be no doubt at all about that. Mentmore is an extremely important early Victorian country house, but it is much more than that. It is not just a house by Paxton, who is a particularly interesting architect for us—the builder of the Crystal Palace—and whose son-in-law, Hodges, was another fine architect. There is also the fact that Mentmore is, above all others, "the" early Victorian country house, which is most perfectly preserved with its original decoration, its original furniture and its original fittings; its original possessions within it. This alone makes it quite unique.

So far as the collections are concerned, it is not just a question of a magnificent collection, a collection covering France, Germany and Italy, of several centuries, all amassed by one man, that would, in any circumstances, anywhere, be remarkable. It is also a collection which fits within a setting and a house which was very largely built and designed to frame it, to show it off to its best advantage. This means that the house and the collection form one integrated whole. This in itself makes Mentmore, in my submission, very nearly unique.

Still more than that, it is possible to say of course that Mentmore does not represent high Victorian English taste. It is not in any way characteristic; it is not typical. It represents far more, the international bankers' Jewish taste of the Rothschilds—le gout Rothschild, if you like. But surely, my Lords, it is no worse for that. How boring it would be if all the collections in this country consisted of only English works. It is nothing to do with that. The whole point of it is that this is eclectis—collected by somebody who was an individual and who cared. If we are looking for Englishness it is perfectly easy to find Englishness. We can perfectly well say that Mentmore was, after all, the home of a very remarkable Englishman, the Fifth Earl of Rosebery, who was the second youngest Prime Minister (only Pitt was younger); who was the first chairman of the London County Council; who was a philanthropist; a superb historian; a first-rate sportsman who won the Derby three times. But none of this seems to me important. Surely what we are really discussing is the fact that here we have superb works of art which infinitely transcend the narrow bounds of Englishness, or of any other country. Great art belongs to the world—which can never be said often enough.

In many recent conversations I have had over Mentmore, in the National Trust and outside, the question has been asked, "What about the National Trust?" I do not believe that Mentmore is the kind of property which would fall, with any degree of comfort or convenience, within a National Trust framework. The Trust is not equipped, and was never designed, to deal with great and broadly representative artistic collections. We do not have the expertise for it; we do not have the equipment. Surely this kind of house is ideally suited nowadays, in this rather sadder and less opulent age in which we live, to be an outstation of the Victoria and Albert Museum.

It may well be said that so is Osterley, which is a National Trust property, and so is Ham, which is a National Trust property. But Osterley and Ham were National Trust properties first. It is very hard to see what good either the public or the Trust get out of the ownership of these houses, over which we no longer have any real control. Surely if anybody is, the Victoria and Albert Museum is more than capable of looking after its own premises as well as the contents of those premises.

Having said that, it seems to me that there are two basic questions that we have to face. The first question is, what, even at this late and depressing stage, if anything, can still be done about Mentmore? Is there still any hope at all? Let me say right away that I absolutely understand—I am sure that we all absolutely understand—the Government's difficulties. At this particular moment it is extremely difficult, if not impossible, for them to shell out £3 million, or probably more, for a case like this. They are under enormous pressure to curtail public spending. They are under further pressure from the International Monetary Fund. It cannot be done.

I am rather less impressed by the arguments which I also read in the Daily Telegraph on Monday about there being the obvious priorities of housing, education, and social security. Of course these are vitally important; far be it from me to suggest anything else. But they will always be with us, and if we always give them priority we may as well wave goodbye to our national heritage now and forever. I absolutely accept what the noble Baroness has already told us about the telescoping of her remarks, and I am sure that she did not make the suggestions that she was reported as having made about Lord Rosebery's lack of patriotism or longing for profit overriding his love for the national heritage. But I should like to go a little further than that. It seems to me that it is not just a question of Lord Rosebery having put his own interests first, or anything like that.

We read, and we believe, because we read on excellent authority, that the results of this sale may yield a figure in the nature of £8 million, plus another £2 million-odd for Sotheby's. We know that the house and its contents are being offered for public sale at the minimum price of £9 million. If Lord Rosebery is still offering the house now for only £3 million—in the past he offered it for £2 million—it seems to me that his is an act of intense generosity. Thus, rather than anybody else being accused of lack of public spiritedness or looking for their own profits first, I believe that it is the Government, possibly for very good reasons, who are in that situation. I suggest that they are flinging stones from a peculiarly fragile glass house—one might almost say a Crystal Palace.

Please let me make it clear that I am not wishing in any sense to blame the noble Baroness, or, heaven knows! the noble Lord, Lord Donaldson of Kings-bridge, or any other individual. They both care desperately about conservation. They have both worked extremely hard to find alternative possibilities, given that the Land Fund cannot, in these circumstances, be used. However, I should very much like to know—I am not being sceptical, but just curious—a little bit more about the inquiries. I should like to know, for example, whether they have consulted—and, if so, with what result—the Buckinghamshire County Council. The National Trust has had considerable experience, and very happy experience, on the whole, of doing deals and making agreements with county councils. I can think of several cases off the bat—Sudbury, Cragside, Tatton Park, Clumber; there are a good many of them—where county councils have come in with, on occasion, very generous contributions which have been to the advantage of all concerned.

I should also like to know to what extent the British Tourist Authority has been consulted; also the London Tourist Board, because the London Tourist Board is tearing its hair out in handfuls about the over-visiting of the great London tourist shrines—the Tower, the Changing of the Guard, and so on. I do not need to remind your Lordships of those buses parked all the way down Constitution Hill every morning. The London Tourist Board is longing to get more tourists out of London, and, obviously, if it is to do so, the first place it has to look is in the near environs of London—within, perhaps, a 50-mile radius. Mentmore is virtually on the M1. It is virtually on the main road between London and Stratford, which, after London, is the second biggest tourist shrine in this country. An enormous number of foreign visitors go to Stratford by road on account of the abysmally awful rail service to this hugely important tourist centre. It would be very easy for them, and very tempting for them to go off a little way to Mentmore.

My Lords, if anybody has any doubts about whether they would none the less do so, or as to whether they are interested enough, it might be useful to give the figures for what is in many ways a very similar house—another tremendous example of le gout Rothschild—which is Waddesdon only a few miles away, with a collection even greater, probably, than that of Mentmore, although architecturally nowhere near as distinguished. Waddesdon, which is a National Trust property but which is still basically run by the Rothschild family and a trust, was last year open for only seven months of the year, on only five days a week and for only four hours a day: on those days, it none the less managed to attract 96,000 visitors, which is to say, roughly speaking, 160 visitors for every hour that it was opened. I see no reason why Mentmore could not be opened considerably more than seven months a year and considerably more than four hours a day, and could not charge considerably more than the National Trust feels that it has the right to charge. I should be surprised, in fact, if some enterprising entrepreneur (and, now I come to think of it, I suppose most entrepreneurs are fairly enterprising, by definition) were not able to make a jolly good thing out of it. At least, if I were one and I had some money to put into the idea, I should think it well worth trying.

If all this fails, one can only hope that it will be possible to do as much as can be done to buy some of the individual works of art, although, as the noble Lord has pointed out, they will obviously be a good deal more expensive if they are bought in that way then they would have been if the whole lot had been bought in one go.

My Lords, so much for Mentmore. I am afraid that if it goes, it goes. At any rate, what could we hope to salvage from the ashes? What lessons can we learn to see that no further Mentmores occur; that this same sad saga is not endlessly repeated in the tough years which are, alas!, almost certainly to come? There are, I believe, certain lessons which we can learn. First, it seems to me vitally important that we should try to streamline the grotesquely creaking machinery of the Land Fund, which at present seems hardly worth its existence—if, indeed, it exists. One of the most important of the many philosophical questions which the noble Lord, Lord Donaldson, suggested that we should discuss this afternoon is whether or not the Land Fund actually exists.

Lord DONALDSON of KINGS-BRIDGE

My Lords, it is worth saying that £1.58 million was paid out of the Land Fund for objects during the last year. I think the noble Viscount is a bit off the mark here.

Viscount NORWICH

My Lords, I stand corrected. I am delighted to learn—to be convinced, indeed—that the Land Fund does exist. This already seems to be a major step forward. The next stage, I suggest, is that we should learn how to use it to good advantage. I should have thought that in this case also there would have been a case for consideration. If, as the noble Earl, Lord Mansfield, has said, we are always going to say that more important cases will come in the future, we shall never spend any of the money at all. Anyway, that, I suggest—it is only a suggestion—should be one of the lessons we should learn, or at least one of the possibilities that we should study very carefully.

My Lords, the next lesson is that we should no longer get ourselves into a position where we can be steamrollered or rushed into decisions through lack of time. Here we have the situation whereby, if we do not take a very quick decision over Mentmore, Lord Rosebery will be faced with a greatly increased amount of taxation to pay. Surely, it should not be beyond our powers to pass such relatively minor (I should have thought) legislation as to make this unnecessary, so to allow a longer time. Three years may seem a long time, but I fully accept that with a large and complicated collection, where problems of ownership and property occur, it is not as long as all that. Surely it should not be impossible to make it a little longer and to allow us at least time to think, and to make sure that the right decision is taken when it is taken.

Thirdly, my Lords, I would suggest that all the collections in any great house which may in future be the subject of the same kind of problems as Mentmore has been should be properly researched and catalogued in advance. One of the great problems this time is that all the investigations of the collection really had to be done when already the sands were running out. I would suggest that in future all such houses and all such collections should be properly catalogued, and all the details fully and clearly established at an early stage, so that we do not have to wait until the eventual crunch comes.

Lord DONALDSON of KINGS-BRIDGE

My Lords, would the noble Viscount make this a compulsory inventory for everybody who owned anything? It is a little difficult. One knows a number of marvellous country houses, of which I think Mentmore was one, where the previous owners had not the slightest intention of having anybody in whom they did not invite.

Viscount NORWICH

My Lords, I think this may well be true. I think it would probably be very difficult to make it compulsory. None the less, it could be firmly encouraged, which so far I do not think it has been. The name of Chatsworth has already been mentioned this afternoon. Pray God that this will never happen to Chatsworth! But pray God that, if it does, we know what is in Chatsworth rather more clearly than in the case of Mentmore! Once again, do not let it be suggested that I am attaching any blame to the Government for this. I am not trying to attack anybody; I am merely suggesting what I think would be a good idea for the future, so that when new cases occur we do not find ourselves in the same position again. I assure the noble Lord that I am really not trying to say any more than that.

Lord DONALDSON of KINGS-BRIDGE

I do not doubt it, my Lords.

Lord CLIFFORD of CHUDLEIGH

My Lords, is it not the case that the Courtauld Institute of Art has photographed practically all the major collections in the country? Are they not already listed? I know it has done so in my case.

Viscount NORWICH

My Lords, I am afraid I cannot answer the noble Lord's question off-hand. I know the Courtauld Institute has a very compendious photographic collection, but I think it is not just a question of having photographs of objects. It is a question of having valuations, or rough valuations, at least; of having properly made inventories; and even, in many cases, of firmly establishing to whom the individual objects belong. Even this, with a family with large ramifications, can be an extremely complicated matter and a difficult one to establish.

The last point which I should like to make—and this has also, I think, been very briefly touched on by the noble Earl—is that I feel that at all stages and at all levels there has been some lack of co-ordination, because there has been a lack of co-ordinating machinery, between the architectural conservers, on the one side, and the museum world, on the other. I think that this probably exists among the private bodies, among the semi-official bodies and also, I venture to suggest, in the Government itself between the Department of Education and Science and the Department of the Environment. We are very well equipped to deal with a country house or a collection or a work of art; but when the two things are inextricably woven together, as in the case of Mentmore, I feel that our machinery lets us down. We ought seriously to consider ways by which these two separate but, as we now realise, potentially interdependent disciplines can be geared together, so that the wheels turn rather more smoothly the next time round. If we can do those things, then I like to think that we should be able to rake a few valuable little remnants from the Mentmore ashes. I should like to reassure the noble Lord that I am speaking figuratively. I am not suggesting that the place is going to be burned down but the thing seems to be, none the less, a disaster. I hesitate to say, "from the ruins". I do not mean that either. Let me say "from the Mentmore tragedy". With that, I think everybody would agree.

My Lords, this very morning we saw the inauguration of Heritage Education Year, the whole purpose of which is to educate the younger generation into a greater and deeper love and understanding of our national artistic and architectural heritage in order to train them to be the guardians of it in the future, as they inevitably must be. I only hope that we shall succeed in doing so, but I cannot think we are setting them at present a very good example.

In conclusion, my Lords—and I should have said this at the beginning of my remarks—long before this debate was ever thought of, six or eight months ago I accepted a lecture commitment in Coventry this evening. I am, therefore, very sorry that I must leave the debate now. I apologise for this apparent discourtesy. I can assure noble Lords that I shall read in Hansard everything that has been said and hope that the House will accept that explanation.

Baroness BIRK

My Lords, as the noble Viscount is leaving, may I put him right on one point? He quite rightly quoted me as having stated, and the Daily Telegraph as having mentioned, the alternative priorities of housing and schools and so on. May I explain the reason for this. It is because the expenditure involved in these matters, even though it is reimbursed from the National Land Fund, still counts as public expenditure and therefore it is treated no differently. This is a statement of fact. I am not making any judgment or expressing any opinion. The case for money spent on housing, schools and hospitals must be balanced against other claims on the public purse. My views on the question of whether there should be more expenditure for conservation is something that the noble Viscount will have to read about in Hansard and I will not go into them now. I had to put him right on that point. It is not a matter of what I consider or of what anybody considers: it is a matter of how these things are accounted for.

4.46 p.m.

The Duke of ARGYLL

My Lords, only last week the noble Lord, Lord Baker, most eloquently expressed my very apprehensions in addressing this House for the first time when he referred to the anxiety of being unprovocative yet constructive. Unprovocative loosely means, "Don't be rude!" An ex-Lord Chancellor further refined this matter for me by saying, "Don't be offensive!" But, as yet, nobody has told me not to be forthright. Bearing these guidelines in mind, I pray for the indulgence of your Lordships' generous attention if at times what I say may be interpreted by some as straying outwith these parameters.

The global aspect of this debate raised by my noble friend Lord Mansfield lies very close to my heart; and hereby I am bound to declare an interest, albeit an all-consumingly passionate one at that. I only wish circumstances were such that I derived some more negotiable benefit from my activity. Much publicity has been given to Mentmore, wild speculation as to its contents; yet outside a relatively small circle of people who have taken the trouble to find out the facts, little is known of the problems facing the family. Many sensational statements have appeared, largely due to the discreet manner in which both the family and Her Majesty's Government have conducted some exceedingly difficult negotiations. Indeed, the tone would have remained this way had these come to a fruitful and successful conclusion. Otherwise, this sad and essentially private business would not be being aired before your Lordships today. I mention "privately" intentionally as, all things being equal, the dilemma should have been resolved by the owner and the Inland Revenue. But, as time wore wearily on, the issue at stake invited, however unwittingly, the introduction of members of the public to question the whole situation and the possible outcome. Any conclusions that may have been drawn at this point are as we have been told this afternoon, premature as there is still yet time for change; although I cannot help thinking from what I have gathered and seen in the last few days that all the signs are particularly ominous.

Mentmore Towers, as your Lordships will know by what has been said this afternoon, is an outstanding building of the high Victorian period. Of the 3,800 Grade 1 buildings in England and Wales (excluding cathedrals and churches) 780 are country houses. But less than 15 of these buildings were designed and erected during the Victorian era. This is a startling statistic considering that the period in question very nearly spanned a whole century. Mentmore was built between 1851 and 1854 for Baron Mayer Amschel de Rothschild by Joseph Paxton and is a supreme example of that Derbyshire architect's work of which little remains. Many today are possibly not far enough removed in time, relatively speaking, from that period to evaluate objectively the merits of that epoch in the architectural context. How many of us in this Chamber may have cleared out any Victoriana (if we had any) after the last war—and bitterly regret it today?

Baron de Rothschild amassed, during a relatively short period—1840 to 1873— with discriminate indiscrimination, three centuries of outstanding culture from post-Renaissance Europe. To some of us in the United Kingdom this might smack of "off the peg vulgarity " particularly when the means to carry out this pursuit were amply available. I strongly suggest to those who may think in this way that their feelings might be more than slightly influenced by envy rather than the higher ethical aspirations. After all, the Grand Tours undertaken only a bare century before by young men with enlightened tutors amply collected artefacts and brought them home to a nation which today gratefully acknowledges their acumen and directly benefits from their foresight.

My Lords, in the United States people in great numbers flock to the Metropolitan Museum, to the Frick House in New York City, to the various Vanderbilt houses on the eastern seaboard (held under trust by the National Parks Commission), the Dupont Museum in Delaware, the Hearst extravaganza at San Simeon in California, the Huntingdon Library and gardens in Northern Los Angeles and, more recently, the Roman villa at Malibu, housing the great Getty acquisitions—to name but a few. In practically all these instances, whole rooms with their furnishings have been carefully uplifted from Europe and reassembled many thousands of miles from where they were originally intended—initially, I would assume, for the purpose of displaying to one's contemporaries that one had achieved success in the "new world" and had been able to pick out from the "old world" the very finest examples of art and craftsmanship, in many cases spanning from the late Victorian period to the very dawn of civilisation. Perhaps this was done with a view to cocking a perfectly justified snook at us, who managed to reply with a brilliant satire to cover a sad apology in filming "The Ghost Goes West". Indeed, how we laughed at the time when we saw it! Now these, my Lords, are collections; for collections they undoubtedly are. They are not dissimilar in essence to what is in Mentmore, despite what the antagonists might say; namely, that it is not a collection at all but an ad hoc mixture from various houses from the Rosebery and Rothschild families.

The bitter irony of this saga is that, while in the short term Baron de Rothschild's collection undoubtedly fulfilled its prime purpose—namely, to display to his close friends the wondrous objects he had acquired—the rest of the world were not aware of its existence. In fact, it was not until 1884 that a private catalogue was drawn up. There was no reason why this should enjoy universal circulation; in fact I believe only 20 copies were issued. Today I am reliably informed, however, that 80 per cent. of the catalogue's contents are in existence. It is these contents, along with the house, that have been offered, as I understand it, by the noble Lord, Lord Rosebery, to the nation for the sum of £3 million. Fifteen items of furniture are very conservatively valued at just over £2 million. I repeat, my Lords, 15 items of furniture valued at just over £2 million. Five paintings are valued at just under £1 million. I understand that the Government would get these at a considerable discount under special arrangements for private treaty sales. That represents only 20 items. There are as many as 100 pieces that are considered so exceptional that there is the very strongest possibility that objections to export licences would be lodged as it is extremely unlikely that anybody in this country might be a successful bidder for these.

The Department of the Environment, so far as I can establish, have treated this whole business in a hopefully unusual fashion in that they do not appear to have consulted with the National Trust or the National Arts Collection Fund. In any event, little has been forthcoming from that Department over a two and a half year period. It may be of interest to your Lordships that, after three visits by the Historic Buildings Council, there was a unanimous recommendation for the Government to accept the house and its contents at a lesser sum—the sum in that instance was £2 million—provided that an outside interest would come in with help on maintenance. It is truly tragic that this undisclosed source of income failed to carry through with its admirable intention.

Now I should like to touch on the financial aspects of the situation in further depth. The offer to the Government was refused on the grounds that the Treasury had already accounted for from between £3 million and £4 million in what I can only refer to as a "windfall sum". Technically it may be passed as death duties, capital transfer tax or call it what you will, my Lords. The noble Baroness, the Parliamentary Under-Secretary of State, Department of the Environment, in January and in this House did not rule out the possibility of the national Land Fund being brought into consideration.

Not many people of my generation know too much about this Fund, and for their benefit may I briefly explain its bizarre history as it could be particularly relevant to this debate. The Fund was set up in another place on 9th April 1946 by the then Chancellor of the Exchequer with a capital sum of £50 million. Dr. Dalton, in introducing the Fund, said this—and with the leave of the House, I should like to quote the purpose of this Fund—as reported in the Commons Hansard, volume 421, at column 1840: It is surely fitting, in this proud moment of our history, when we are celebrating victory and deliverance from overwhelming evils and horrors, that we should make through this fund a thank offering for victory, and a war memorial which, in the judgment of many, is better than any work of art in stone or bronze. I should like to think that through this fund we shall dedicate some of the loveliest parts of this land to the memory of those who died in order that we may live in freedom…let this land of ours be dedicated to the memory of our dead, and to the use and enjoyment of the living forever. In the first 10 years the Fund, invested in short-term Government securities, increased by £10 million, a mere £750,000 at that time having been expended. In 1953 the scope of the Fund was considerably extended to include the acquisition of outstanding houses, their surrounding land and, most particularly, their contents. Further, in 1956 the acceptance of preeminent works of art not necessarily associated with any particular house came within the parameters of this Fund.

Stranger yet, in a debate in another place on 1st July 1957 the Financial Secretary of a Government which had been in Opposition when the Fund was set up moved for a reduction to £10 million on the grounds that the Fund was not only inert but also non-existent. Dr. Dalton, in a spirited rally, defending and clarifying the origins of the Fund, came back. With your Lordships' leave, I should like to refer to his words from volume 572 of Hansard at columns 806 and 807: The plain truth is—it is as well to get it once more on the record—that in 1945 and 1946 we were selling, the war being over, vast quantities of war stores of all kinds. It appeared to me—I was advised by the Treasury that this was the right way to proceed in order to do what I wished to do—desirable and appropriate…to set aside some part of that money so that, by various means, the beauty of England, the famous historical houses…might be preserved in the future, and…increasingly become part of the heritage of us all. The reduction of the National Fund nevertheless went ahead from £60 million to £10 million. Not being an economist, nor wishing to play the part of a "daft laddie"—as they say in my part of the country—it is to me a most remarkable example of bookkeeping, the logic of which passes straight over my head. Many questions arise but sticking to only one, if the Fund genuinely did not exist in 1957, how come it was reduced from £60 million to £10 million and by March of 1976 had risen again to £18.45 million?

I have carefully studied two recently completed feasibility reports independently compiled with the intention of retaining Mentmore and opening it to the public. They are, in my opinion, sound and certainly promising on the grounds that the property and contents are acquired by the nation. Mentmore could play a significant role in our second largest growth industry after oil—namely, tourism. Your Lordships will have heard last night that £630 million was the surplus in balance of payments earned by tourism for this country. I received a forecast today from the British Tourist Authority that it is confidently expected that for 1977 there will be a surplus of £1,000 million.

However, I appreciate that there may be national economic difficulties and certain obscure regulations governing the release by the Treasury of funds. Hopefully, this will change to obviate the likes of this situation ever arising again. If not, and the time element of less than a month runs out, the sale to the world will go ahead. If the country wants then to retain any of the contents, it will be at an enormous figure matching the market prices received from the Western world. In any event, I should like to say that the cruel anxieties of indecision which must have been visited on the owners of the property over the past few months—nay years—should never in any circumstances happen again. If Mentmore goes history may well say one day that it was a classic example of a civilised country not only stripping assets from a family but compounding the act by allowing a national asset to go by default.

5 p.m.

The Earl of PERTH

My Lords, it is my pleasure to congratulate the noble Duke, the Duke of Argyll, on his maiden speech. It really was a very fine and remarkable effort. Perhaps "effort" is not the right word, but it was full of facts and told us many things which we did not know, and which it is so important for your Lordships to be informed about. I knew his father well and he would have been proud if he had heard what he said. Equally, I knew the tenth Duke well and he, also, would have been proud. I ask only one thing of him, which is that he speaks often again to your Lordships.

I want to start by talking about Mentmore, because that is such a desperately urgent subject. It is one minute to 12. I should like first to thank the noble Earl, Lord Mansfield, for having told us something of the background of the whole of this sorry story. One thing that conies out very clearly is that the Rosebery family, if I may put it in that way, have really done their best to try to ensure that Mentmore and its contents should remain as a whole, if the Government and those concerned were ready to take it on very generous terms offered.

What is my position in regard to Mentmore? Let me put it very simply. I am passionately of the opinion that it should be saved as a whole. The house on its own can, perhaps, be preserved—indeed, there is a preservation order on it—but the house without its contents would be like Hamlet without the Prince of Denmark. Again, taking some of the contents for museums is not the same. That would be like breaking up a great library, such as the Evelyn Library that we have heard about. House and contents are part of a whole. They are the record of a great merchant banker in high Victorian times—a Rothschild a[...] that. When you go into the Grand Hall, you look up 40 feet—I suppose about the height of this Chamber—and there you see a glass ceiling, the work of Paxton, and I believe the last example, the Crystal Palace having been burned, of what it was all about.

It is not that one is excited by one object, or by one angle; it is the general feeling of richness, of sparkle on all sides. There is gold and all kinds of glorious things surround you. There are the gilded chairs which came from the Doge's Palace in Venice. There are the lanterns from his barge. There is a vast mantelpiece—I think of incredible ugliness—which came from Rubens' house. There are tapestries around the walls, and then, above, instead of a balustrade as here, there is marble. It is the same when one goes into room after room on the ground floor—Genoese velvets of great age encasing the walls, or glittering mirrors and, again and again, treasures within.

I am not saying that it is all to everyone's taste; I do not think it is to mine. But, as a whole, it is a splendid thing and it really should be preserved. It is a great spectacle and it is fun, and I know that the public would love it. The French furniture at Waddesdon may be finer—that is for the connoisseur to say—and the Wallace Collection may be more remarkable as a collection of one man. But, with all respect, the Wallace Collection is a dead thing whereas, somehow or other, Mentmore is living and it can go on living if it is kept as a whole. It is a living testimony to an age. Your Lordships have heard the noble Duke say that there are only 15 houses of that type left in this country from the whole of the last century.

I wonder how many of your Lordships have been to Mentmore. If you have not been, I advise your Lordships to pay a visit, if you can, in the very short time that is left. I know that the noble Baroness, Lady Birk, has been there, but has any member of the Cabinet been? Has anybody concerned with the ultimate decision seen it, as opposed to getting advice? I do not know the answer, but I doubt it. However, for those of your Lordships who are not able to go and yet want to get some feel of it, Mr. Marcus Binney and some of his young friends have produced a very remarkable illustrated brochure which your Lordships will find either in the Library or in the Opposition Whips' Office, and I commend it to your Lordships. It was written in two days. It was written in the heat of the time, which shows how deeply they felt, and those who wrote it were young. It is the young to whom saving Mentmore appeals.

As we know, the Government have offered £1 million and have said that the remaining £2 million must come from private sources, together with the endowment for the running of the house. To raise £2 million within a month is a fearsome task. I just do not know whether there is a chance, but, thinking in terms of their sponsorship of sports and other activities in this country, one of our great industrial companies might find the money. I am sure that it is worth a try, but I suppose that it is a 100 to 1 chance that it will come off. But then I believe that the Derby was once won—Lord Rosebery would know this—by a 100 to 1 chance. As regards the endowment, I think that the position is very different. Dare I say that Whipsnade and Woburn are nearby, and that if Mentmore were added to the tour it would be an enormous attraction? The noble Viscount, Lord Norwich, talked about that and I know how right he was, both in his experience and in his belief that it would be successful.

My criticism of what has happened—I suppose that it is a criticism of the Government—is that they have offered too little and too late. Let me first take the question of too little, and throw out an idea which perhaps has little merit. We are told that £1 million is all that can be provided "in the light of constraints on public expenditure ". I understand what that means, but I wonder whether it is the right approach in this case. Has anyone in the Government considered this whole project from what I would call the job-creation angle? Has anyone thought of it in terms of a factory building, with Mentmore being the factory building and the contents being the plant and stock in trade? Has anybody thought how much employment, direct or indirect, it might provide if it were well run by, for example, the noble Lord, Lord Montagu of Beaulieu? I am sure that there would very quickly be about 200,000 visitors spending £1 each.

Think, my Lords, of the benefit to the locality, of the benefit to the catering trade and of the benefit to the transport services, and of how much would come in from overseas tourists. They flock to that part of the world and we have heard how London is overwhelmed. I ask the Government to look at this again and very quickly from the job creation angle. They are very ready to spend money on doubtful industrial projects and if they fail, then they lose. Mentmore would be very different. Let me suppose that the Government act as I suggest and the project fails: I do not believe that it would fail, but if it did at say the end of five years I have no doubt that if they had to sell it all up they would make a very great profit. Surely it is worth taking the risk, which would give us the time that we want.

My last point on Mentmore is the question of help being too late. I recognise the great difficulties over secrecy and I am grateful, as I am sure everyone in your Lordships' House is, to the noble Earl, Lord Mansfield, for explaining the timetable of this tragic affair. However, not sufficient time has been given to us to awake public opinion; it amounts to only a month. The lesson of this sad story is that in future there must be something like the committee which was suggested by the noble Earl, Lord Mansfield, upon which people from outside are able to serve with the Government.

From Mentmore it is easy for me to pass to the question of the saving of works of art generally. It is a natural transition. First, let me say to the noble Lord, the Minister for the Arts, that I agree with him that we cannot save everything. Also I agree with him that successive Governments have done a very great deal to try to ensure that those objects which are part of the national heritage remain. They have done it through the four lines of defence which have been outlined. In many important ways through the Finance Acts, the Government have tried to ensure that there will not be a flood of goods coming on to the market at the same time. Having said that, however, the Waverley Committee was set up 25 years ago, and its criteria have stood the test of time in an extraordinary way. I am not suggesting that there should be any change in that respect. However, I am suggesting —the noble Lord anticipated in some degree what I am going to say but he did not hear the full reasons that I am about to give your Lordships—that the time has come for us to have a look at the working of the reviewing committee. The noble Lord said that I was calling for a comprehensive review. All right, I am. Let me tell your Lordships why.

First, the various Finance Acts have greatly changed the position since 25 years ago. Your Lordships have heard how the Government have tried—when I was on the reviewing committee this was something which we also tried very hard to do—to explain how the Finance Acts can benefit the private individual if he offers his treasures to the country. Second, what are works of art today? They are different from what they were 25 years ago. There are new categories. Photographs are now included. There is also a great awareness of our industrial heritage. Does our industrial heritage come under the heading of "works of art"? I do not know, but this question should be part of the review. Attempts are being made on the industrial or scientific side to save objects or buildings but it is all rather haphazard. Third, the great auction houses, upon whom so much depends, have changed very much in character over the last 25 years. Today they have branches all over the world. I am in no way blaming them for this; indeed, I well understand it. Sometimes our treasures are sent to, say, Holland or to Geneva because it may be to the advantage of the owner

Then the problem of values arises and how export control should work. This is a very difficult question and I do not know the answer to it. Fourth, there is the question of the extent of works of art which are going abroad. The committee tried a little while ago to make a study of this point. In the rather brief time that we tried we failed. All that we were sure about was that a great deal more was going abroad than is remaining in this country. I accept, however, that we cannot keep everything. Only last night I was speaking to one of the important London dealers. I asked him how much of what he sells today stays in this country and how much goes abroad. He told me, and I fired this a most disturbing figure, that in the last year 90 per cent. of all sales went abroad. That was the situation in one great dealer's firm in this country.

I must give your Lordships one or two more reasons why this review is important. The noble Lord said that he might do something with his Department. I do not believe that that is good enough. Originally the Reviewing Committee was charged: To advise in cases where a special Exchequer grant is needed towards the purchase of an object which otherwise would be exported". So far as I know, we have never cone that and I am not very sure why. However, I am clear that the whole situation has changed. In the days when that recommendation was made the reviewing committee reported to the Treasury. It does not do so now; it reports to the Minister for the Arts, who reports to the Department of Education and Science and to its Secretary of State, and they in their turn report to the Treasury. The Treasury has a wonderful barrier between it and those members of the public who want it to give money, and I think that the position ought to be looked at.

The last of the reasons why we should have a review is that I believe that we should look at the workings of the committee. May I first pay tribute to the splendid work that is done by all of the expert advisers who help, and to many others, but I have the feeling that there is too much secrecy. Your Lordships are not aware, and I do not think that the public are aware, of one or two disquieting matters. For example, one of the objects which we wanted to stop leaving this country a little while ago is now out of the country. The owner, who took it out, said that he did not realise that we had stopped its export. Perhaps that is true; I do not know. However, it is very worrying that something like that can happen. When the position is explained to the owner—how he has broken the rules and how, if he does not return the object, it will be a very great loss to this country—I hope that he will do something about it. We must be sure that this situation does not happen again.

Lord DONALDSON of KINGS-BRIDGE

My Lords, will the noble Earl allow me to say that he has described a case which is under very active pursuit.

The Earl of PERTH

My Lords, I appreciate that point. I am merely saying that it is very important that we should make quite sure that our machinery is such that it cannot happen again. There have been one or two other disquieting matters over this period of time which call for a review. I am sure that the trade—upon whom, in a sense, everybody depends, because if they do not believe that a thing is fair then the whole thing collapses—would welcome such a review and the opportunity to give testimony before it. Exactly what form it should take would be for the Minister for the Arts to decide. However, if there is to be a review, and my hope is that there will be one, its outcome must be made public. We must be given the chance to know what it is all about. It is not enough for the Minister for the Arts, the Reviewing Committee and various Government Departments to look at these questions and for that to be the end of it. We must know the outcome.

I am sorry to have spoken so long, but these are serious matters. I hope that the Government will think again about Mentmore, particularly from the angle of what I have called job creation and I hope that when the noble Baroness, Lady Birk, replies she will tell us—having had a quick consultation with the Minister for the Arts—that any result of the review I have asked for will be made public to all of us.

5.20 p.m.

Lord MONTAGU of BEAULIEU

I should like to start by adding my own words of congratulation to my noble friend the Duke of Argyll on his remarkable maiden speech. It was a fine example of what he is doing at the moment in his own home, which was so tragically nearly burnt to the ground last year, and the enormous amount of courage and hard work that he is putting into that in order to bring it back to public display.

I should also like to preface my remarks by declaring an interest, of course, not only as a house owner but also as President of the Historic Houses Association which now has over 700 members, of whom a great many are not in your Lordships' House. In fact only a very small proportion come from your Lordships' House; many are of much more modest means. But on their behalf I should like to welcome the move made by the noble Earl, Lord Mansfield, in initiating this debate. As I recall the debates on the heritage in your Lordships' House over the last few years I cannot but reflect on the great progress that has been made in persuading not only Parliament but also the Government of the need to take positive and constructive steps to help. Therefore it would be churlish of me as President of the Association, who has been very much in the forefront of the campaign, not to start by paying a tribute to the present Government for the legislation which they initiated and which has given many of us hope and perhaps strengthened our will to make a last ditch-stand to preserve our heritage against the growing forces of inflation, rising costs and. indeed the vandalism of envy—the latter being a sad reflection of today's political climate. However, I should like to pay a special tribute to the noble Baroness, Lady Birk, and other members of her Ministry, not forgetting Mrs. Jenkins of the Historic Buildings Council, all of whom have listened sympathetically to our case and also heeded our pleas.

An honourable Member in another place from the Party opposite said to me recently that the heritage lobby was the most powerful and successful that existed in this country. It is indeed right and proper that it should be so. There are, I hope, no Party divisions—nor should there be—in the cause of preserving the heritage for our children. Significantly, the Select Committee on the Wealth Tax showed the wide agreement among all three political parties and in 1975 the largest petition ever presented to Parliament destroyed once and for all the myth that the people of this country did not care. Nor, indeed, did they wish for their heritage to be forcibly nationalised or dispersed overseas by destructive taxation.

Let us therefore recognise the fact that under the present Government the climate changed dramatically and it was fair to conclude that we were entering a new era of mutual understanding and partnership. It was therefore somewhat of a traumatic shock to conservation societies, and especially to owners of historic houses, when they read of the decision with regard to Mentmore. For many years, pessimists have been forecasting the gradual break-up of great collections and the desertion of the great houses, both large and small, because of overwhelming capital and income taxation. Here indeed was the crunch—a test case—and, in spite of a Government known to be sympathetic, they could, unfortunately, apparently rely only on private enterprise to save Mentmore. When that failed they seemingly had no alternative but to allow the house to be sold.

I know that experts will probably not all agree as to the merits or otherwise of the house, but nevertheless it was built, as has been said, for a former Prime Minister. It is a supreme example of Victorian architecture; it is full of first class contents and, most important—It is geographically extremely well si[...]ted.

The Government can well imagine the chill that was sent down the spin; of every historic house owner. If this is a typical Government decision towards a noteworthy house and contents, what would happen if a Woburn or a Chatsworth or a Boughton became available for national ownership? Would it again take three years for negotiations and would political considerations again equally apply?

I fully accept that negotiations have not been easy and the Government may well have excellent reasons for their decision. One of the great problems in discussing the pros and cons of Mentmore has been the lack of facts, and I am sure we shall be very much wiser at the end[...] of this debate when the noble Baroness, Lady Birk, has replied. It is of course entirely understandable that the discussions which took place between the Treasury, the Department of the Environment and Lord Rosebery's lawyers had to be kept confidential. But, assuming that the Government were fully aware of the necessity of a settlement being made within the three-year limit, was there not really a need for a greater sense of urgency? For instance, how long after the negotiations opened did the Historic Buildings Council or the Minister make a visit to the property? Is it true that on; of the final decisions was influenced by the fact that the running costs, which were estimated to be about £80,000 a year, would not be covered, it was thought, by any income?

It is that last point that I wish to stress this afternoon. Let us start with one or two simple facts. Last year, 1976, there were about 50 million visitors to our historic buildings—an impressive total especially when compared with the figures which historic houses attract in other countries of Europe, such as France. Department of the Environment properties are under the care of the Department of Ancient Monuments and Historic Buildings, most ably led by Vivian Lipman and its commercial operations efficiently managed by Brian Bayliss—both men of great dedication and imagination. Nevertheless I believe it is an open secret that they are understaffed and are den[...]ied the right to make sound commercial judgments—particularly with regard to entrance fees; they are not trusted to evaluate and proceed on worthwhile new money-making projects without Treasury permission. The annual income is unfortunately swallowed up by the Treasury and therefore the results are never related to their efforts and successes. Consequently, it must be very difficult for those officials to prepare a proper feasibility study based on hard commercial experience.

I have read the two feasibility studies that have been prepared with regard to the tourist potential of Mentmore. They were reasonably optimistic and I hope that the noble Baroness, Lady Birk, will express her opinion on those reports when she replies. Here is a house never before open to the public, full of priceless treasures, geographically well sited near the Ml and also near the enterprising new town of Milton Keynes—which could surely find many uses for it—and indeed, a house which has been publicised nationally by every medium, to the envy of every other historic house owner, as I can assure your Lordships. It has been debated in both Houses. What more does one want to start a successful tourist business? Indeed, I would accept the invitation extended by the noble Earl, Lord Perth, and I say publicly this afternoon that I should be more than happy to advise Her Majesty's Government and to take the commission to run this house for a year if they so wished and if they will let me keep a part of the profit at the end.

Is it not about time that the tremendous value of tourism to Great Britain and the enormous part played by our heritage in that sphere was fully recognised by the Treasury when decisions of this sort have to be made? Last year, £2,500 million of foreign currency was earned by tourism. Historic properties netted about £50 million—let us say, modestly, one-third from overseas. Thus they provided about £17 million in foreign currency to the Exchequer, not counting the extra money raised by hotels, shops and internal travel. I really feel that in recent years the value of tourism to this country has not been sufficiently appreciated by the Treasury. Has not the time now arrived for the commercial department of the Department of the Environment, which is responsible for opening Government buildings to the public, to stand on its own feet; to be given a status like a nationalised industry; and to be allowed to make its own commercial judgments and be a profit centre like, for instance, British Airways or the Post Office? Furthermore, does it not seem absurd that some of our historic buildings are open under the Department of Education and Science, many of them free, and others, under the Department of the Environment, who, in fact, naturally, charge? Surely all buildings of this nature should be the responsibility of one Minister and one organisation.

All over the world it is becoming increasingly recognised that the best and only way to pay for conservation is by money derived from tourism. We have in the British Tourist Authority a very successful organisation which has been and is providing the goods—10 million visitors last year—far more successfully than any other European country. It is sad to see that even their tremendous efforts and successes are sometimes rewarded with cuts. I sincerely believe that a serious reappraisal of the benefits of tourism to this country is long overdue. New thinking must emerge and new solutions sought and imposed. Here is a success story of immense financial benefit to our balance of payments, which is and was largely unappreciated in many of the corridors of Whitehall, and only at best treated as a useful bonus.

Our heritage is a vital part of this tourist success, together with theatres and shopping; it is what people from overseas come to see. Indeed I go further this afternoon and claim that, if properly managed, there is no reason why our heritage should not only be self-supporting but perhaps sometimes even make a profit. My Lords, what is so immoral about making the ever-increasing leisure boom work for and not against the interests of conservation? Cannot we once and for all get all the political Parties to agree that they will never again shame the nation by saying that preserving our heritage cannot be afforded. The point is can we afford not to. If properly managed, I believe exploiting our heritage is good business for the nation in the future.

I recognise that not every place would be able to open at a profit; some would be profitable and some would be unprofitable. But, after all, the State-owned houses are in a very fortunate financial situation in one sense; they are not subjected to capital or income taxes, and they can afford to take a long-term view. If only the private sector was so lucky. For if the State finds it impossible to organise their historic buildings with a view to making a profit, why does the Treasury make it a requirement for private historic houses to do so in order to get income tax relief? Perhaps we could have a little more egalitarianism in their treatment of those who are custodians of the heritage. I was, however, very happy to hear Lord Donaldson say that he will look at the problems of Case 6, and other problems. I hope he has better luck with the Treasury than we have had in the last few years. For I must warn the Government, as president of the Historic Houses Association, that Mentmore is only the tip of the iceberg. There will be more, both large and small. There is, after all, a limit to the personal sacrifices and discomfort which even the most devoted unpaid custodians are prepared to face.

I make one other suggestion. Is it not time for another report, like the Gowers Report perhaps, to investigate in depth the whole problem. There is now much excellent research which was not available 30 years ago. Professor Miles of Reading University has just completed a very comprehensive cost survey, and the Historic Buildings Council is very well aware of repair costs. Further more, perhaps my suggestion of a corporation to run our historic houses can also be considered. But for any British heritage authority to succeed it must be allowed freedom to make its own commercial judgments. The Government could perhaps consider allowing the corporation to have as its original capital this mythical Land Fund.

Of course, for the heritage to be self-supporting there will have to be a dramatic change in attitude with regard to charging. Perhaps it would not be too heretical to suggest this afternoon that, in order to preserve our overall heritage, particularly our works of art, calm reconsideration could be given to charges being levied at our museums and art galleries. I know this is rather an emotional subject which has been debated before. But what will future generations think of an age which spent millions on television, visiting cinemas, football matches, buying records, and gambling, but whose leaders thought it immoral to ask people to pay to see our great works of art, as a result of which some of our most precious objects went abroad and were lost for ever, for temporary financial gain, and perhaps even museums closed for lack of money to pay staff?

I sometimes wonder what ideas drive museum curators to prefer deprivation to accumulation and curtailment to further expansion. Free museums were; certainly a fine philosophy of a bygone age but are not now much use if by being so they cannot keep abreast of museum development and are not financially strong enough to compete with other museums in the world. One has only to look behind the Iron Curtain, to Poland and Russia, to see the millions that have been spent there on preserving their past and recreating their history.

So, my Lords, to conclude, I ask the Government, for the sake of the heritage as a whole, to give serious consideration to the status, organisation and accountability of the Department of the Environment, which is responsible for opening Government properties to the public. With regard to Mentmore, I am certainly happy to place my 25 years' experience at their disposal in order to help advise the Government on the tourist potential of opening it to the public. Not to do so—even experimentally for a few years, as Lord Perth suggested—would surely be a grave error, for which I think the Government must take some blame and perhaps even the condemnation of future generations. They have nothing to lose, maybe much to gain. Surely the future of our heritage is far too important to be settled by the vagaries of when a man dies and the resulting penalties imposed by various Finance Acts. Therefore, I plead with the Government, whose record with regard to the heritage is one in which they can take pride, to show that not only is their heart in the right place but that they are prepared to back it up with action. I cannot believe that it is too late to sit round a table with Lord Rosebery and discuss this matter again. Where there is a will there is a way.

5.37 p.m.

The Marquess of SLIGO

My Lords, it is customary in a maiden speech to ask for the indulgence of this House and to be non-controversial. I ask for a triple indulgence: first, because, although my old friend the noble Lord, Lord Donaldson, meant it kindly, he took me back over 50 years and makes me feel rather like a small boy talking out of turn: secondly, the Mentmore affair has gone on with such speed that it was only yesterday that I was able to rewrite this speech in view of what happened the day before when the matter was finally settled; and, thirdly, though my family have sat in this second Chamber for nearly two centuries, for nearly three centuries the family home has been and still is in a very Irish part of what is now the Republic of Ireland. To be non-controversial in the context of England and Ireland is almost a contradiction in terms. Nevertheless, I believe there is a subject which fulfils this condition; I refer to the urgency of more Government expenditure on stately homes.

My Lords, you hardly realise in this country the number and the wealth, and, above all, the nationwide distribution of your famous houses, which is perhaps the reason for the rather cheeseparing attitude by successive Governments to their problems. There is a feeling that if Longleat went Chatsworth would still be there, that if, say, Wilton were sold up—which Heaven forbid!—Burghley and Woburn would probably remain. In my country of Ireland the matter has just reached urgent proportions. The remaining houses and castles now in private hands can be counted on the fingers of two hands. We have recently been jolted into a realisation of their value by the fate of a famous castle, Malahide. The situation, on a much less grand scale, closely paralleled the Mentmore affair. It looks as though the lesson of Ireland has not been learned by the British Treasury.

On the death of the late Lord Talbot of Malahide the castle and contents were offered to the Government in lieu of death duties. The offer was declined. The contents were, therefore, sold. The Talbots had lived there for nearly 800 years and although there were no great masterpieces—Rembrandts, Raphaels or Titians—there were good pictures covering three centuries, some fine furniture— some of it old Irish—silver, a good library and so on. In the event, the sale realised nearly five times the amount at which the Government could have obtained these items and nearly all of them went abroad. The Government acquired the castle itself as a new national portrait gallery, which was an admirable idea. It is six miles from Dublin and if they had retained the best of the pictures, a great deal of the good furniture, the silver and particularly the historical exhibits associated with the family and country, there would have been plenty of room and a very great many more visitors because the house would have retained an atmosphere which it now lacks.

That brings me to Mentmore Towers. I do not know it; I gather that not very many people do. It has been suggested that it might house the overflow from the Victoria and Albert Museum, which would be a splendid idea. If some of the less valuable items were sold, with a little rearrangement I am sure that there would be plenty of room for some of the very fine furniture and pictures which, for lack of space, the Victoria and Albert is unable to show at present. However, Mentmore is not an isolated phenomenon. Rather, it is a test case and the reason for this speech. If substantial Government assistance is not given soon to England's and Ireland's historic houses, five years from now at least half will have gone. Owners and trustees cannot be expected to carry on indefinitely. Death duties, a wealth tax, and inflation will inevitably end them. It is the potential value of Mentmore and other great houses to the tourist trade, and of this trade to the economy, which is not fully grasped. In fact, tourism has been the one real success story of England's post-war commercial operations.

I should like to quote some figures. As my name appears half way down the list of speakers these figures have already been mentioned twice, but I shall repeat them because they are so very well worth saying. Last year in this country 10 million overseas tourists spent £2,000 million. That was foreign currency—as much an export on the credit side of the balance of payments as shipping, insurance or exported motor cars. This year Jubilee Year—a 15 per cent, increase in numbers and expenditure is confidently expected. I do not have this year's estimated figure for exports for British Leyland, but I know that in 1975 that group exported £580 million worth of cars—rather less than a third of the amount that the tourists brought in. We must get our priorities right. Almost everything that the tourist comes to see makes no money. Buckingham Palace, Westminster Abbey, the "changing of the guard" do not pay, and stately homes certainly do not pay. However, for the tourist we have everything—Windsor, Stratford, Oxford, Hampton Court—"you name it, you have got it".

I speak with some feeling on the matter of stately homes that are open to the public. Fifteen years ago my own comparatively small house in the west of Ireland was opened to tourists it was the first in Southern Ireland to do so commercially. That year we had 5,000 visitors and hoped eventually to break even. Last year, after working unremittingly for years, we had 60,000—a respectable figure even by English standards—and we are still hoping to break even. Our nearest three towns with a population exceeding 10,000 are all over 60 miles distant. Mentmore and, indeed, most of England's stately homes have literally millions of potential visitors within that distance. Tourist-wise (which is an odious word) I envy people in England. They do not know how lucky they are.

Of almost as much, importance as the foreigner are the home tourists. Last year they, too, spent £2,000 million in this country. In 1960 8 per cent, of manual workers had three weeks holiday with pay. This year 96 per cent, of them will have that. Very few of these workers will go abroad; most will take their holidays here, staying at home some of the time and going out with the family for odd days Great houses are open to the public in every county in England and these can easily be reached from all the great industrial towns. Many of these people will have children whom they cannot and do not want to leave at home, which is why outdoor zoo parks, show jumping competitions and so on are essential. I intensely dislike the idea advanced by some that such amenities should not be available.

My Lords, I have really said all that I wish to say. I understand that as an hereditary Peer—and a backwoods Peer at that—it is unlikely that I shall sit in this Chamber for much longer. In the last century my ancestors voted here for Catholic emancipation and Irish home rule many years before these were achieved. They were right then and I think that I am right now. They thought that politics was about people. Perhaps I should not say this at this moment in this House, but it seems to matter very little whether Concorde goes a little faster or a little less noisily to New York. If these historic houses are not saved, millions of people will have rather greyer and duller lives. In the cruder sense, as an investment it is worth thinking about these stately homes. As something which makes cur lives more worthwhile, their value is incalculable. I thank noble Lords for listening to me.

5.47 p.m.

Lord VAIZEY

My Lords, I, like other noble Lords, am grateful to the noble Earl, Lord Mansfield, for enabling us to air this matter and for not confining it too narrowly to the future of Mentmore. I should like to congratulate the noble Duke, the Duke of Argyll, on an absolutely brilliant maiden speech. I hope that he will be able to spare time from his busy labours of rebuilding his house to come here and see us more often. I should also like most warmly to congratulate the noble Marquess, Lord Sligo, on his maiden speech. I have spent many happy months in one of the houses of the noble Marquess which is on the seashore in the West of Ireland and which is now an hotel. I have often visited the house of the noble Marquess and I hope that he, too, will come more often to this House, while it exists, and give us the benefit of his wisdom.

Unlike virtually everyone else in this debate, I have no interest to declare. If the public wish to pay to see my house, they are welcome—indeed, they are welcome if they do not pay. However, I fear that I am not likely to be in the position of noble Lords opposite and on the Cross-Benches, of spending many years negotiating with the Chancellor about my historic seat. Perhaps, as was suggested by one noble Lord, my intervention is directed by envy. I do not think it is, but I concede that it may be. In all honesty, to the public at large it must seem very odd for quite so many people with interests to declare to take part in this debate. It might add slightly to the fuel for the abolitionists' case. I am afraid that my remarks will not be as congenial to other noble Lords who have taken part in the debate as those of my noble friend the Minister who spoke with his normal courtesy and circumspection. I shall speak with courtesy but, quite frankly, I shall put the other case because no one else will until the noble Baroness replies.

My wife and I have a deep and passionate interest in the arts and my wife spends half her week working for nothing for the Arts Council and the noble Lord, Lord Gibson. However, that interest is not a pecuniary one. I want first in this speech to say a little about the economics of the conservation of art objects and great houses because economics is my trade—it is not much of a one, but it is mine. Frankly, the market for art objects is grossly distorted by the American tax structure. Because you can get remission from taxation in the United States on a preposterous scale by giving, or nominally giving, art objects to museums, the value of art objects throughout the Western world is inflated beyond all measure. The result is that American galleries and museums, and private American collectors in the guise of American galleries and museums, can outbid our galleries and our museums whenever they want to. That is a statement of fact. I believe it to be the case.

In my view, in this situation the British authorities would be perfectly morally entitled to forbid the export of works of art, and to do so by setting a normal price—and "normal" in inverted commas—for all kinds of art object which would be the price that it would have fetched if the Americans were not bidding, because, frankly, the Americans are bidding in a game where they have rigged the market through their own tax system. On the economics and morals of that, I am perfectly certain that the existence of the American tax structure has inflated the value of art objects quite beyond what it would normally be in a world where the United States tax structure did not exist. If I were Chancellor—and heaven knows! with the abolition of the House of Lords on the cards I suppose that I might be one day—I would not allow anything like the prices to be paid that some of these things at Mentmore will fetch when they are auctioned. That would have the effect of reducing the price of some art objects here to far less than the owners now get. I have no doubt that we shall hear a great deal of indignation from such owners. Frankly, I do not think that many of us will be greatly moved by those objections, and your Lordships should note that I would be as iron a Chancellor as the present Chancellor is.

I may say, furthermore, that in France—and they often order these things better in France than we do here—they have auctions where the price of art objects goes up to an enormous height, and then a man in a black coat gets up and says, "Reservé au Louvre", and they pay the price they think they will for what the Louvre wants. I think we have been living for some years in a world where the owners of valuable works of art and historic objects have been unbelievably favourably treated by the working of the art market and the working of the tax structure.

Now I must say a few things which are said outside this Chamber—though they are not said by me—about the inheritors of great houses in England and Scotland. I do not say them, but other people do. They seem to me to compare unfavourably with the Americans of the last century who were so gracefully mentioned by the noble Duke, the Duke of Argyll, in his speech. If the past owners of Mentmore had wished Mentmore to be preserved for the English people, it could have been given to the English people with an endowment. I hope we shall hear no more of this talk of alleged generosity, when in fact there is no evidence whatsoever to support that proposition.

It seems to me that the private possession of alleged national treasures without public access to them reflects a private person rather than the public spirit. People can, within limits, own what they like, but it surely is most unedifying to see the owners of precious works of art demanding State help while to a man they support a Party which wishes to reduce public expenditure. Frankly, I do not think that that is a debating point. I think it is a serious point, and I find it absolutely astonishing that nobody has seen fit to mention this until I stood up. The private inheritance of artistic treasures which are not available to the public seems to be an unacceptable ground for public expenditure or for exemption from taxation, and I cannot conceive that ordinary citizens will be very much impressed by the chain of argument to which we have listened this afternoon.

May I now turn directly to Mentmore? I want to make a few points. First of all, if the capital transfer tax had been in operation when this house changed hands, it would, as I understand it—and I may have been misinformed but I believe not—have been easier than it has been in the circumstances under the old death duties system. Am I entirely wrong in recalling that it was the present Lord Rosebery's grandfather who brought in death duties? I think I am correct in thinking that it was his Government that did it.

A lot has been said in this debate and is going to be said about the capital transfer tax. It is important to make clear that it may be interesting, and it may be important, but it is not relevant to the case of Mentmore. If one were to revise the tax structure it is clear that the first revision in the tax structure which is required is to give more incentives to those who work, and if you are going to give more incentives to those who work it is inescapable that you will tax more heavily the transfer of capital between one hand and another. The case for art objects and historic houses is a special case which has to be carefully examined in that context. I know of no impartial authority on the tax structure who would venture to contradict that point. I noticed that it was made emphatically by the report of Professor Mead which appeared in this morning's Financial Times.

Although I do not share the enthusiasm for Victoriana which appears to impassion the thinking classes these days, it is clear to me that those who are qualified to judge—and I include in that category of course my noble friend Lord Norwich, who is a very great expert in these matters (I am sorry, he is my friend and noble though not of my Party, but I have hopes)—think highly of Mentmore, want it to be preserved and want it to be open to the public. I respect very much what the noble Lord, Lord Montagu of Beaulieu, said when he suggested from his very great experience that it could probably pay for itself as a tourist attraction. I would agree with him that, if there is any deficit on the running side, at least in the earning levels, charitable donations might possibly cover that and then the house could become a profit centre. We have no guarantee that this is so and, of course, in the present financial circumstances I think that a prudent person would have to think carefully about it. However, I am very much persuaded by the arguments of the noble Lord, Lord Montagu of Beaulieu.

That brings me to the third, and I think crucial point, so far as I am concerned, about Mentmore. It was raised by my noble friend Lord Donaldson of Kingsbridge in his speech from the Front Bench. It is: should the collection be preserved as a national asset as a collection? Despite what the noble Viscount, Lord Norwich, says I am not convinced—I have not seen it but I have talked as well as I can to those whose judgment I would trust on the nature of the collection—that you could sustain the argument that it is a great personal collection in the sense, say, that Mr. Gulbenki[...]an's collection, which is now in his museum in Lisbon, is a great personal collection reflecting the taste of a great collector, or in the sense of the Frick collection in New York. I do not think that you could sustain that case.

Basically, so far as I can judge, it is the proceeds of a rather unselected gathering of artistic things which happened to be on the market at a particular time from a number of auctions. That may be an interesting thing; it is what you could pick up at auctions in a few years in the mid 19th century. I would have judged from what I have been told that from this plethora of objects an interesting and a displayable collection—not the same thing—could be made which would be of value in itself, and which would be a substantial tourist attraction. Of that I have little doubt on the basis of the information which has been supplied to me. But I must say candidly, at the risk of sounding a bit of a Philistine, that I do not see any real reason why we should call Marie Antoinette's milk pails on Rubens' fireplace part of our heritage. They are not part of our heritage. I see no reason why, the Rothschilds having bought these objects in the middle of the 19th century, rich people should not buy them back in the middle of the 20th century. Nevertheless, I gather that there are many beautiful objects there which personally I should like to see in public hands for all of us and our overseas visitors to see, but that is only a suggestion on my part.

The real problem is quite simple, as I see it. Responding to the national will, expressed by all Parties except half the Party to which I belong, the Government have imposed rigorous limits on public spending. I have sat here through one debate after another, taking part in some of them, in which we have all said that we must reduce public spending. Then along comes Mentmore. Where will the Government find £3 million when they are already decimating the National Health Service and putting thousands of men and women out of work by cutting central and local government expenditure? Posed in those terms, the Government's case is absolutely unanswerable.

In circumstances like this there is always an answer. Usually it is to send for the noble Lord, Lord Goodman. Perhaps we should send for the noble Lord, Lord Gibson, who will be speaking later in the debate. I am putting forward the sort of idea which occurs to me as perhaps the way out. It may have been tried and I am sure that the noble Baroness, during the many months she has been dealing with this matter, must have had this notion put to her so many times she is sick of hearing it, but I wish to end on a positive note.

If noble Lords opposite, who have spoken so movingly, would form a consortium and lend the money to the Department of the Environment, the Department, having got this stuff, could sell half of it off and pay the loan back, and then perhaps we should have no increase in public expenditure and we would have Mentmore in the public domain. That seems to me a possibility for negotiation. I gather—of course I may be misinformed—that half the Chancery Bar has floated such schemes and that they have been wrecked on the rock, not of the Government but of something else it would be discourteous to mention. I fear that Mentmore will go. I must say that, from my own point of view, it will be no great loss. Few have seen it and few will miss it. However, let it not be said here that its loss was due to a grasping or uncaring Government. There really is little evidence for that.

6.2 p.m.

The Duke of GRAFTON

My Lords, in view of the Statement by the noble Baroness on Monday, I fear that I must share the view of the noble Viscount, Lord Norwich, that Mentmore may have to be regarded as a lost cause. I very much hope not, and incidentally the only sentence in the speech of Lord Norwich which I would query was his claim that Lord Rosebery was the second youngest Prime Minister, because I think the third Duke of Grafton has that claim.

So much has been said about Mentmore that I hesitate to go on about it, but as a member of the Historic Buildings Council for England, on which I have sat for 24 years, and one of the main objects of which has been to preserve houses and collections of Mentmore's importance, I feel very personally involved in this argument. Last May, with almost the entire Historic Buildings Council, we visited Mentmore and as there has been talk of lack of advice having been given to the Government I will, with the permission of the noble Baroness, Lady Birk, read what the Historic Buildings Council said, having paid our visit: The Council recommended that both the house and the collection were of such importance that the whole property, apart from the few objects which Lord Rosebery wished to retain, should be purchased by the Department out of the national Land Fund. They regarded Mentmore as the outstanding surviving building by Sir Joseph Paxton and the only great house of the high Victorian period which has survived relatively intact. In their view it was essential to keep the house with its important fittings and its collection of French furniture, possibly the finest in the country, as a homogenous whole. They also considered that the attractive parkland laid out by Paxton would afford great opportunities for development as a country park, situated, as it is, close to Milton Keynes and less than 50 miles from London. The Council were aware of the need to restrict Government expenditure, but they felt that it would nevertheless be in the national interest to preserve Mentmore and its contents for future generations as an important part of our cultural heritage and that, preserved as a whole, the property would prove a very profitable tourist attraction. They were convinced that if his offer were not accepted, Lord Rosebery would sell the furniture and fittings, most of which might go abroad, the house would then be unlikely to find a buyer and might be left with a largely derelict interior, and a unique national treasure would be wasted. We could hardly have been more explicit in our advice. As instanced by the remarks of the noble Duke, the Duke of Argyll, the "mysterious" Land Fund has been discussed at such length today, that perhaps I might mention a few places where over the last 20 years the Historic Buildings Council has advised the use of the Land Fund to save some of our most important houses and, in certain cases, their collections.

Starting with Cobham Hall near Rochester in Kent, the great Tudor house altered by Wyatt, it was literally collapsing near 20 years ago when the Council first got going. The situation was so bad that we persuaded the then Minister of Works to purchase Cobham, repair it and lease it to a school, which has subsequently bought it, and so far as I can remember we also recommended the purchase of some of the furniture, the State coach and the organ. We also, in the case of Dyrham in Gloucestershire, which was in an equally desperate state, recommended the purchase of the house and its transference to the National Trust. So far as I can remember, because it is so long ago, the position at Dyrham was so desperate that most of the furniture was literally at Sotheby's about to be sold, and about half of it had to be bought back at the sale.

We also recommended the purchase of Ivor Grove, a small house by Vanbrugh just outside London. The Land Fund was also used in two cases I can think of. One was at Saltram, outside Plymouth, where this very fine house with its beautiful Adam interiors and its marvellously complete collection of Adam furniture had to be accepted in lieu of death duties, and the money came out of the Land Fund. Secondly, Hardwick in Derbyshire was saved in a similar way. There are five houses and at least three marvellous collections which have already been saved by the Land Fund, and I simply cannot understand why Mentmore should not be treated in the same way.

I must utter a few words about Mentmore, although so much has already been said, and I wish to begin by stressing that I am not a particular enthusiast of Victorian architecture. In fact, I remember arriving at the inaugural meeting of the Victorian Society held in the offices of the Society for the Protection of Ancient Buildings to be greeted by the founder, the late Lord Esher—who must, incidentally, have been one of the wittiest speakers who ever addressed your Lordships' House—with the welcome, "Here is Lord Euston who loathes Victorian architecture ". On the contrary, over Mentmors I feel entirely differently and passionately, and I agree with the noble Earl, Lord Perth, that unless one has seen it one cannot talk about it. It is absolutely essential to get the feel of the whole pace as it was when it was entirely untouched. I expect that at the moment, with labels being put on all the furniture, it is not looking like that, but anybody who has seen Mentmore in its proper state must be profoundly moved at the idea of dispersing this fantastic treasure trove in what I consider to be a most beautiful house.

Incidentally, not nearly enough has been said about the position and about the beauty of the country around it and the unrivalled views over this part of North Buckinghamshire, part of the Vale of Aylesbury, which, within 40 miles of London, can rival views in a county such as Northumberland. Make no mistake about it, this is a unique opportunity. This overworked word really must be used over Mentmore and the Government's failure to take up this offer is the public's loss. Such an opportunity to provide an amenity of this importance in the belt of unspoilt country between London and the Midlands I do not believe will ever occur again, and it must therefore be the public and, with them, the vastly expanding tourist trade which will suffer. As has already been mentioned, 10 minutes away is Woburn Abbey, which has I million visitors a year.

On a last note about Mentmore, and following previous speakers, I think we have a right to know what steps the Government are proposing to take to secure some of the furniture, pictures and china for the National collections. It seems clear that the Committee on the Export of Works of Art are indeed going to have their hands full. And what will be the outcome? These marvellous treasures, or some of them, must be kept in this country for the benefit of the public, and I have been encouraged by the words of the noble Lord, Lord Donaldson, who seems very fully apprised of this problem.

In passing, and following a previous speaker, when talking about the individual contents of the house I should like to make a plea that some less haphazard system of financing operations of this kind should be set up. As vice-chairman of the National Portrait Gallery, I have been made very much aware of this problem. One has only to think of crises which have arisen at the National Portrait Gallery when portraits of importance—of Stern, of Handel and indeed the picture of Dr. Harvey which the noble Lord, Lord Donaldson, mentioned—have come on the market. The trustees have racked their brains, and with jolly little money we have raced round and on the whole we have been successful. But I feel that this is a most unsatisfactory way to conduct our affairs when objects—and in the case of Mentmore, a place as well—of such outstanding importance are in danger.

Finally, I speak as chairman of the joint committee of all the National Amenity Societies which are joined by the two National Trusts, the National Trust of Scotland and the National Trust of England, who have decided, if given time, to back the Victorian Society in an appeal to raise a fund adequate to endow Mentmore until, as we believe, having looked at Mr. Marcus Binney's papers, it could become self-supporting. In fact, we have already had offers of £50,000 a year for five years to get the scheme off the ground. What we quite obviously cannot do is to raise the money to buy the house and the collection.

So much for Mentmore, which I think is a most alarming tip of the iceberg. What other national treasures are going to appear next on the market and require this rather undignified last-minute salvage operation? Ever since 1974 the joint committee of the National Amenity Societies has been deeply concerned about the future of the heritage, and we have in fact set up a tax group of acknowledged experts under the chairmanship of Mr. Benson who, with immense care and time, have prepared recommendations for the modification and extension of the Government's own scheme of conditional exemption for outstanding heritage properties. In fact this group spent half of yesterday with the Inland Revenue going through these recommendations.

I should like here to pay tribute to the great help we have received from the Government, and particularly the noble Baroness, Lady Birk, over this most complex issue which has gone on now for three years. Much the most vital of these recommendations, which have already been mentioned but there is no harm in spelling them out again, are these: First, making maintenance funds effective and acceptable to the people who are supposed to provide them; secondly, providing a new and appropriate tax case to cover the exemption from income tax of the cost of showing houses and heritage properties particularly which cannot claim to come under Case I which means qualifying as a business (and these are minorities); thirdly, detailed improvement of the conditional exemption system so as to make it acceptable to the owners of the properties.

One cannot state too strongly that there is no time to wait to see whether the system will work. To those of us who have studied it in detail, its imperfections are fully apparent, and for the Government to say that they have solved the problem of the heritage I do not feel is true. In my experience, a crisis of confidence really exists. Most owners are still prepared to see whether the situation is going to improve.

Lord DONALDSON of KINGS-BRIDGE

My Lords, may I interrupt the noble Duke for one moment. I do not think anybody in the Government has ever suggested that we have solved this problem.

The DUKE of GRAFTON

I have the feeling that with the very considerable exemptions that have been made this was going to solve the problem. Particularly the question of maintenance funds has not been followed through carefully enough, and I continue to think that people are waiting to see. Unless they understand the situation, which is extremely difficult, and see that it is improving, I think there is a real risk that they are going to bail out; and while the going is not good it means that they will be left with at least some of the proceeds. I feel that I must finish by saying that at any minute there might—and I hope there will not—be a spate of important houses and collections which are in the jeopardy in which Mentmore finds itself.

6.19 p.m.

Lord INGLEWOOD

My Lords, first I must declare an interest, a many-sided interest, I am the owner of a Grade 1 house too big for today, but no Mentmore. I am one of the original members of the Historic Buildings Council when I was a colleague of the noble Duke who has just spoken, and I think I was the first member of the Historic Buildings Council to go and see Cobham which he has referred to. I am also President of the Cumbria Tourist Board and was associated for some years with the organisation which preceeded the more formal board, which will please the noble Lord, Lord Montagu, and professionally I am qualified as a member of the Royal Institution of Chartered Surveyors. So I hope I can claim to have some knowledge of the maintenance of such properties as we have been considering this afternoon and the lands that surround them. So closely am I involved with all this, my Lords, that it may well be said that I shall not be able to see the wood for the trees, but none the less I shall try.

When considering the speed at which the beautiful things which make up our heritage are disappearing—and that must be admitted—it is understandable that the biggest and most splendid things, houses or pictures, should attract the most attention, and probably rightly so. But the biggest are not necessarily the most beautiful nor valued most by the people of the neighbourhood wherever these houses may be and whatever certain international experts may think. In saying that I do not want to appear critical of Mentmore, and I would never refer to the contents of Mentmore as a plethora of objects, as the noble Lord on the Benches opposite has just done. But I am anxious that the rules which at present seem of most help to the biggest houses are not further tilted in that direction as a result of any reconsideration which may result from today's debate, so in fact working against the advantage and the interests of the very many middle-sized houses in this country, which are so important to us.

Such houses do not reflect palace life, but rather the way of life of families with resources, in the 16th, 17th and 18th centuries; people whose sons went on the Grand Tour and brought things home which we now enjoy, people who patronised our British artists, and we had the most wonderful portrait painters at that time. These people were cr[...]eators of taste which spread downwards in their day, greatly influencing the life in their counties, and which is in many ways still influencing our taste and way of life through the example they set, although it is now some time ago.

The families owning such houses which are open to the public are generally prepared to do a deal of work themselves, with the owner's wife doing the largest share. They live for choice, if it can be arranged, in a self-contained corner of the house and by so remaining they give a lived-in air to the main rooms which are visited by the public; that is something which visitors rate very highly. Many such houses can never be the centre of a great enterprise and they can never easily generate the same big turnover as the very biggest houses with their wealth of contents, even without taking any side-shows or menageries into account. But it takes time to open such a house to the public with reasonable success, for the customers must be built up. It is not just a case of putting a small advertisement in the paper, saying that a house will now be open so many days a week this summer and sitting back.

Certainly in the early stages a house is not justified in opening for as many days as the big established enterprises. Owners have to depend on part-time staff for showing such houses; they have to be recruited and they have to be trained, and this all takes time. Then the owners must build up their public, just the same as if one is selling anything else. This will happen if a person has anything good to show and if the enterprise is well run. But it will take time.

Many of these middle-sized houses reflect the English way of life which is so beloved of foreign visitors and is very valuable to us as part of the attraction of the tourist trade. Hence my submission this evening that the rules under which the Historic Buildings Council considers grants, the English Tourist Board considers grants, and the Inspector of Taxes considers the case under which these properties are to be assessed, must be flexible. They must take into account at least in the early stages of setting up businesses such as I am trying to describe, the more limited resources available to the owners and the necessary time—two or three years is a minimum—which will be needed to build up their trade and to become established.

My Lords, in saying all this, I am not trying to imply that the public are not entitled to fair access in return for any help from the public; of course they are, and that is a principle on which the Historic Buildings Council has always worked. But what I am saying is that, if we want to save these houses, there is no point in laying down criteria for grants or for tax purposes which are unrealistic. This applies particularly to the English Tourist Board and to the Inland Revenue. It was very welcome to hear the noble Lord, Lord Donaldson of Kingsbridge, say that he and his colleagues would look again at the Case 1, Case 6 issue, which has already been referred to and which I will not try to explain again. I hope that this means that he will see whether Case I can be made less restrictive than it is at present for businesses in their early stages, because unless something like this can be arranged, the future is gloomy.

6.25 p.m.

Lord GIBSON

My Lords, if we have in this country, as I think we have, the finest heritage of domestic buildings, full of the most beautiful things, of any country in Western Europe, the reason is not only the relative affluence of our country in the last couple of hundred years, and the relative peacefulness of our history during that time, but also the system of primageniture, the fact that the eldest son takes the estate. The reason why this heritage is threatened now is not only taxation, but also the fact that we are declining relatively as a wealthy power. It might not matter so much if things were passing from one Briton to another, but as has been said by a number of noble Lords they are passing abroad and are likely increasingly to do so. The confidence which has been expressed in some quarters that taxation would extract from private hands beautiful things which would then be enjoyed by all is proving sadly misplaced.

With our limited resources we must try to get some kind of consensus about priorities. Although we have talked mostly this afternoon about the export of works of art, I should like to say at once that for me the first priority, the first claim on resources, whether public or private, is the claim of buildings which of course cannot be exported. We have nearly 10,000 pre-Reformation churches in this country, and it seems to me that if a medieval parish church falls down, or for that matter a fine house or a great cathedral, or indeed the centre of an historic town (those of them that are left), it is a much worse tragedy than the sale abroad of a movable work of art.

I should say at this point that it seems to me that works of art always have moved around the world and always will, and the importance to this country of a thriving art trade, based on London, and with a reputation throughout the world second to none, is an enormous economic asset to us. Though I am against restricting the movement of works of art and restricting the art trade, there are things which we must try to keep. What are the priorities when it comes to deciding what they are? First, there are the collections which have a value as such; collections, as the noble Lord, Lord Donaldson of Kingsbridge, mentioned, where the value as a whole is greater than the sum of the parts. Here an example immediately comes to mind. What a pity it would have been if the collection of theatrical pictures put together by the late Mr. Somerset Maugham, or indeed the collection of theatrical pictures owned by the Garrick Club, were to be dispersed. They are not, for the most part, works of art of prime or international importance, but as collections they are immensely important and interesting and indeed would not, I think, in the case of the Maugham Collection, or in the case of the Garrick Collection (if that by any mischance were ever to be in danger) be particularly expensive to save. Their value is as collections.

Then one comes to the collections which have no connecting thread. Here it depends on how they are housed, what their history is, what was the manner of their acquisition, and so forth. If there is no special interest of that kind I would let them go for the reasons I gave a moment ago. Under those circumstances the museums and galleries could try to acquire them, and the Government have introduced some inducements to make that a little easier for them to do. But in this connection I must say that the recent and very useful circular from the DES, about the conditions under which the sales of public collections can take place, is probably not enough. I think that it was the noble Earl, Lord Mansfield, who suggested the setting up of a special committee to review these matters, and although he did not suggest that it should act quite in this context I wonder whether it might find a way of taking steps to involve owners at the earliest stage of their thinking when they come to dispose of things, so that they can be made aware of what are the possibilities. I say this because not all the owners of fine things, nationally important things, are rich men or are sophisticated in matters of taxation.

My Lords, if, on the other hand, there is a special interest attaching to the manner in which a collection is housed, then it seems to me that it is a prime candidate for being kept together, if it possibly can be—and, of course, Mentmore comes into this category. It is a matter of opinion how you order your preferences between these different collections, but that Mentmore comes into that category would be, I should have thought, hard to deny. Here, again, I would not be opposing the dispersal of a collection like Mentmore if it was not for the ensemble, for the completeness—a point made particularly eloquently by the noble Earl, Lord Perth. It is housed in a great mansion. Let me say that I have never seen it, and the noble Duke, the Duke of Grafton, said that one should not really talk about it if one had not seen it. I hope he will forgive me if, from what I have heard and from the pictures of it that I have seen, I say that it would appear to be a collection which, housed as it is, illustrates the life of a period of English history which, perhaps because of our present decline, is of particular popular interest at the moment, since it represents the life and tastes of this country at the moment when we were at the zenith of our power and opulence.

Lord DONALDSON of KINGS-BRIDGE

My Lords, perhaps I may ask the noble Lord to clarify this, because I am not really sure. I understand that a number of items in this collection have already been removed and that, in any case, Lord Rosebery intends to take a number of them away to other houses.

If this is so—and I believe it is—does it not rather alter the argument which the noble Lord has just been making?

Lord GIBSON

My Lords, it diminishes it to the extent that it is true, quite clearly.

Lord DONALDSON of KINGS-BRIDGE

My Lords, if it is lot true it has no effect.

Lord GIBSON

It is a question of degree, is it not. my Lords? Some things, we know, were sold by the late Lord Rosebery in the early 'sixties; other things have been sold by Lady Rosebery; and, clearly, the present Lord Rosebery intends to take some things to Dalmeny. I am told—and I speak with no special authority—that what will be left after those sales and transfers still goes to make up a remarkably complete whole; but it is a matter of opinion.

My Lords, I was about to say that this period in our history seems to me to be particularly popular today, and I think that is because of the fact that it illustrates the taste of the people who were running our country at the time of the zenith of its power. It is a Trollopian setting; it is the Duke of Omnium, as it were, supported by high finance. This has enormous popular appeal, and I believe that the opportunity ought to be taken to see whether we cannot make something viable of it. But, of course, that would mean a stay of execution of Lord Rosebery's tax liabilities for time to be found to see whether something could be done, and I must say that I think one has to be realistic and say that at this last moment it is not very likely. I must also say that, if I had to choose, Mentmore would not come very high on my personal list of preferences. If present trends continue, there are many houses which are likely to be in danger, which I should mind about a good bit more, but that does not mean to say that it is not unique and that every effort ought not to be made to see whether it could not be preserved.

I have great sympathy with the Government at this time. It would not have looked well if they had taken the other decision. They are making outs here and outs there; we are all urging them to make cuts in public expenditure, and many people would have said, "There they go, finding funds for these baubles ". That cannot be denied. It would have taken great political courage to snap up what nevertheless looks to me to have been a real bargain. The cost is however many millions (I am not clear how many it is; £2 million or £3 million) Lord Rosebery is asking plus, of course, the amount of tax forgone on the proceeds of the sale which would otherwise take place; but in terms of what might be made of Mentmore in the manner described by the noble Lord, Lord Montagu of Beaulieu—whose offer to advise I commend to the Government, because he has been so successful as an entrepreneur in this field—it does really look a bargain. I do not suppose we are going to get the time, but if we did have time one feels that a solution might be found.

However, my Lords, even if we do not save Mentmore, the question remains: What is going to be done about the rest of the heritage in private hands? I do not value them primarily—no one does—as economic assets, but if we are told that we cannot afford them, then I think we have a right and indeed a duty to present our case in economic terms; and I think it should be said that these are things which may well be worth very much more as revenue-earners, even if indirectly through the tourist trade, than some of the enterprises upon which the Government have felt it necessary to spend public money.

While on the subject of economics, I should like to say that I could not follow the logic of the noble Lord, Lord Vaizey, when he said that it was wrong for the Americans to distort the values of works of art by giving tax concessions to their citizens who donate these works of art to museums or public collections. I wish we could emulate this system in this country. I speak as chairman of the Arts Council, which is perhaps the principal dispenser of public funds on the arts, and I can only say that I should like to see patronage diffused, and not concentrated. It seems to me much better for the American Government, rather than buying these pictures itself, to allow its citizens to choose what they buy, and thereby diffuse choice. But if you take Lord Vaizey's view about how monstrous it is for the American Government so to distort art values by giving these concessions, is it then logical to say that we ought to follow the French and distort them downwards, by intervening in the middle of a sale and saying, "Reservé au Louvre"? I cannot quite understand why he does not accept the one principle or the other.

However, coming back to the main question, which is what we do about that part of the heritage which remains in private hands, it seems to me that the only way forward is through a partnership between the Government and private owners, and, where appropriate, bringing in public and private bodies. Here, again, I could not quite follow the noble Lord, Lord Vaizey, when he spoke of complaining about help for owners of works of art which were to be inaccessible to the public. I have not heard a single noble Lord, nor have I heard anybody outside this House in recent times, suggesting that there should be public support for people who do not make their houses or their objects available to the public. Of course, access cannot be totally unrestricted, or access destroys the very things that the public come to see, but it really is not a matter of controversy any longer, I should have thought, that accessibility is a condition of exemption of any kind.

My Lords, if we are going to have a partnership between the Government and private owners, it means two things, surely. It means, first, efforts at an early stage to act in concert. The Government are now saying that in the case of Mentmore they cannot act alone; they need public support to the tune of £2 million, or whatever it was, and £80,000 to £100,000 a year. One quite understands that, but could we not extend that principle and say that the Government should not have acted alone from the beginning; that there are other bodies with advice to give, with ideas which might have been fruitful if consultation had taken place at an early stage? I am only a council member of the National Trust, and therefore am not closely involved in its deliberations—I do not go to any of its committee meetings—but I understand that it was not consulted at any stage before it became public in the newspapers a few weeks ago. It has been actively discouraged from interesting itself in the matter. I should have thought that that was not a good example of acting in the kind of partnership that might be fruitful if we are going to solve this intractable problem. The local authorities in the neighbourhood might also have been consulted.

Baroness BIRK

My Lords, I was disturbed to hear the noble Lord say "actively discouraged" in relation to the National Trust. I have no evidence of this. Would he like to explain that? We work closely with the National Trust. We are aware of their thinking and they of ours. They were not able to provide the money necessary. To say that they were actively discouraged from discussing it puzzles me.

Lord GIBSON

My Lords, I can only say that my information is that the National Trust were actively discouraged from giving their advice. They have shown themselves extremely good at enterprise and at adding revenues to the ordinary gate money that you get at properties that they maintain. They have an enormous revenue from shops. They have developed great expertise over the years and I can only repeat that I should have thought it a good idea to ask their advice at an early stage about viability and possible ways of supplementing revenue at Mentmore. I was told—it may be inaccurate and, if so, I will withdraw it—that they have been discouraged from giving their views.

My Lords, it is really a question of partnership which means acting in concert together early and it also means partnership in providing resources. It seems to me that the partnership as now proposed is not sufficiently tilted in favour of the owner. The terms of conditional exemption—and I will not go into them in detail—must be improved, the principle being that funds genuinely dedicated to the endowment and maintenance of property must not be taxed. If egalitarianism is always to take precedence over conservation, however small the infringement of the egalitarian principle and however great the damage to our heritage, we could say goodbye to our heritage. I do not believe that that is part of the Government's thinking but I beg them, having declared their interest and policy of conservation, to have the political courage to implement this policy realistically.

6.42 p.m.

The Duke of MARYBOROUGH

My Lords, I, too, must declare an interest in this debate being the owner of a house which, because of its historical connections and its geographical position, has a slightly better chance of surviving the problems that exist in preserving our heritage than many other large and small houses of equal importance. The Mentmore Towers situation has once again highlighted the difficulties and complications of trying to preserve our national heritage for future generations. The difficulties are caused by the even increasing costs associated with preserving these great houses and their contents. The complications are caused by the endless, different fiscal rules and conditions with which owners have been recently beset. Nevertheless, we must all congratulate the Government and give them credit for the arrangements they have made for the historic houses and their contents with regard to capital transfer tax and capital gains tax, provided, of course, that the public have reasonable access.

However, the problems do not end there. The problems are far more complicated. Before the owner's heirs are able to make use of these arrangements which will allow visitors from here and overseas to enjoy the house, its content; and its surroundings, the present owner has to be able to overcome the appalling difficulties that are connected with maintaining and looking after these houses and their treasures. The maintenance costs and yearly running costs are increasing at a frightful rate; but let me quickly add here that these costs have been kept in much better control than if the houses were in the care of Government or local authorities. I believe that the Government and all local authorities realise that these houses and their contents are far cheaper looked after by their owners than by the Government. That is probably why Mentmore Towers was turned down by the Government.

Therefore, my Lords, what is to be done to assist owners in maintaining their houses and their treasures for the benefit of this and future generations and for the benefit of the nation? Yes, for the nation, because it is vitally important for our economic survival that millions of tourists come to visit us here to see our heritage.

This is why they come. Do not let us kid ourselves that they come for any other reason than to see our heritage and the glorious English countryside. Destroy our heritage and you will destroy our second largest earner of foreign exchange.

While we all realise the difficulties of legislating for any particular cause, especially during these difficult economic times, I believe that our nation wants to preserve its heritage; hence the enormous number of signatures that the Historical Houses Association got for their "Heritage in Danger" petition last year—over 11/4 million signatures, the biggest ever presented to the other place.

There are three areas where help is required. First, with maintenance funds. Nobody with the present Government's mentality for destroying wealth is going to be able for much longer to produce the funds that are necessary for maintaining these houses and their contents. Therefore it is essential, in order to encourage funds to be provided for their maintenance, to ensure that these funds do not have to go to a charity after 80 years and also to ensure that the income from these funds can be used, before tax, for the buildings and their contents. In addition, it is vitally important that Section 77 of the 1976 Act be more clearly defined. This might then encourage owners to hand over land into a maintenance fund. Unfortunately, at the moment this is not the case. I quote from a letter that I have received from Treasury Chambers. It says: Generally speaking, most properties which are statutorily listed as Grade 1 buildings under the Planning Acts, and their surrounding amenity land, would qualify for exemption from capital transfer tax under Section 77 of the 1976 Finance Act. It is difficult, however, for me to advise on precisely what area of the parkland at Blenheim would qualify as being essential for the protection of the character of the building. It is the Department of the Environment, in consultation with the Historic Buildings Council, who advise us on what area of the surrounding land can qualify for exemption. You will have noted, however, that the Act lays down that the land must be essential for the protection of the building. As neither we, nor the Department of the Environment, have sufficient resources to enable us to give all inquiries specific advice on their properties, we have been forced to restrict our detailed scrutiny of cases to those where a chargeable event has arisen or sale of the property is seriously contemplated in the near future. I am afraid, therefore, that I cannot be very helpful at this stage. That is certainly not being very helpful. In fact, what they are saying is, "We are not prepared to define or give guidelines. When you die we will tell your heirs how it works". It is not very satisfactory. I hope that the Government will seriously think of ways and means of making this section more definable and clearcut.

Secondly, my suggestion is that in the case of those houses which are not able to get the benefit of Case 1 assessment, provided they are open to the public and their contents are exempted items, the maintenance and insurance of the house and those contents should be tax deductible. Those houses which are not large enough to be assessed as Case 1 will be enormously assisted by this. We must realise that there are a lot of small houses which are of tremendous historical and architectural importance. Also, there are many owners who are neither in a position to provide money nor to provide land for a maintenance fund. Alternatively, the Government might consider purchasing works of art from an owner of a house open to visitors which would stay in that house provided the proceeds of that sale went into a maintenance fund.

My third point is regarding VAT. I feel that a way should be found for exempting all listed buildings from the payment of VAT on repairs. All indications are that VAT will rise in the Budget, and with grants from the Historic Buildings Council being reduced this will mean further curtailment on repairs to these buildings and consequently a further rise in the number of unemployed in the building trade.

My Lords, unless solutions are found, I am afraid that there will be an ever-increasing number of sales like Mentmore Towers, and an ever-increasing disappearance and decay of our heritage. Many of your Lordships will have read of the proposed sale of Daylesford owned by the noble Viscount, Lord Rothermere. This is a very important house once owned by Warren Hastings, and on which the noble Viscount has spent a considerable sum of money, not only restoring but also furnishing it with many of the original possessions of that famous man. Now, because of the high cost of running a house and maintaining it, this has to be sold.

Some of your Lordships may say: "So What? Somebody will buy Mentmore Towers. Somebody will buy Daylesford. Let the possessions go into a museum where they can be seen by the public." But who is going to buy them and where will they be seen? Already many museums have treasures stored in cellars, and probably most of these possessions would go overseas. These treasures are to be seen and appreciated far better in a home that has history and atmosphere rather than in a museum which lacks all feelings, cosiness and warmth. Tourists come here for the houses, their contents and the surrounding environment. They will not come to see empty, decaying houses.

My Lords, the Government have two choices: one, to assist owners in preserving our heritage, or, two, to let it decay and be dispersed. I sincerely believe that our countrymen wish it to be preserved. I hope that the Government will show not by their words but by their actions that they too wish to preserve our national heritage.

6.53 p.m.

Lord COTTESLOE

My Lords, we must all be grateful to my noble friend Lord Mansfield for putting down this Motion, and for putting it down on a most appropriate day, the very day on which the noble Baroness, Lady Birk, and the noble Lord, Lord Donaldson of Kings-bridge, have been concerned in the launching of Heritage Education Year. The noble Baroness has just begun so far as Mentmore is concerned, and I hope profoundly that the race has not gone beyond any possibility of recall.

The matters with which this Motion deals are of course of great public importance and, in the case of Mentmore, of particular urgency. But they are not, mercifully, matters for Party politics. I do not think that the noble Lord, Lord Donaldson, or the noble Baroness, Lady Birk—though we might differ on what may or may not be practicable or advisable—differ from us very much on matters of general principle. With respect to the noble Lord, Lord Vaizey, I own no historic house and have no interest whatever to declare except a lifelong and passionate interest in works of art, in the heritage, and the chairmanship of a voluntary committee called Heritage in Danger. That is a committee which concerns itself with the preservation of our national heritage in the widest possible sense, with historic houses great and small, with works of art particularly, with the marvellous countryside and all the rest that go to make up a great part of the noble civilisation that we in these Islands are so fortunate to inherit.

I need not tell your Lordships that on that committee we are deeply concerned over the fate of Mentmore and its wonderful contents, a product of the height of the Victorian era. That era, which is now so often decried, had many faults but who are we when we compare our almost bankrupt economy with their great and growing prosperity, our sadly weakened strength and influence in the world with their pre-eminent position, to throw stones at the Victorians?

The noble Baroness has been quoted as saying that there would be risks in taking £3 million from the Land Fund, which stands, I think, at £17½ million, when something of the stature of Blenheim or Chatsworth may suddenly come on the market. No one in their senses would claim that as a part of our heritage Mentmore and its contents can compare with Chatsworth or Blenheim which are also of enormously greater value. But I think that I can hear the noble Baroness, Lady Birk, telling us that if Blenheim were suddenly thrown on the market nothing could be done because the very large sum that would be needed from the Land Fund would make it impossible if Chatsworth also came on the market, and vice versa. That, my Lords, is a barren line of reasoning which leads nowhere except to stultification. The Land Fund exists to be used when needed, and to refuse to use it when it is needed because something else might at some time turn up means in effect that it will never be used at all.

Mentmore is a splendid and unique house designed by Paxton, whose other great monument was his Crystal Palace for the Great Exhibition of 1851 which was destroyed by fire many years ago. Mentmore, with its marvellous contents, is architecturally more splendid than Waddesdon, which is a mere pastiche of a French chateau set in an artificial English park and with much more varied and interesting contents even than the splendid French furniture and fine pictures at Waddesdon. That is the only complex that is at all comparable. It would be a major tragedy if this historic assembly were dispersed and the great house left as an empty shell to fall into ruin or perhaps to house some institution.

I have read two careful and realistic feasibility studies (the noble Lord, Lord Montagu of Beaulieu, referred to them) by two independent experts who approached the problems from different standpoints, each of which concludes that Mentmore, with its contents, if run as a historic house open to the public, might be expected to make ends meet or perhaps even do better than that. As two or three noble Lords have said, what a tourist attraction that would be! That is an aspect of it that should appeal not only to this Government but to any Government. I hope profoundly that the noble Baroness, when she comes to wind up this debate, is able to tell us that some arrangement may still be possible, perhaps similar to that at Petworth, by which the great dispersal may be avoided even at this late hour.

If I may turn now to the other matter raised by this Motion, one related to but much wider than Mentmore in its scope, the specific control over the export of works of art—to which the noble Lord, Lord Donaldson of Kingsbridge, referred—I have some knowledge of this matter, having been for 18 years the chairman of the reviewing committee and advisory council that advise the Government on the exercise of control and on particular cases.

As the noble Lord, Lord Donaldson, has told the House, there are what I might call the deterrent measures to discourage the sale of important works of art, and I welcome the steps that have recently been taken to give wider publicity to them. Beyond them, there is the specific control that was set up a quarter of a century ago, in 1952, and which rests on the recommendations of a committee under the chairmanship of the late Lord Waverley, a committee of which my noble friend Lord Robbins was a member. Until the last war, there was no control at all and in the early years of the century and again in the 1920s, the Duveen era, there was an uninhibited and massive outflow of works of art from this country; in the main, of course, across the Atlantic.

I find it difficult to imagine what must have been at the turn of the century the stupendous wealth of this country in fine works of art built up over the centuries largely as a product of the Grand Tour in the 18th century. Some anxiety was felt over the outflow in the early years of the century, and in 1912 a committee—I think under Lord Curzon's chairmanship—reported that "in recent years 500 prime pictures" which they listed "have left the country". That list included 57 paintings by Rembrandt and seven by Vermeer, one-fifth of that artist's whole known output.

However, nothing was done to stem the tide which continued without hindrance between the wars, until a general control was set up for exchange control purposes during the last war. Out of that control there emerged in 1952 the existing system. As the noble Lord, Lord Donaldson, has told the House today, the present control is a licensing control designed only to affect a limited number of objects of substantial importance and, as Lord Waverley pointed out, the more widely a licensing control is extended, the more ineffective and irksome to those concerned it becomes, with the result that it soon ceases to operate as it was intended.

The rules are simple enough. If you wish to export an object more than 100 years old that has been in this country for 50 years and has a value of more than £4,000, you have to apply for an export licence. Your application is referred to an expert adviser—if it is, for instance, a Rembrandt it will go, perhaps, to the Director of the National Gallery and so on—and if he, applying the criteria that the noble Lord, Lord Donaldson, detailed to the House, considered that the object should remain in this country, it is then referred to the Reviewing Committee, an independent committee of four permanent members appointed by the Government, who hear evidence from the exporter and from the expert adviser. If, in the light of the evidence, they decide that the export should not be allowed, then they can set a term, generally not more than three months, during which an offer may be made to purchase the object at a fair price, and if such an offer is made, whether or not the owner accepts the offer, he does not get an export licence.

The latest report of the Reviewing Committee for 1974– shows that in that year, out of some 1,900 applications for export licences, only 22 were referred to the Committee and in nine cases the objects concerned were retained in this country. So that the control is very light and it is designed, unlike the controls in some continental countries, to treat owners and exporters as fairly as possible. Those are its essential features, because they result in the almost invariable co-operation of the trade and of owners, without which no control could hope to operate successfully.

In the 18 years during which I was concerned with the control, there was in fact, so far as is known, only one substantial fraudulent breach of the control, the export to California on a fraudulent declaration of the only known portrait of Dr. William Harvey in his prime. The noble Lord, Lord Donaldson, and the noble Duke, the Duke of Grafton, referred to it. I think we may all rejoice that now, some 15 years later, largely as a result of much generosity and help by the University of British Columbia, it has been possible within the last few weeks for the discoverer in the 17th century of the circulation of the blood to return to this country to take his proper place in the National Portrait Gallery.

Looking back, I think it can be said without complacency that within its narrow limitations the control has operated successfully. The Waverley criteria have stood the test of time remarkably well and no one, I think, would wish to change them, as the noble Earl, Lord Perth, said. Some people would understandably like to extend the control more widely, but that could not, in my belief, be done without forfeiting the co-operation and help of the trade, and that would quite certainly defeat the purpose. If the trade wanted they could run rings around the control.

The great weakness of the control is that it lacks the backing of a fund that can be drawn on to meet the requirements to purchase for the public objects of exceptional value. This has often been said and it is as true today—and perhaps more true, having regard to current values and to our economic situation—than it ever was. It is a weakness that led to the disappearance from this country of, for instance, the Longford Castle Velasquez of Don Juan de Pareja the Rembrandt of Titus, so-called, the unique medieval bronze lectern which is now in the cloisters of the Metropolitan Museum in New York, and a lot else—

Lord DONALDSON of KINGS-BRIDGE

I wonder whether the noble Lord will allow me to make the point that when one speaks of the absence of a fund, £6 million is a good deal more than nothing.

Lord COTTESLOE

My Lords, I thank the noble Lord very much. I was very delighted to hear the noble Lord, Lord Donaldson, say that the Land Fund can be drawn upon on occasion. But there are always good reasons for not drawing on the Land Fund for a substantial sum at any particular moment.

Lord DONALDSON of KINGS-BRIDGE

My Lords, I am sorry to interrupt again, but I am not speaking of the Land Fund. I am speaking of the purchase grants.

Lord COTTESLOE

Although I agree with the noble Lord, Lord Donaldson, that, in general, purchase grants have been very greatly increased, they are not on a scale which is able to cope with works of the kind of value of those of which I have spoken, which have come suddenly on to the market—I am sure that the noble Lord would agree with that—and I do not see how they ever could be.

The Earl of PERTH

My Lords, may I ask the Minister for the Arts whether the £6 million figure is really a very fair figure? I think he said that it included the monies for the national libraries, but about £2 million of that must properly be for the buying of books for current study, so that the truer figure would be only about £4 million.

Lord DONALDSON of KINGS-BRIDGE

My Lords, if——

The Earl of MANSFIELD

Order! I am very sorry, my Lords, but we cannot have this backchat.

Lord COTTESLOE

I am sorry, my Lords. I cannot answer for the Minister.

I was going on to say that I hope that the Government will look again, and look most seriously, at the possibility of making use of the Land Fund as a source on which to draw on quite exceptional occasions, without requiring reimbursement from the purchase grant of the gallery concerned. I can well appreciate the difficulties and the objections of the Treasury, but it would provide a most valuable safeguard and I can see no other way in which, at the present time, this weakness in the control could be overcome. As circumstances and values change, so the control has to adapt itself, and I understand that consultations are taking place to increase the value limit further to take account of inflation, and to decrease the age limit.

I do not think that any general review of the system in the light of the experience of the first quarter of a century ought to be initiated until those consultations have been concluded and the necessary action taken. But when that is settled and out of the way, it might be good, notwithstanding what the noble Lord, Lord Donaldson of Kingsbridge, has said, to have a general review of the system to see whether, in one way or another, it cannot be improved. I think that my noble friend Lord Perth has made a very strong case for that.

We live in a changing world. I have been criticised for saying on one occasion that as communications about this globe become easier and more rapid, so the context in which works of art can be seen and studied becomes more important and their location less important. I believe this to be true. I think, for instance, there would be general agreement that if there were a new find of Boswell papers such as that at Malahide Castle some years ago—nothing is much less probable—the right place for them would be not the British Museum but the University of Yale where they could be studied in the context of the great mass of Boswell material that is there. That is possibly an extreme and certainly a very improbable case, but it may serve to illustrate the point.

I must make one other point before I sit down. The last thing that I want to do is to embarrass my noble friend Lord Donaldson of Kingsbridge, if I may so call him without impropriety, for he is certainly not my enemy. His predecessor, Mr. Hugh Jenkins, took the opportunity of an Adjournment debate in another place on 28th October last to make what I can only call a venomous attack on the reviewing committee and its members, accusing them of making use of their report for anti-Socialist propaganda, saying that if he had still been Minister he would have refused to accept their report, and taking a pride in having, as he clearly implied, got rid of the noble Earl, Lord Perth, as chairman and two out of the three other permanent members of the committee.

The noble Earl, Lord Perth, cannot well himself reply to these accusations which are, in fact, monstrous and ill-founded. No one who knows him will really believe that he would behave in that way. He is, in any case, sitting as he does on the Cross-Benches, not really a political animal. No one who reads the report dispassionately will find a word of truth in the allegations. Still less will anyone who knows the other two members of the committee concerned, Professor Sir Anthony Blunt and Mr. John Ehrman, devoted scholars as they are, conceive it possible that anyone, however prejudiced, could accuse them of injecting Party politics into their report. Nor, indeed, is there any truth in the suggestion that Mr. Jenkins sacked them for doing so. They had both given long years of selfless service on the committee and themselves decided that it was time to retire from it. No one, so far as I am aware, has injected Party politics into the field of the arts, except Mr. Hugh Jenkins himself.

I feel rather apologetic for saying all this, but a privileged and wholly unwarranted attack, to which they cannot themselves reply, was made against these two gentlemen in another place—gentlemen who have given most valuable public service—and it is necessary that the truth should be told and set on record.

Lord DONALDSON of KINGS BRIDGE

My Lords, may I intervene to say that Mr. Ehrman left during my time after I had begged him not to do so, and that Sir Anthony Blunt is one of my oldest friends. There should be no suggestion in this House that the Department of which I am the Minister of State has anything but gratitude for the work that was done by these people.

Lord COTTESLOE

My Lords, I thank the noble Lord very much.

7.15 p.m.

The Marquess of HERTFORD

My Lords, may I begin by offering my congratulations to the noble Duke and the noble Marquess for two outstanding maiden speeches. It is painfully obvious by now that the fate of this great house and its contents presents no easy problem. There is one solution which I do not for a moment suppose would receive any serious consideration: to reduce the rate of capital transfer tax so that the owner who is, or at least was, extremely rich could afford to maintain the house. But that is far too simple a solution to merit your Lordships' attention. I mention it just to make the point that there is at least one Conservative Peer who still thinks there is some merit in the hereditary principle, particularly with regard to the ownership of historic houses where I must plead an interest. My own home is open to the public.

I am about to speak from a financial angle but I want to make the point, which has not been very strongly expressed in the debate this afternoon, that works of art of the calibre of the contents of Mentmore do not have a financial value. They are worth very much more than money. They are worth our children's education. They are our cultural heritage. The word "heritage" gets bandied about rather a lot. If something is beautiful and a work of art, then surely it is worth preserving for its own sake.

Having said that, we now have to enter into the difficulties of the money side. I am President of the Heart of England Tourist Board and I want to follow the noble Lord, Lord Montagu of Beaulieu, by speaking about Mentmore in relation to the tourist trade. The regional tourist boards have a well defined and, in my belief, worth while duty to encourage the provision and the use of tourist amenities outside London. It is our policy to attract tourists away from the over-crowded places referred to by the noble Viscount, Lord Norwich, like London, Oxford and Stratford-upon-Avon, into the less well-known areas where they and their money are much more welcome. When I say "tourists" I mean British people having a holiday or a day off as well as people from overseas.

The most popular attraction which draws people away from the tourist resorts and into the countryside is a visit to a famous house, particularly if the house contains a great collection of works of art. Outside London, historic houses form our greatest capital asset in what is rapidly becoming our most valuable and profitable industry. We cannot afford to destroy that asset, nor should we squander that income-producing capital. The Government presumably see the figures about tourism which are published from time to time and which have been mentioned today, but one cannot detect much sign of any appreciation of the real importance of those figures.

It is natural, when one thinks about it, for the importance of a country's tourist trade to increase as that country becomes poorer. Our currency becomes cheaper for foreigners to buy. At the same time, more of us have holidays at home because we cannot afford the prices abroad. This means that our economy gains twice over, both from the foreign money that is brought in—£2,500 million last year—and from the British money that is not taken out. Some years ago this happened in Spain, Portugal, Greece and Italy, and it is now the position here.

I apologise for repeating all these well-known facts, but I do not think that the importance of that trend has been hoisted in. I repeat them because of the penny-pinching attitude towards tourism which is so sharply shown upon n the case of Mentmore. Here we have, or possibly had, a potential tourist attraction which could have been bought for a fraction of its present value and used and managed by the Victoria and Albert Museum—perhaps instead of the very expensive extension which I understand is planned and which will cost about half the purchase price of Mentmore.

Mentmore is outside London, but it is not so far away as to be inaccessible to tourists. It could provide just one more reason for a holiday in England. Its existence as a tourist attraction could persuade foreign tourists to spend one extra day in this country. One extra day probably brings in about £10 a head. A house like Mentmore could hardly attract less than 50,000 visitors a year so that is £500,000 a year that it could be earning, not from its own gate money for itself but in bringing money into the country to the benefit of the national economy.

Lord DONALDSON of KINGS-BRIDGE

My Lords, while not disagreeing with almost anything which the noble Marquess has said, I should like to point out the falsity in the argument about the new building for the V and A. That new building is to house items which ought to be shown and which would be totally unsuitable to be put in Mentmore.

The Marquess of HERTFORD

My Lords, that I did not understand. I merely heard the very large figures being bandied about and I thought perhaps Mentmore would have done instead. It is figures such as the large figures we have been bandying about which I think justify the term "penny-pinching" in relation to the attitude of the Government to the tourist trade in general and to Mentmore in particular. I do not know enough about Mentmore to talk about it as a special case. I should like to make the point for the general case, for a more sympathetic attitude to the whole tourist industry and of course to historic houses in particular.

Our tourist trade has such a lot going for it. In the British Tourist Authority we have something which claims the admiration and at the same time the despair of our competitors abroad. Americans have said to me that if only they had a similar organisation no American would ever need to leave America because they have it all there. They have the works of art, they have the scenery and they have the coastline—they have the lot. Mercifully, they do not realise it, so they will continue to come here to see historic houses such as Mentmore. We also have the Regional Tourist Boards, gravely hampered though they are by lack of local government money, although they are beginning to be effective; and we have the greatest collection of historic houses, such as Mentmore, which are unique to this country. All those things we have. It does sometimes seem that the only thing we do not have is the support of our own Government.

7.23 p.m.

Lord O'NEILL of the MAINE

My Lords, first I must explain to your Lordships that as a younger son I have no interest whatsoever to declare. Secondly, I should like to make some remarks from my previous knowledge of the country from which I come. I wish to make the somewhat astonishing suggestion that if Mentmore had been in Northern Ireland and had come up for consideration a few years ago it would have been saved by the Northern Ireland Government through the agency of the Ulster Land Fund and would today be run by the Northern Ireland Committee of the National Trust. There is a good reason for this. Of course, the owners of historic properties in Northern Ireland were much poorer than their cousins across the water in England, and therefore it was essential that assistance should be given from the Land Fund.

As a result of all the discussion that we have had today about the national Land Fund in Britain, I must admit that I am very confused. We have been told that it does not exist. We have been told that it increased in value from £50 million to £60 million. And I remember well, with horror, when I was Minister of Finance in Northern Ireland, hearing that a Tory Chancellor had robbed this Fund of £40 million. I must admit that I was absolutely horrified. Think what might be done today if there were a sum of £60 million in this non-existent Fund!

We in Northern Ireland fostered our fund. It did not increase—as the noble Duke, the Duke of Argyll, explained to us earlier today in his excellent maiden speech—to the extent of £10 million. It was a miserable sum of £1 million and the interest from that fund was used every year to purchase something which could be run by the Northern Ireland Committee of the National Trust. Today there are 14 properties in Northern Ireland which would not have been saved had it not been for the use of the Land Fund. True, as Minister of Finance I got a feeling that the Trust really had too much of a good thing out of all this and I created a National Museum in Belfast. I turned the Municipal Museum there into a National Museum, which practically ruined the fund, but despite that fact an enlightened Ministry, after I had passed from the political scene, topped it up again so that it is still in existence.

May I say here that the noble Lord, Lord Donaldson of Kingsbridge—who knows a lot about Northern Ireland—I understand, from talking to one of my former officials recently, was most helpful in saving Mount Stewart and the Congress of Vienna chairs and tables which have existed there since Lord Castlereagh's day. So I am not criticising the noble Lord in any way at all. I merely wish to state my belief that we did something useful in Northern Ireland which should have been done with the national Land Fund, which is a great memorial to the man who set it up in 1947. There is no doubt about that whatsoever. I reiterate, I am ashamed to think that a Tory Chancellor raided it, presumably on the advice of the Treasury—although, of course, the excuse could be that the Fund does not exist.

Perhaps I may mention three properties that were saved in Northern Ireland. First, Castle Ward, one of the most attractive houses I have ever seen anywhere: built because husband and wife could not agree, one side Strawbery Hill Gothic, the other side classical, and yet somehow or other a house of fantastic charm. Second, Rowallan Gardens, which my wife looked after for over 20 years—one of the finest gardens in the United Kingdom which would certainly have "gone down the drain" had it not been for the Land Fund. Lastly, I suppose something which all noble Lords in this House have heard of—the Giant's Causeway. I think it was Doctor Johnson who said it was worth seeing but not worth going to see. Nevertheless, it is a very interesting geological formation. When I was a child there was there a rusted turnstile and one had to pay money in order to get in. That was bought by the National Trust with the assistance of the Land Fund, saved for posterity, free to everybody—to the natives and to the tourists. How sorry I was that when I asked Jack Kennedy to come and declare it open he could not come; this was something prehistoric in Ireland and I did not feel it would lead to any trouble.

Across the Border: the noble Marquess, Lord Sligo, in his maiden speech referred to Malahide. Malahide, like Mentmore, would have been saved had it had the good fortune to be in Northern Ireland. Here was an absolute tragedy. Here was a Norman castle, still with its central hall, lived in for 800 years, the finest collection of Jacobite Irish pictures in existence, original Irish Chippendale furniture. An arrangement was made between the owner and the Prime Minister in Dublin for it to become either an Irish Chequers or an Irish guesthouse. The owner drops dead; there is an election; the Government change and the whole thing goes "down the drain". The contents were sold for vast sums of money the other day and were dispersed all over the world. It was an absolute tragedy, as Lord Sligo was explaining.

My Lords, I always speak very briefly in your Lordships' House. May I now return once more to Mentmore. As I understand it, the guillotine cones down on 5th April; this is a guillotine the Government can still operate. Could not this date be extended, despite what we have been told about the Inland Revenue's views? Would it not be possible for this date to be extended so that further consultation could take place to see whether there is any way in which Mentmore could be saved? I do so hope that Lady Birk in her reply might be able to suggest that at least consideration could be given to this point.

I hope I have not injected too much from my own part of the world into this discussion; but at a time when the news from that part of the world is so unpleasant and so dreadful I thought noble Lords might be interested to hear that there was something which I believe we did well, as Lord Donaldson knows. Personally I regard it as an absolute tragedy that this mythical English, British, Land Fund does not in some way or other continue and remain available to Lady Birk and Lord Donaldson at this moment.

7.32 p.m.

Lord CAMOYS

My Lords, I must first apologise for not putting my name down to speak in this debate. Unfortunately, I have been abroad, and was not very efficient. Secondly, may I congratulate the maiden speakers. As a recent practitioner myself, I was very impressed indeed. Thirdly, I myself have to declare an interest. It is rather a peculiar interest, in that I am still in the rather agonising process of trying to buy my own family home in order to save it and its contents as a unit. I am still trying, I think, only because of the encouragement that I have received from the Department of the Environment, from many Members of your Lordships' House, and from many people of all walks of life, in many parts of this country and also in the many countries I have to visit on business abroad. Without that encouragement I think I would have given up.

My Lords, what I think is extraordinary is that, whereas I am quite convinced that there is a very deep conviction in your Lordships' House, in the Government in particular, that historic houses should be saved, there is a lack of the right policy to achieve it. Believe me, my Lords, encouragement takes one a certain way, but it may not take one the whole way. I am also a banker, and a banker connected—I do not want to make this too personal—with a very large travel business. As a banker, I am trained to look at cash flow and all of that, and one of the most frightening aspects of entering into this commitment, if I ever manage it, will in fact be the large capital outlay in addition to the purchase price, which does not, in my opinion, receive very favourable tax treatment.

So far as the travel business is concerned, I am very aware that historic houses are in fact one of the two unique selling points of our tourist industry. That is a rather vulgar phrase, but it is a very meaningful one. We are very lucky in this country to have two unique selling points. I think the other is pageantry. Any businessman, any Government, I would submit, should be ensuring the survival of that unique selling point. I believe there probably is a very simple way of doing it; that is, if I may humbly suggest it, for the Government to treat historic houses as part of the tourist industry, as a priority industry, Noble Lords before me have given very impressive and accurate figures about which there is no dispute. As a priority industry, one would humbly suggest that depreciation allowances on our plant and equipment be granted us, as they are, after all, in manufacturing industries; and, of course, as our plant and equipment I refer to the buildings, the pictures, et cetera. My Lords, I do not want to delay your Lordships any longer, but I would submit that there is this very simple way of avoiding a great many of the tragedies that we are now seeing.

7.35 p.m.

Baroness BIRK

My Lords, it seems æons of time ago since the noble Earl, Lord Mansfield, got up to open this debate. I think until about the last hour or so I would have found it very difficult to give even my formal thanks to him, because he has caused me so much trouble and heartache. Nevertheless, I feel that this has been an extremely useful debate, not because it has once again aired the problems of Mentmore, but because it has gone very much further than that. Some very positive points have been made, some suggestions have been put forward which I shall pass on with great pleasure to my colleagues in different Departments of the Government as well as within my own.

I should first like to congratulate the noble Duke, the Duke of Argyll, and the noble Marquess, Lord Sligo, on their fascinating, informative and really very interesting contributions to the debate. I will not, in view of the lateness of the hour, and the vast range of points made, touch on all the points that have been raised. Nor will I attempt to deal with the points with which my noble friend Lord Donaldson has already dealt, I think most effectively. If there are any pieces hanging around, he has been sitting through this debate with me and has told me that he will be writing to noble Lords. My comments will concentrate on the threat to the heritage. Incidentally, I very much welcome Lord Mansfield's shift in emphasis from his earlier Motion, which talked of the threat to the heritage unless Mentmore Towers and its contents were acquired for the nation; he is now using it to exemplify, which I think enables one to concentrate on the wider issues and put the Mentmore situation in a rather better, less emotive context. But I will start with Mentmore, a problem that I feel I have lived with for years, something that I feel will always be carved on my heart; so much so that the other day, walking down one of the corridors in this House, when I was addressed as Lady Mentmore my spontaneous reaction indicated either a Pavlovian reflex or a case of total identification.

My Lords, the qualities of Mentmore have been stressed many times. There has been outside this House vociferous support from various conservation groups. I understand and absolutely sympathise with their concern and their passion. The noble Earl, Lord Perth, was quite right when he stressed how interested the young were in this, and the fact that I do not agree with everything they have said does not mean that I do not appreciate their right to have said it; certainly it would have been the sort of thing I would have done in that situation. Nevertheless, I think we must get some balance about this.

I have been very interested in the impression, not deliberate but sort of ambivalent, that has come across to me. whether Mentmore exactly fits into the natural heritage, and how and in what way it does so. Here I am making a distinction between the items as individual items and as part of a collection. I must point out that a number of distinguished art historians and distinguished 19th century historians who have spoken to me and written to me, have questioned the unity—I am just repeating the words of experts—of a mid-19th century house, a collection of mainly French and German furniture and art from several centuries. This is a point of view when we are talking in these terms. I am assuming, after what has been said and acknowledged by all noble Lords here, that we are talking within the terms of the economic constraints the country is in.

Let me right away say that if we were in a state where we could indulge in what is becoming the luxury of buying Mentmore—this is as far as the Government acting alone is concerned—then I do not think there would be any problem about that. However, we are having to become extremely selective and must try to be more specific in our definition of "the heritage". The noble Lord, Lord Gibson, who put both sides of the case, showed the dicotomy that many people are quite rightly in over this issue. When I visited Mentmore Towers, I found it to be a fascinating part of our social history, a marvellously variegated treasure trove. It would be untrue to say that the original collection is a complete collection, because over the years a great deal of it has been sold and has disappeared. There were sales in 1939, and in 1964 the entire Boucher Room was moved to Frick House in New York. The 10 painted doors have gone as well as a number of pictures.

I do not make a point of that, but I mention it simply to show that this is one argument that does not fit.

The noble Earl, Lord Mansfield, quite rightly, went through the sequence of events as he understood it. It would be quite wrong of me if I did not ensure that the record was correct from our point of view. What happened before February 1976 is water under the bridge. One can argue—and it has been argued by noble Lords—that we should find a way of being aware of these things and what will happen when they arise. I shall return to that aspect later: We should find a way round the problems that arise when a house has not been opened for years, when the last Earl dies at the age of 94 and when his son exercises his right not to continue to live in the house.

I shall take as my starting date February 1976 when the present Lord Rosebery offered the house for sale to the Government for the equivalent of about £2 million, although over and above that taxation would have been lost. The house and contents were never offered in lieu of estate duty, which is another misconception that has been put abroad. During the spring of 1976, as the noble Duke, the Duke of Grafton, pointed out, it is quite true that the Historic Buildings Council—my statutory advisers— went and looked at the house. In July they recommended that it should be acquired. In August the Department was approached by a multinational company which indicated a serious intention to move into the conservation field. Certainly in America and in other countries that is common practice. That company was not worried at the idea of the house costing £2 million plus. Naturally, the idea of this partnership between industry and the Government not only caught our imagination, but it certainly caught my financial fancy. We hoped that everything would turn out all right for Mentmore.

Lord Rosebery wanted a reply by the end of January, but in the middle of January the company pulled out. It gave as the reason the economic situation. We were then in a very difficult position because at that time no extension had been granted. It is perfectly true that there were discussions later. We had to inform Lord Rosebery's solicitors that this deal had fallen through because they needed to know by the middle of January.

As noble Lords know, another offer was made. It was that offer which increased the purchase price by £1 million. It was that to which I referred in the rather telescoped quote which has been mentioned. This is a matter of one's point of view and Lord Rosebery has the absolute right to take an entirely different attitude. I thought that his original offer was an extremely generous and reasonable one. Nothing had changed except that the Government had lost their industrial partner and were therefore very much up against it. To use a colloquial expression, the "ante" was then "upped" £1 million and we had to find £3 million rather than £2 million.

The Earl of PERTH

My Lords, I do not want to interrupt the noble Baroness except to ask whether this international company realises the great damage that it has done to the national heritage and whether, in seeking funds, we might be able to persuade it, even at this late date, to make a substantial cash contribution towards saving the situation.

Baroness BIRK

My Lords, my immediate reaction was to take every possible step to retrieve the situation, but I am afraid that the company withdrew the offer. Exactly the same thought occurred to me. This brings me to recent weeks. During that time discussions went on between my colleagues and myself, both within my Department, across Departments and with the Treasury. I have personally tried to get in touch with anyone who might have access, either themselves or through groups with which they are connected, to the sort of money that is necessary. We must be realistic about this. We shall not obtain such money by having a collection where the odd "fiver" is donated. We are talking about big money, and it was on that basis that I set about the task of finding it. I discussed the matter with a great many people, who were very doubtful due to the times in which we live.

I was asked whether consultations took place. I consulted with the chairman of the British Tourist Authority who is also a member of the Historic Buildings Council. He was very anxious to lend his help and support. I spend a great deal of time making sure that the tourist dimension of everything that we do is used to the full—I nearly said "exploited ". I had rather hoped that the noble Lord, Lord Montagu of Beaulieu, had appreciated that point because I am very conscious of it. As he has, perhaps, noticed, I even carry the card about in my handbag so that I can remind people that over 10 million foreigners will come here this year and that 44 million people will spend their holidays at home.

That does not get us out of the initial difficulty. I appreciate the point made by the noble Lord, Lord Cottesloe, that it is a seductive conclusion to draw that if we say that Mentmore is not the most important part of our heritage, then we shall say the same thing again. I do not like the noble Lord saying that, but I quite understand why he is suspicious. Nevertheless, there is a big difference and the noble Lord must appreciate that. I would not put Mentmore in the same class as Hardwick or Houghton Hall, which was opened last year by Lady Cholmondeley, nor even Boughton House, which shows a succession of historic events. It does not rank with Osterley or Ham House which are all intrinsic segments of English history.

Therefore, we are looking at the purchase of not just this marvellous and interesting house and its wonderful Alladin's cave of a collection, but we are looking at it with a horribly selective and financially discriminating eye. Can we at this moment afford to do this with the overriding other demands for public expenditure? I am very grateful for the help that has been offered by the noble Lord, Lord Montagu, to work it out, and all the comments that have been made on how this could be built up into a tourist trade. We are very aware of this, but none of this overcomes the initial problem of finding the £3 million.

While noble Lords have been speaking, I have worked out that there are 13 Peers who have spoken in favour of buying Mentmore. I counted the noble Lord, Lord Gibson, in and the noble Lord, Lord Inglewood, out because I was not quite sure whether or not he was quite so sold on Mentmore itself. If they want to make a financial dash for it, I worked out that if each one makes himself responsible personally, or finds a group of people who would put up £153,846, then we could secure Mentmore by 5th April. That is a very good thought to go away with. I am serious about this because of the way noble Lords have spoken; they are speaking as people who have considerable connections, contacts, expertise, drive and with considerable advice to give. Could we then think in those terms?—because we consider that Lord Rosebery's renewed offer is still open.

As my right honourable friend said in a Written Answer the other day, if at least £2 million is promptly promised from private sources the Government are ready and willing to do their share. I will even stretch my neck out further and say that, if we had that amount, between the Government's support and that suggested by other soundings I have made, I think the money for the maintenance would probably be forthcoming, certainly to cover the situation until Mentmore got on to its own feet, which I have no doubt is possible in the future. But it still has to be maintained and prepared for this tourist trade and it still needs some money to get it started.

It has been said that at £2 million or £3 million it is a bargain. But things are only a bargain in that sense if you are prepared to sell them, or part with them. If you are keeping them, you cannot argue it both ways in that way. It has been suggested that we should accept Lord Rosebery's offer and sell off part of the collection to recoup part of the capital outlay, or help with the maintenance. I was very attracted to this idea and mulled it over. But I must also admit that there are grave financial and heritage problems over Government purchase and resale which I will not go into in detail here; but I can imagine a number of people who have spoken in the debate would be against this conception for a variety of reasons. Also—and this is important—we do not know whether Lord Rosebery would be willing to go ahead in the knowledge that the Government were to resell items bought from him for the national heritage. I do not honestly think we could keep it from him. He is sitting there, and can hear what I am saying in any case.

I must try to deal with the complicated problems of the national Land Fund. It looks like some enormous piggy-bank providing cash for this kind of eventuality; but the keys to it are then hidden in a whole series of Chinese boxes. This is how it seems to work. There is nothing simple about it at all. It seems to me to be the greatest misnomer of all time. The Fund seems to be rather mytnical. It comes and goes; it is there, and it is not. Where it deals with the land it has moved away from the original concept of Hugh Dalton, who was concerned much more with the countryside and the National Parks. Perhaps, if we kept the word, "national" and built from there we could get something more realistic which would be more easily understood; then I would not have to explain it as many times as I have in these last few weeks.

The way it works now means that, if my right honourable friend the Secretary of State for the Environment had decided we should acquire Mentmore, then his expenses should be reimbused from the national Land Fund. But—and this is the snag, the tripwire—the expenditure involved, even though reimbursed from the Fund, is still public expenditure. Therefore, it is treated no differently from money spent on schools, housing, hospitals, and the case for it has to be balanced against other claims on the public purse.

Expenditure—all this was carefully explained in an expert way by my noble friend Lord Vaizey—has to be contained within the recently published PESC White Paper. The effect would be that Mentmore could be purchased only at the price of an equivalent cut in housing and other programmes, and this is the rub. It is a cut in public expenditure. Quite apart from the current severe public expenditure constraints, buying Mentmore and its collection would have the effect of diminishing the Land Fund by that amount. Again, there is here a question of priorities because more and more is being drawn on it. At one time we were trying to exist on the interest from it, and more and more is being drawn because of the greater demand for rescuing works of art.

I think in my mind the real question, without going into any further rather tedious details of this illusive and evasive Fund, is whether the national Land Fund is the right contemporary mechanism in circumstances quite different from 1946 for financing the acquisition of historic houses and their contents. It certainly creates a congestion of confusion, if nothing else. Whatever mechanism is used, what we have to face up to is that the only real answer lies in additional public expenditure on conservation. This means all the implications of cuts in expenditure, of questions of priorities and policies which extend right across the field of Government. I do not think we can dive out of that one. One cannot just find the odd bit here and there; it has to be a straight policy line. It is "no" secret that I certainly would not say no to that, and would press very hard to get more for conservation.

Another input of confusion surrounding Mentmore which has surfaced several times in this debate, is the widespread impression that estate duty rules are the material factor facing executors to sell the contents on the open market before the end of May. This point has been raised so many times that I am afraid noble Lords will have to bear with me while I try to rattle through the exact situation. If they do not catch the words perhaps they will read it themselves in Hansard tomorrow, but I must get it on the record. The three-year rule applies where works of art and similar heritage objects are the subject of a claim for exemption from estate duty and a claim has been formally accepted. I must make the point that under the estate duty régime exemption was not available for historic buildings as it now is under capital transfer tax. Therefore, Mentmore Towers itself does not qualify for estate duty exemption. The broad effect of this rule is that if an object which has been exempted from estate duty is sold within three years after the death, estate duty becomes chargeable on the value of the object at the date of death. But if an exempted object is sold more than three years after the death, duty is charged on the sale proceeds. This is a statutory rule since Section 39 of the Finance Act 1969 and the Government have no powers to vary it. It has been widely assumed that the existence of this three-year rule means that a sale of the contents of Mentmore on the open market more than three years after the death (that is, after the 30th May 1977) would necessarily attract estate duty on the sale price, and thus, if values have risen substantially, involve a larger estate duty payment. This is not the case. The reason is that in large and complicated cases of this sort the processing of a claim to exemption is necessarily lengthy. It is open to the parties concerned to withdraw their claim for exemption while it is still under consideration. If they do this the property could still be chargeable to estate duty at the date of death value, and not by reference to the sale proceeds even if a sale on the open market took place outside the three-year period.

I understand that the executors of the late Lord Rosebery's estate are aware of this possibility. In these circumstances, I do not think that the estate duty position in the event of a sale on the open market after 30th May 1977 need be a material factor in a decision that the sale should take place before that date. Therefore, in answer to the question put to me by the noble Lord, Lord O'Neill, the date could be extended; but this is up to Lord Rosebery.

The Earl of MANSFIELD

My Lords, before the noble Baroness leaves that point, may I ask whether this very interesting factor has been communicated to Lord Rosebery's advisers?

Baroness BIRK

Yes, my Lords.

Lord STRABOLGI

My Lords, my noble friend said that that was the case just a few seconds ago.

Baroness BIRK

Lord Rosebery's advisers are absolutely aware of it, my Lords. He has very good advisers and if they do not know this, he should sack them. Of course they know it, and I said so. This is the situation of the three-year rule and therefore it is not a stumbling block. As for the £153,864 worth, I hope that is all the syndicate is in for; perhaps they could arrange with Lord Rosebery for the period to be extended; but that is up to him, not me.

I move on to the wider issues—that is, before I lose noble Lords as they go to collect the money. The problems highlighted by Mentmore are illustrative of the general problem of the architectural heritage, a heritage which, in the context of the debate today, has been rather narrowly conceived as made up of the outstanding country houses and their contents. I absolutely agree with all noble Lords who have said that one thing that should happen as a result is that we should learn from this case.

The Mentmore story has certainly spelled out loud and clear the need to establish order of priorities before another outstanding house comes on the market. But we have to be realistic and accept that Government alone could never take over more than a few and that these must therefore be the most outstanding composition of house and contents of the outstanding buildings. One is coming to a peak of excellence, therefore. Accordingly, I shall be asking the Historic Buildings Council and other bodies concerned to meet me to discuss the best and most practical way of drawing up a league of top houses and contents which stand head and shoulder above the rest as a part of the British heritage that must be saved. If we use up money and credit on the interesting but not essential in heritage terms, we will have less chance of saving anything of great importance.

Now for the knotty fiscal problems. The tax and other concessions made by this Government, particularly in relation to capital transfer tax, have been acknowledged, but the complaint is that these have not gone far enough, and I shall certainly take up the point made by the noble Duke, the Duke of Marlborough, about not knowing exactly when the situation was changing. As a Socialist and a member of a Government committed to a more equitable distribution of wealth, it seemed to me when I first started doing this job a paradox to encourage the privileged owners of splendid houses to continue to enjoy their privileges at the expense of the State. But I soon saw that the most economic as well as the most attractive way of making the heritage available to the general public was to encourage owners to stay on and open their houses to the public, and this has been a very personal experience for me.

This is a two-way transaction; on the one hand, there is the pleasure of continuing to live in a house with which the family has been associated for many generations—noble Lords will agree that even when people are stretched financially and finding it difficult, they find great satisfaction in living in the place to which they are accustomed and for which they have a great deal of affection—and, on the other hand, the public are being given the pleasure of visiting a house which is coloured by warm personal conditions, with its social history seen through the human eyes of the people who live there.

One of the key factors here is a partnership. There must be a partnership based on mutual passion for the individual house, and it must be a partnership between the State and the owner; and with great respect, I feel that that factor is missing in the Mentmore syndrome. I attach no blame for this; it is just a fact. It is an ingredient which is not present and which makes the whole situation more difficult. The Government are not just paying lip service to this concept of partnership. It is acknowledged in the substantial relief available under capital transfer tax, which differs from estate duty in three major ways. I will mention them briefly because they have been dealt with by noble Lords.

First, historic buildings can qualify for capital transfer tax exemption where they did not qualify for estate duty exemption, and my noble friend Lord Vaizey went into that in some detail. Secondly, adequate access is a condition of the exemption, and I have raised the amount of access needed to qualify for grants; this is the responsibility which I think we all agree is absolutely essential for any form of fiscal privilege. Thirdly, maintenance funds for historic houses attract a special relief not available under estate duty.

Lord INGLEWOOD

My Lords, when the noble Baroness speaks of a maintenance fund, may I ask her to confirm that it is not in perpetuity and that any owner who sets aside certain resources for a maintenance fund loses the lot at the end of 80 years?

Baroness BIRK

My Lords, if I start going in to maintenance fund details and the various views that are held about it I shall be here for a very long time tonight. I assure the noble Lord that I am aware of the problem he has raised. I have been written to a lot about maintenance funds and I will, if I may, write to the noble Lord on the subject. Both in this House and outside there have been strong arguments for further concessions, for example a change in the rules for income tax, to help owners of unprofitable houses which are open to the public. The Historic Buildings Council has made this point very strongly and I am in touch with my Treasury colleagues about it. It has been suggested that we are now approaching a crisis of confidence, but frankly I would like more hard evidence that many owners really intend to divest themselves of their responsibilities and of their privileges before I put up a case to my Treasury colleagues on the subject. Mentmore Towers is not really a good example of this because there are many other factors involved.

On the advice of the Historic Buildings Council, we give grants for repairs—I see the recommendations myself every month to agree them or otherwise—and there is no real evidence that owners are unable to find their share of the cost. Again, on this subject I intend to ask the Historic Buildings Council to let me have specific examples when they occur. We really must, if we are to get down to this problem, discuss it in terms of specifics and not just in generalisations.

I shall of course report the views expressed here to my Treasury colleagues. I must however point out—because they will point it out to me—that the claims for even more generous treatment have to be weighed against the basic problems of creating too many exceptions in the tax system. The Government are keeping the provisions under review, and while I appreciate the point made by Lord Mansfield, it is necessary to see how the rules work out in practice, and in the specific ways I have suggested, and then decide what changes are necessary. The situation is certainly complex enough and it would be premature to rush into making substantial changes in the rules and give the owners of heritage property a further dose of legislation to digest unless we had got it right, in spite of the hole the noble Earl feels has perhaps been left by the devolution legislation.

Anyone listening to this debate would certainly believe that the whole national heritage is contained in the large historic houses and their contents, although Lord Inglewood spoke of the smaller and other houses. It also embraces a great number of lesser manor houses which are essential elements in the life and shape of a town or village. It includes vast numbers of modest small buildings which, individually or in their groupings, are necessary to the aesthetic and social fabric of our towns and villages and to our rundown inner cities which the Government are trying desperately to resuscitate.

The Government's concern for the architectural heritage must embrace all this and, with nearly a quarter of a million buildings listed as of special architectural or historic interest, it is quite unrealistic to believe that we can or should seek to conserve and maintain every one of them. The problem is a familiar one: how to allocate limited resources. At this time of economic stringency, we have managed to maintain in real terms the amount devoted to grants aiding repair of the outstanding historic houses and environmental work in outstanding conservation areas. Obviously we need more. Indeed, the amount spent last year by the HBC, about £4½ million, roughly equals the cost of acquiring Mentmore and providing for its future.

I am sorry that I cannot sound more optimistic about the matter at this time. So far as Mentmore is concerned, I shall never lose hope until the last minute. I feel that perhaps something will turn up. I hope that the publicity that has arisen from the debate in this House will result in it being saved, even if it is at the last moment. Furthermore, I hope that in the wider context what has arisen over this has been an object lesson all round. I accept that it has been so for the Government and for my Department and certainly for me personally. We want now to see what kind of preventive action we can take, the ways in which we can integrate even further all the various areas concerned in the wider field of conservation and what we can do about increasing the resources available. In any case, in the middle- and long-run, as the economic situation improves and as we get a greater creation of wealth, noble Lords will not find me or my noble friend Lord Donaldson, Minister for the Arts, lacking in getting the largest share we can for our respective areas of the arts and conservation.

8.11 p.m.

The Earl of MANSFIELD

My Lords, we have had a lone debate on this matter, and I suggest a very useful one. First, I should like to thank all noble Lords who have taken part, and would particularly mention the two splendid maiden speeches we have heard. Both came from very different parts, not of the United Kingdom but of the United Kingdom of Great Britain, Northern Ireland and the Republic of Ireland. Both were entertaining and interesting, and I am very glad that a debate which I initiated prompted my noble friend the Duke of Argyll to break his silence. I hope noble Lords will forgive me if I do not reply at any great length to the debate or to either of the two Ministers who have taken part. It probably would be wearisome and tedious and I feel I could not do it in any way which would be other than extremely boring for all who had to listen.

I should like to say a word or two about the contribution made by the noble Lord, Lord Donaldson of Kingsbridge. I enjoyed the way he set out the four ways in which he saw the Government were going to make the best use of their resources. I particularly liked the sound of his first heading; that is, the idea that so far as the chattels were concerned, owners would be encouraged to keep them and show works of art to the public. I do not think— am looking at the noble Lord, Lord Vaizey, when I say this—that there is any noble Lord who nowadays imagines that he can obtain any form of fiscal advantage or appreciation on the part of the Government if he does not make his house and its contents available for others to enjoy. I hope that the noble Lord, Lord Vaizey, will believe me when I say that most of us enjoy showing our houses to members of the public. Maybe we suffer from some form of exhibitionism, but it gives us pleasure to take members of the public round and show what we have, and perhaps to say how the particular desk or piece of furniture has been in the family for 300 or 400 years. I shall come back to this, but I think we rather tend to forget the market value.

Lord VAIZEY

My Lords, will the noble Earl forgive me? Perhaps when he reads Hansard he will see that I did not say what he appears to think I said. I do not disagree at all with his views. The truth about Mentmore is that it never has been open to the public. Surely he will agree that there is a certain ambiguity in using the words "national heritage" about something which is entire y private property and has been open only to private people.

The Earl of MANSFIELD

My Lords, I think the noble Lord might well read the terms of my Motion. I shall come back to him in a moment. The noble Lord, Lord Donaldson, postulated two philosophical questions, the second of which is: who should run historic houses? I think it follows that criterion No. 1 for the best use of resources, so far as chattels are concerned, is that owners should keep them and show them to the public; and it follows that it is probably helpful, if they have an historic house, to show them there rather than in a Dutch barn. It seems to me that that is a question which is answered very quickly indeed.

I was particularly pleased with what I regarded as a very reasonable undertaking—if that is not too strong a word—on the part of the noble Lord to take a hard look with his colleagues at the Case 1 and Case 6 situation. Without giving away too much so far as socialist philosophy is concerned, there is a good and arguable case for making some new form of tax structure for the profits, if there are any, of historic houses which can be set off against their losses. I shall not say more than that.

My Lords, I must come back to the noble Lord, Lord Vaizey, because he was the only noble Lord who struck a discordant note, although I am not quite sure of the motives from which he struck it. He said that he hoped he was not motivated by envy, but I think I have a clue to his motivation and I shall come to that in a moment. When you are talking about objects which may have been in the family for 300 or 400 years or even 100 or ten years, the question of the value of works of art is really neither here nor there. One does not think of the value; nobody ever wants to sell them, not through some horrid cupidity or nasty avaricious greed but simply because there is natural in every human being a desire to keep around him the possessions in the nest, and above all an appreciation of their beauty and the craftsmanship which has gone into their making. So far as I am concerned, my legal ancestor, the first holder of my title, ordered from one Chippendale some mirrors, and the carving which went around them cost far less than the mirrors themselves which were imported. I would not care a jot if the ratio of value of mirror to the surround stayed in exactly the same proportion, but of course it has not done so since 1750 when it was bought. Perhaps that is an illustration of this point. It is a false argument to use that there is any concern about values.

So far as Mentmore is concerned, the noble Lord seems to take exception to the Rubens mantelpiece. Of course that is a value judgment and the noble Lord has every reason if he wishes to take exception to it. From the way in which he put his remarks it may be because it is a foreign mantelpiece.

Lord VATZEY

My Lords, the noble Earl seems to have great difficulty in understanding what I said, for which I apologise. Surely even he would not argue that the possessor of a work of art, like the possessor of any other object, occasionally sells it for his own purposes, and this is liable to taxation. I see nothing wrong with that. I certainly did not use the case of the mantelpiece as grounds for being opposed to foreign works of art. I merely said it is very difficult to argue that it is part of our national heritage, particularly as it has never been seen by the public.

The Earl of MANSFIELD

My Lords, something can become part of the heritage without it being seen by a lot of folk. Surely the noble Lord would concede that not very many people see the Elgin Marbles, but they are still part of the heritage; and they are foreign too. How jingoistic can one get? But I must get on, especially as I see the noble Lord, Lord Donaldson of Kingsbridge, beginning to uncoil himself. I must thank him for so doing.

I want to come to the last but not the least speaker by any means, the noble Baroness, Lady Birk. I am not sure that what she said about the history of this unfortunate affair has given me much consolation. She took as her opening date 6th February 1976, and on the face of it I suppose that that is a reasonable thing to do. I would hope that in future the penny might drop (if I might use that expression) in the mind of the Department rather earlier, because it was after all in April 1975 when the offer in general terms was made—I am sorry; 6th February 1975 was when the first letter was sent. So if there was some type of consultative body, such as I have suggested, I would hope that when a letter such as this, even in the most general terms, is brought to the notice of the Department, that would be the moment when the Department would in effect say to its committee, "Here is a situation. Here is a question of a house or chattels being taken into public ownership. Now is the moment to assess the value, not in cash terms, but in terms of the potential value to the nation"——

Baroness BIRK

My Lords, I do not want to prolong this matter, but I should point out that in order to save time I jumped a little. I went to the time of the first offer. During that time, the year 1975–76, all the objects in the collection were being catalogued. There was an enormous amount. During that time the director of the Victoria and Albert Museum and the under-secretary in charge in my Department went down to Mentmore, and so it was going on during that time. I am not saying that it was all perfect, but there were not long periods when nothing happened.

The Earl of MANSFIELD

My Lords, I accept that from the noble Baroness, but with respect it makes the position worse, because the groups of people who might have helped to raise funds and who might have concerned themselves with this question were not informed. That is really the central point. There is no mechanism by which the public can take an interest in this. It is no use the noble Baroness shaking her head. It did not happen—that is my point. I would suggest, I hope with a certain diffidence, that in future, if this situation is likely to arise, there should be a mechanism by which the public and all the various consultative bodies, such as we have been talking about today, are in a position to offer advice and possibly help.

It is not much use this evening for the noble Baroness to do her sums and to say that there are 15 noble Lords. I do not know whether I personally am a sheep or a goat so far as this fund-raising enterprise is concerned, but I hope that I am a sheep——

Baroness BIRK

Yes.

The Earl of MANSFIELD

Oh, well, I rejoice. But I shall still use my best endeavours, even in this saintly role. But the point is that it is not much good for us to be talking about private enterprise at this moment, especially when from what one can glean of Mr. Shore's offer, if it can be called such, any money put up from private sources would really be in the nature of a donation. There is no question of this being a joint public and private participation from which there would be any return. I think that I am right in saying that——

Baroness BIRK

My Lords, I do not know what the noble Earl wants. He is talking about trying to get Mentmore. The Government would be giving £1 million to it, and what I am suggesting is that people who feel that we should have this from the point of view of the national heritage are investing in the heritage. With regard to the noble Earl's other point, while I do not want to belabour this, I should point out that one cannot go out to consultation until the various objects are catalogued and there is an offer there. One cannot have people swarming over somebody's house and having a look around. I think that this was also one of the problems. It would be most unfair to do that. There must be something specific. It may be said that from 1976 perhaps more people should have seen Mentmore, but I do not think that that would have made any difference in the end. It may have been a possibility, but not before then.

The Earl of MANSFIELD

I am not going to continue to argue the point, my Lords, because I do not think that we shall reach agreement. I do not think that the noble Baroness sees what I am driving at, and I certainly do not agree with what she is saying.

The fact of the matter is that we have the position where, for one reason or another—and this is the last time I will say it—nobody knew until a very late stage and nothing could be done about it.

That is the situation which I think is regrettable, though I am not blaming the noble Baroness, heaven knows! I think I have made that plain. I am trying to explore whether something could be put in its place by way of a body, or a procedure, to make the matter better in the future.

There is only one other matter which I want to take up with the noble Baroness, and I hope that it will not lead to another general exchange. The noble Baroness says that the three-year period is not necessarily calamitous to Lord Rosebery. I am not going to start swopping esoteric tax law with the noble Baroness, the one very good reason being that I am not a good tax lawyer, and I have not the resources of an Officials' Box to provide the necessary knowledge and expertise. All I can say is that I have been assured by experts that this three-year period has a considerable financial bearing, and if the sale does not take place within the three years then Lord Rosebery will be financially disadvantaged.

I cannot put it clearer than that, and I do not think that it would be any good my trying to do so, although I have much material that I could try to gabble out in the same way—no, not in the same way; I will leave it there. Once more I should like to thank those who have taken part in the debate and to repeat that I believe that this has been a useful exercise, and certainly, until the last few hours, it was a very pleasant exercise. In the meantime, with the leave of the House, I beg leave to withdraw my Motion.

Motion for Papers, by leave, withdrawn.