Sitting of 14 February 1957

Preamble
The House met at half-past Two o'clock
PRAYERS
[Mr. SPEAKER in the Chair]
ORAL ANSWERS TO QUESTIONS
  NATIONAL FINANCE

    Scientific Research and Development
    Mr. Braineasked the Chancellor of the Exchequer what proportion of the gross national product was spent by Government and by private industry on scientific research and development, excluding market research and capital development, in 1939, 1950 and 1955.
    The Financial Secretary to the Treasury (Mr. J. Enoch Powell): The proportion in 1955 is estimated at about 2 per cent. Between one-third and one-half of this work was done in Government laboratories and nationalised industries, and a large part of the remainder was financed by the Government. I regret that there are no estimates for 1939 and 1950.
    Mr. Braine: Does my hon. Friend agree that there is a definite, established correlation between investment in research and an increase in national productivity? Would he not also agree that in the United States of America there is far greater investment in research and, therefore, far greater results? Will he advise his right hon. Friend of these facts, if he agrees with them, with a view to reliefs in this direction being given in the forthcoming Budget?
    Mr. Powell: The Advisory Council on Scientific Policy is considering the whole question of the extent to which the country's resources are devoted to research and the results of this investigation will be forthcoming.

    Iron and Steel Companies (Capital Stock)
    Mr. Marquandasked the Chancellor of the Exchequer what proportion of the equity and fixed interest bearing capital of iron and steel companies formerly vested in the Iron and Steel Corporation, respectively, has, up to the present, been transferred to private owners.
    The Economic Secretary to the Treasury (Mr. Nigel Birch): In view of the changes in the capital structure of many companies it is not possible to give the answer in the form sought by the right hon. Member; but I am sending him a copy of the third Annual Report of the Agency in which the position is explained in detail.
    Mr. Marquand: Even if the right hon. Gentleman cannot give me exactly what I ask for, would it be fair to conclude that after three years of so-called denationalisation the Government have handed over control of policy of 75 per cent. of the productive capacity of the steel industry but have left the nation to hold the baby of fixed interest bearing securities to the extent of something like 75 per cent.? Is it not time that the Government made a considered statement of their policy in regard to the denationalisation of the steel industry?
    Mr. Birch: There has been no change in policy. The right hon. Gentleman had better study the figures first.
    Mr. Marquand: If there has been no change in policy, will the right hon. Gentleman say whether the nation was informed in the Elections of 1951 and 1955 that denationalisation would mean merely handing over the control of the industry while leaving the fixed interest bearing capital in the hands of the nation?
    Mr. Marquandasked the Chancellor of the Exchequer what directions have been given by the Iron and Steel Holding and Realisation Agency to iron and steel companies whose capital stock is held by it as to the amounts of their gross profits which shall be reinvested in the industry or held in reserve.
    Mr. Birch: It is the general practice of the Agency to allow subsidiary companies to retain the balance of net profits after payment of dividend at the same rate as in 1948.
    Mr. Marquand: Is this the policy now being followed in Wales? Is the right hon. Gentleman aware that, as a result of what has been going on, the greater part of the steel industry in Wales is still the property of the people and that, certainly in Wales, when they voted in the two Elections of which I have spoken, the people did not give a mandate for the denationalisation of iron and steel? May we have a promise that the Government will now stop as far as they have gone and leave the industries of Wales in the hands of the people?
    Mr. Birch: Denationalisation of steel was decided by Parliament. I do not see that the right hon. Gentleman's supplementary question has anything to do with his original Question.

    Interest Payments (Value)
    Mr. Mossasked the Chancellor of the Exchequer what rate of interest would now be payable on £1 in order to produce an increment equivalent in real value to the interest which would have been paid on £1 in 1938.
    Mr. Birch: If I have understood the hon. Member correctly, the rate of interest would have to be 2·7 times as great as in 1938.
    Mr. Moss: Can the right hon. Gentleman say why no change has been made in the interest payable on small savings such as are placed in the Post Office Savings Bank, since the decline in the internal purchasing power of the £, plus the decline in the real value of the interest paid, means that a person who saved £1 in 1938 has, in fact, lost 4s.?
    Mr. Birch: If the hon. Member is referring to the rate of interest paid by the Post Office Savings Bank, it has, of course, been the same since 1860, and many things have happened since then.
    Mr. Mossasked the Chancellor of the Exchequer what financial increment has accrued to a person who placed £1 in Post Office savings in 1946 and left it to fructify.
    Mr. Powell: Interest on £1 deposited in the Post Office Savings Bank in January, 1946, and left to fructify would now amount to 5s. 6d.
    Mr. Moss: Yes, but is the hon. Gentleman aware that a person saving £1 since 1946, owing to the decline in its real value, despite the addition of compound interest at the rate of 2½ per cent, would still be left 2s. 6d. worse off?
    Mr. Powell: He would be better off than if he had not saved it.
    Commander Maitland: Would my hon. Friend say what would have happened to that investment if it had been in Daltons?

    Small Savings
    Mr. Mossasked the Chancellor of the Exchequer what steps he will take to encourage small savings.
    Mr. Powell: A number of steps to encourage small savings were taken in 1956, and a marked increase has already followed.
    Mr. Moss: What steps is the hon. Gentleman going to recommend to encourage small savings in the Post Office?
    Mr. Powell: If the hon. Member is referring to the fact that the Post Office rate of interest is unchanged, I would remind him that it is a fact that the National Savings Movement has itself recommended that this rate should not vary with market rates of interest.
    Mr. Maurice Macmillan: Would my hon. Friend consider adjusting the amount deducted from National Assistance of recipients' small savings with a view to encouraging people to continue saving, even though they are on National Assistance, in view of the fact that at the moment it is more profitable for them to spend their savings and draw extra National Assistance when they have spent them?
    Mr. Powell: That is not a question for me but for the Minister of Pensions and National Insurance.

    Public Record Office (Legislation)
    Mr. Hydeasked the Chancellor of the Exchequer (1) when he intends to introduce legislation transferring responsibility for the Public Record Office to the Lord Chancellor, and giving legislative effect to other recommendations of the Committee on Departmental Records, where this is necessary;

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    (2) when he proposes to appoint, as official head of the Public Record Department, a Keeper of the Records, in accordance with the recommendation contained in paragraph 142 of the Report of the Committee on Departmental Records.
    Mr. Powell: Legislation is in preparation to permit the transfer of responsibility for the, Public Record Office to the Lord Chancellor and the appointment of an official head of the Public Record Office, with the title of Keeper of the Records. I cannot yet say when it will be possible for it to be introduced.
    Mr. Hyde: Is my hon. Friend aware that it is getting on for three years now since the Departmental Committee issued its Report, and that it is more than twenty months since we were told that legislation was to be introduced? Cannot he give us an assurance that it will be brought forward this Session? What consideration has been given to the aspect which interests the public most, namely, the period after which records are to be transferred to the Public Record Office and become available for inspection by historians and students? What consideration has been given to the advertisement of this important post of Keeper of the Records? Is it to be filled from inside the Civil Service, or is it to be thrown open, like other public appointments', to suitably qualified candidates?
    Mr. Powell: Perhaps my hon. Friend would give me notice of those last three detailed questions. As to his first two supplementary questions, it is desired to introduce this legislation as soon as practicable, but I cannot give any guarantee of its being introduced in the present Session.

    Building Projects, Norwich (Credit Restrictions)
    Mr. J. Patonasked the Chancellor of the Exchequer if he is aware that the credit restrictions have caused the postponement of so many building projects in Norwich and Norfolk that there is now heavy and increasing unemployment among building trades workers in the area; and if he will now take appropriate steps to relax these restrictions at least for local authority projects such as public improvements and building and slum clearance.
    Mr. Birch: Although unemployment in Norwich has increased during the past year, my right hon. Friend cannot agree that it would yet be right to encourage unrestricted building.
    Mr. Paton: Is the Economic Secretary aware that special circumstances exist in this area? There is no alternative employment in Norwich or Norfolk. Does he not agree that the hardships being suffered by these people are direct results of the Government's financial policy? Does he not think, therefore, that there is a duty upon the Government to do something to relieve those hardships?
    Mr. Birch: I think the hon. Member has a Question to the Minister of Labour and National Service, whose business it is much more than mine.

    Surtax
    Mr. John Hallasked the Chancellor of the Exchequer what would be the estimated loss of revenue in a full financial year at present rates of tax if personal earned income, marriage and children's allowances were allowed for Surtax.
    Mr. Powell: About £34 million.
    Mr. Hall: Is my hon. Friend aware that when I asked a similar Question last year, asking what would be the cost then of raising the Surtax level to £3,000, the answer was £27 million? Would not the figure now, in answer to my present Question, be rather less than that? In any case, whatever the figure is, is it not a small price to pay for lessening a little the heavy and unjust burden of taxation on brains in this country?
    Mr. Powell: I cannot, of course, anticipate my right hon. Friend's Budget statement, but my right hon. Friend will have noted my hon. Friend's point.
    Mr. John Hallasked the Chancellor of the Exchequer what is his estimate of the gross salary which in 1938 would have given a married man with two children the same purchasing value after tax as he receives today from a gross salary of £2,000.
    Mr. Powell: For a married man with two children a gross salary of about £620 in 1938–39 would have given about the same purchasing power, after tax, as a salary of £2,000 at the present time.
    Mr. Hall: Does my hon. Friend think that a level of purchasing power of £620 is the right level at which to start Surtax? Is he aware that it is because we in this country have the highest taxation in the Commonwealth on brains that so many of our able young men and women are thinking of emigration?
    Mr. Powell: The starting level for Surtax is a matter for the Budget, which I cannot anticipate, but my right hon. Friend will be aware of my hon. Friend's point.
    Mr. Chapman: Is it not a fact that there are only about 250,000 in this category anyway? After making allowance for the fact that only a few have young children, we are dealing with only a very few thousand, and, therefore, the case is not half as strong as the hon. Member for Wycombe (Mr. John Hall) makes it out to be.

    Highland Dancing (Entertainments Duty)
    Sir W. Anstruther-Grayasked the Chancellor of the Exchequer whether he is aware that, owing to a new ruling by Customs and Excise, the tax on Highland dancing competitions has been raised from 2½d. to 6½d. on a 2s. 6d. seat; that this compares unfairly with the rate charged at ballet dancing, variety entertainment or the Welsh Eistedfodd; and whether he will give the matter his attention.
    Mr. Prydeasked the Chancellor of the Exchequer why competitive Highland dancing is now classified under Scale 2 of the Entertainments duty.
    Mr. Powell: Scale 2 of Entertainments Duty covers admissions to watch such dancing as cannot be regarded as ballet or as variety entertainment. Whether Highland dancing competitions can be so regarded depends upon the circumstances of each case, and the classification of a particular competition may have been altered as a result of changes in its programme.
    Sir W. Anstruther-Gray: Yes, but is my hon. Friend aware that in many cases the classification turned out unfortunately? Would he be prepared to look into this matter again, because Highland dancing is a very desirable pastime?
    Mr. Powell: The classification is, of course, a matter of law. As I pointed out, it may well be that the character of an entertainment changes from one year to another, but I will gladly look at any case which my hon. and gallant Friend has in mind.
    Mr. Pryde: Is the hon. Gentleman aware that Ellen MacGregor and Rob Roy won every competition from the Mull of Galloway to the Mull of Kintyre without being asked for one penny piece of taxation and that this tax in Scotland today is a tax to finance the Government's misadventures in Egypt?
    Mr. Powell: I cannot say whether the performances of the artistes to which the hon. Gentleman refers would properly be classified either as ballet or as variety entertainment.
    Sir A. Gomme-Duncan: In view of the fact that Highland dancing is immensely superior from a cultural point of view to ballet in the ordinary sense or variety—
    Mr. Nabarro: Or rock 'n roll. It is much better than that.
    Sir A. Gomme-Duncan: —will not my hon. Friend give this matter very careful attention to see whether he cannot do something about it?
    Mr. Powell: Certainly I will look at any case which my hon. and gallant Friend brings to my attention.
    Mr. Emrys Hughes: Is not this a very short-sighted policy from the point of view of the Exchequer, for a large quantity of whisky is consumed at these meetings? Would it not pay the hon. Gentleman to take off this tax and thus catch more whisky drinkers?
    Mr. Powell: Not unless the whisky were consumed inside rather than outside the enclosure.

    Service Contracts (Compensation Payments)
    Mr. Tileyasked the Chancellor of the Exchequer if he will provide for the amendment of the Finance Acts so as to control the tax liability of payments of capital sums now made free of tax as compensation for alleged loss of

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    earnings under service contracts when those contracts are cancelled by agreement.
    Mr. Powell: I cannot anticipate my right hon. Friend's Budget statement.
    Mr. Tiley: While thanking my hon. Friend for that illuminating answer, may I ask him to bear in mind the fact that we have an enviable reputation in the world as patriotic taxpayers, due to the fairness of our system, and that while these methods of tax dodging are permitted our reputation is in question? Will he advise my right hon. Friend to deal with this tax dodging method speedily and ruthlessly?
    Mr. Powell: My hon. Friend has already brought this matter to my right hon. Friend's attention.

    Life Assurance
    Mr. Tileyasked the Chancellor of the Exchequer if he will, in considering his Budget Statement, provide for the amendment of the law affecting pensions for the self-employed and controlling directors so as to permit them to include life assurance cover in the event of death for the benefit of dependants in lieu of the present law and practice of merely returning on death the premium paid to that date.
    Mr. Powell: I cannot anticipate my right hon. Friend's Budget statement.
    Mr. Tiley: While thanking my hon. Friend again for an answer, may I ask whether he will convey to my right hon. Friend the fact that this change can be made without adding the cost of a penny in taxation? The problem of dealing with the dependants of men who die early, when between 25 and 45 years of age, is more serious than the problem of providing a pension at 65. As the change can be made within a broader scheme, will my hon. Friend ask the Chancellor to consider it?
    Mr. Powell: I will convey that view to him.

    Association of British Communities in Egypt (Office)
    Major Wallasked the Chancellor of the Exchequer what request he has had from the Association of the Councils of
    1424
    the British Communities in Egypt for financial assistance in order to set up an office in this country; and what was his reply.
    Mr. Powell: The Association asked for an initial grant of £15,000 and assistance in obtaining office accommodation, but it was decided that no assistance could be given from public funds.
    Major Wall: Does my hon. Friend not agree that the Association has a useful function in the vetting of British subjects from Egypt whose property has been sequestrated?
    Mr. Powell: I am aware that the Association does that, but the difficulty is that these claims would have to be vetted by the Foreign Office in any case and a duplication of work would be involved.

    Taxation Laws (Consolidation)
    Mr. Peytonasked the Chancellor of the Exchequer if he will consider the introduction of legislation to consolidate the law relating to direct taxation.
    Mr. Powell: The Income Tax law was consolidated in 1952. I do not think that further consolidation is necessary at present.
    Mr. Peyton: Am I not right in saying that there are about 16 Statutes in force bearing on Income Tax alone? Would my hon. Friend give further consideration to this point and bear in mind that it would be highly desirable not only to have the law in one hand but also to have it more simple? Would he not also agree, that it would be very much easier to get it simplified if it were less penal?
    Mr. Powell: Consolidation is not necessarily simplification, and there has been consolidation within the last four or five years. The Royal Commission on the Taxation of Profits and Income recommended consolidation over ten years, beginning from 1962, and we have not quite got there yet.

    Company Taxation
    Mr. Peytonasked the Chancellor of the Exchequer how the level of company taxation in the United Kingdom compares with that in force in those European countries which support the proposals for a Common Market.
    Mr. Birch: As the answer contains a number of figures, I will, with permission, circulate it in the OFFICIAL REPORT.
    Mr. Peyton: Whilst I am very grateful to my right hon. Friend for that answer, and I am certain that the information will be most interesting, may I ask whether he will accept on the part of the Government the long-term objective of equating the level of taxation in the country with that in all the other countries participating in the Common Market in order that our industries shall not continue to be crippled, in even worse conditions, by continued penal taxation?
    Mr. Birch: Taxation here is high, of course, but if my hon. Friend will study the figures he will find that there are enormous variations in these countries and comparisions are not easy to make.
    Following are the figures:

    Country and rate of lax on company profits

    Per cent.

    United Kingdom:

    Profits tax

    On distributions

    30

    On undistributed profits

    3

    Income tax

    On undistributed profits

    42½

    Belgium:

    On distributions

    20

    On undistributed profits

    First Fr. 150,000

    25

    Next Fr. 350,000

    30

    Next Fr. 5,000,000

    35

    Next Fr. 9,000,000

    37½

    Balance

    40

    Federal German Republic:

    Corporation Tax

    On distributions

    30

    On undistributed profits

    45

    Berlin Aid Tax

    4·09

    Income tax

    On undistributed profits

    25

    France:

    Company Tax

    41·8

    Italy:

    Income Tax

    18

    Company Tax (on taxable profits excess of 6 per cent. of "taxable capital")

    15

    Luxembourg:

    On total taxable profits

    First Fr. 400,000

    20

    Next Fr. 600,000

    30

    Balance

    40

    Netherlands:

    Corporation tax

    First F1. 40,000

    40

    Next F1. 10,000

    55

    Balance

    43

    1. The rates shown are for 1956–57 for the United Kingdom and for other countries the latest rates which could be ascertained in the time available.
    2. The table excludes those taxes on shareholders' income, which are, for convenience of collection, charged on companies and deducted by them from distributed profits.
    3. The method of computing profits and the allowances and reliefs given to companies varies from country to country, and comparisons of the weight of direct taxation by reference to rates alone should be treated with reserve.

    House Purchase (Loans)
    Mr. Langford-Holtasked the Chancellor of the Exchequer whether, in view of the reduction in the Bank Rate, he will exclude from the operation of the credit squeeze and credit limitation money borrowed for house purchase.
    Mr. Birch: As my right hon. Friend pointed out in his statement on 7th February, the reduction in the Bank Rate was not a signal for the relaxation of credit.
    Mr. Langford-Holt: Would my right hon. Friend not agree that, in addition to its political desirability, on which I trust we are both agreed, this is also deflationary in its object in so far as if people are paying for a house or repaying a loan for house purchase they cannot buy motor cars, television sets and other forms of consumable goods, the purchase of which my right hon. Friend wishes to restrict in the home market?
    Mr. Birch: I entirely agree that house ownership is very desirable.
    Mr. Jay: Is there any reason at all for having high interest rates for house ownership, and is not this an obvious case for some selectivity in interest rates policy?
    Mr. Birch: This matter has been raised before, and I doubt whether it is practicable. The rate at which a building society lends depends upon the rate at which it can raise money.
    Mr. Fernyhough: Does the Minister's reply mean that the Tory Party has now forsaken its belief in a property-owning democracy and that, far from encouraging people, they are taking financial means to discourage them?
    Mr. Birch: No, Sir.

    University Teachers (Salaries)
    Mr. K. Robinsonasked the Chancellor of the Exchequer if he will make a statement on the result of recent negotiations concerning the salaries of university teachers.
    Mr. Powell: My right hon. Friend is not yet in a position to make a statement.
    Mr. Robinson: Is not this a very disappointing start to the new negotiating machinery which the Chancellor instituted a year ago? Is it not a fact that the University Grants Committee presented the Treasury with its final recommendations over two months ago? Would not the right hon. Gentleman speed matters up?
    Mr. Powell: This is an important matter and the desirability of an early statement is recognised.

    Building Societies (Interest Rates)
    Mr. Liptonasked the Chancellor of the Exchequer whether he will introduce legislation requiring building societies to reduce interest rates to borrowers to correspond with reductions in the Bank Rate.
    Mr. Birch: No, Sir.
    Mr. Lipton: Will the right hon. Gentleman not agree to set up a committee to probe the rather tricky methods of manipulating interest charges employed by these money-lenders, which are bitterly resented by hundreds of thousands of house-purchasers who discovered too late how the dice are always loaded against them by their so-called benefactors?
    Mr. Birch: I think that the hon. Member's statement is entirely unfounded.

    Superannuation Schemes (Cost)
    Mr. J. Patonasked the Chancellor of the Exchequer what was the amount of the Treasury contribution to State retirement pensions for 1956; and what was the cost to the Treasury of the rebates allowed in taxation of private concerns for their superannuation schemes for the year 1956.
    Mr. Powell: The cost of allowing employers' contributions to superannuation schemes for their employees to be deducted in arriving at taxable profits is estimated at present to be in the region of £80 million a year.
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    The estimated total cost to the Exchequer of Civil Service and Armed Forces pensions for the financial year 1956–57 is £82·6 million.
    Retirement pensions payable under the National Insurance Scheme are the principal benefits payable from the National Insurance Fund, to which the Exchequer contribution in 1956–57 is expected to be £96·75 million: in addition, the estimated cost of non-contributory old-age pensions in 1956–57 is £15·3 million.
    Mr. Paton: Is it not evident from these figures that the cost of these superannuation schemes of private firms is mainly borne by the Treasury? Is it not rather inequitable that the general taxpayer, and the State pensioner in particular, should be asked to contribute so lavishly to the specially favourable retirement pensions of the equivalent of one-third of the workers engaged in our industries?
    Mr. Powell: If the hon. Member will look carefully at the reply, I do not think that he will find it bears out his contention. In any case, there is no analogy between the Exchequer contribution and the cost of paying State pensions on the one hand and the contributions of a private firm on the other, for if firms were to pay the same sums as additions to wages these would equally be a deduction for tax purposes.
    Mr. Jay: Is not the hon. Gentleman's figure of £80 million for tax rebate on private superannuation schemes too small for the total tax rebate for all forms of private saving, since the Phillips Committee gave a figure of £100 million two years ago? Is it not rather extraordinary that more public money should be used for fairly high pensions for a third of the community than for much lower pensions for the remaining two-thirds?
    Mr. Powell: The £80 million relates to the Question, but it does not follow that if these contributions did not rank to be allowed against taxable profits that amount of tax extra would be collected.
    Mr. Osborne: Would my hon. Friend not agree that these contributions do not come from public funds but come from the profits created by the brains of these men and, therefore, the more he allows in this way the more he will encourage the managerial class on whom the welfare of the country so largely depends?
    Mr. Powell: That is another ground on which there is no real analogy between the figures which the hon. Member for Norwich, North (Mr. Paton) sought to compare.

    Egypt (British Claims)
    Mr. Hurdasked the Chancellor of the Exchequer if he will permit the use of Egyptian sterling accounts for the payment of sums due to British manufacturers for goods in transit from their works to Egypt during late July and early August last, in view of the fact that manufacturers could not have had any prior knowledge of the Government's intention to prevent payment for goods so despatched, and that the settlement of these outstanding accounts would not benefit Egypt.
    Mr. Birch: I am afraid that any relaxation of our existing restrictions must wait until the negotations whch we contemplate with the Egyptian Government on claims and counter-claims.
    Mr. Hurd: As this is really quite a small matter and obviously these few firms have a prior claim on any Egyptian sterling balances here, would it not be fair, as well as sensible, to allow these claims to be settled straight away?
    Mr. Birch: I quite agree that there are many difficult cases, but the only thing to do is to wait for a general settlement.

    Lifeboat Men (Fees and Expenses)
    Mr. Hector Hughesasked the Chancellor of the Exchequer if he is aware that the retaining fee and expenses of men employed in the service of the Royal National Lifeboat Institution are greatly and unreasonably reduced by heavy Income Tax; and, in view of the smallness of these fees and expenses as compared with the work for which they are paid, if he will consider and implement a substantial reduction in the rate of Income Tax for which these men are liable.
    Mr. Powell: I could not agree that these particular payments should be treated exceptionally for Income Tax purposes.
    Mr. Hughes: Does not the Minister realise that these men perform extremely
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    dangerous and difficult work for wretchedly small pay, and that the amount of Income Tax for which they are liable is disproportionate to the amount of their pay? Will the Minister look into that with a view to seeing that justice is done to them?
    Mr. Powell: I am sure that the hon. and learned Gentleman will realise that it would be quite impossible to differentiate between one man's earnings and another's for tax purposes according to the danger or value of the calling in which they were earned.

    Universities (Foreign Students)
    Mr. R. Bellasked the Chancellor of the Exchequer what is the proportion of foreign students in relation to the total number of students at British universities at the present time.
    Mr. Powell: The latest available figures relate to the academic year 1955–56, when foreign students accounted for 4·4 per cent. of the total number of students at universities in Great Britain.
    Mr. Bell: Has my hon. Friend any figures indicating whether this is an increase or a decrease on previous years?
    Mr. Powell: I shall be glad to look into that point.

    Student Hostels
    Mr. John Hallasked the Chancellor of the Exchequer what Government-sponsored or assisted student hostels exist in this country; and what amount has been contributed by Her Majesty's Government to the appeal launched by the National Union of Students for a new International Student Centre and hostel in London.
    Mr. Powell: A substantial contribution from Government funds is made towards the cost of establishing and maintaining hostels and other residential accommodation at universities and technical colleges. In addition, the British Council runs students' hostels at London, Edinburgh and Sheffield, and the Government have promised a contribution of E200,000 towards the cost of an International Hall of Residence at London University. No contribution to the appeal launched by the National Union of Students has been made nor, so far as I know, requested.
    Captain Duncan: Will my hon. Friend cease using the term "Government funds"? Is he not aware that the Government have no funds except what they raise from the taxpayer?

    Treasure Trove, Congleton (Exhibition)
    Air Commodore Harveyasked the Secretary to the Treasury why the eighteen gold coins found recently in Moody Street, Congleton, and declared to be treasure trove, are all being disposed of to the Grosvenor Museum at Chester; and whether it will be possible for a few of these coins to be retained in the Borough of Congleton in accordance with the wishes of the civic authorities.
    Mr. Powell: The British Museum is entrusted with the disposal of finds of this kind in England. In accordance with normal practice, the Congleton hoard, not being required for the National Collection, was offered as a whole to the Grosvenor Museum at Chester, which is the nearest museum to Congleton and has a fine collection of coins. Custody and loan of the coins are now matters for the Grosvenor Museum.
    Air Commodore Harvey: Will my hon. Friend look at this matter again, and is he aware that a few years ago, in similar circumstances, the borough of Shrewsbury was allowed to retain some of the coins found? Is he further aware that Congleton received its Charter in 1272 and that there is a public library with similar coins where these could be shown? Will he bear in mind that, unless he reconsiders this matter, Congleton will present a petition to this House and I shall raise the matter on the Adjournment?
    Hon. Members: Answer.
    Mr. Nicholson: Does not my hon. Friend think it desirable that all areas in this country should take an interest in their local archeology, and is he aware that this is the very way to discourage it? Not only from the cultural point of view, but also for the sake of safeguarding archæological finds and other things of interest, this should be done, and that is the wrong way to go about it.
    Mr. Powell: Those are considerations which the British Museum has in mind in advising upon the disposal of these funds. An important factor is that hoards of this kind should, where possible, be kept together for purposes of research. It is of some historical interest what the coins were which were found at one time and place. So far as local exhibition is concerned, I am told that Congleton has been offered facilities for loan and obtaining copies of these coins.
    Air Commodore Harvey: On a point of order, Sir. It is an insult to Congleton to be offered copies—[HON. MEMBERS: "Hear, hear."]—and I give notice that I shall raise this matter on the Adjournment at the earliest opportunity.

  CIVIL SERVICE

    Inspectors of Taxes (Salaries)
    Mr. Langford-Holtasked the Chancellor of the Exchequer, in view of the difficulty being experienced in filling vacancies for inspector of taxes without lowering standards, if he will review the salary scales of these inspectors with a view to increasing them.
    Mr. Powell: The salaries of inspectors of taxes have recently been raised in the light of the improvement in salary scales for comparable grades recommended by the Royal Commission on the Civil Service.
    Mr. Langford-Holt: Is my hon. Friend quite satisfied that the salaries offered are sufficiently high to attract the best type of person into this very important job?
    Mr. Powell: The increases were made only last July and, therefore, it is really too early to tell whether they are having the desired effect.

    Chief Executive Officers (Salaries)
    Mr. H. A. Priceasked the Chancellor of the Exchequer what was the commencing salary of a chief executive officer in 1939; what should this be today to compensate for higher taxation and increased cost of living; how much of the increase is due to each of these two factors; and what is the commencing salary of this grade today.
    Mr. Powell: In 1939 the commencing salary of a chief executive officer was £900, and his net income, if married with one child, was £794. To compensate for the increased cost of living, the equivalent net income would now be £2,080, for which a gross income of £3,180 would be needed at today's rates of taxation. The commencing salary of this grade is now £1,635, yielding a net income of £1,299.
    Mr. Price: Does not this represent a reduction in their standard of living of about 40 per cent. in these cases? Is my hon. Friend aware that this trend is true, if not in the same degree, for most of the professional or middle classes of this country today? Do Her Majesty's Government approve of this trend and, if not, what action is it proposed to take to arrest it?
    Mr. Nabarro: Join the Middle-class Alliance.
    Mr. Powell: The first deduction at any rate is broadly true, though I think the fall is slightly less than the figure which my hon. Friend mentioned.
    Mr. S. Silverman: Could the hon. Gentleman estimate how much of the loss indicated in the Question and answer is attributable to the cost of an emergency that occurred between 1939 and 1945?
    Mr. Powell: If the hon. Gentleman would like me to split up this change before and after 1945, I will willingly do so if he will put down a Question.

  AGRICULTURE, FISHERIES AND FOOD

    Fish Prices
    Mr. Doddsasked the Minister of Agriculture, Fisheries and Food if he will make a statement on the progress of the investigation by the White Fish Authority into the price of fish.
    The Minister of Agriculture, Fisheries and Food (Mr. Derick Heathcoat Amory): The White Fish Authority's report on their investigation of distributive costs and earnings is now in the hands of the printers, and should be on sale early next month. I will arrange for a copy to be placed in the Library of the House.
    Mr. Dodds: Whilst thanking the Minister for that statement, which has taken a
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    long time to come out, can he say what are the effects of this report, and what classes of fish it is likely to affect?
    Mr. Amory: I will ask the hon. Gentleman to await the report, because it is a mass of detail and I think he will find it interesting.
    Mr. Willey: Would the right hon. Gentleman look into the current difficulties of the fishing industry, owing to the bad weather and the increased cost of fuel oil, to see whether it can be afforded any relief?
    Mr. Amory: I am conscious of the present difficulties. The weather has improved lately for fishing. I am not seeking to take immediate credit for that fact, but the landings of fish have been somewhat better in the last week.
    Mr. G. Jegerasked the Minister of Agriculture, Fisheries and Food whether he has now received from the National Federation of Fish Fryers a complaint that the further rise in the price of fish caused by the Suez Emergency Surcharge has led to a fall in sales and seriously threatens their trade; and what reply he has sent.
    Mr. Shortasked the Minister of Agriculture, Fisheries and Food what steps he proposes to take in response to the complaint by the National Federation of Fish Fryers about the adverse effect on their industry of the extra cost of oil to trawler owners.
    Mr. Amory: I have received a copy of the circular letter dated 30th January to which the hon. Member presumably refers. The circular did not call for a reply, but I would refer the hon. Member to the reply given to a Question from the hon. Member for Feltham (Mr. Hunter) on 4th February. The recent high prices have been due to the exceptionally low level of landings resulting from the prolonged gales in recent weeks and have not been caused by the Suez Emergency Surcharge which the trawler owners have temporarily imposed.
    Mr. Jeger: In reply to a Question on 4th February, the Parliamentary Secretary referred to the high price of fish being due to the persistent bad weather at sea. Why do the Government persistently blame bad weather for their misdoings when the circular to which the

    1435
    right hon. Gentleman has referred states specifically that a surcharge of 6s. per kit of 10 stone on all fish sold has been imposed to meet the increased cost of fuel and diesel oil owing to the Suez crisis? Why does he evade the consequences of his own action?
    Mr. Amory: No. It is the hon. Member who is wrong in this case. The surcharge is applied, but where the market price is substantially above the minimum price plus the surcharge, the surcharge has no effect. That is the point. The present price, which is substantially above the minimum price plus the surcharge, has been due almost solely to the bad weather.
    Mr. Short: Does not the Minister agree that the surcharge, arising from the increase in the price of oil, should be borne by all fish landed, including fish going to meal factories, and not merely by fish for human consumption?
    Mr. Amory: The point is that the surcharge is at present not being borne by anybody. As evidence of that, a week after the surcharge was applied the market price was 1s. or so lower than in the week before the surcharge was applied.

    Sausages (Meat Content)
    Mr. Doddsasked the Minister of Agriculture, Fisheries and Food if he is now in a position to make a statement on the proposal to stipulate a minimum meat content of beef and pork sausages.
    Mr. Amory: Certain technical difficulties are involved and I must ask the hon. Member to be patient a little longer.
    Mr. Dodds: But is it not a fact that I have been patient for quite a long time now, and is it not also a fact that the Food Standards Committee, after careful consideration, recommended that there should be a minimum meat content in the sausage, and will not the Minister get a hit tough with the vested interests who want to be able to continue to diddle the housewives with phoney fillings?
    Mr. Amory: The hon. Gentleman has been patient in this matter, but on an important point the members of the Food Standards Committee were divided. I must acknowledge that I find the sausage to be a much more complex entity than I had ever imagined.

    Exports of Ponies (Sea-Transit Conditions)
    Mr. Chapmanasked the Minister of Agriculture, Fisheries and Food (1) whether the Dartmoor, and similar ponies, now being exported to Canada from Glasgow and other ports, are examined individually by his veterinary officers and rested beforehand; and if he will give an assurance that none will be exported in an unfit condition;
    (2) whether he will prohibit the export to Canada of any pony likely to foal while on board ship;
    (3) whether, in order to avoid the necessity of using his statutory powers, he will institute discussions with the commercial interests concerned to get voluntary agreements to prevent the export of ponies via the long Atlantic crossing during the worst winter months, to secure separate penning in the ships, and to arrange, if possible, shipment from other ports than Glasgow in order to save the long overland journey beforehand.
    Sir F. Medlicottasked the Minister of Agriculture, Fisheries and Food if he is satisfied as to the conditions under which Dartmoor and other ponies are exported to Canada; and if he will take all steps necessary to ensure that none of these ponies are exported unless in a fit condition to undertake the journey across the Atlantic.
    Mr. Amory: Discussions have been held with the shipping companies, and with their co-operation this traffic is being closely supervised. The ponies are inspected by veterinary officers who satisfy themselves that each pony is fit to travel before it is shipped. Any pony likely to foal on board ship would not be allowed to travel. My right hon. Friend the Secretary of State for Scotland and I are satisfied that the steps we have taken should prevent any unnecessary suffering by ponies being exported even in winter.
    Mr. Chapman: Could not the right hon. Gentleman try to make a little more progress? Is he not aware that one of the worst troubles is the long Atlantic crossing in winter? Could he not get the commercial interests voluntarily to stop exporting in the worst months? Secondly, could he not do something about the question of separate penning?

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    Is he aware that what happens is that the unbroken ponies do great damage to each other in their terror during a stormy Atlantic crossing, and that it would be a help if he could get the commercial interests to obey at least those two requests?
    Mr. Amory: I will pay the greatest attention to what the hon. Gentleman has said, because I know how interested he is in this important matter of humanity to animals. On the two points he has specifically asked me about, I am doubtful if much trouble arises through winter crossings, as such, but we are in close touch with the shipping companies.
    On the second point of separate penning, I am assured that separate penning might even be a drawback. At present the pens are designed to hold about five wild or wildish ponies, and technical advice at present is that these ponies are unaccustomed to being alone—like Members of Parliament, I think—and that if they were put into separate pens they would become even more alarmed than they are at present.
    Further, because I treat this matter seriously, I want to say that the main trouble occurred over the first consignment, and that as under the present law there was no need for veterinary inspection of that consignment, it was not made. Since then, the veterinary inspection has been done very carefully and the results, I think, have been reasonably satisfactory.
    Sir H. Studholme: My right hon. Friend knows that I have written to him about the export of Dartmoor ponies, about which I am worried. Will he satisfy himself that there is adequate veterinary inspection? I understand that in the past this has not been so and a number of in-foal mares have died en route. These poor little ponies are quite wild, and, therefore, it must be a horrible experience for them.
    Mr. Amory: I can give my hon. Friend an assurance that I will keep in very close touch with the veterinary inspection side. He will be glad to know that, apart from the first consignment, only four ponies out of 500 have died, but I agree that even that position is not satisfactory.

    Net Fishing Rights
    Mr. Templeasked the Minister of Agriculture, Fisheries and Food if he will give an assurance that, at all future conferences held by his Department where the rights of the estuarial industrial net fishermen of this country are under consideration, representatives of these interests will be asked to attend.
    Mr. Amory: I can assure my hon. Friend that if proposals should be made which would involve changes in public netting rights the net fishermen will have full opportunity for stating their views.
    Mr. Temple: While I thank my right hon. Friend for his reply, is he aware that these netting rights have existed continuously in many instances since Magna Charta?
    Mr. Amory: Yes, Sir, and I will make sure that all the fishery interests are given opportunity to make representations before any change is made in those rights.
    Mr. Hector Hughes: Does the right hon. Gentleman succeed in attending or even being represented at the various conferences which he is expected to attend in order to represent his three-fold Ministry?
    Mr. Amory: I attend as many as I can. The conferences in question were called by my own Department and, therefore, were attended by officials of my Department.

    Land, Wales (Non-Agricultural Uses)
    Mr. Gowerasked the Minister of Agriculture, Fisheries and Food what steps he takes to be formally represented at statutory tribunals considering cases involving the taking of agricultural land in Wales for non-agricultural uses; and if he will make a statement.
    Mr. Amory: It is not the practice of my Department either in Wales or in England to be represented at public inquiries held under the planning or compulsory purchase procedures on the instructions of another Minister.
    Mr. Gower: Can my right hon. Friend say, then, how he indicates the attitude of the Ministry of Agriculture in cases of this kind? Also, how does he indicate the attitude of the Ministry in cases like

    1439
    the projected taking of land at Treweryn in North Wales for the purposes of a reservoir for Liverpool?
    Mr. Amory: The practice is that my Department gives advice to other Ministries when that advice is requested by other Ministries.
    Mr. Langford-Holt: Would not my right hon. Friend agree that the matter is becoming of increasing importance in both Wales and England? Is not the time fast approaching when his attitude and his decision should be paramount in these matters?
    Mr. Amory: I think the Government will be reviewing these questions in the light of the recommendations of the Franks Committee.

    Land Drainage (Report)
    Mr. J. Johnsonasked the Minister of Agriculture, Fisheries and Food what discussions he has had with the National Farmers' Union regarding the Heneage Report; and whether he has come to a decision to implement any of the recommendations of this Report, particularly those relating to land drainage.
    Mr. Amory: The Heneage Committee's recommendations have been fully discussed with all the interests concerned, including the National Farmers' Union. I am not yet able to add to the reply given to the hon. Member for Anglesey (Mr. C. Hughes) on 6th December last, but I will do so as soon as possible.
    Mr. Johnson: While thanking the Minister for that Answer, can he tell us when he will be able to do so? In view of the flooding, which is so prevalent in these villages and the low-lying areas, it is most important we do something about this very difficult matter.
    Mr. Amory: I could not agree more with the last part of the hon. Member's supplementary question. It is important that we should do something. In reply to an earlier Question, I indicated that I hoped to be able to make some progress on perhaps a more limited front, and I hope quite shortly to be able to make a statement on that subject.
    Mr. Osborne: In view of the fact that the Report has been issued for some years—by Lieut.-Colonel Heneage, the former Member for Louth—and since
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    the people of Louth and in the coastal districts feel a sense of grievance, will he not do something fairly quickly and not leave the matter lying on the table for so long?
    Mr. Amory: I repeat that I hope very shortly to be able to make some statement.

    Farm Improvement Schemes
    Mr. G. Jegerasked the Minister of Agriculture, Fisheries and Food whether he is now able to make a statement on long-term improvement grants amplifying Command Paper 23.
    Mr. Amory: I would refer the hon. Member to the replies given to my hon. Friend the Member for Norwich, South (Mr. Rippon) on 12th February and to my hon. Friend the Member for Norfolk, South (Mr. J. E. B. Hill) on 30th January.
    Mr. Jeger: Does the right hon. Gentleman appreciate that many farmers would be anxious to start preliminary work, which perhaps would qualify for grant, if they knew what grant they would receive? Does he not agree that it is essential they should get their information while builders are ready and available to start the work?
    Mr. Amory: I should like to repeat what I have said already, that farmers and landowners must be very careful to acquaint themselves with the replies I have given, because no grant will be payable on any work which has been undertaken and started prior to authorisation after the passing of the legislation.
    Mr. Willey: In view of the obvious difficulties arising from the announcement of the policy and its implementation, will the right hon. Gentleman assure the House that he will expedite the introduction of the Bill?
    Mr. Amory: I am very anxious that the Bill should be introduced at the earliest possible moment for the reasons the hon. Gentleman knows very well.

    Machinery Spare Parts (Standardisation)
    Mr. G. Jegerasked the Minister of Agriculture, Fisheries and Food what progress is being made in the encouragement of greater efficiency and economy by the standardisation of spare parts in farm machinery.
    Mr. Amory: The British Standards Institution has issued twelve standards for tractors and agricultural machinery which have been adopted by many manufacturers. Work on other standards is proceeding.
    Mr. Jeger: Is the right hon. Gentleman aware that the work is proceeding exceedingly slowly and that many farmers are verb worried about the fact that there is no standardisation, even in simple things like nuts and bolts.
    Mr. Amory: I agree with the hon. Member that one is always hoping for faster progress in matters of this kind, but there is the Agricultural Machinery and Implements Industry Standards Committee which has been studying this matter and has produced the results to which I have referred. Therefore, there is some progress all the time, but I am assured that there are very great technical difficulties. I, too, wish progress were faster.

    Production Costs (Petrol)
    Mr. de Freitasasked the Minister of Agriculture, Fisheries and Food whether he is aware that in several foreign countries there are special schemes which relieve farmers of the full effects of the rise in price of petrol used in agricultural production; and whether he will consider some similar scheme to keep down the cost of food.
    Mr. Amory: I am aware that there are schemes in several foreign countries which relieve farmers of part of the taxation on petrol, but such a scheme would have little effect in reducing food costs.
    Mr. de Freitas: If the right hon. Gentleman will not introduce such a scheme, will he at least take account of the indirect subsidies which these countries have when comparing our cost of production with the cost of production in neighbouring European countries which have these subsidies?
    Mr. Amory: That is a fair enough point. I wanted to make the point that there is little home-produced food at present which is sold at prices which reflect production costs. It is sold at the best price which can be obtained in the market regardless of costs.
    Mr. Champion: Will the rising price of petrol be taken into account in the Price Review now taking place?
    Mr. Amory: This element, as my hon. Friend the Parliamentary Secretary said in reply to an earlier Question, is an item which will be taken into consideration at the Annual Review.
    Mr. Baldock: Is my right hon. Friend aware that the horticultural industry, the one most affected by this, gets no benefit from the Price Review and is an industry where labour-saving appliances are particularly required and where most of the gadgets have to be driven by petrol and cannot be converted to using other fuels?
    Mr. Amory: My hon. Friend will agree that the horticultural industry obtains some benefit from some of the production grants.

    Seeds and Fertilisers (Orders)
    Mr. Templeasked the Minister of Agriculture, Fisheries and Food if he will take special steps to bring to the notice of farmers the urgent need to take early delivery of seeds and fertilisers this spring so that maximum use can be made of railway delivery, and thus help the national transport situation.
    Mr. Amory: I will gladly do what I can to bring to the notice of farmers the special importance in present circumstances of early ordering so as to help merchants to plan their deliveries in the most economical way and also avoid the risk of delay in deliveries when spring cultivations start, and I am confident that the trades concerned will be doing so too.
    Mr. Temple: Is my right hon. Friend aware that speed is the essence of success in this matter? Will he take every opportunity of putting this over to the farming community with as much speed as possible?
    Mr. Amory: I certainly will, and I think that the Question which my hon. Friend has put down will help in that way.
    Mr. Langford-Holt: Is my right hon. Friend aware that probably the best way of doing this is to get something inserted into the script of a well-known serial which is on the radio every night?
    Mr. Amory: I think I know to what my hon. Friend is referring.

    Farm Produce (Exports)
    Mr. Hurdasked the Minister of Agriculture, Fisheries and Food if he will make a statement on the export in recent months of farm produce, particularly grain, beef, cattle, and eggs, to the Continent, stating the amount of subsidy, in price guarantees, paid on these exports.
    Mr. Amory: Exports of farm produce in recent months have been relatively small. Cattle was the most important item, and my hon. Friend was given particulars about these exports on 31st January. Cereal grains exported were mainly for use as seed. Exports of other produce, including eggs, were trivial in amount. The payments due to producers under price guarantee arrangements in respect of the quantities of farm produce exported in the second half of last year cannot be calculated precisely but would not exceed £500,000.

    Potatoes
    Mr. Hurdasked the Minister of Agriculture, Fisheries and Food what is the latest estimate he has made of the quantity of potatoes of the 1956 crop which will be surplus to human requirements; if there is likely to be an export market for any considerable quantity; and whether the Potato Marketing Board consults with his Department about the disposal of surplus potatoes for stockfeed and manufacturing purposes, so as to keep down the charge falling on the Exchequer.
    Mr. Amory: The Potato Marketing Board's census of potato stocks in Great Britain on 1st January suggests that there will be a surplus over human requirements of more than half a million tons. Export possibilities are not substantial in relation to this quantity but are being actively explored. The Board is in close and continuous touch with my Department regarding disposal of the surplus.
    Mr. Hurd: Is my right hon. Friend ensuring that potatoes—not only for human consumption—will be used in the most economical way possible for stock-feeding, so as to save some of our import bill on feeding stuffs?
    Mr. Amory: I certainly will.

  SHIPPING AND SHIPBUILDING INDUSTRIES
  Commander Maitlandasked the Prime Minister, in view of the many problems facing the shipping and shipbuilding industries, namely, shortage of steel, the need for deep-water ports, financial and taxation difficulties and the need to construct much larger ships, and of the importance of co-ordinating policy in this field in the national interest, if he will take an early opportunity to state the policy of the Government on these problems and what steps he proposes to take to assist in their solution.
  The Prime Minister (Mr. Harold Macmillan): I recognise the concern of my hon. and gallant Friend in these important questions. The various aspects of these problems are being studied by Her Majesty's Government in consultation with the commercial interests concerned. Some progress has already been made. The Government will keep the House informed of developments.
  Commander Maitland: Does the Prime Minister realise it is important not only that the Government should take a lead in this matter but that they should appear to take a lead and the industries should know that that is happening?

  MEMBERS' SALARIES AND PENSIONS
  Mrs. Whiteasked the Prime Minister if he will refer to the Standing Advisory Committee, under the Chairmanship of Lord Coleraine, on the Remuneration of the Higher Civil Service the question of remuneration and a pensions scheme for Members of Parliament.
  The Prime Minister: No, Sir.
  Mrs. White: Will the Prime Minister consider the matter again? Is he not aware that several of his more senior colleagues have recently announced that they do not propose to stand for Parliament at the next General Election? Does he realise that there are probably a number of senior hon. Members on this side of the House who would be glad to make a similar statement but are not in a financial position to do so?
  Mr. Shinwell: For whom is my hon. Friend speaking?
  Mrs. White: As we have reached deadlock on the matter, does not the Prime Minister think that the Committee might well be asked to look at the matter again?
  The Prime Minister: No, Sir. I think the matter to which the hon. Lady has referred is an important one, but I do not think the Standing Advisory Committee is an appropriate body to consider the question of the remuneration of Ministers or Members of Parliament.

  MIDDLE EAST (SUPPLY OF ARMS)
  Mr. Warbeyasked the Prime Minister whether, in preparation of his forthcoming meeting with President Eisenhower, he will define the policy of Her Majesty's Government in relation to the latest official Soviet proposal for an agreed embargo on the supply of arms to all countries in the Near and Middle East, and for other forms of joint Four Power action on the economic and security problems of this area.
  The Prime Minister: The Russian proposals were addressed to the United States and French Governments as well as to Her Majesty's Government. They are naturally being studied with care and will be the subject of consultation with our American and French allies. Pending such consultations I should prefer to say no more.
  Mr. Warbey: Will the Prime Minister give us an assurance that when he gives the proposals more detailed consideration he will not be prejudiced against the Soviet proposals by virtue of their being almost identical with those advanced by the Opposition as far back as last May?
  The Prime Minister: I should not like to identify the two sets of proposals in that way. I would only say that we received them on the morning of 12th February and they were published at midday the same day, and I think it is only right that the three Governments should seriously consider their reply before making it.
  Mr. Younger: Will the Prime Minister consider representing to the United States Government that the practice which was followed on this occasion as well as on some previous occasions when there were
  1446
  Soviet proposals, whereby the State Department instantly issued a very discouraging statement about the proposals without prior consultation with anybody, is not helpful and that it creates a rather bad impression among their allies? The formula which he has given us, by which we have consultation first and a statement afterwards, will be much more satisfactory.
  The Prime Minister: I think the formula that I have announced is the one that we have agreed with our French and American allies.

  THE PRIME MINISTER (TALKS WITH PRESIDENT EISENHOWER)
  Mr. Emrys Hughesasked the Prime Minister which of the Service Ministers are to accompany him to Bermuda.
  The Prime Minister: While recognising the hon. Gentleman's great interest in Service matters, I am afraid I must disappoint him. I do not intend to take any of the Service Ministers with me.
  Mr. Hughes: Is the Prime Minister not taking Service Ministers because he thinks they might frighten President Eisenhower as much as they frighten us? Will he consider taking the Lord Privy Seal, who is responsible for civil defence and who carries some weight in America? Alternatively, will he consider taking the retinue of ex-Defence Ministers with him?
  The Prime Minister: The hon. Gentleman has worked in very well a new version of an old joke. I think that on this occasion it would be wiser for us to rest upon the teams that we shall agree for the discussion of the subjects which are most appropriate.
  Mr. H. Hynd: Is it not important that the Prime Minister should take the Secretary of State for Air with a single ticket?

  AGRICULTURAL RESEARCH

    Horticultural Crops (Spray Drift Damage)
    Mr. B. Harrisonasked the Minister of Agriculture, Fisheries and Food, as representing the Lord President of the Council, what progress has been made in

    1447
    the research into the prevention of damage to horticultural crops by spray from neighbouring farms.
    Sir F. Medlicottasked the Minister of Agriculture, Fisheries and Food, as representing the Lord President of the Council, if he is aware of the damage which continues to be caused to horticultural crops by spray from neighbouring farms; and if he will make a statement as to what progress has been made in the study of methods aimed at preventing this damage.
    Mr. Amory: Fundamental research at several research centres has yielded knowledge which may prove relevant to the problem of spray drift. The Agricultural Research Council are proposing shortly to call a meeting of experts in this field to consider the application of this knowledge to changing techniques of spraying agricultural crops.
    Mr. Harrison: While thanking my right hon. Friend for his reply, might I ask him to press on as hard as possible with research into non-volatile sprays in order that the damage which is done to horticultural crops may be the absolute minimum?
    Mr. Amory: I agree that the damage is becoming serious, and I will take note of what my hon. Friend has said.
    Mr. Snow: Is the right hon. Gentleman aware that the damage referred to in the Question is not restricted to horticultural crops? A high incidence of damage is done to bee colonies, and this is a very important matter in the soft fruit growing areas.
    Mr. Amory: Yes, Sir. I am aware of the point raised by the hon. Gentleman, which is a relevant one.

ELECTRICAL POWER ENGINEERS (DISPUTE)
Mr. Robens(by Private Notice) asked the Minister of Labour whether he has any statement to make about the dispute between the Electrical Power Engineers' Association and the Central Electricity Authority.
The Minister of Labour and National Service (Mr. Iain Macleod): Perhaps the House will allow me, first, to say how glad we all are to see the right hon. Gentleman back in his place again.
1448
I understand that negotiations have been going on for some time between the Association and the Authority about a salary claim. These negotiations were recently broken off by the Association.
As regards the reported decision of the Association to instruct its members to work to rule, I am informed that the Central Electricity Authority has not, so far, received an official notification of this action.
The Authority is considering whether to refer the matter to my Department, whose services are, of course, available to them.
Mr. Robens: Does not the Minister agree that the action proposed to be taken by the trade union concerned might easily cause considerable dislocation at peak hours, especially to industry and the travelling public? Secondly, does not he agree that no responsible trade association or trade union, such as this is, would take such an action unless under intense irritation? Does not he know from his experience as Minister of Labour that one of the most irritating things, which causes the greatest difficulty between workers and management, is the long delay in negotiations? This matter has been discussed now for 15 months.
To prevent any worsening in the situation, and to enable the union to withdraw the notice which it has sent to its members, will the Minister undertake to use his good offices to bring the union and the Authority representatives together to heal the breach, so to speak, and to enable the negotiations to continue from where they left off?
Mr. Macleod: It is true that serious consequences might flow from such a decision, although one cannot be too precise about what those consequences may be. I attach the greatest importance to trade union procedure, as I am sure the right hon. Gentleman does, as a previous Minister of Labour. Trade union procedure has not been exhausted in this matter. In particular, at the request of one side alone an unresolved dispute can be referred to arbitration, and I had hoped that that course would follow. I recognise the feelings which have arisen in this matter, and I respond to the right hon. Gentleman's approach. I am very ready to see whether, and, if so, how, my Department can best be of service.

BUSINESS OF THE HOUSE
Mr. Gaitskell: May I ask the Lord Privy Seal whether he will announce the business for next week?
The Secretary of State for the Home Department and Lord Privy Seal (Mr. R. A. Butler): Yes, Sir. The business for next week will be as follows:
MONDAY, 18TH FEBRUARY—Second Reading of—the Housing and Town Development (Scotland) Bill.
Committee stage of the necessary Money Resolution.
TUESDAY, 19TH FEBRUARY—supply [2nd Allotted Day]: Committee.
The following Civil Supplementary Estimates will be considered:
Class II, Vote 9, Colonial Services which contains a Grant-in-Aid for Cyprus.
Class II, Vote 2, Foreign Office Grants and Services.
Class VIII, Vote 2, Agricultural and Food Grants and Subsidies.
WEDNESDAY, 20TH FEBRUARY—The Rating and Valuation Bill will be further considered.
Second Reading of the Public Trustee (Fees) Bill [Lords].
Committee stage of a Ways and Means Resolution and of a Money Resolution required for the Electricity Bill, which is now before Standing Committee.
Report and Third Reading of the Patents Bill [Lords].
THURSDAY, 21ST FEBRUARY—Consideration of the Motor Vehicles (Variation of Speed Limit) Regulations, which it is hoped to obtain by 7 o'clock.
Report stage of the Customs Duties (Dumping and Subsidies) Bill.
FRIDAY, 22ND FEBRUARY—Consideration of Private Members' Motions.
Mr. Gaitskell: Is the Lord Privy Seal aware that on Tuesday it is the desire of the Opposition that there should be a full day's debate on Cyprus, and that we should, therefore, wish some of the other Supplementary Estimates to be deferred until a later date? Will he also say when he thinks that the House can debate the
1450
Report of the Joint Committee on Private Bill Procedure, to which my right hon. Friend the Member for Colne Valley (Mr. Glenvil Hall) referred last week?
Mr. Butler: With reference to Tuesday's business, we certainly take note of the wishes of the Opposition. The other Votes were, of course, put down at their request. On the question of Private Bill Procedure, it might be convenient if I make a short statement to the House, with the leave of the House, and in answer to the right hon. Gentleman.
The Report contains recommendations which have engaged the close attention both of the Government and of the authorities of both Houses. Of the 22 recommendations of the Joint Committee all but seven were dealt with, as the House will remember, in a Question answered on 31st July last. One of the remaining seven recommendations is the subject of a Private Member's Bill at present in progress, and Mr. Speaker has made a statement about another. The remaining five points are under consideration by the Government, in consultation with the authorities of the House.
Now we come to the second recommendation of the Joint Committee, that Mr. Speaker should ordinarily declare the Second Reading of a Private Bill carried unless a reasoned Amendment to the Motion for the Second Reading stands on the Order Paper signed by at least six Members. This was not found to be acceptable. I have recently received representations from certain hon. Members opposite who are opposed to the old practice under which Bills may be blocked at the time of unopposed Private Business by the objection of a single Member. In considering this matter, I would wish to consult through the usual channels and with private Members who are interested.
Mr. Gaitskell: Without wishing to enter into the merits of the Report, may I ask the right hon. Gentleman whether he does not agree that as it was published as long ago as May, 1955, the most sensible course would be to have a debate upon the whole subject as soon as possible?
Mr. Butler: I would rather do what I have said and have a consultation first with the right hon. Gentleman and his friends, and also with hon. Members who are interested. Certain private Members

1451
have approached me. I would rather decide about what we should do next after those consultations have taken place.
Mr. Nabarro: As we are approaching the period in the year when it is a regular weekly feature to debate Votes and Estimates, can my right hon. Friend tell the House when we might expect a statement on the vastly expensive atomic energy programme which has been promised almost every week since the beginning of December?
Mr. Butler: I was aware that this question might be asked, but I cannot make any further statement today; nor can my right hon. Friend who is in charge of this matter. But I will note the need for a further statement.
Mr. Glenvil Hall: Will the right hon. Gentleman bear in mind, in the talks which he has now told us are about to take place between various authorities, that the great hope is that the discussions will result in a lessening of costs and expenses to local authorities and others promoting Private Bills?
Mr. Butler: In some respects the costs would be less to those private interests if some hon. Members, such as the right hon. Gentleman, were less assiduous in their attention to their Parliamentary duties. I suggest that we discuss this matter first—that we do not decide its merits across the Floor of the House—and then decide what it is best to do next.
Mr. Glenvil Hall: Is the right hon. Gentleman aware that a Second Reading debate now costs the promoters of a Bill at least £25?
Mr. Short: Has the right hon. Gentleman seen the Motion on the Order Paper which refers to the dilemma facing the State of Israel, which has been signed by more than 100 right hon. and hon. Members of all parties? If he cannot find time for a discussion of the Motion, will he be so kind as to bring it to the attention of his right hon. Friends the Prime Minister and Foreign Secretary, and let them know what massive support it is receiving from all quarters of the House?
[That this House is of the opinion that a withdrawal of Israeli forces from the
1452
Gaza Strip and the Gulf of Aqaba before adequate guarantees have been given to Israel as to the security of her frontier with Egypt and the freedom of her shipping in the Gulf would not be in the interests of peace in the Middle East.]
Mr. Butler: Yes, Sir. I have the Motion here and I am aware of the support for it. I will certainly mention it to my right hon. Friends.
Mr. Osborne: In view of the immense importance to the people of this country of the proposed free trade area in Europe, and the differences of opinion in industry concerning the proposals, will arrangements be made for a debate to take place in this House as soon as possible after the Chancellor of the Exchequer and the President of the Board of Trade have returned from the Paris conference?
Mr. Butler: We have had a general debate on the subject but, naturally, the House would wish to know the latest news. We had better await the return of my right hon. Friends the Chancellor of the Exchequer and the President of the Board of Trade before we make up our minds about a statement.
Mr. Daines: During last Session, a Select Committee was set up, by Resolution of the House, to deal with amenities and accommodation, or the lack of them, in the House, but so far this Session a Motion has not been moved for the setting up of a Select Committee. Is it the intention of the Leader of the House that that position should be maintained, or is a Select Committee again to be set up?
Mr. Butler: I have studied this matter, on which I should like to obtain the considered views of Her Majesty's Opposition. If we could have an opportunity of a discussion with them for that purpose, we might make progress.
Motion made, and Question put:—
That the Proceedings on the Rating and Valuation Bill be exempted, at this day's Sitting, from the provisions of Standing Order No. 1 (Sittings of the House).—[Mr. R. A. Butler.]
The House divided: Ayes 211, Noes 170.

Division No. 60.]

AYES

[3.41 p.m.

Agnew, Sir Peter

Gomme-Duncan, Col. Sir Alan

Nairn, D, L. S.

Allan, R. A. (Paddington, S.)

Gower, H. R.

Neave, Airey

Alport, C. J. M.

Graham, Sir Fergus

Nicholson, Godfrey (Farnham)

Amory, Rt. Hn. Heathcoat (Tiverton)

Green, A.

Nicolson, N. (B'n'm'th, E. & Chr'ch)

Arbuthnot, John

Gresham Cooke, R.

Oakshott, H. D.

Armstrong, C. W.

Grimston, Sir Robert (Westbury)

O'Neill, Hn. Phelim (Co. Antrim, N.)

Ashton, H.

Gurden, Harold

Ormsby-Gore, Rt. Hon. W. D.

Astor, Hon. J. J.

Hall, John (Wycombe)

Orr, Capt. L. P. S.

Atkins, H. E.

Harris, Frederic (Croydon, N.W.)

Osborne, C.

Baldwin, A. E.

Harris, Reader (Heston)

Page, R. G.

Barber, Anthony

Harrison, A. B. C. (Maldon)

Pannell, N. A. (Kirkdale)

Barlow, Sir John

Harrison, Col. J. H. (Eye)

Partridge, E.

Barter, John

Harvey, Air Cdre. A. V. (Macclesfd)

Pickthorn, K. W. M.

Baxter, Sir Beverley

Harvey, John (Walthamstow. E.)

Pilkington, Capt. R. A.

Beamish, Maj. Tufton

Heald, Rt. Hon. Sir Lionel

Pitt, Miss E. M.

Bell, Ronald (Bucks, S.)

Heath, Rt. Hon. E. R. G.

Pott, H. P.

Bevins, J. R. (Toxteth)

Hesketh, R. F.

Powell, J. Enoch

Bidgood, J. C.

Hicks-Beach, Maj. W. W.

Price, David (Eastleigh)

Biggs-Davison, J. A.

Hill, Rt. Hon. Charles (Luton)

Price, Henry (Lewisham, W.)

Birch, Rt. Hon. Nigel

Hill, Mrs. E. (Wythenshawe)

Prior-Palmer, Brig. O. L.

Bishop, F. P.

Hill, John (S. Norfolk)

Ramsden, J. E.

Body, R. F.

Bossom, Sir Alfred

Hinchingbrooke, Viscount

Rawlinson, Peter

Boyd-Carpenter Rt. Hon. J. A.

Holland-Martin, C. J.

Redmayne, M.

Boyle, Sir Edward

Holt, A. F.

Renton, D. L. M.

Braine, B. R.

Hope, Lord John

Ridsdale, J. E.

Braithwaite, Sir Albert (Harrow, w.)

Hornby, R. P.

Rippon, A. G. F.

Brooke, Rt. Hon. Henry

Hornsby-Smith, Miss M. P.

Robertson, Sir David,

Brooman-White, R. C.

Horsbrugh, Rt. Hon. Dame Florence

Robinson, Sir Roland (Blackpool, S.)

Browne, J. Nixon (Craigton)

Howard, John (Test)

Rodgers, John (Sevenoaks)

Bryan, P.

Hughes Hallett, Vice-Admiral J.

Roper, Sir Harold

Butler, Rt. Hn. R. A. (Saffron Walden)

Hulbert, Sir Norman

Ropner, Col. Sir Leonard

Campbell, Sir David

Hutchison, Sir James (Scotstoun)

Russell, R. S.

Carr, Robert

Hyde, Montgomery

Schofield, Lt.-Col. W.

Cary, Sir Robert

Iremonger, T. L.

Scott-Miller, Cmdr. R.

Channon, Sir Henry

Irvine, Bryant Godman (Rye)

Sharples, R. C.

Churchill, Rt. Hon. Sir Winston

Jenkins, Robert (Dulwich)

Shepherd, William

Conant, Maj. Sir Roger

Jennings, J. C. (Burton)

Simon, J. E. S. (Middlesbrough, W.)

Cooper, A. E.

Johnson, Dr. Donald (Carlisle)

Smyth, Brig. Sir John (Norwood)

Cooper-Key, E. M.

Keegan, D.

Spence, H. R. (Aberdeen, W.)

Cordeaux, Lt.-Col. J. K.

Kerby, Capt. H. B.

Spens, Rt. Hn. Sir P. (Kens'gt'n, S.)

Craddock, Beresford (Spelthorne)

Kerr, H. W.

Stevens, Geoffrey

Crouch, R. F.

Kimball, M.

Steward, Sir William (Woolwich, W.)

Crowder, Sir John (Finchley)

Langford-Holt, J. A.

Stewart, Henderson (Fife, E.)

Cunningham, Knox

Leavey, J. A.

Storey, S.

Currie, G. B. H.

Lindsay, Hon. James (Devon, N.)

Studholme, Sir Henry

Dance, J. C. G.

Lloyd, Maj. Sir Guy (Renfrew, E.)

Teeling, W.

Davidson, Viscountess

Longden, Gilbert

Temple, J. M.

D'Avigdor-Goldsmid, Sir Henry

Lucas-Tooth, Sir Hugh

Thomas, Leslie (Canterbury)

Deedes, W. F.

McAdden, S. J.

Thomas, P. J. M. (Conway)

Digby, Simon Wingfield

Macdonald, Sir Peter

Thompson, Kenneth (Walton)

Dodds-Parker, A, D.

Mackeson, Brig. Sir Harry

Thompson, Lt.-Cdr. R. (Croydon, S.)

Donaldson, Cmdr. C. E. McA.

McKibbin, A. J.

Thornton-Kemsley, C. N.

du Cann, E. D. L.

Mackie, J. H. (Galloway)

Tiley, A. (Bradford, W.)

Duncan, Capt. J, A. L.

Maclean, Fitzroy (Lancaster)

Tilney, John (Wavertree)

Duthie, W. S.

McLean, Neil (Inverness)

Turton, Rt. Hon. R. H.

Eden, J. B. (Bournemouth, West)

MacLeod, John (Ross & Cromarty)

Vane, W. M. F.

Emmet, Hon. Mrs. Evelyn

Macmillan, Rt. Hn. Harold (Bromley)

Vaughan-Morgan, J. K.

Erroll, F. J.

Macmillan, Maurice (Halifax)

Vickers, Miss J. H.

Farey-Jones, F. W.

Macpherson, Niall (Dumfries)

Wade, D. W.

Fell, A.

Maddan, Martin

Wakefield, Edward (Derbyshire, W.)

Finlay, Graeme

Maitlanrl, Hon. Patrick (Lanark)

Wall, Major Patrick

Fisher, Nigel

Manningham-Buller, Rt. Hn. Sir R.

Watkinson, Rt. Hon. Harold

Fletcher-Cooke, C.

Marlowe, A. A. H.

Webbe, Sir H.

Fort, R.

Marples, Rt. Hon. A. E.

Whitelaw, W. S. I. (Penrith & Border)

Fraser, Hon. Hugh (Stone)

Maude, Angus

Williams, R. Dudley (Exeter)

Fraser, Sir Ian (M'cmbe & Lonsdale)

Maudling, Rt. Hon. R.

Wills, G. (Bridgwater)

Freeth, Denzil

Mawby, R. L.

Wilson, Geoffrey (Truro)

Garner-Evans, E. H.

Molson, Rt, Hon. Hugh

Wood, Hon. R.

Gibson-Watt, D.

Morrison, John (Salisbury)

Glover, D.

Mott-Radclyffe, Sir Charles

TELLERS FOR THE AYES:

Godber, J. B.

Nabarro, G. D. N.

Mr. Legh and Mr. Hughes-Young.

NOES

Ainsley, J. W.

Benn, Hn. Wedgwood (Bristol, S.E.)

Bowles, F. G.

Allen, Arthur (Bosworth)

Benson, G.

Braddock, Mrs. Elizabeth

Allen, Scholefield (Crewe)

Beswick, Frank

Brockway, A. F.

Awbery, S. S.

Blackburn, F.

Brown, Rt. Hon. George (Belper)

Bacon, Miss Alice

Blyton, W. R.

Brown, Thomas (Ince)

Balfour, A.

Boardman, H.

Burke, W. A.

Bellenger, Rt. Hon. F. J.

Bowden, H. W. (Leicester, S.W.)

Burton, Miss F. E.

1454

1455

Butler, Herbert (Hackney, C.)

Janner, B.

Redhead, E. C.

Callaghan, L. J.

Jay, Rt. Hon. D. P. T.

Reeves, J.

Carmichael, J.

Jeger, George (Goole)

Reid, William

Champion, A. J.

Jeger, Mrs. Lena (Holbn &St. Pncs. S.)

Rhodes, H.

Chapman, W. D.

Jenkins, Roy (Stechford)

Robens, Rt. Hon. A.

Chetwynd, C. R,

Johnson, James (Rugby)

Roberts, Albert (Normanton)

Clunie, J.

Johnston, Douglas (Paisley)

Roberts, Goronwy (Caernarvon)

Collick P. H. (Birkenhead)

Jones, Rt. Hon. A. Creech (Wakefietd)

Robinson, Kenneth (St. Pancras, N.)

Collins, V. J. (Shoreditch & Finsbury)

Jones, David (The Hartlepools)

Rogers, George (Kensington, N.)

Corbet, Mrs. Freda

Jones, Elwyn (W. Ham, s.)

Ross, William

Cove, W. G.

Jones, T. W. (Merioneth)

Shinwell, Rt. Hon. E.

Daines, P.

Key, Rt. Hon. C. W.

Short, E. W.

Darling, George (Hillsborough)

Lawson, G. M.

Silverman, Julius (Aston)

Davies, Rt. Hn. Clement (Montgomery)

Lindgren, G. S.

Silverman, Sydney (Nelson)

Davies, Stephen (Merthyr)

Lipton, Marcus

Simmons, C. J. (Brierley Hill)

de Freitas, Geoffrey

McGhee, H. G.

Skeffington, A. M.

Dodds, N. N.

McKay, John (Wallsend)

Smith, Ellis (Stoke, S.)

Dugdale, Rt. Hn. John (W. Brmwch)

McLeavy, Frank

Snow, J. W.

Ede, Rt. Hon. J. C.

Mahon, Simon

Sorensen, R. W.

Edwards, Rt. Hon. John (Brighouse)

Marquand, Rt. Hon. H. A.

Sparks, J. A.

Edwards, W. J. (Stepney)

Messer, Sir F.

Steele, T.

Evans, Albert (Islington, S. W.)

Mitchison, G. R.

Stewart, Michael (Fulham)

Evans, Edward (Lowestoft)

Monslow, W.

Stones, W. (Consett)

Fernyhough, E.

Moody, A. S.

Strauss, Rt. Hon. George (Vauxhall)

Finch, H. J.

Morris, Percy (Swansea, W.)

Summerskill, Rt. Hon. E.

Fletcher, Eric

Morrison, Rt. Hn. Herbert (Lewis'm,S.)

Swingler, S. T.

Fraser, Thomas (Hamilton)

Moss, R.

Sylvester, G. O.

Gaitskell, Rt. Hon. H. T. N.

Moyle, A.

Taylor, Bernard (Mansfield)

Gordon Walker, Rt. Hon. P. C.

Mulley, F. w.

Taylor, John (West Lothian)

Grenfell, Rt. Hon. D. R.

Neal, Harold (Bolsover)

Thomson, George (Dundee, E.)

Grey, C. F.

Noel-Baker, Francis (Swindon)

Thornton, E.

Griffiths, Rt. Hon. James (Llanelly)

Noel-Baker, Rt. Hon. P. (Derby, S.)

Tomney, F.

Hall, Rt. Hn. Glenvil (Colne Valley)

Oliver, G. H.

Viant, S. P.

Hamilton, W. W,

Oram, A. E.

Warbey, W. N.

Harrison, J. (Nottingham, N.)

Oswald, T.

Wells, Percy (Faversham)

Hayman, F. H.

Owen W.J.

Wells, William (Walsall, N.)

Herbison, Miss M.

Paling, Rt. Hon. W. (Dearne Valley)

West, D. G.

Hobson, C. R.

Pannell Charles (Leeds, W.)

Wheeldon, W. E.

White, Mrs. Eirene (E. Flint)

Holman, P.

Parker, J.

Willey, Frederick

Houghton, Douglas

Paton, John

Williams, W. R, (Openshaw)

Howell, Denis (All Saints)

Pearson, A.

Williams, W. T. (Barons Court)

Hoy, J. H.

Peart, T. F.

Willis, Eustace (Edinburgh, E.)

Hubbard, T. F.

Pentland, N.

Wilson, Rt. Hon. Harold (Huyton)

Hughes, Cledwyn (Anglesey)

Plummer, Sir Leslie

Winterbottom, Richard

Hughes, Emrys (S. Ayrshire)

Popplewell, E.

Woodburn, Rt. Hon. A.

Hughes, Hector (Aberdeen, N.)

Price, J. T. (Westhoughton)

Yates, V. (Ladywood)

Hunter, A. E.

Probert, A. R.

Younger, Rt. Hon. K.

Hynd, H. (Accrington)

Proctor, W. T.

Zilliacus, K.

Irving, Sydney (Dartford)

Randall, H. E.

Isaacs, Rt. Hon. C. A.

Rankin, John

TELLERS FOR THE NOES:

Mr. Holmes and Mr. Wilkins.

ORDERS OF THE DAY

  RATING AND VALUATION [MONEY]
  Resolution reported,
  That, for the purposes of any Act of the present Session relating to rating and valuation, it is expedient to authorise the payment out of moneys provided by Parliament of any increase attributable to the provisions of the said Act in the sums payable out of such moneys for the year 1957–58 or subsequent years under Part I of the Local Government Act, 1948, or the Local Government (Financial Provisions) (Scotland) Act, 1954, as amended by the Valuation and Rating (Scotland) Act, 1956, being provisions—

  (a) reducing the rateable value of any hereditament;

  (b) increasing the rateable value of any hereditament which a Gas Board is treated as occupying under section six of the Rating and Valuation (Miscellaneous Provisions) Act, 1955; or

  (c) reducing for the purposes of Part I of the Local Government Act, 1948, the rateable value for an area by reference to the reduction in the amount of rates chargeable in respect of hereditaments to which section eight of the said Act of 1955 applies.

  Resolution agreed to.

RATING AND VALUATION BILL
Considered in Committee.
[Sir CHARLES MACANDREW in the Chair]

Clause 1.—(RATEABLE VALUE OF SHOPS, OFFICES, ETC., FOR PURPOSES OF EXISTING VALUATION LISTS.)
3.52 p.m.
The Chairman: The first Amendment, in the name of the hon. Member for Harrow, Central (Mr. Bishop), in page 1, line 5, to leave out "net annual" and to insert "rateable", might, for convenience, be discussed with the next one, in page 1, line 6, to leave out from the beginning to "is" in line 7, and to insert:
"consists of or includes a shop".
At the same time, we might discuss the first four Amendments in page 512, in the names of the hon. Member for Lowestoft (Mr. Edward Evans) in page 1, line 9. after "1925," to insert:
"or where the hereditament is a holiday camp",
1458
the hon. Member for Harwich (Mr. Ridsdale), in page 1, line 9, after "1925" to insert:
"or where the hereditament is a pier".
the hon. Member for Stalybridge and Hyde (Mr. Blackburn), in page 1, line 9. after "1925", to insert:
"or where the hereditament (whether or not its net annual value is an amount ascertained as aforesaid) is a market hall".
and the hon. Member for Harrow, Central, in page 1, line 10, after "value" to insert:
"as ascertained in accordance with the provisions of subsection (1) of section twenty-two of the Rating and Valuation Act, 1925, as amended by section five of the Rating and Valuation (Miscellaneous Provisions) Act, 1955".
Mr. G. R. Mitchison: At the end of the discussions on all those Amendments, would you allow separate votes, without further discussion of any of the Amendments, Sir Charles?
The Chairman: I do not propose having any Division other than on the first Amendment.
Mr. Mitchison: The first Amendment raises quite different points from the Amendments in page 512, Sir Charles. These also raise separate points. I would not ask for a separate discussion on them. For example, the first of the Amendments in page 512, relates to holiday camps and the next to piers. These should not be irrevocably tied together for rating purposes. They are separate matters.
The Chairman: I went into this matter very carefully with my advisers and we came to the conclusion that they could be discussed together.
Hon. Members: Hear, hear.
Mr. Mitchison: I have no objection to that and I do not think that my hon. Friends have any objection. All we are asking is that, after the discussion, if a vote is required on these Amendments it should be allowed. The Amendments could be moved formally.
The Chairman: Most certainly no more discussion, but I will not promise a vote.
Mr. Mitchison: They are on different points. It puts us in very considerable difficulty if we are not allowed a vote. I am not asking for further discussion. We are simply asking that because they are

1459
all discussed together—which may, we hope, save the time of the Committee—no particular Amendment should be given voting preference. There may be larger support for holiday camps than for piers.
The Chairman: Without making any,promise at all, I would ask the hon. and learned Gentleman to indicate the Amendments on which he wants Divisions to be allowed. I am not prejudicing my judgment in any way.
Mr. Mitchison: I appreciate that, Sir Charles, and I thank you. These Amendments cover holiday camps, piers, market halls, etc. We shall certainly want a Division on holiday camps and market halls. I do not know what the position is about piers, because the hon. Gentlemen whose names are attached to those Amendments sit on the Government side of the Committee.
The Chairman: In other words, the hon. and learned Gentleman would like a Division on the first and the third Amendments, in page 512?
Mr. Mitchison: Yes, Sir Charles, on holiday camps and market halls.
Mr. J. T. Price: On a point of order. Like other hon. Members, Sir Charles, I feel rather puzzled about your Ruling. Naturally, you must have had good grounds for giving the Ruling, but surely, if an Amendment is accepted by the Chair as being in order, it will be open to the Committee to divide on it. It would be helpful for us to be told under what Standing Order your Ruling is given.
The Chairman: I have the power of selection of Amendments. It would make my work much easier if I had not that power. I do not want it, but it is thrust upon me. Under the Standing Order, I have to select Amendments.
Mr. Eric Fletcher: Further to that point of order, Sir Charles. Your Ruling raises a very great point of principle. For some years the practice has grown up of taking a number of separate Amendments together and discussing them together. They are all discussed together on the assumption that they have all been selected as being in order. When, for the convenience of the Committee, five, six or seven different Amendments are taken together, it is on
1460
the assumption that they have all been selected for discussion. It follows from that assumption—
The Chairman: The hon. Member is arguing from a false premise altogether. There is no such assumption. I have been doing Committee work in this House for many years. Because Amendments are discussed together it does not indicate that they are all to be selected. It never has been the case.
Mr. Fletcher: That is not my point, Sir Charles. If you rule that certain Amendments can be discussed together that can only be on the assumption that they have all been selected for discussion. As you have ruled, in this case, that certain Amendments can be discussed, surely it follows that if any Member wishes to vote on any Amendment that has been discussed he is entitled to ask that there should be a Division.
The Chairman: Certainly not. That has never been the rule. I have been doing this work for many years and this has always been the rule that I am now applying. It is often indicated, as the hon. and learned Gentleman has just done, that a Division is desired, and I am allowing a Division on two Amendments. Otherwise, all that would happen would be that my selection would be very much narrower.
Mr. Fletcher: The Chair has power of selection?
The Chairman: Yes.
Mr. Fletcher: The Chair having once decided what Amendments should be selected, and having indicated that certain Amendments which have been selected can be discussed together, surely, after that stage, the Chair has no power or authority to decide that there can be votes only on certain Amendments and not on others. I suggest that after the Chair has ruled that certain Amendments that have been selected shall be discussed, hon. Members have the right to divide on all those Amendments that have been selected.
The Chairman: If the Committee wants to make that rule I shall be quite happy, but I shall not select so many of the Amendments for discussion. That is the difficulty that hon. Members are in.
Mr. Fletcher: I suggest, in all seriousness, that once the Chair has ruled that certain Amendments have been selected for discussion, and might all be discussed together, the Chair has no authority to decide that there shall not be a Division on any of the selected Amendments.
The Chairman: The Chair has every power to do so. Up to that point, there has only been one Amendment called. If the Chair does not call any of the others there can be no Divisions. It is very simple. Now we had better get on with the business.
Mr. W. T. Proctor: Is it now contended that the Chair has two selections, selection for discussion and selection for voting? I have never heard of two before.
The Chairman: Well, the hon. Member has heard of them today.
4.0 p.m.
Mr. F. P. Bishop: I beg to move, in page 1, line 5, to leave out "net annual" and to insert "rateable".
There is one simple solution to the procedural problems that hon. Members opposite have been raising. If the Amendment which I am now moving is accepted, it will cover the Amendments which they have put down, because our Amendment deals with the general case of which the other Amendments are particular examples. The two Amendments in the names of my hon. Friend the Member for Harwich (Mr. Ridsdale) and myself are parts of the same proposition.
It may be convenient for the Committee if I read out how this Clause would read if these three Amendments were accepted:
"(1) Where the rateable value of a hereditament which is neither a dwelling-house nor a private garage or private storage premises would but for this section be equal to its net annual value as ascertained in accordance with the provisions of subsection (1) of section twenty-two of the Rating and Valuation Act, 1925, as amended by section five of the Rating and Valuation (Miscellaneous Provisions) Act, 1955, the rateable value of the hereditament shall be ascertained …"
as the subsection reads at present.
The purpose of the Amendment is quite clear and quite simple. It is to bring within the benefit of the concession that is to be made to shops and business premises which are valued by reference
1462
to gross value a number of other hereditaments of a miscellaneous kind which are valued by reference to the net value, and, therefore, are excluded from Clause 1 as it stands at present, but which we think have just as good a claim to the remission as the shops and business premises themselves. The Amendment has nothing whatever to do with industrial hereditaments or with the public utilities, which are dealt with on quite a different basis.
This matter was discussed on Second Reading, when my right hon. Friend was good enough to say that he would give consideration to any Amendment that was put down to attain this objective. We are not asking him to do anything more than that, recognising that this is an extremely technical and difficult problem. Certainly, I do not feel confident that the wording of the Amendments that we have put down may necessarily be exactly the way to do what it is that we want to do. We are asking my right hon. Friend whether he would look again at this problem of the various groups of hereditaments which, as I put it on Second Reading, are suffering the worst of all possible worlds, and see whether he can do something to help them.
It is a mixed bag, as my hon. Friend the Parliamentary Secretary said, that we are now considering. On Second Reading, I mentioned particularly the case of the advertising stations and advertisement hoardings, which are valued by reference to their net value, and, therefore, are excluded from Clause 1. Like the shops and business premises, they have been put up to the full 1956 value, and, as I pointed out to the House on Second Reading, some of these advertising stations have had their values increased by as much as 167 per cent., whereas the figure given by my hon. Friend for the shops, which he considers, and I think rightly, entitles them to some relief, is no more than 120 per cent.
Of course, if the advertising stations get no benefit under Clause 1, they will not merely be left with this higher burden of valuation at great cost to themselves, but will suffer the further burden of the increase in the rate poundage which is bound to follow from the benefits given to the shops and business premises.
The advertising stations are only one of the groups affected by this Amendment. Another group of which I have

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learned recently comprises bus stations and parking grounds. This appears to be a very complicated problem. The bus stations may include a great variety of premises, ranging from an enormous park, where there are huge buildings with garages, down to the small shelter put up in the street for the benefit of passengers waiting for a bus.
As I understand, some of these premises are valued on the gross basis and some are valued on the net basis. If there is any principle governing the question of which way they are to be valued, it would appear to depend on the relation of the actual buildings to the ground involved and the use to which the buildings are put. I am informed that, in the case of bus stations and garages, which are valued on the net basis, the valuations have been increased by as much as 129 per cent. as the result of last year's Act, so that they, too, are unfavourably affected, even as compared with shops and business premises.
These are only two examples, but there are other examples of the sort of hereditaments concerned in Amendments on the Notice Paper, because hon. Members have put down Amendments dealing with seaside piers, with holiday camps and with market halls, and I understand that there are others also equally affected. I do not want to go any further into detail, and in view of the very differing circumstances applying to some of these different groups, I do not want to lay too much stress on the actual wording of our Amendment. It may be too wide, or it may, perhaps, even be too narrow, but if so, that can be corrected by the expert draftsmen. It is an extremely difficult and technical matter.
I should like my right hon. Friend to consider the principle lying behind this Amendment, and to give the Committee an assurance that he will review this matter again with a view to doing justice to these other groups of hereditaments that have suffered the same increases in their assessments as shops and business premises, and to apply the same relief to there as he applies to shops and business premises.
The Chairman: Before we proceed further, perhaps I could say that I have considered the matter of calling Divisions, and that the Amendment at the top of
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page 512, in the name of the hon. Member for Lowestoft (Mr. Edward Evans) will be called for a Division, if required.
Mr. Edward Evans: I beg to move the Amendment standing in my name—
The Chairman: That Amendment cannot be moved yet; not until we reach it; but the hon. Member may speak to it now.
Mr. Evans: I want to refer to my Amendment because I believe that there may be an unfair deal here. I may tell the Committee there are 99 holiday camps in various parts of the country, some of them in my own constituency on the East Coast. Most of them are very near the sea. It is accepted that they perform a most useful service and provide great benefit to the community by giving opportunities for a healthful holiday to people who, in the ordinary way, could not have the benefits and amenities of a seaside holiday. They cater not only for adults and young people but, what is most important, for family groups. Their popularity is evidence of the service they perform.
This industry is labouring under a sense of grievance and injustice at being excluded from the terms of the Bill. The camps consist mainly of residential chalets with central amenities for dining, dancing and other entertainments. Generally, they are permanent, or what is called semi-permanent—a hideous word, but I think the Committee understands that it means not very substantially built—and they provide very homely amenities. Big hazards in running the camps profitably are inherent in their siting and construction. They demand a great deal of overhaul work every year. They are subject to storm and violent weather in winter and, owing to the rapid changes in their occupation, they are more liable to damage than well-built and well-furnished residential hotels.
The amount of money required to keep them in good order and attractive is so considerable that over the whole range of holiday camps in the country it is probable that about £½million is spent in renovation and redecoration. I have some experience of running a considerable establishment on the East Coast. I can assure hon. Members that the stress of bad weather and winter storms makes it

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quite frightening to realise the amount of money required to keep these places in good repair and decorative order.
Another liability, which probably is the most important, is the short season. Most of these camps can operate for only about thirteen weeks at most in a year, but they have to be maintained all through the year. They need a skeleton staff, a repair staff, and a clerical staff to maintain the bookings. Originally, when the assessments were made under the 1928 Act, it was provided that to arrive at a rateable value there should be a reduction to cover the cost of repairs and maintenance and insurance. That allowance, however, was made on prices ruling in 1928 and is wholly inadequate today. Anyone with experience of the building and decorating industry knows how those prices have risen.
Under the last valuation the assessments have been raised to a very considerable extent; in some cases by as much as 300 per cent. It can be claimed that appeals may be made. Most holiday camps have lodged appeals; others are pending. I do not propose to develop the technical arguments which have been put forward in appeals against the assessments lodged by the National Federation of Permanent Holiday Camps and their rating consultants. I think that most hon. Members, certainly members of the Government, have been provided with details of the case which has been set out. I have not the time nor the capacity to go into the technical details.
There are many anomalies in this Bill, but this is one of the most glaring, because the big competitors in the entertainments and holiday industry are hotels and boarding houses, which are protected by the Bill through the reduction which is proposed. It seems a most invidious discrimination that people doing practically the same job, but under much more strenuous and difficult conditions, should be penalised as compared with their competitors.
I hope that the Government will accept the Amendment in my name. It is designed solely to give parity of treatment with hotels which are open all the year round. Those hotels can develop their business. In winter they can work with a reduced staff, but holiday camps have to concentrate on a much shorter season and, in such inclement weather as we are
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now experiencing, there is no inducement to people to stay at holiday camps. I hope that the Amendment will be accepted so that we can wipe out a sense of injustice which is very prevalent in the holiday camp industry.
4.15 p.m.
Mr. Julian Ridsdale: While supporting my hon. Friend the Member for Harrow, Central (Mr. Bishop) I wish to speak particularly about the Amendment in my name, which refers to the question of piers. [Laughter.] I mean the ones which go out to the sea.
My purpose in tabling this Amendment is simply to put right what seems to me an injustice in the Bill. I speak on behalf of Clacton Pier, which is in my constituency. Before rerating took place, Clacton Pier was assessed at £3,500. The original proposition was £10,000, an increase of 280 per cent. I have taken this up with the Minister and the reply I have had is as follows:
"In the case of piers, a proposal for a reduction in the new assessment has been made in every instance.
A substantial proportion of the proposals has been settled, and the revised figures for these show an average increase of under 66 per cent. as compared with the assessments before revaluation.
The comparable increase for the shops and miscellaneous properties, to which relief is given in this Bill, is over 120 per cent.
I do not think, therefore, that it is unfair to deny this relief to pleasure piers."
If that statement was not misleading, I certainly would not have tabled my Amendment. It seems to me that there is an injustice here. It is simply not true, so far as Clacton Pier is concerned, that the increase is only 66 per cent. That is why I ask the Minister to consider the question of piers being included in this Bill.
If he is not willing to include piers, I ask him to look again at the assessment of Clacton Pier, which, if the rates payable are taken into consideration, and the suggestion of £8,500 is taken as final, would still be paying £7,430 net—taking the present rate of 17s. 4d. in the £—compared with Brighton Pier, which pays £6,025, being assessed at £9,000, the rate there being only 13s. 4d. in the £.
I know that it would be unfair to ask the Minister to comment on respective assessments of certain piers, but if he uses the argument of averages—as he has

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done—I must make that comparison. Clacton Pier has to pay £1,400 more than Brighton, which has a much longer season that we have on the East Coast, although we have much more sun on the East Coast than there is on the South Coast. Unfortunately, we do not have such a large resident population as Brighton, nor does the electric railway yet go to Clacton, although we hope that it will shortly. Again, Brighton is much nearer London.
Taking the longer view, when we consider the Minister's proposals for the refinancing of local government, this anomaly may be ironed out, for one of the biggest charges which my constituents have to bear on their rates is the county education charge, which goes not so much towards schools in their area as towards schools for the urban population of Essex in outer London. But until this refinancing takes place, this difficulty which is reflected in the rates paid by all my constituents will continue.
Naturally, in common with all fair-minded people, I wish to see an equitable distribution of the rates burden among shops, industry and householders, especially for people who are retired, but until this is brought about by the proposals which the Minister made this week, then it is wrong for the Minister to use the argument of averages in respect of Clacton pier and other pleasure piers. That argument does not apply in this case. I ask my right hon. Friend to consider very carefully the Amendment which deals with piers and I have much pleasure in supporting the Amendment of my hon. Friend the Member for Harrow, Central.
Mr. F. Blackburn: Although I do not necessarily agree with the principle of the Bill, it is important to ensure that, if we have to accept it, it should be made to work as fairly as possible. I do not know why the Minister has selected only those hereditaments where there is a gross rateable value, but I will not argue about that. What I have to say will not delay the Committee for very long. It concerns a small anomaly which I do not think the Minister intended when he framed the Bill.
When I heard, Sir Charles, that you did not intend to allow a vote on my Amendment, concerning market halls, I was not much worried, because I rely
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upon the Minister's sense of justice to put this matter right. Indeed, it strikes at the very roots of the Bill, because if what the Minister says is correct—that the Bill is to help the shopkeeper—then he must either accept my Amendment or the spirit behind it. If the small shopkeeper is to benefit from the Bill, then the shopkeeper in the market hall should also receive that benefit.
We have the strange position that some market halls have a gross rateable value and others have not. It seems to be the principle that in some cases the market hall and the market ground are assessed together and have only a net assessment, while in other cases the market hall and the market ground are assessed separately, and in that case the stallholders in the market will get the benefit of the Bill.
I can give an example from two small towns in my constituency. In the case of Stalybridge, the market hall and market ground are assessed separately. Consequently, the market hall has a gross rateable value and the stallholders will gain the benefit of the Bill. At Hyde, the market hall and the market ground come under one assessment; there is no gross rateable value, but only a net rateable value; and the stallholders will gain no benefit from the Bill.
I am sure that it was not the Minister's intention, in framing the Bill, that there should be such an anomaly as this, and I hope that he will put it right. The Amendment moved by the hon. Member for Harrow, Central (Mr. Bishop) would cover the case which I have in mind, but I had no guarantee that that Amendment will be accepted and it was, therefore, necessary for me to put down a separate Amendment. I assume that the Minister has three courses open to him. He can accept the Amendment of the hon. Member for Harrow, Central; he can accept my Amendment, or use similar words; or he can give the instruction that all market halls and market grounds should be assessed separately and that market halls should be given a gross rateable value.
I do not want to delay the Committee on this small point, but it involves a matter of principle and I hope that the Minister will put it right.
Mr. Geoffrey Stevens: I heartily support the all-embracing Amendment moved by my hon.

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Friend the Member for Harrow, Central (Mr. Bishop), but if the Minister does not feel that he can give us the whole loaf, needless to say I hope that he will consider giving my slice, which concerns the holiday camps.
Rating is a very abstruse science. It may be that this is the reason that, in common with other sciences, experts in that science can look at the same sentence and give two completely contradictory views as to its meaning.
Mr. J. T. Price: Would the hon. Member care to tell us exactly what is scientific about the British rating system?
Mr. Stevens: I will leave that to the rating experts, but I am grateful to the hon. Member for giving me the opportunity to say that I am certainly not a rating expert.
A number of hon. Members on both sides of the Committee have referred this problem to the Ministry and many of us have had a letter from the Parliamentary Secretary which is couched in similar terms:
"When a hereditament is assessed direct to net annual value the cost of repairs, maintenance and insurance at current price levels is fully reflected in the assessment."
I am quite content that, advised by his advisers, the Minister has made that statement in perfectly good faith, but I am advised by rating experts acting on behalf of the holiday camps that, although that may be true in theory, it is not what happens in practice. One of the difficulties may well arise from the fact, as I understand, that the ordinary basis of arriving at a rating assessment is to take the rent which a willing tenant is likely to pay. Obviously, it is impracticable to consider a tenant for a holiday camp or even for an amusement pier.
The consequence is that contractors' prices have been taken, and from that arbitrary basis arbitrary figures have been worked out both in respect of what might be the notional rent and what might be the appropriate deduction for repairs. I am informed by my advisers that, as a consequence, the rateable values of holiday camps, as arrived at under the 1955 Act, very closely approximate to the gross annual value less 1928 deductions. I therefore ask my right hon. and hon. Friends to look at that statement of theory
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again and to have it examined by reference to the figures which have been provided to see whether there is not an anomaly.
I support the Amendment for this reason if for no other: as one looks through the whole rating structure one finds that the Bill gives some rating relief to almost the last forms of hereditament to receive some relief. The hon. Member for Westhoughton (Mr. J. T. Price) asked what was scientific in rating. I do not know. But what appears from the Bill, which, in principle, I support very strongly, is that it gives some rating relief to almost the last form of hereditament to receive such relief. Agriculture is Berated altogether; industry is derated to 75 per cent., and even when my right hon. Friend's new proposals are implemented it will still be derated to 50 per cent. and private houses are rated on their 1939 values and to that extent receive a form of derating.
In the Bill, shops, commercial properties and hotels are to receive some element of Berating. The only things left out in the cold are such establishments as holiday camps, amusement piers, and market halls. It is because they, too, should get a fair crack of the whip that I recommend some, indeed all, of these Amendments to my right hon. Friend.
4.30 p.m.
Mr. J. A. Sparks: We have opposed this Bill on the ground that it seeks to place an unreasonable burden on the back of domestic ratepayers. The Amendments which have been tabled in the name of the hon. Member for Harrow, Central (Mr. Bishop) and his hon. Friends—and, indeed, those in the names of my hon. Friends—seek to add to that burden a further category of hereditaments—
Mr. Blackburn: I think I said that, while not necessarily agreeing with the principle of the Bill, if we have to accept the Bill it is important to try to make it as just as possible.
Mr. Sparks: Two wrongs do not make a right.
Although my hon. Friend may have a case for bringing market halls, as such, into the category of those shops and miscellaneous hereditaments which enjoy the advantage of Clause 1, I think he will

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see that, in fairness, all the others would have an equal claim to be included
My objection is that this proposal would increase the burden upon domestic ratepayers, that it would transfer the burden from one section of ratepayers to another. We have heard very little in support of domestic ratepayers in the arguments advanced in favour of these Amendments, and it is important that we should have some idea what this group of Amendments involves. If they were carried, especially those in the names of the hon. Member for Harrow, Central and his hon. Friends, it would mean that the remaining hereditaments in the miscellaneous column of the valuation list would be entitled to a reduction of one-fifth in their net annual value.
The total rateable value of the miscellaneous hereditaments, in which this particular class is located, is £170 million. The Minister already proposes to take out £137 million and reduce it by 20 per cent. The remainder—the difference between the £137 million that he will derate and the £170 million—represents precisely the increase suggested by the hon. Gentleman, a total rateable value of roughly £33 million. To those in that category he wants to give a reduction of one-fifth.
What does that mean? It means that he wants to give them a reduction of £5,170,000 in the rates they will pay—
Mr. Edward Evans: More than that.
Mr. Sparks: If my hon. Friend wants me to work it out, I will do so. The £33 million of rateable value affected will be derated by one-fifth, which gives a figure of £6,600,000. The average rateable value for the year 1956–57 is 15s. 8d. in the £. If we take that £6,600,000 at 15s. 8d. in the £ we arrive at a figure of £5,170,000, which is precisely the figure which the hon. Member for Harrow. Central wants to shift on to the domestic ratepayers.
Mr. Bishop: I do not think that the hon. Member should fix the figures on me, or say that I am asking that any precise relief should be given to any group. I want to put the group covered by the £30 million in the same position as those represented by the £130 million.
Mr. Sparks: The hon. Gentleman has no need to apologise; that is precisely
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what I am trying to tell him will be the effect of his proposal. It will put on the domestic ratepayers an additional burden of about £5,170,000, on top of the additional burden of £35,410,000 which they will have to carry.
That is most unfair. I dare say that hon. Gentlemen opposite, and my hon. Friends, have something of a case when they accuse the Minister of picking and choosing from those hereditaments included in the miscellaneous list. We shall wait with interest to hear what the Minister's case is, and why he has sorted the sheep from the goats; but it does not make it any the more just to add to the burden of the domestic ratepayers by bringing in a far wider category—unless, of course, hon. Gentlemen support my new Clause which appears later in the Notice Paper, and which, I believe, is out of order; that, to some extent, would redress the balance.
Therefore, whatever the hon. Members may believe to be the merits of their case in bringing this additional category of ratepayers into the advantage of Clause 1, they will, I am sure, realise, on reflection, that it would be most unfair to the householders and to the domestic ratepayers. Indeed, to deal with this problem in a logical and sensible way, we must take all the categories of hereditaments in the miscellaneous column of the valuation lists—
Mr. Blackburn: I think that my hon. Friend will agree that my Amendment did not introduce a new category. I merely referred to all small shopkeepers, not to a new category such as is introduced in other Amendments.
Mr. Sparks: I was not aware that a market hall was a small shopkeeper.
Mr. Blackburn: I mean the small shopkeepers in the market hall.
Mr. Sparks: That may well be but, as I said before, there is no escape from the fact that it is the householder who would have to bear the amount taken from the market hall, the pier, or even the shops, or the "pubs", or the cinemas—the whole series. I feel that there really is no substantial case to be made for increasing and widening the categories which will enjoy the derating provisions of Clause 1. The Clause is inequitable and unjust enough as it stands, without

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adding to that injustice. The people who have to bear this added burden are entitled to be heard, and they are entitled from this House to consideration equal to that given to other categories.
Mr. Blackburn: While I agree with most of what my hon. Friend has said, would he not agree that it is an injustice that some market halls should get the benefit of this Bill and that others should not?
Mr. Sparks: Perhaps the Minister will explain that to my hon. Friend when he tells us why he has sorted the sheep from the goats.
Mr. Kenneth Pickthorn: I agree with the hon. Member for Acton (Mr. Sparks) about the illogicality of some of his hon. Friends—
Mr. John Paton: Hon. Friends of the hon. Member for Carlton (Mr. Pickthorn).
Mr. Pickthorn: No. My hon. Friends did not vote against the Bill on the grounds upon which hon. Members opposite did. Indeed, they did not vote against it at all. That is the point of the hon. Gentleman's charge of illogicality, and I am very sorry that the hon. Member for Norwich, North (Mr. J. Paton), although he sits near to the hon. Gentleman, has not caught from him a little more illogicality. I agree with him in his estimate of illogicality, and I think—although I would not be sure about this—that I agree with his arithmetic.
One of the reasons that I rise is to say that I hope my right hon. Friend the Minister of Housing and Local Government, or the Parliamentary Secretary, will explain to us whether that arithmetic is right, and what is the whole amount of money concerned here. In addition, if he can, I hope he will explain to us what is the principle. I understand the accident of rating law, which everybody has agreed to be a matter which contains no rhyme and only just enough reason to prevent it being impossible. I understand the accident of rating law which puts these things together, but if there is a principle which puts them together and either tends towards the acceptance of the Amendment or tends against it, I think it would be a help if we could have Ministerial exposition of that principle.
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I am sure that it would be a help if we could have a statement of what are the values concerned and what is the arithmetic involved.
I must say, as a Suffolk man myself, that I was rather horrified by the hon. Member for Lowestoft (Mr. Edward Evans) and his insistence upon the unendurable rigours of the Suffolk climate. I hope that all his constituents will read his speech. If they do, I can hardly believe that when they have read it they will think they want to support him as a Member for a holiday town like Lowestoft.
I did not understand the point about the difference between Butlin's and Marks and Spencer's. I hold no shares in either concern. I do not patronise either concern. I have no prejudices in the matter. But I have understood at an earlier stage of this Bill that the enormous point of principle and equity and humanitarianism and all the other grand things for which hon. Members opposite are fighting, all turn upon this question whether we ought to try to help some ratepayers if the effect were going to be that we helped Woolworth's and Marks and Spencer's. But now, when it comes to this bit, I understand; perish the lodging house keepers, so long as the great capitalists who put up chalets unsuitable for the climate can make large profits; and I am bound to say that we ought to have a little more explanation of what coastal Members mean by that.
As I have said, without knowing more about the arithmetic or the principles involved, it is difficult to have more than prejudices in this matter, and my main prejudice here is for the bus and lorry stations. I do not quite understand why it is that they should be excluded from the benefit which the shops and other commercial establishments are to have If there is good reason why they should be, I think we ought to have it more fully explained to us. I am prepared to believe that my bus and lorry stations, in which, also, I have no interest to avow, ought to get it and that as for the other things like sewage dumps or amusement piers, whichever hon. Members may prefer for their holidays or other purposes, there ought to be some distinction between them. But I think that we should have the distinction made plain to us.

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I submit to the Committee that the bus and lorry stations seem to me to have a stronger case for inclusion in the benefit of the Clause than the other, as I think, pieces of rag which happen accidentally to be in this particular bag.
4.45 p.m.
Mr. Mitchison: I am sure that we have all followed the hon. Member for Carlton (Mr. Pickthorn) in his quest of principle with great interest. We gather that he does not go to Butlin's holiday camps. We gather, with even less surprise, that he does not shop at Marks and Spencer's, but we gather that he does frequent either sewage dumps or bus and lorry stations. This interesting sidelight on his habits is a great relief in the middle of a debate on what might otherwise be a tedious subject.
I should, however, like to put to the Committee one very simple proposition. It has, of course, been for the convenience of the Committee that all these Amendments which represent additions to the properties which will receive the benefit of a 20 per cent. reduction should be discussed together. I should like to point out, however, that if it had not been for the appearance of the first Amendment on the Notice Paper, what would have happened would have been this. We should have put forward our view, which we all hold on this side of the Committee, that this concession should have been confined to shops only and not to these other miscellaneous properties, and, having done so with the usual lack of success of Opposition principles when the Government, as they usually do, have a majority, we should then have been able to contend that if we are going to have these other miscellaneous categories in, there are at least certain things that ought to be done about them.
I therefore wish to make it perfectly clear that on this side of the Committee none of us, including my hon. Friends whose names are attached to these Amendments, abate one jot or tittle what we said on Second Reading and what we shall no doubt say again on a subsequent occasion. Very strongly do we feel that this concession ought to be given, if it is to be given at all, to shops and only to shops. But we do say that if the concession is to be spread further, then there
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are one or two minor points which we think deserve consideration, and of those minor points one is the position of holiday camps.
We do not want this concession to be given to hotels, which is the obvious standard of comparison, but if it is, in fact, to be given to hotels, then it might be given to what to many people is the poor man's hotel—the holiday camp. I am not a bit concerned with holiday camp interests. I simply say that if the large seaside hotel gets a concession in respect of its rateable value, then certainly the holiday camp ought to do so too. That briefly is the point about the holiday camps.
As to markets, I should have thought that this was a matter which, apart from any deep questions of principle, the Minister might see his way to accept. If in the notable towns of Stalybridge and Hyde there is a market in each town and one market gets a concession and the other does not, let the Committee think of the desperate plight in which the hon. Member for Carlton will be put when seeking for a principle in these matters. There really is not one.
It is absurd to suggest that one can go on like that, that where there are a couple of markets in neighbouring towns, substantially the same, one should get this concession and the other should not. Even allowing for a good deal of illogicality in rating, that, as Euclid used to say, is just absurd. For those reasons, I earnestly hope that that concession will be made. If it is to be made, clearly it ought to be made in favour of the market. It is simply a collection of small shops, and it is nonsense that a small shop outside a market should benefit while the market as a whole, including a number of stallholders in it, who have to pay for their share of the market, should not get the concession.
I read with care and attention the first Amendment on the Paper, and I do not want to take up the time of the Committee by any technical discussion at all, but have really tried to understand it and I completely fail to see that it effects the object which its mover intends it to effect or that it has the sweeping character which he supposes it to have. I think that it would be tedious to go further in the matter because, for the reasons so clearly put by my hon. Friend the Member for

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Acton (Mr. Sparks), it seems to me quite inconceivable that the right hon. Gentleman is going to accept the Amendment. If he were to accept it, we should have to consider at a later stage exactly what he had accepted.
In order not to bore the Committee too long but just to indicate what I have in mind, I will put the matter very shortly. In Section 22 of the Rating and Valuation Act, 1925, we begin with two categories of hereditaments. One of them is where there is a deduction from the gross value and the second, broadly speaking, is where there is no deduction from the gross value. We then go on to say, that as regards these two categories, the rateable value shall be taken to be the net annual value. I therefore, rather fail to understand what is the difference.
There is, however, one exception, and I think that the Amendment of the hon. Member for Harrow, Central (Mr. Bishop) would cover that exception; that is, if the hereditament—a horrible word—belongs to one of the classes specified in the first column of the table contained in Part II. When we look at the table in Part II, we find that it has been amended, and the only thing that is now left in is the very obscure subject of certain tithes, tithe commutation rentcharge, etc. I cannot understand—I do not ask the hon. Member to tell me unless he wishes to—how his Amendment in fact covers anything but this rather curious group of tithes, tithe commutation rentcharge, etc.
I strongly suspect that someone or another may have failed to notice the rather radical amendment made in Part II. I see that the hon. Member is going to correct rue, and I shall be grateful to him.
Mr. Bishop: I certainly would not venture to correct the hon. and learned Gentleman, who is a much greater expert on these matters than I am. The intention was to include those hereditaments which are valued by the net value as well as the gross value but to exclude those that are under special arrangements, such as public utilities. If I have gone wrong in that, it is because I am not an expert.
Mr. Mitchison: If I may say so to the hon. Member, I am just as likely to be as wrong as he is on a matter of this sort. I only put the point in order that it may be cleared up. I thoroughly disapprove of the hon. Member's intention,
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but I quite understand it, and I am certain that if it were to be accepted the question whether it had been carried out in this Amendment would no doubt be checked. I do not want to waste the time of the Commitee over this, but I thought it well to mention it because I am sure that this particular category is not exactly what the hon. Member had in mind.
The Minister of Housing and Local Government and Minister for Welsh Affairs (Mr. Henry Brooke): It has been stated by more than one hon. Member that rating is an abstruse science. The subject of this Amendment is not altogether transparently clear for debating purposes, and, at the outset, I should like to congratulate the Committee on having given us such a lucid debate on such a complicated subject. All I can say is that I will endeavour not to throw dust in the eyes or cast fog in the air, but try to enable the Committee to come to a conclusion on this group of Amendments.
First, I think that I ought to say a word about the distinction between being assessed to gross value or to net value, and the reasons why we have made use of that distinction in the Bill. The fact that some properties are assessed to gross and some to net is not new. It is very familiar to those who study this abstruse science of rating. In the case of those properties which are assessed to gross values, there is then a scale deduction for repairs, maintenance and insurance which is applied to the gross value, and so the net value is arrived at.
As I think the hon. Member for Lowestoft (Mr. Edward Evans), said, that scale formula has not been altered since 1928, and I certainly would not stand here and say that it was fully up-to-date. That was a reason which weighed with my predecessor, I know, when he introduced the Bill, because it seemed to him that one should take account of the fact that in one category of these properties, that is to say, those assessed to gross, the net value on which the rates would be calculated would be arrived at after the application of a formula which is nearly 30 years old whereas in the case of those assessed to a net value, the actual cost of repairs and maintenance and so on—the actual current cost—is taken into account. So there is a clear distinction

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here, and that is how we have sought to proceed.
The hon. Member for Acton (Mr. Sparks) gave us some arithmetic. I will not follow him too far, but, if I may say so with respect, I thought that he started well, but later in the lesson went astray a little. The main fact that he established is perfectly correct, that is to say, that if the first Amendment were carried there would be a loss of rateable value of between £6 million and £7 million. I must put it to the Committee that that would be a very serious thing for local authorities suddenly to suffer—
Mr. J. T. Price: The local authorities will be losing about £35 million rateable value in any case by this Measure.
Mr. Brooke: If I may be allowed to conclude my sentence, I was saying that it would be a serious thing for local authorities suddenly to suffer exactly at a period when their finance committees, if not the councils themselves, are meeting to make their rates for the ensuing year. [Interruption.] I quite appreciate what hon. Members are saying, and I hope that they will forgive me for remaining on my feet and completing my argument. When any responsible body has to make its budget for the ensuing year, it is essential that it should have firm knowledge of the basis from which it proceeds.
This Bill was published two months ago and all the local authorities have, I know, proceeded on the basis that it was likely to pass into law. I think that any hon. Member, if he consults the town clerk or clerk of the council in his constituency, will be informed that the finance committee has been proceeding on the basis that Clause 1 would pass into law unchanged, and that would, in fact, determine the rateable values for the coming year for that class of property.
Mrs. Lena Jeger: Would not the right hon. Gentleman agree that that is making a farce of the whole Committee stage of the Bill? Is it not a great discourtesy for him to suggest to the Committee that Amendments are really not worth considering because local authorities are proceeding on the assumption that no amendments are going to be accepted in the Bill?
Mr. Frederic Harris: Could not my right hon. Friend
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get over all his troubles by doing away with industrial derating altogether? It could be done with a stroke of the pen, and the local authorities would not mind.
5.0 p.m.
Mr. Brooke: If my hon. Friend thinks that industrial derating could be got rid of almost overnight in this House and that we could give a fresh basis for local authorities to make their budgets for the next year within a few days, I assure him that he is very much mistaken. There is a great deal of work to be done both outside the House of Commons, in consultations with the bodies concerned, and inside the House before we can make a move on the bigger subject of industrial derating. All I was seeking to do was to put before the Committee the financial implications of the first Amendment.
The first Amendment, of course, goes much wider than any of the others, and it would bring within the scope of Clause 1 a large collection of very varied properties and undertakings including categories for which arguments of greatly varying cogency could be adduced. Some of them, it might be said, would be stronger than others. I might say that over the whole range the argument would be weak, but in some cases it would be weaker than in others.
I appreciate that the pros and cons in some of these difficult cases are not the same. A separate case can be made out for one and not for another. The whole category which would be brought within the scope of the 20 per cent. reduction by the first Amendment includes, of course, a large group of public utilities and other undertakings which are assessed by reference to their accounts; their actual financial experience and their actual costs are taken into the reckoning. In fact, over that whole group, the increase in assessments due to the 1956 revaluation has been much smaller than the large figures quoted by hon. Members in favour of making the change for some particular category.
Outside the public utility section, there is a miscellany of properties, some, but only a few, of which have been mentioned in this debate. Therefore, the Committee must come to a decision whether it will make a sweeping concession on the lines of Clause 1 which would make a big difference to rateable value and also give the concession in a number of directions

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where really very little case indeed could be made out for it, or reject Clause 1 and—I think this was the phrase used—"pick and choose" in a somewhat arbitrary manner just a few which might be considered to qualify.
I cannot advise the Committee to accept the first Amendment. I am sorry to disappoint my hon. Friend. He put the case persuasively and I know he feels strongly about it and is anxious, as he thinks, to do justice in regard to a number of varied properties, but I must advise the Committee that his Amendment would be going far too wide to accept. Although I do not want to rest my argument wholly upon the case put to the Committee by the hon. Member for Acton, we must all be practical people and consider what the reactions of the elected members, as well as the officials, of the local authorities in our own constituencies would be if at this time, 14th February, the most inconvenient time of the year, we were to make a sweeping change in rateable values.
Mr. Glenvil Hall: Does that mean that the right hon. Gentleman intends to withdraw the Bill, because, quite obviously, it is causing local authorities a terrific amount of trouble?
Mr. Brooke: The local authorities have taken the Bill into account and are drawing up their budgets on the basis of it. The local authorities have not just woken up to the fact that a new Bill was published on 21st December. All their financial work since that date has proceeded on the reasonable basis that the Bill would become law.
Mr. Mitchison: Was the right hon. Gentleman's specific reference to 14th February a reference to St. Valentine's Day or to the North Lewisham by-election?
Mr. Brooke: Not even to the Ides of March.
Other Amendments, spoken to by various hon. Members, seek to obtain the concession for specific kinds of property. I am sure that the Committee will have realised that there are other specific items for which a case as strong—in some cases perhaps stronger, in other cases weaker—could have been made out. My hon. Friend the Member for Harwich
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(Mr. Ridsdale) spoke in favour of a concession for piers. He gave the Committee the information which had been contained in a letter from my hon. Friend the Parliamentary Secretary pointing out what is the actual position as regards piers. It is quite true that piers which are assessed to net value showed on the revaluation a very substantial increase. But appeals against the new valuations have been made in almost every case of which I am aware. A small number of those appeals has already been settled, but only a small number.
Where an appeal has been finally determined, there has, on average, been a considerable reduction in the valuation, and certainly, if one can rest any argument on those cases which have been determined on appeal, the case for making this concession because there has been a particularly large percentage increase in the valuation, falls to the ground. I am sorry that I cannot help my hon. Friend about the difference between the rating of Clacton Pier and Brighton Pier. It is not a responsibility of mine, I am thankful to say. We all, I am quite sure, have equally jealous feelings when something like that happens in our constituencies.
A case has been made out for a concession in favour of the holiday camp. The hon. Member for Lowestoft and my hon. Friend the Member for Langstone (Mr. Stevens), I think, both spoke to that. There, again, I realise that the new valuations show a very large increase. At the same time, I must have regard, as indeed must the Committee, to the fact that if one examines these cases and tries to judge what would have happened in the case of holiday camps if they had been assessed to gross instead of net values and then had the benefit of the 20 per cent. concession, it certainly becomes clear that their rateable values would be likely to be higher than the actual values on which they are now going to pay rates. It is difficult to argue that, in their case, any injustice has been done.
The hon. Member for Stalybridge and Hyde (Mr. Blackburn) quoted the case of the market hall. I realise that there are two markets in his constituency, both being assessed to net value—
Mr. Blackburn: No.
Mr. Brooke: I am sorry—one to gross and one to net value. I was getting confused in my mind. That, again, is a specific case where an argument could be advanced that there should be a change. I would say to the hon. Gentleman, and to other hon. Members who have spoken or have a constituency interest of this kind, that it is open to any interested party to argue that a particular hereditament should, under the law, be assessed to gross value and not to net value, and to make a proposal to that effect. Then the ordinary statutory procedure will operate. There will be opportunity for appeal, and so on, and a determination will be made under the law. Obviously, I cannot speak with precise knowledge, but there appears to be a clear anomaly within the hon. Gentleman's constituency. Someone should consider whether or not there is any legal ground on which the matter could be pursued further. Clearly. I cannot say more than that. The determination is not in any way in my hands.
Mr. Blackburn: Would not the Minister agree that the same principle should be applied to market halls where-ever they happen to be situated? It seems foolish to have one assessed on gross rateable value and another on net. Surely the same principle should apply to every market hall?
Mr. Brooke: I was not clear in my mind about what happened in the hon. Member's constituency. I understood that the Hyde market and the Stalybridge market were both assessed to net, but I now understand from him that that is not the case.
Mr. Blackburn: The towns are next door to each other. In the case of the Stalybridge market hall and market ground, they are assessed separately, and the market hall, therefore, has a gross rateable value. The Hyde market hall and market ground are assessed together, and there is only a net value.
Mr. Brooke: If that is so, and if the matter has finally been established that way, there would appear to be some extraneous reason which differentiates them. If there is not, one would think the normal course of action would be for someone to make a proposal that the property assessed to net should be
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assessed to gross and that the ordinary procedure would apply. I will willingly have a talk with the hon. Gentleman about the matter later, but I do not think I should hold up the business of the Committee now. The hon. Gentleman will appreciate that I cannot interfere with the legal processes or have anything to do with the final determination. I am only trying to give what assistance I can, speaking from this Box.
Were we to accept any of these individual Amendments, I must warn the Committee that there would be other individual categories where a case of equal cogency could be made out. This is a difficult matter. I hope that my speech has not made it more difficult. It is impossible for anyone to make this subject easy. A statement which I made a couple of days ago clearly foreshadowed a major local government Bill in the near future. I suggest to the Committee that we should not seek to make any alteration in this Bill on the lines of these Amendments, but that all these matters should be further examined.
When we come to the major Bill, and if hon. Members think it is clear, as a result of what has happened between now and then that injustice is being done, it will be open to them to bring the matter forward in the normal way. Meanwhile, I will undertake to examine the whole subject. In these difficult circumstances, I submit that would be the most practical way of doing it and the fairest way to achieve a just result.
5.15 p.m.
Mr. G. Lindgren: It is rather startling that the Minister should say that we are to have a major Bill in the near future. This may be hardly the place to ask, but it would be nice to know how long is the "near future".
The Minister said that it would he wrong to accept any of these Amendments because this Bill, which was published on 21st December, is the basis upon which local authorities have made their estimates for this year. I think it a most undemocratic principle that bodies which are partners with the central authority in the administration of local government should be placed in the position of having to anticipate what the House of Commons will do. I think it wrong for any Government to put local

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government in that very invidious position. It reinforces what was said during the Second Reading debate on this Bill by right hon. and hon. Gentlemen on this side of the Committee, that the urgency of this Bill was not apparent, and that there should have been a period in which it could be discussed outside the present very difficult period for local government, when budgets are being decided upon.
I hope that it will not embarrass the right hon. Gentleman if I say that we agree with him that the Amendment in the name of the hon. Member for Harrow, Central (Mr. Bishop) is far too wide in its scope. As was pointed out by my hon. Friend the Member for Acton (Mr. Sparks), its acceptance would put local authorities in a very difficult position, and relieve from rates certain groups which, on the face of it, have no entitlement to such relief. But we must press the Minister regarding holiday camps. It is true that the case for some general arrangement regarding the deduction between net and gross value can be argued from his side of the Committee, but it is not so true that holiday camps as a whole would have been better or more highly assessed had they been assessed on gross value.
We accept and we shall show later, that Clause 1 should not be in the Bill at all and that there should not be any exemptions at all. But if we are to derate by one-fifth the high-class hotels of the kind to which the hon. Member for Carlton (Mr. Pickthorn) goes in the summer—
Mr. Pickthorn: Do not believe that. I never do.
Mr. Lindgren: —I think it is only logical that we should apply the same principle to camps which provide the same facilities on a less "Rolls-Royce" standard.
Because of the basis of rating, it is possible to be excused from rates if it can be proved that there is no beneficial occupation. If a person has no beneficial occupation of premises, application for excusal from rates may be based upon that fact. I agree that there has been a large number of cases in which local authorities have argued what is beneficial occupation and what is not. It has been
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argued whether there is or is not beneficial occupation even of an empty house, if curtains are put in its windows.
A high-class hotel, however, which is to get one-fifth off its rates, is occupied all the year round—not all such hotels, it is true; but, generally speaking, the better class the hotel, the greater the tendency for it to be kept open in the winter as well as in the summer.
Sir Peter Macdonald: It depends where the hotel is situated. Many hotels in many of our seaside resorts have to be closed in winter nowadays because of the Catering Wages Act, and legislation produced by the Socialist Government.
Mr. Lindgren: It will be nice for the hon. Gentleman's constituents to learn that he is against the Catering Wages Act and reasonable standards of wages and conditions of employment for those who provide holiday facilities.
I agree that a large number of hotels are closed in the winter, and I agree, too, that the number of them closed in one place differs from the number closed in another. Fewer hotels can be kept open all the year round in Scarborough than in Torquay—or the Isle of Wight. Indeed, the Isle of Wight with all its blessings, except in its Parliamentary representation, is a place which induces one to visit it at any time of the year, in winter as well as in summer.
Sir P. Macdonald: Moreover, it is quite satisfied with its Parliamentary representation.
Mr. Lindgren: That is obvious from the length of time that the hon. Gentleman has been here. I hope he will not take cut-and-thrust in debate across the Floor of the Chamber as aimed at him personally.
However, here are two classes of hereditaments all engaged in the same trade, but in different classes of the trade. There are the hotels and there are the holiday camps. I think that the holiday camp works under more difficult conditions than does the hotel. I may be biassed because I am more inclined to go to the holiday camp than to the hotel. It is clear, however, that the season of occupation of a holiday camp is not more than 16 weeks out of the 52. I think that the case ought to be conceded, and I hope the Minister will think about it again.
Mr. Harold Garden: I am rather disappointed that this debate has not so far touched upon the serious problem of the joint sewage disposal boads. I was relying upon this Amendment to even out an anomaly which has arisen through the 1956 revaluation, which has caused those disposal boards a tremendous increase in rates which they have to pay. Some of them have had their previous rates doubled and trebled. A sewage board may have its sewerage works situated in the areas of one or two local authorities but may be working for the areas of many local authorities. In the Midlands there are seven or eight local authorities which dispose of their sewage through the Tame and Rea Sewage Disposal Board, but the whole of the income—
The Temporary Chairman (Major Sir William Anstruther-Gray): Order. Perhaps the hon. Member will explain how he relates this argument to either of the Amendments.
Mr. Garden: Yes, Sir William. The first Amendment would cover these disposal boards. I think that is agreed by my right hon. Friend. I see that he is nodding assent. Or is he not?
I was about to say that the whole of the income of the board is derived from rates from the local authorities concerned. The board's works are situated mainly in the area of one local authority, that of Sutton Coldfield. Under the 1956 revaluation the precept of all those seven or eight authorities has increased enormously, mainly for the benefit of Sutton Coldfield. In effect the seven or eight local authorities are subsidising Sutton Coldfield. One authority pays £18,877 for the disposal of its sewage but it receives £44,400 from the board on rates upon the board's sewerage works. So it gets its sewage disposed of for nothing and makes a handsome profit out of the other authorities.
This is not a party matter. It is common sense that sewage disposal boards should receive some benefit of de-rating either by this proposal or through industrial derating, because they pay rates at 100 per cent. but do not get any allowance through net annual value as against gross. They do not get any relief at all, and are having to increase their demands upon other authorities. In the instance
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that I have mentioned the present state of affairs works mainly for the benefit of Sutton Coldfield.
That is not an isolated case—the Colne Valley and all the other sewage disposal boards are similarly affected—and I was relying upon this Amendment to put an end to this aggravation felt by the local authorities. My right hon. Friend is seeking to put an end to it by not accepting the Amendment because he does not want to aggravate the position of the local authorities and their finance committees, but if the sewage disposal boards are not derated that will aggravate the position immensely.
I fully appreciate the arguments which have been adduced on both sides of the Committee to show that this Amendment is too widely drawn and would seriously affect the position of the local authorities. I had been relying upon the Amendment, but I have changed my mind, and I could not support it. I agree with the arguments against it, but I appeal to my right hon. Friend to give me some assurance that these joint sewage disposal boards will be sympathetically considered. Better still, I hope that he will include them as industrial premises so that they can be derated by 50 per cent. or 75 per cent., as it is at present.
I have here a copy of a letter from the Ministry and addressed to Colne Valley Sewage Disposal Board. It indicated that sympathetic consideration might be given by the Minister if this matter were raised in the Committee stage of this Bill. I look to my right hon. Friend now to give me some indication that this matter will have sympathetic consideration. Failing that consideration, I must make some move in the direction of ceasing the aggravation of the local authorities in this respect. Already it has gone on too long and, failing some satisfaction, I shall have to consider moving an Amendment at a later stage.
5.30 p.m.
Mr. Douglas Houghton: I should like to elicit from the Minister information which has not yet emerged but which I think is crucial to the point of the debate, and that is whether the actual shift of the rate burden has been as heavy in the case of these properties as in the case of ordinary commercial properties. That is the information

1489
which we all want and which we have not yet had from either side in the debate. We are asked to apply the same principle, the 20 per cent. reduction in values, to two sets of properties which are assessed on a different basis.
Commercial properties are assessed by reference to gross and net, and the deduction between gross and net to arrive at a rateable value is a statutory deduction. Unlike the case with Schedule A Income Tax, an excessive cost of repairs and maintenance is never reflected in net annual value. In the case of Schedule A, on the five years' average, the assessment can be reduced if the actual expenditure exceeds the statutory deduction for repairs, but in the case of rating this does not apply. Therefore, the assessment of commercial properties receives no consideration if actual cost of maintenance is in excess of the actual deduction.
The other properties, the holiday camps, etc., have the advantage of being assessed on net annual value, after taking into account actual current expenditure on maintenance and repair. That is undoubtedly an advantage in many cases, but if the shift of the rate burden has been as heavy on those properties as on the rest, they are entitled to the same consideration when applying the deduction under Clause 1. The Minister said that under revaluation many of these properties have a net annual value that has been substantially increased. Has there been any substantial difference between the proportionate shift of the rate burden on to these properties and the shift on to the others? If it is lighter in the case of holiday camps and similar properties, the Minister has a case. If it has been as heavy, I do not think that he has a case.
Sir Spencer Summers: I hope that the Committee will not charge me with discourtesy in speaking without having heard the earlier part of the debate, but in fact I was elswhere on the business of the House. It has been suggested that the hereditaments concerned with these Amendments have an advantage in respect of their repairs, but there are quite a number among the list with which we are concerned where repairs are a very small item. There are sporting rights, advertising rights, sports grounds and the like, where the element of repairs,
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in so far as the system otherwise gives an advantage, does not arise.
I am told that one of the reasons why my right hon. Friend has not seen his way to be more accommodating about these Amendments is that at this late hour it would be an inconvenience to local authorities to alter the forecast of rate revenue by the change which would follow from them. I scarcely think that that is a view which would commend itself to the local authorities, when we know quite well that they are anxious to see better treatment accorded to these hereditaments. By following it we shall arrive at the very remarkable position where we have certain undertakings treated differently not because of the nature of their operations but because of the system by which their rates are calculated.
If no change is made in the Bill, we shall find those which are at least as deserving as commercial undertakings which are given a 20 per cent. concession, being the only undertakings in the country paying full rates on current values. Everybody else, either by referring to an earlier period or to a 75 per cent. or a 20 per cent. rebate, will not be paying full rates on current values. I can scarcely think that the Minister will regard it as fair and reasonable that sports grounds, car parks, markets and the like should be the only kind of hereditament to be paying full rates at current value. The local authorities are keen to see the change, and I hope that my right hon. Friend will be more accommodating than I have been informed that he is willing to be.
Mr. Herbert Butler: We have now a situation in which the whole Bill is so illogical, arising as it does from pressure by a section of the community, that the Minister has to use as an excuse for resisting Amendments the statement that local authorities would not like the alterations made as it would be impossible for them to deal with their rate forecasts. The Parliamentary Secretary to the Ministry of Housing and Local Government said on 7th February:
"I have spent a few years in local government and I should have thought that it was very difficult indeed for the leader of any large local authority, at the beginning of February, to estimate with any precision what would be the rate poundage at the end of March."—[OFFICIAL REPORT, 7th February, 1957; Vol. 564, c. 629.]

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The Parliamentary Secretary said then that it was impossible for local authorities to know what would be the result of the Bill. The Minister said today that if this concession were made the Bill which was published on 21st December would upset the arrangements of local authorities and the chairmen of finance committees.
It is quite obvious that the Bill was a matter of expediency to placate a very vocal section of the community who, through chambers of commerce, were exercising pressure on Members of Parliament. There is no justice or equity in the Bill. I agree with my hon. Friend the Member for Acton (Mr. Sparks). How can I face my constituency, where we shall lose £165,000 of rateable value under the Bill, and talk about the possibility of a reduction of rates on advertising hoardings which will be passed on to the residents?
Log-rolling is going on as a result of the Government's surrender to a vocal section of the people who they think, and only think, are their supporters. Not all shopkeepers are, thank heaven, Tory supporters. If my hon. and right hon. Friends go into the Division Lobby on the Amendments relating to holiday camps, I must say that I cannot support the proposal, because I do not see why commercial undertakings should seek to take advantage of the House of Commons to relieve themselves of financial responsibility and pass it on to the ordinary householder. Therefore, if one accepts the situation, as I do, that the Bill has no justice, no equity, in it, I cannot agree that in addition to relieving from rate responsibility a certain section of the community—which in my view has no just right to it—it should be extended to another section.
The local authorities have been up in arms about the general attitude of the Minister to the Bill. Even today, at the council meeting of the A.M.C., further criticism was made of the Minister and of what he has done to the local authorities by this proposal. Therefore, before the right hon. Gentleman proceeds with this iniquitous Measure, the Association is anxious to talk to him about the consequences to the local authorities.
The Minister cannot ride away on the arguments of his hon. Friends for further concessions to meet the requirements of
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the supporters of their party. We know what would be the consequence of these Amendments. We know how many hereditaments come into this type of rating, and we know what would be the effect on the rate poundage.
We say that the Bill ought never to have been brought forward, certainly not at this time of the year when there are thousands of claims and appeals before the tribunals and when we do not know exactly what our rate poundage will be. But the Minister brings the Bill forward and says that he must have it now. The Bill is bad, and the Minister cannot ride away with the log-rolling of his supporters upon the flimsy excuse that this would inflict further inconvenience on the local authorities.
Amendment negatived.
Mr. Mitchison: I beg to move, in page 1, line 6, to leave out from the beginning to "is" in line 7 and to insert "consists of or includes a shop".
The Chairman: I have also selected for discussion with this Amendment the one to page 1, line 7—leave out from "amount" to "and" in line 9 and insert "not exceeding one hundred and fifty pounds".
Mr. Mitchison: I have been looking through the report of the discussion in the House on the Second Reading of this Bill, and I find a singular lack of support for it on both sides. We voted against the Measure on Second Reading because we thought it was fundamentally wrong. One of the reasons we gave was that we thought it wrong to separate this bit of temporary patchwork, this attempt to remedy matters in one respect, from the equally urgent and, it seemed to us, more serious injustice brought about by the derating of industry many years ago. We still hold that opinion, we do not abandon it in the least, but we take the view that, as is the case for the moment with the Rent Bill in Committee upstairs, having shown our disapproval of the entire Bill, we can at least try to make it better in some respects.
For that reason, and with those limitations, we have put down these Amendments. I am not here to quibble about the exact definition of a shop. We have, in fact, taken the definition out of one Act of Parliament, since the one in the Shops Act is obviously much too wide

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for this purpose, but the substantial point is that we ask for this concession to be limited entirely to shops. That is the main point I want to argue.
5.45 p.m.
Again, looking through the previous debate, including the speech of the hon. Gentleman the Parliamentary Secretary, I see that though he carefully mentioned at many points the commercial ratepayer too, I seemed to see a special stress laid on the position of the shopkeeper. If the hon. Gentleman disclaims that entirely, and says that he is just as interested in, let us say, the Prudential Assurance Company as he is in the small shopkeeper in the back street, I shall be content to let him do so. I can assure him, however, and I can assure the right hon. Gentleman, too, that if they will look at the arguments put forward by their hon. Friends, they will find this remarkable emphasis on the small shopkeeper.
For the purposes of this Bill, the small shopkeeper seems to have some hereditary connection with the widow and orphan shareholders in railway companies, about whom we used to hear so much in the past. But it is not only the small shopkeeper with whom this Bill is concerned.
Is there any real reason why local authorities should be put into difficulties, as they are being put by this Bill, and why the domestic ratepayers should be made to pay more rates in order to relieve offices as a class? I am taking offices as the part that does not include shops, and I take leave to remind the Committee that shops are the smaller part of the properties which it is proposed to benefit by this Bill.
I shall not go into these figures in great detail, but let us get them clear. There is to be a concession of 20 per cent. for £220 million of rateable value. The right hon. Gentleman, with that mastery of arithmetic which characterises him, told us on Second Reading that this amounted to £44 million. I would not differ from him, and I repeat that I think it was the way I put it which made the correction necessary. That is the figure, and I am dealing for the moment with the £220 million of rateable value which is to have that concession.
Out of that concession, five-eighths goes to the miscellaneous category and only three-eighths goes to shops. Shops
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include, for instance, banks, cafés, and so on, in shopping areas. Consequently, if we take the joint stock banks as one good instance to start with, a large number of their branches would be included in the three-eighths attributable to shops, and the remainder of their branches would be included in the miscellaneous category.
No doubt the joint stock banks have been groaning under this injustice for a long time past, and equally such bodies as the insurance companies—for instance, the poor, impoverished Prudential Assurance Company—have no doubt been groaning under it for years past too. But this is a temporary Measure, one to meet an injustice so flagrant, leading to such gross hardship, that it must be dealt with in advance and separately.
I find it difficult to believe that the sense of grievance suffered by the Prudential and other insurance companies, by the joint stock banks and by the countless other offices which fill the City of London, has been so instant and so grievous as to require special legislation to meet it. I should have thought that with a little difficulty they could manage to hang out for a year or two more until the right hon. Gentleman chooses to bring in a Bill for the rerating of industry, an obvious Measure, together with what other proposals about local government finance he is to put before us in due course.
I say, therefore, that, accepting what the right hon. Gentleman says, that this is a temporary Measure, a bit of legislative patchwork to met a grave injustice, I see absolutely no reason whatever why preferential treatment should be given to offices as a class. On the contrary, I see a very real reason why for the moment domestic ratepayers should be spared the additional burden of having to contribute to the rates of the Prudential and other insurance companies, the joint stock banks and the rest of the companies that we find in the City of London and other large towns.
I wonder whether right hon. and hon. Gentlemen opposite really think it right that a temporary Measure should include that concession to that class of hereditament. I cannot see the case for it. It is a simple enough proposition. When their constituents complain to them about the rising rates, will hon. Gentlemen opposite point to some of the enormous blocks of

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new offices which are being built, such as I recently saw in Bristol, and say to the domestic ratepayers, "We hope to help the people who live in those blocks with their rates?" It is a fantastic proposition.
If this were part of some general scheme for dealing with the rating problem, we should obviously have to consider it in a different way and in relation to many other things. We should, particularly, have to consider it in relation to the position of industry. But where is the sense in saying, "These offices have had such an injustice done to them that it must be remedied at once," and, at the same time, "The rerating of industry can wait. There is nothing so urgent or immediate in it. The crying injustice which has existed for years because of the position of industry can continue a little longer under a Tory Government"?
Offices, banks, insurance companies and other big concerns must, so the Government say, have an immediate advantage. It all comes out to a very curious and simple proposition. At the end of it all, those who are to have immediate advantage, whether by the Bill or by the neglect to rerate industry, are the really large concerns, those whom my hon. Friends and I suspect of occasionally contributing to the funds of the Tory Party. We do not know, because they will never tell us. Those are the people who must have the benefit at once, even in advance of any general scheme. The people who suffer as the result are the domestic ratepayers.
We heard from the right hon. Gentleman just now that the local authorities are increasing the rates already. Of course they are. They suppose th4t the Government will carry their Bill, and they are adding to the necessary increase of rates due to greater expenditure, due to paying higher interest on their borrowings and due to the Government cutting help to them in the way of housing subsidies and other things, the additional burden caused by the Bill. In Manchester there will be increases of 2s. for one thing and 2s. for the other. In most of the big towns the increase will be between 1s. 6d. and 2s. It is a serious matter.
I notice that a political speaker at North Lewisham said that the Government have their blood up. It is a little
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like that. What is, in effect, being said is, "The man who lives in a rented house will have to pay more rent, but let us put the knife into the owner-occupier, too. If we cannot get at him any other way, let us see that he pays more rates and that he makes his contribution to the office expenses of the banks, insurance companies and the rest. "That is what this temporary Measure is doing when it includes offices in the class entitled to this exceptional temporary advantage.
There is another matter, which I will put shortly to the Committee because it has previously been mentioned. We all know well the difference between the domestic ratepayers and these concerns. The domestic ratepayers have to pay the additional rate, and all of it. These offices will be able to set down their additional rate as an expense in their business. Consequently, in the long run they will make smaller deductions and, therefore, some of the expense will be borne by the Treasury. We come back to the simple proposition that we help the Prudential, the joint stock banks and the Treasury at the expense of the local authorities and the domestic ratepayers.
It is obviously wrong. However, if one is going to be wholly illogical and make some special case in favour of shopkeepers, one should at least keep it to the shopkeepers. There is no excuse whatever for offices being included, and yet they represent the major part of the concession. I will dangle a little bait in front of the four representatives of the Conservative Party sitting opposite. It is a little difficult to define the small shopkeeper, but they can do so roughly by saying that his premises will be under a certain rateable value. The matter of the small shopkeeper can be dealt with in that way if it is desired to confine the concession to him. There is an Amendment on the Order Paper dealing with the point. I mention this in case hon. Gentlemen opposite would like to take up the point and deal with it in that way. The Amendment with which we are now dealing is designed to keep out the offices and the whole gang of miscellaneous categories that we have been talking about.
What a muddle it all is. There was no logic or sense in our last discussion. The Bill is a muddle from beginning to end. The Government can make it a little clearer if they keep to shops only. Our Amendment will place no burden on

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municipalities or domestic ratepayers. What we seek to do is to remove from both of them the unnecessary burden imposed upon them by the Government through the vague, comprehensive and wholly indefensible character of the category which they choose for special relief.
6.0 p.m.
Mr. F. Harris: I very much agree with many of the things said by the hon. and learned Member for Kettering (Mr. Mitchison). When the former Minister promised to review the position if the revaluation for shopkeepers was found to be unfair, he stressed that it was the case of the shopkeepers to which he was referring, whereas the Bill gives two and a half times more than we need and simply adds to the problems.
There is no doubt about much of what the hon. and learned Member put before the Committee. Anyone who takes an interest in this matter must feel deeply concerned about it. We must constantly remember, however, that private houses are being held back to 1939 values. When their valuations are brought up to date, householders will find an altogether different situation. In a way, private houses are getting a certain amount of subsidy at present, because their rateable values are being held back to the 1939 level.
The hon. and learned Member also kept referring to the fact that the Government have not yet put derating right. However, I remind him that for six years a Socialist Government had plenty of opportunity to put that matter right. I was in the House for three of those years and constantly put the same query to the Socialist Government, who did nothing about it. It is no good blaming the one Government while forgetting the failure of the other, when they could have put the matter right.
Industrial derating should have been cancelled long ago. It is outdated and outmoded. The whole matter of industrial derating is most complicated and unfair and is not a tenable proposition under any circumstances. Anyone can pick holes in the present rating situation and the only way to put matters right is to put everything right with proper valuations for all property.
Mr. James Harrison: The hon. Member referred to private houses being on 1939 valuations.
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Are we not faced with the prospect that 1939 valuations will be brought up to current valuations in the near future, so that any advantage which private householders are now receiving will soon pass away?
Mr. Harris: I was trying to point out that it was no good saying that the burden is being switched more and more to the householder, because at present the householder is already enjoying a measure of subsidy by the fact that his house is being held back to 1939 values. The whole matter is very complicated.
I was distressed to hear the Minister say that Amendments on this point could not be accepted. If that is so, what was the good of the Second Reading debate, which we had the other day? If anybody had put forward a strong case, would the Minister not have been able to do anything about it? That is sheer nonsense.
I have discussed this matter with the Croydon borough treasurer. Croydon is one of the largest towns in the south of England and I am sure that the borough treasurer there is as capable as any other. He told me that if derating had been altogether cancelled—which is what I want—or eased by 25 per cent.—as the Government apparently intend to do in a few years' time—it could have been done very quickly and a provision for it incorporated in the next rates adjustment. It is nonsense for the civil servants who advise the Minister, or for Ministers themselves, or for a Minister who knows local government inside out, to try to pull the wool over the eyes of hon. Members by making silly statements of that kind.
All this disturbs me a great deal. This anomaly has been argued and argued in my nine years' political experience in the House. Nobody has done anything about it, the Socialist Government did nothing and our Government have not. It is grossly unfair to householders and to all who pay rates. Why cannot rating be put on a proper basis? Why should we have this nonsense of a variation on behalf of the shopkeepers—to which they are entitled—without putting the rest of the situation right at the same time? It could have been all put right at the same time. That is what every council wants.
There would have been no difficulty if civil servants had used their brains and had thought for two minutes. I deplore

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the fact that Ministers, when faced with a situation of this kind, come to the House with nonsense and, say that the thing cannot be done. It could have been done. A Government Amendment could have been moved to provide for it. I should have preferred to have seen derating cancelled, but certainly it could have been amended on the basis which the Government intend to have in 12 months. Many of us would then have been saved much unnecessary trouble. I feel very strongly about this and particularly want to make my own protest.
Mr. C. W. Key: As one who has been engaged in London local government for nearly forty years, I have to admit that the present state of local government finance requires an alteration which is long overdue. I shall not deny that under present conditions small shopkeepers may have a grievance, but the suggestion that that grievance should be dealt with by amalgamating shopkeepers with all sorts of other people, as the Bill does, has no justification at all. If a small shopkeeper has a grievance, it does not mean that a big banker has a grievance. If things are eased for the man with a small shop, that is no reason why they should be eased for public houses, cinemas, dance halls, and premises of that sort.
If this is to be a temporary Measure, and the Government are not ready to undertake a complete readjustment, why do they not make a temporary alteration in industrial derating to balance the list and to spread the burden a little until they are prepared to deal with the whole matter? The whole of rating needs radical alteration.
We should try to discuss these matters with some reality and not merely theoretically. I want to put the facts for one of the poorest localities in the Metropolitan area, the one I represent. I cannot give the figures with absolute precision, but I have been to the local authority offices to try to discover the effects that the Bill will have in that area.
The first thing that I was told was that it was calculated that the present rate of 15s. would have to be increased by 1s. 1d. to 16s. 1d. However, that is not the total cost, but only local demands. In Poplar,
1500
the rates are considerably affected by the London County Council precept and that has to be taken into account in these calculations. I found out from the solicitor and Parliamentary officer of the London County Council that the effect of the Bill will be to increase the precept which the London County Council will have to make on local authorities in London from 6s. 8d. to 7s. 8d., so that the rate will rise from 15s. to 17s. 1d. In other words, to give this relief the small householders, the poor people in the area, will have to pay a rates increase of 2s. 1d. I can see no justification for that.
I should like to compare the position of three buildings standing almost side by side in a main road in my constituency. One is a bank. Taking only the 1s. 3d. increase and not the 2s. increase, the bank would have a net saving in rates of £41 12s. 6d., and the public house next door a saving of £22 12s. 6d., but in the house next door, with a rateable value of £36, the householder would have to pay an increase of £2 5s. in rates. The banker and the brewer will get a big reduction, but the man living in the house, who may be unemployed, or living on an old-age pension, has to pay £2 5s. a year more in rates, simply so that the other people may put some money into their pockets.
I support the Amendment because it will create a fairer position. In my constituency, the provisions of the Bill will effect a reduction of £80,000 in the rateable value. If the Amendment is accepted and the alteration is restricted only to small shops, the reduction in rateable value will be only £18,000. The £80,000 represents 7·5 per cent. of the total rateable value and the £18,000 represents 1·7 per cent. The effect will be to reduce the rise in rates from the 1s. 2d. or 1s. 3d. that we have been talking about to only 2¾d. or 3d.
I know that the small householder will have to pay an increase, but the Amendment will considerably ease his position. If we also accept the Amendment to restrict the alteration to shops of £150 or less rateable value the benefit to smaller householders will be even greater. We have every reason to give the fullest possible support to both the Amendments that we are discussing.
Mr. W. E. Wheeldon: One of my hon. Friends

1501
described the Bill as iniquitous. I agree with his opinion. This Clause is certainly the very worst feature of the Bill.
During the Second Reading Debate, a week ago, the Parliamentary Secretary referred to complaints that had been made, and asserted that the revaluation had imposed an unfair rate burden upon what he described as
"…the highly assessed occupiers of commercial premises."
Who are these people? In the main, they are bankers, brewers and occupiers of offices. None of them is in the National Assistance class; they are all doing very well indeed. Their profits are generally high, their prosperity great and their prospects very good. One has only to look through the financial columns of our newspapers to see that. Yet, despite that fact, the Government are very compassionate to these people.
The Parliamentary Secretary also said that
"…ratepayers in this group"—
which I took to mean the people in the commercial class, such as bankers and brewers—
"have been required…to delve much too deeply into their pockets."—[OFFICIAL REPORT, 7th February, 1957; Vol. 564, c. 623–4.]
How sad it all is. This solicitude of the Government and the shedding of tears for these well-to-do people strikes me as being in marked contrast to what they have done, or rather not done, for other sections of the population whose pockets have been almost empty for some time past.
Unless the Amendment is accepted, the Government propose to give still further relief to the well-off sections of the community at the expense of the pensioners, tenants and owner-occupiers generally. That is why we oppose the Clause strongly and castigate it as being completely unfair. It is sheer nonsense to claim that these commercial people cannot bear the existing rate burden. In the majority of cases the additional burden is completely trivial for individual firms, although in the aggregate it is of substantial importance to local authorities.
Here I join with the hon. Member for Croydon, North-West (Mr. F. Harris) in deploring the fact that the Minister has said that at this time in the financial year
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local authorities could not cope with Amendments such as this or, indeed, with the rerating of industry. I have known and worked with city treasurers for many years and I am quite sure that, given the will on the part of the Government, they could quite easily adjust their figures to meet the altered circumstances, even at this late stage. It is sheer humbug for the Government to say that these alterations could not be made.
6.15 p.m.
In the same speech the Parliamentary Secretary said, further, that complaints had been made about these high assessments. Who made these complaints? The only complaints that I have received came from shopkeepers. I believe that that is the common experience of other hon. Members. I have not received one complaint from a banking company, a commercial business, or a brewery, and I doubt very much whether the Government or other hon. Members have received any such complaints.
The reason for the absence of those complaints is simply that the commercial people themselves recognise that they have no case; they understood that what was being done in seeking to get the Bill through was quite undeserved, and something which they could not really ask for. They regarded it as too blatant an example of unjustified subsidisation at the expense of tenants and other occupiers.
In my Second Reading speech I mentioned one or two points about tenants. I do not intend to repeat them now, except to emphasise that prospects for tenants at this moment are bleak. We must remember that the relief which is to be given under the Clause is mainly at the expense of tenants. Very shortly, as a result of the Government's action, the majority are to have a very big increase in rents. What is more, four years' hence, in the 1961 valuation, they will have to face a further substantial increase because, by the transfer from 1939 to 1961 values, the rates will rise considerably and will be translated into higher rents for the majority of tenants. For that reason alone we should give this matter very serious consideration.
Lastly, I turn to the position of local authorities, with special reference to my own. As everyone will agree, they are in an exceedingly difficult position. Most

1503
of them will be forced to increase their rates this year. Although confined to one central proposition, this Amendment would help local authorities considerably.
I wish to give figures which apply to my own authority, in Birmingham. At the beginning of the current financial year the rateable value of licensed premises amounted to approximately £640,000. That represents about 4 per sent. of our rateable value. That is one of two broad sections to which I propose to refer. The other is the banks and offices. They represent a rateable value of approximately £1 million. Leaving out the two sections with which we are principally concerned in our Amendment, the banks and the brewers, Birmingham would be affected to the extent of £1·6 million of rateable value, or over 10 per cent. of our total rateable value. In itself, although much less than we would desire, and less than we should get by rerating industry, nevertheless, this concession would be of enormous value to the city.
As I said during the Second Reading, the rates in Birmingham would be increased by at least 1s. 7d. as a result of what is now taking place. There will also be other increases. I am not blaming the Government directly for those, but at this time we should avoid imposing any further increase on local authorities. The Bill and this Clause have no justification. It is something which every hon. Member concerned with the good government of our country should regard with abhorrence and vote against. I hope that the Minister will reconsider this matter, and, even at this late stage, accept the Amendment.
Notice taken that 40 Members were not present;
House counted, and, 40 Members being present—
Mr. J. Harrison: In moving this Amendment, my hon. and learned Friend the Member for Kettering (Mr. Mitchison) disclosed the identity of those who would obtain the greatest benefit from the Bill. He said that five-eighths of the relief would go to big financial houses and corporations. He also said that the other three-eighths represented the relief to shopkeepers. That means that only three-eighths of the total relief will be afforded to those people whom this Bill was
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supposed to be designed to help. I think it is common knowledge, but it needs to be repeated, that most of that amount of three-eighths of the relief will still go to the big financial corporations who own the multiple shops; and that the eventual amount to be devoted to the relief of small shopkeepers will be about one-eighth.
This overwhelming amount of relief is to be afforded to the bankers and financial corporations, and about one-eighth will be devoted to the purpose for which the Government are supposed to have introduced the Bill. While I support the Amendment, I think that hon. Members should remember that even with the acceptance of the Amendment, where we limit the granting of relief to the shopkeepers, a large proportion will still go to the big financial corporations.
Mr. David Jones: During the Second Reading, a week ago, the Parliamentary Secretary sought to prove that the Bill was so innocuous that it was impossible, at this stage, for anybody to estimate with any degree of accuracy what the consequences of its provisions would be to the local authorities. The hon. Gentleman quoted a figure from a local authority, which probably he knows much better than I do, and attempted to prove that, because of the addition of another nought in that figure, the information given was erroneous.
I asked whether, if the hon. Gentleman would not accept the figures of a leader of a political party of one of the authorities, he would accept the figures of two town clerks and the treasurer of another authority. The hon. Gentleman brushed that off by suggesting that he did not think it was a matter about which anyone need become agitated. He said that at this stage it was difficult to make precise estimates of what rate poundages were likely to be two months before the event. In other words, the hon. Gentleman was seeking to say that the municipal authorities, or their financial experts, were not in a position to estimate what would be the consequences.
When we were discussing previous Amendments, the hon. Gentleman's right hon. Friend sought to justify a blanket refusal of a number of Amendments because the local authorities had had the Bill before them since 21st December and had made all their computations on the

1505
basis of the provisions contained in it. I suggest that the Minister and the Parliamentary Secretary, who are in charge of the Bill, should make up their minds about which of them is right. They cannot both be right.
The Parliamentary Secretary was seeking to mislead the House last week, or his right hon. Friend is seeking to mislead the Committee this afternon, in saying, "We cannot accept any Amendments because most of the local authorities have already decided the matter and I ought not to compel them to do their arithmetic all over again." Every municipal treasurer would be delighted to do all the arithmetic all over again if the right hon. Gentleman would withdraw the Bill. That is the right course for him to take.
6.30 p.m.
Local authorities know what is likely to happen. Let me give an example. Middlesbrough Town Council estimated, on 6th February, that there would be a reduction of £117,000 in the rateable value of that town and that it would involve an additional poundage of 1s. 2d. to recover from other hereditaments the loss on shops and miscellaneous premises. Did the right hon. Gentleman take into account the inclusion of miscellaneous premises in some of the industrial towns and what it would mean in rate poundage? Having relieved shops and offices, some of them associated with big firms, the council will proceed to collect another 1s. 2d. in the £ from the industrial worker of Middlesbrough in order to make good the loss.
Middlesbrough is not an exception to the rule. On the other side of the River Tees is the little Borough of Hartlepool, with less than 19,000 population. The Bill will mean a reduction of £6,000 in their rateable value and at least 8d., and probably 9d., on the rates in the current year. The right hon. Gentleman knows better than anybody else that the consequences of other aspects of Government policy will involve local authorities in several pence in the £ and that the general rise in price level and the additional wage rates which have had to be conceded to municipal employees will involve them in several other coppers. Therefore, 9d. is the minimum. It may have to be substantially more than that. These are not figures supplied by an elected member of the council. They have been worked out
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by the finance departments of the authorities concerned and have been communicated especially to the Members of Parliament to bring to the attention of the Minister.
I come to the most important part of my constituency, the County Borough of West Hartlepool, with a population of 72,000. The Bill will mean a reduction of approximately £50,000 in the rateable value and will involve at least 1s. 1d. on the rates to raise the same amount of money. The town will require more money this year, so the increase will be considerably more.
If we consider the three different sets of properties, we find that about 40 per cent. on the rateable value is secured from house property. The effect of the Bill will be in addition to the effect of another Bill in which the Minister is particularly interested and which will inflict a heavy burden on domestic properties. Had I been fortunate enough to catch the eye of Mr. Speaker last week, I would have pointed out that the increase of 25 per cent. in the rating of industrial properties will just wipe out in West Hartlepool the reduction of 20 per cent. created by the Bill. I am at a loss to understand why, if the right hon. Gentleman had made up his mind to increase the rating of industrial properties by 25 per cent., he did not do it simultaneously with the introduction of the Bill. He intimated earlier this week that he intended to bring about that increase.
I see no purpose in the Bill as it is drafted. There is a case for reduction in the rateable value of the small shopkeeper, but I do not accept that as a general principle. The right hon. Gentleman told us that shop properties were rated at current values, but no comparison can be made between domestic and shop properties in this connection. Even in London at present it is not difficult to secure the tenancy of a shop. There are empty shops. Therefore, the law of supply and demand operates. In these circumstances, it does not seem unreasonable that shop properties should be rated at current values.
I can see no case whatever for reducing the rateable values of office properties. Surely the Minister, in his perambulations around London, has seen the huge blocks of office properties going up with the huge "To Let" notices outside. There

1507
is no shortage of office property. There is competition for it. Is it unreasonable to argue that office property ought to be rated at current values? What is the case for reducing the valuations by 20 per cent.?
The greatest case is for the reduction in favour of the small shopkeeper, and that is covered by a later Amendment. Otherwise, I see no case for the Bill. I can see a case for supporting the Amendment which is before the Committee, and I have the greatest possible pleasure in supporting it.
Mr. Houghton: I am sorry that I cannot support the Amendment. That might be misleading my constituents because it would give the impression that I was in favour of giving this concession to shopkeepers and to no one else. I am not in favour of giving this concession to anybody and I might as well make my position absolutely plain.
I am not unduly concerned, for the purpose of my argument, with the difficulties of local authorities. They have their problems I have no doubt, but mainly of arithmetic. In fairness, let me say that whatever the reduction in rateable value caused by the proposed concession, that rateable value will still be very much higher than it was before the revaluation.
Moreover, local authorities have enjoyed this very much higher rateable value for only one year, and it might even be said that they have not yet got used to it. Whatever damage is done to rateable value, local authorities have only to work out what the redistribution in the rate burden is to be, having regard to the reduced basis on which they can levy their rates. That is the least of the problems thrown up by this proposed concession.
The right hon. Gentleman, in his speech on Second Reading, referred to Clause I as being intended to remedy a glaring anomaly. I did not have the opportunity then, which I hope I may take now, of examining how glaring that anomaly is. There is, of course, nothing new in the basis of assessment of what are known as miscellaneous properties; that is, properties other than dwelling-houses. The basis of valuation in operation today was written into the 1925 Rating and Valuation Act, and it has stayed there unamended ever since. The 1948 Act,
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which was introduced as a Bill by my right hon. Friend the Member for Ebbw Vale (Mr. Bevan), made no alteration in the basis of valuation of business and commercial premises, or for that matter of industrial premises. What he did was to alter the basis of valuation of dwellinghouses, and the Committee probably remembers what that alteration was.
It put the post-1918 dwelling-houses on a basis of valuation for rating which was a percentage of the sum of two capital values: one, the site value at 1948 values, and the other the cost of the construction of the building at 1938 prices. That was not an assessment based on current values; it was not an assessment based on a hypothetical tenant; that is when the break was made between the basis of valuation of miscellaneous properties and the valuation of the post-1918 dwelling-houses, the pre-1918 houses did remain under the 1948 Act on a hypothetical tenant basis, or, to be more accurate, on the basis of prevailing rents in the area.
What the 1953 Act did was to alter the basis of assessment on dwelling-houses, and again leave untouched the basis of valuation of business, commercial and industrial premises, so that this disparity between the assessment of commercial premises and the basis of assessment of dwelling-houses has been there since 1948, and was reaffirmed in the Act of 1953, when the basis of the valuation of dwelling-houses was placed on the 1939 rental values.
Why was the assessment of dwelling-houses put on the 1939 values? Surely we all know that it was because there were no other values to take, and if rating assessments are to be related to actual rental values, we cannot in fairness put an assessment on dwelling-houses on a hypothetical market value when, by reason of rent control, there is no such thing. So, at the time of the introduction of the 1953 Bill, and contrary, I admit, to the views of some of my hon. Friends, I defended the Minister when he placed the valuation of dwelling-houses on the 1939 rental values.
There, it seems to me, they have to stay until they can be more fairly placed on some other basis. But, since the rateable values are fundamentally related to the letting values and to the rents which properties can command in the

1509
open market, there was never a case at that stage, and there is not even at the moment, for putting the assessments of dwelling-houses on current market values, because nobody knows what they are.
6.45 p.m.
On the other hand, there was never a case for putting the valuation of commercial and business premises on any other footing than the one they were on, are on, and have been all along, which was the current value, and that was recognised at the time of the 1948 Act and again at the time of the 1953 Act.
The measure of the increase in the assessments of shops, offices and commercial premises in the recent revaluation was, to a very large extent, the measure of under-assessment for years past. There are large blocks of offices, which have been erected in the City of London during the last five years, and commanding enormous rents, which were valued for rating purposes on a 1934 basis, be cause the professionals said, "We must value in tone with the surrounding and older properties." They have been undervalued and underrated ever since they were put up, and now they are to be given a concession in Clause 1 of the Bill. They are only entitled to a concession if they pay all that they have been relieved of by under-assessment since they were built.
I am, therefore, going to say that there is no injustice in assessing commercial and business premises on current value, while we place dwelling-houses on the 1939 value. That is the law, and this House made it the law. It made it the law twice, once in 1948 and again in 1953, and now the right hon. Gentleman is really amending a law which has been twice confirmed by the House of Commons. What is the basis for it? Is it that there has been an unjust shift in the rate burden? From what to what? It is common knowledge that dwelling-houses have for years past borne a disproportionately heavy rate burden in relation to commercial and industrial premises, leaving out derating for the time being, and, therefore, the revaluation adjusted that anomaly to a very large extent.
But the right hon. Gentleman is apparently impressed with the case put to him, I know forcibly and persistently, by commercial interests, that some of them have
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now assumed a heavier rate burden than is fair and is justified in present circumstances. I know that it is very hard and unfortunate when one has been getting away with something for a long time and events catch one up.
After all, that is what the delinquent taxpayer says when he has paid nothing for five years and the Inland Revenue come on him for a very large sum to be paid at once. I have no doubt that the taxpayer, whose case was reported in the newspapers the other day, who said that he had never heard of Income Tax before 1951, felt himself very aggrieved in being asked to pay arrears of tax from 1939. No doubt, he was going round saying that this was quite unfair and that something should be done about it. The mare a person gets away with things the heavier the burden when events catch up with him.
That, I am afraid, is the main burden of the case of the occupiers of many of these commercial premises. The point my hon. and learned Friend the Member for Kettering (Mr. Mitchison) has continually made in this connection must come to the forefront of our discussion of this problem. That is the difference between the treatment for tax purposes of rates paid in the course of business and rates paid for occupation of dwelling-houses. One cannot get rid of the Income Tax factor in looking at the net rate burden—
Mr. Mitchison: And Profits Tax.
Mr. Houghton: —and Profits Tax, where, as in many cases, that will be levied as well.
I do not want to burden the Committee with a lot of figures, but I have just looked at the sort of result which, as I see it, runs through this piece in the case of a commercial property in one of the parts in my constituency.
Let us say that a shop was assessed on a rateable value of £50 and the rates then were 24s. in the £. I am dealing with the assessment before revaluation. That shop paid £60 a year in rates. The payment of rates was, of course, put in the profit and loss account and, when the Inland Revenue had to decide what was taxable, this was chargeable in full against the taxable profits.

1511
For the purpose of my illustration, I could take the tax at the rate of 8s. 6d. in the £. I will not do that, but I will take it at an average of 5s. in the £. The net rate burden in that case was £45. After revaluation let us assume that the assessment was doubled. We have heard a lot of complaints about doubling and trebling assessments. Let us say that this was doubled and went up to £100, but, after revaluation, the rate poundage fell from 24s. to 18s. 6d. Then, on the £100 assessment, £91 would be paid in rates, less tax at the average rate of 5s. in the £, say, £69 net.
Clause 1 proposes to reduce that £100 rateable value by 20 per cent., which would make it £80. The town clerk of Todmorden, the borough which I am quoting, assumes that with no increase in the current year's expenditure, the poundage will go up from 18s. 6d. to 19s. 9d., an increase of 1s. 3d. So, on an £80 assessment, under Clause 1 the rates would be £74 and, after taking off tax. £57 net.
Now I take the case of a householder who started with the same rateable value of £50. His rates at 24s. in the £ were £60. There was no tax relief for him, that has to be paid out of taxed income. Let us assume that after revaluation it was increased from £50 to £60 and that the poundage went down to 18s. 6d., so that instead of £60 he paid £55. With the increase in the rate poundage consequent on the concession proposed in Clause 1, he would pay rates not on £55, but on £59. So, on the same original assessment, he will have to pay more in net rates than the shopkeeper after his assessment has been doubled and then cut by 20 per cent.
I cannot see where the glaring anomaly comes in. As my hon. Friend the Member for Holborn and St. Pancras, South (Mrs. L. Jeger) said, if the right hon. Gentleman feels compelled to make a concession he is doing it in a way which takes him further from his objective of getting assessments on current values. When the next revaluation comes, say in 1961, he will then be faced with a need to restore the £20 cut made in assessments on commercial properties and, at the same time, will have to revalue dwelling-houses on the then current values if that becomes practicable. He will be faced with a
1512
double movement towards his objective of current values as the basis of rating assessments.
In my opinion, what he ought to have done if he felt compelled to make the concession was to do it the straight way, the visible way by a percentage increase in the assessment of dwelling-houses. Then everyone would have known what he was up to. As it is, householders are being hoodwinked. They thought their assessments and poundage rates, taken together, had eased their rate burden, but now they find that it is to be put up again. What did the Minister say when he was postponing the right of appeal against the new valuations in order that the ratepayer could see the two material factors together—the new rating assessment and the new rate poundage? He said:
"What matters to the individual ratepayer is not what his assessment is, or what the rate poundage is, but the combination of the two, because that is what determines how much he will if to pay. It is, therefore, a great advanage if the ratepayer knows precisely what effect the change will have upon the demands made upon him before he decides whether or not to lodge an appeal against the new assessment."—[OFFICIAL REPORT, 17th June, 1955; Vol. 542. c. 913.]
When ratepayers looked at those two things together many of them decided not to go forward with appeals. Now they find that in a back-handed way in effect their assessments have been increased more than they thought and that their rate burden is higher than they thought it would be. I believe that is a dirty trick on the occupiers of dwelling-houses.
I say that the right hon. Gentleman could have done it the straight way, increased the assessment of dwelling-houses and not pretended that they were staying as they were and that occupiers would get the benefit of revaluation. I am sorry, but in these circumstances I am going to take the straight line, through all these Amendments, of no compromise on opposition to Clause 1. I cannot allow myself to be exposed to misunderstanding by voting in support of the Amendment, even though it confines the concession only to shopkeepers. I believe that shopkeepers are fair-minded people. I believe that they recognise in most cases that they have been favourably placed in relation to assessments in past years.
I am not saying that all shopkeepers are rich, but when we talk about poor shopkeepers we have to remember that,

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as my hon. Friend the Member for The Hartlepools (Mr. D. Jones) said a few moments ago, assessments on shops are related to letting value. Letting value is related to the profitability of the business likely to occupy them, but very few assessments of shops are higher than the business will bear. In those circumstances, I see no justification for giving any special concession just now.
7.0 p.m.
The Parliamentary Secretary to the Ministry of Housing and Local Government (Mr. J. R. Bevins): I hope that the Committee will think it convenient if I intervene at this point for a few moments, first, to congratulate the hon. and learned Member for Kettering (Mr. Mitchison) on his highly accurate calculations earlier in the debate and to commiserate with him, if I may, on the attitude taken to this Amendment by his hon. Friend the Member for Sowerby (Mr. Houghton).
Mr. Mitchison: The hon. Gentleman need not trouble. My hon. Friend the Member for Sowerby (Mr. Houghton) has made his principles perfectly clear and it seems to me to be a mere matter of procedure on this kind of thing. There is no difference whatever between the views of my hon. Friend and mine.
Mr. Bevins: Perhaps we have construed the hon. and learned Gentleman's remarks in rather different ways. I shall, perhaps, come later to what he said.
I want to give the Committee one or two unvarnished facts. The Amendment seeks to limit the relief afforded under Clause 1 to shops. According to the White Paper relating to the distribution of rateable values, the total rateable value on shops is about £89 million. On the occasion of the last revaluation, the assessments for shops as a whole were increased by about 126 per cent. At the same time, the assessments for the miscellaneous properties other than shops, most of which the Government propose should benefit by Clause 1, rose by about 120 per cent., 6 per cent. less than the shops. Consequently, I do not see a great deal of logic in the case presented by the Opposition.
If the argument is—the Government's argument certainly is—that the rise in certain classes of assessment was too sharp and too severe, and if the rise in the case of shops was 126 per cent. and
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in the other classes about which we are speaking 120 per cent., I do not see a great deal of logic in the argument from the point of view of the percentage increases. However, I invite the Committee to consider what the Amendment would involve.
Mr. Lindgren: Before the hon. Gentleman leaves that matter, will he consider this point? The previous revaluation was in 1935. Consequently, it was a matter of a change of valuation as between 1935 and 1955. Did not the value—rating is based on value—of both shops and offices rise very much more in those twenty years than did the value of domestic properties? Consequently, if the value exists, why should not the occupiers be rated on it? A shop having a rateable value of £50 in 1935 probably had a rateable value of £200 in 1955.
Mr. Bevins: I do not think that there is anything between the two sides of the Committee on that matter, for the obvious reason that one class of property has been largely in a free market and the other not.
Mr. Glenvil Hall: Is the hon. Gentleman now arguing that the rise is unrealistic, that it is not proper and according to value?
Mr. Bevins: All I am saying is that the rise in the case of the miscellaneous properties which the Amendment seeks to exclude from benefit is very much of the same order as the increase which has taken place in the case of shops. I say no more than that for the moment.
I should like the Committee to consider one or two of the implications of the Amendment. It was said by the hon. and learned Gentleman, and repeated by other hon. Gentlemen opposite, that the motive of the Government in extending the definition to go beyond shops and to include offices, banks, and so forth, has been to give some gratuitous and undeserved benefit to, I suppose, wealthy financial institutions like the Prudential and other big insurance companies, big shopkeepers, and finance houses.
We ought also to remember that the Amendment would exclude from relief all pool promoters' offices, warehouses, hotels and boarding houses, private nursing homes, theatres, cinemas, youth clubs, even Labour clubs, church halls,

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public buildings, universities and schools. I give the Committee that list because it is important that we should understand that this class of property includes a very wide variety of hereditament.
It is true, as has been said, that, initially, most of the agitation, certainly that heard in the Committee, was on behalf of shopkeepers. I think it is true—I have nothing to conceal on this, nor has my right hon. Friend—that many hon. Members, on both sides of the Committee, were impressed by hard cases which they came across in their constituencies of relatively small shopkeepers whose assessments had risen on average from £75 to £150 or £160.
When we were debating amending rating and valuation legislation two years ago, the hon. Members for Acton (Mr. Sparks) and Widnes (Mr. MacColl) entered a plea on behalf of the small shopkeepers and suggested that the Government should do something about them. If the Government are to be logical about this, it is very difficult to say that the only people who shall have any abatement of the new assessments are the smaller shopkeepers, when there is no evidence whatever that the small shopkeepers have fared any worse—or, for that matter, any better—than either the larger shopkeepers or the organisations and industries occupying large shops or large offices.
Mr. Sparks: Surely the hon. Gentleman will agree that there is a great deal of difference between a single shopkeeper who is relying upon his own effort to get a living and concerns like Woolworth's, Marks and Spencer's, Harrod's and other great multiple shops. One cannot compare the two.
Mr. Bevins: Of course there is a difference, but it is very difficult to operate one principle for the little man and an entirely separate principle for the other organisations. I put it no higher than that.
I appreciate full well, as does my right hon. Friend, that there is always psychological sympathy with the little man in this sort of thing. However, I repeat that there is no evidence at all that the high valued properties have suffered smaller increases than the low rated properties.
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It is only fair to add that not all the high rated properties belong to the Prudential and similar organisations. There is a further implication in the case of the second Amendment. If it were approved and the limit were to be a gross rateable value of £150, most of the Co-operative stores would be excluded from benefit.
Mr. Mitchison: I realise that there are some cases in the miscellaneous category where one might differ as to whether or not there was a case to relieve. The hon. Gentleman has mentioned one or two cases which, I fancy, would, in terms of money, represent a small proportion of the total. In view of what has been said, would the hon. Gentleman and his right hon. Friend agree to the exclusion of offices? The hon. Gentleman has said nothing substantial against that.
Mr. Bevins: I think I have made it clear that the reason offices are grouped with shops under Clause 1 is that the extent of the increase in the assessments of offices is more or less of the same order as that in the case of shops.
The hon. and learned Gentleman argued in his speech that the effect of the abatement provided by Clause I would be that householders as a class would be penalised. The argument which he deployed was, "Why should the Prudential and big finance houses gain at tht expense of small householders?" Looking at the Measure in isolation, it is easy to argue a case on those lines. As the hon. Member for Sowerby very rightly put it, one cannot look at a Measure like this in isolation, divorced entirely from its background.
Hon. Members are perfectly well aware that when the revaluation of property was finished, some time ago, by far the largest increase in assessments took place in the three groups of shops, miscellaneous, and industrial property. The smallest increases in the assessments, as a whole, related to domestic premises. Taking the country as a whole, the increase there was 40 per cent.; for shops, it was 126 per cent., and in the case of miscellaneous the percentage was about as high. The increase in the industrial assessment was very high indeed—even higher still, I think.
The fact is that when the last revaluation took place, the principle beneficiaries

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of that revaluation and the fall in rate poundages which flowed from it—though that was not a corresponding fall—were the great mass of householders. It is not good enough, when the general view in the country is that the shopkeepers and commercial interests have been hit too hard by this revaluation, to criticise the Government for abating their valuation by 20 per cent.
Perhaps I may now take up the case argued by the right hon. Gentleman the Member for Poplar (Mr. Key). He spoke as if the householders in that particular part of London were far worse off today than they were two years ago. It is true—and it is true in the case of every local authority—that in the next few months rate poundages are likely to rise, but we really ought to be fair about this, and ought to try to see the thing in proper focus.
Before revaluation, the total rateable value of the Borough of Poplar was £588,000 after revaluation, it rose to over £1 million. The consequence of the revaluation in Poplar—and, of course, this is true of very many parts of the country—was that the share of the rate burden borne by the Poplar householders fell from 47 per cent. to 38 per cent. In other words, there was a direct gain to the ordinary householder living in that locality. It really is not good enough for hon. Members opposite to suggest that all that has happened in the sphere of rating and valuation during the last two years has been injurious to the ordinary householder.
Mr. Sparks: The hon. Gentleman is making a false assumption. He is trying to measure the burden upon the householder on the basis of the proportion of the rateable value borne by the domestic ratepayer. That is not the proper measure of assessment. The proper measure of assessment is the incidence of the rate burden per head of the population. That has constantly risen, and, in recent years, very considerably risen. Even under the new list, despite the fact that the percentage is slightly down on previous years, the householder is paying very much more in rates than he did last year. That is the basis upon which assessments should be made.
Mr. Bevins: All I say, and I do not think that it can be refuted by any hon. Member in the Committee, is that, as a
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consequence of the revaluation which took place, the share of rates paid in England and Wales by householders as a group has fallen; and even though this abatement to the tenants of offices and shops will obviously raise that proportion to some extent, householders will still be bearing, after Clause 1 has become effective, a smaller proportion of the total rates than they were paying before revaluation.
Mr. Blackburn: But was not that what was naturally expected to be the result of revaluation and what was perfectly well known at the time of the 1955 revaluation?
7.15 p.m.
Mr. Bevins: That is quite true.
Now, if I may, I will turn to the argument deployed with such skill—because what the hon. Gentleman has said borders on this—by the hon. Member for Sowerby, who gave a most lucid exposition of recent rating and valuation history. I am sure that the whole Committee very thoroughly enjoyed that exposition. There is one point on which I should like not to challenge him, because I am not sufficiently expert to do that, but one point on which I do not quite see eye to eye with him. This, of course, verges on the arguments that have been advanced by various other hon. Members this afternoon.
What I understood the hon. Member to say—quite rightly, of course—was that houses are still assessed on a 1939 basis, and all other properties are assessed on the basis of current value. He said that there was no ground for trying to assess houses at current values because, as he said, nobody knows what the current values of houses are. He further argued, as I understood, that we could not change the basis for the rating of houses—because nobody knew what modern values were for that class of property—but, at the same time, he said that the Government had no right or permission to vary the existing new assessments on a current value basis for shops and commercial premises.
With great respect to the hon. Gentleman, this is clearly a matter of relative justice and balance between the various classes of ratepayers. If, as was implicit in his argument, the householders have had a fairly easy deal, to put it no higher, and, on the contrary, the tenants of shops

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and offices have had a less easy deal—not only from Conservative Governments, but from the Labour Government, which initiated the 1948 Act—it is only a matter of elementary justice that, when unfairness is done to the tenants of shops and offices the Government should make this very modest gesture to try to redress the balance as between what is paid by householders and what is paid by other sections of the community.
Mr. J. T. Price: This is a very interesting light to throw on the question. As I understand the Parliamentary Secretary, what, in effect, he says is that the Inland Revenue Department which was responsible for the assessments did the job incompetently. He had better consult the Treasury, because he is making a very serious criticism of the officials who made the assessments.
Mr. Bevins: Really, the hon. Member must not take himself as seriously as all that. I cast no aspersions on the Inland Revenue, nor did I question any of its assessments. Indeed, far be it from me to do that in the presence of the hon. Member for Sowerby.
May I refer, in conclusion, to what was said by the hon. Gentleman the Member for The Hartlepools (Mr. D. Jones)? I understood him to say that my right hon. Friend and myself were at variance on certain matters, especially in relation to the statement I made on Second Reading:
"All I said was that it was difficult to make precise estimates of what rate poundages were likely to be two months before the event."—[OFFICIAL REPORT, 7th February, 1957; Vol. 564, c. 629.]
I also referred to certain factors which had to be taken into account before precise rate poundages could be fixed by city and borough treasurers. There was a good deal of interruption at that point, as hon. Members may remember. However, what I said, I said, and I do not depart from it in any way. I believe that it was correct.
What my right hon. Friend said this afternoon was that a Government ought to hesitate before they reduced rateable values by a further £6 million at this stage in local government. He made it perfectly clear that local government as a whole knew perfectly well as far back as December that the Government
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intended to introduce this Rating and Valuation Bill, and that, therefore, local government was well prepared to make its estimates on the basis of that 20 per cent. but not in respect of all the other factors which creep into the calculation, such as the one which was mentioned by the hon. Member for Hackney, Central (Mr. H. Butler) who, this afternoon, referred to the mass of outstanding appeals. He asked who was right, my right hon. Friend or myself. I conclude by saying, if I may, without causing offence, "Both of us."
Mr. D. Jones: Obviously the right hon. Gentleman and his Parliamentary Secretary cannot both be right. The Parliamentary Secretary said that it was impossible to reach an accurate estimate, and he ridiculed the leader of the Liverpool City Council. He went on to explain that it was impossible at that stage, because of imponderables, to reach a definite conclusion. I intervened and asked him, if he would not accept the word of a political party leader, whether he would accept the views expressed in communications from the town clerks of three boroughs.
This afternoon the right hon. Gentleman, in resisting the first group of Amendments, said that one of the principal reasons why he could not accept them was that as this Bill had been printed on 21st December and the municipalities knew that they had to base their new assessments on the 20 per cent. Reduction, it would upset all their work, and he did not want to do that. Either the right hon. Gentleman was wrong or the Parliamentary Secretary was. They can decide between themselves.
Mr. W. A. Burke: I can make my general position quite clear very quickly, and, therefore, I shall not delay the Committee for very long.
I have been for a long time convinced that the burden of rates has been quite inequitable as between the business and commercial communities and people who occupy dwelling-houses. Therefore, I am much more concerned about the necessity to vote against the Clause than to support these Amendments. However, have to support these Amendments, unfortunately, because of the desperate state of affairs in my own constituency and because these two Amendments would at

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all events produce some slight relief which is so desperately needed there.
The effect of this Clause in Burnley—and I am sorry that I must depart from general principles and deal with particular instances—will be to produce an increase in the rate poundage of 1s. 7d. It will mean a drop in the rateable value of £60,000. Burnley is one of those areas which the Government felt that they ought to assist, and so they made it a Development Area because of the drift of population, ageing population and the general depressed condition of the town compared with the rest of the country. Yet we are going to have to pay this very large increase in the rate burden. If the Government had been willing to come to our assistance and bring new industries into the area some years ago, we might have been able to get some benefit from the promised lessening of the de-rating of industry.
It has been said by the Minister that he cannot make any alteration and go back upon what has already been decided because it would put the borough treasurers and the local authorities in a difficult position at this time. It did not take the people in Burnley very long to realise that the cost to them, as a result of this Bill, will be 1s. 7d. in the £ more. By withdrawing the Bill the Government would enable that 1s. 7d. in the £ to be wiped off. That would not embarrass them in the slightest. Even if these two Amendments were accepted, it would be possible to make an adjustment quite easily so as to bring these shops within the figure of £150, as is proposed.
I ask the Minister to bear in mind that some time ago the Government recognised the difficult position obtaining in northeast Lancashire. They recognised the drift of the population and the ageing population and the endeavour of those local authorities to try to maintain a high rate burden. While I prefer to vote against the whole of the Clause, I shall support the Amendment because, although it is not in line with my general principle, it will at all events give Burnley some much needed relief.
Mr. R. W. Sorensen: I endorse the plea made by my hon. Friend the Member for Burnley (Mr. Burke) that the Minister should think again about this proposal to ameliorate in some measure the harsh effect of this Bill.
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I was very disappointed by the speech of the Parliamentary Secretary. He seemed to use as his defence the admitted many anomalies which exist in the world of rating and valuation. Is that not all the more reason why this Bill should not have been introduced at this time but at a time when some of these anomalies could have been cleared up? As it was, the Parliamentary Secretary was the only Member on the other side of the Committee who even attempted to defend this Measure. Behind him sat solidly one Member of his party, who rather resembled Casabianca, but now even he has fled. I hope that he represented a much larger number on the other side of the Committee who are disquieted at the attitude of their own Government to those who will be affected by this Bill.
Although I sat patiently at the end of the queue waiting to be called by the Chair, I am delighted that I was not called upon earlier, for I had the opportunity of listening to the fascinating analysis of valuation and assessment for rating by my hon. Friend the Member for Sowerby (Mr. Houghton). I was as much fascinated by his analysis as I think I should have been had I been at the Council of Nicea listening to theologians discussing doctrinal complexities. My hon. Friend made the subject extremely clear, and although for several reasons I cannot identify him with any of those Early Christian Fathers, at the same time I must express the regret that he is not going to join us in salvaging something from this Bill by voting for this Amendment.
I confess that the effect of the Bill may not be quite so serious in my own constituency as in some other parts of the country. That is because in my constituency there are a large number of domestic hereditaments and a correspondingly small portion of shops and offices and similar places. At the same time, the town clerk and the borough treasurer of the borough which I have the honour to represent informed me that the total income derived annually from shops, offices and other places in that category, based upon a current rate levy of 17s. 8d. in the £, equals some £378,700. If this Clause were passed that would be reduced very substantially by some £70,200, equal to a 4d. rate increase.

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I agree that a 4d. rate increase is much smaller than that in many other areas, although it is inequitable, but one must remember that, in common with other areas, the ratepayers and constituents in my area are themselves apprehensive about many other burdens which are to be imposed upon them. I know, for instance—if this can be used merely by way of illustration—that the education rate transmitted to us by the county council is likely also to add substantially to the burden of the ratepayers in my neighbourhood. All sections of the community are apprehensive about any extra burden being imposed upon them, adding as it does very materially to the harshness of the lot of many ratepayers.
7.30 p.m.
At the same time, although I have admitted that there are a larger number of domestic dwellings in my area than in some areas, there are, of course, a certain number of shops. I entirely agree with one of my hon. Friends who spoke a short time ago when he pleaded that we should distinguish between the shop owned by one man or perhaps by a couple of ladies with whom we have a genuine sympathy, and those other shops which are merely tentacles of some great concern.
Obviously, firms like Woolworth's, Littlewood's, Home and Colonial Stores, Sainsbury's and indeed the Co-op—because although I am an ardent cooperator myself, we do not want Co-op shops to be in a separate category in this respect—have been relatively mildly hit compared with the smaller person round the corner, the little general stores, the barber and the cobbler, etc. These undoubtedly feel the pinch. We can be prepared to consider how to ease their lot within the existing situation, but not that of those who do not need such relief.
Why cannot the Minister recognise that there may be some case to be made out for such people but certainly not for all those much larger concerns to whom the greater portion of relief is being given. I cannot understand why in spite of all that was said just now, he has lumped together all those shops, large or small, or businesses, great or humble, without fair discrimination. A case can be made out for the genuine small man or woman but not, within this Bill, for anyone else.
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As it is, I repeat that we shall impose upon the rest of my local community the task of finding another £70,000. It is surely too much too expect them to bear that. If one could not be quite judicial and equitable about the matter, it would have been far better to have left the matter for some time until we have reviewed the whole rating situation.
It is no use blaming the Labour Government, as one hon. Member opposite did, for not having dealt with the question of the derating of industry. The criticism was often levelled against the Labour Government during the five years that they were in power that they were doing too much and now our opponents are criticising us for not having done even more. We will certainly seek to meet that criticism at the earliest opportunity. As soon as a Labour Government gets the opportunity, we will get on with the job.
Mr. Ede: I listened, as my hon. Friend the Member for Leyton (Mr. Sorensen) did, to my hon. Friend the Member for Sowerby (Mr. Houghton), who gave a masterly history and analysis of the matters which we have in front of us. It seemed to me that the one thing that my hon. Friend the Member for Sowerby overlooked was that the Government have arbitrarily disturbed a situation that was created by former laws.
The Government said that 20 per cent. ought to be deducted from the rateable value of certain people, and they have made it quite clear this afternoon that this Measure is not to be subject, like other Measures that we have had from the Government this Session, to any amendment. The Government have thundered from the Treasury Bench so loudly that they have driven everyone else on that side of the Committee out of the Chamber, except one hon. Member for Northern Ireland, which is not affected by the Bill.
"When creation's work begun
When He spake and it was done."
That is the attitude which the Government are adopting when they have arbitrarily disturbed the situation.
Therefore, from the disturbances that have been created I think that we are entitled to try to save as much from the operation as we can. I am strongly in

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favour of the second of the two Amendments before us, although I understand that on that one we shall not be allowed to vote, and that to show my sympathy for the second I shall have to vote for the first.
Hon. Members in various parts of the Committee, and my right hon. Friend the Member for Poplar (Mr. Key) in particular, have explained to the Committee the effect of this Measure on their constituencies. In my constituency, 2,886 hereditaments will come within the purview of the concession made in this Clause and that will mean a total loss in rateable value of £70,881. If this year's rates—the current year's rates—had had to be levied on the reduced rateable value, the rate would have been 1s. 2d. higher than it was. Therefore, on the assumption, which we all know will be falsified, that next year's expenditure will be exactly the same as this year's, and that there is to be no other alteration in rateable value than that created by this Bill, the rate next year would have to be 1s. 2d. in the £ higher than the rate this year.
I asked the town clerk to analyse these 2,886 assessments into various groups. Unfortunately, I asked him to do it before the figure of £150 was put into our Amendment, so I cannot quite get the exact effect of that, but the analysis that I shall be able to give to the Committee will, I think, indicate what the probable effect would have been. As the Parliamentary Secretary has said, "It will not be quite precise," but I think that hon. Members will be able to approximate the matter fairly easily.
Of these assessments, 645 were for a rateable value of under £50 and the average in that group of assessments was £25. Between £50 and £100 there were 659 with an average assessment of £71. Between £100 and £199 there were 292 with an average assessment of £136, and that would indicate that the bulk of those would be below £150, because, if the bulk were above, it is clear that the average would have been above £150. Between £220 and £299 there were 80 assessments with an average of £247.
Now we come to this amazing figure. In assessments of £300 and over there are 210 hereditaments and their total reduction in value is £42,788. They are
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only 7 per cent. of the whole, but they get 60 per cent. of the advantage because they get a total reduction on £42,788, which is over 60 per cent. but less than 61 per cent. of the total reduction of £70,881 in the rateable value of the borough.
Those figures indicate the way in which the finances of the matter really operate within an industrial and maritime borough which has to face the ordinary exigencies of municipal work.
The Government having arbitrarily settled that a group is to get 20 per cent., we are perfectly entitled to expand or contract that group as appears to us to make more just what the Government have tried to do. I therefore heartily subscribe to the doctrine that only shops of a rateable value of less than £150 should benefit. I speak as the son of a man who kept a shop when shopkeepers kept shops and shops very often did not keep them. I know the anxieties that fall on these people, such as the small shopkeeper who has a little corner house in a back street where he carries on a business, to whom the half yearly visit of the rate collector is a very serious matter. If the Government want to look for a deserving class, I cannot see any reason why we should not do a little more for the most deserving among the group that they have decided is a deserving class.
I protest again at the attitude adopted by the Minister earlier, that we really cannot do anything now because the municipal machine just will not grapple with it. I can assure the right hon. Gentleman that as far as the South Shields Town Council is concerned and as far as the Surrey County Council is concerned—and he can consult his hon. Friend the Member for Wimbledon (Mr. Black) on this—if the Government will bring in the 100 per cent. rerating of industry, both those bodies will be quite capable of dealing with it before they have to announce the rate poundage or the county council sends out its precepts to the local authorities. If the Government will make this further concession to what they regard as justice, the Minister can rest assured that municipal treasurers' offices throughout the country are quite competent to deal with any alterations which, even at this stage, may have to be made.
Mr. C. W. Gibson: I listened very intently to the Parliamentary Secretary in an effort to learn on what basis he was trying to build an argument. Nobody on his own side was listening, and those who were here a short time ago have left the Chamber. Apparently, rating is such a difficult matter that hon. Members opposite do not understand it and do not want to learn about it; but I notice that at Election times they always talk about rates and about how Labour councils put up the rates. Here is an occasion when the Government are to put up the rates for people who are least able to bear the increase.
It is, surely, an admitted principle of British taxation that it should be based upon ability to pay. Ability to bear the cost should govern the nature and size of the taxes which are imposed. The Minister's justification for this Clause this afternoon went completely contrary to that; he wants to help those who can afford to pay and pile the burden upon those who can least afford to pay.
Mr. Bevins: If the hon. Gentleman will allow me to say so, I am quite sure that he is sufficiently well versed in the law of rating to know that the principle which lies beneath rating is not ability to pay but rental value.
Mr. Gibson: The ability to pay is measured by the rental value of the property the person is living in. If a man lives in poor property of low rateable value, ninety-nine times out of a hundred that is because he cannot afford to live anywhere else. If he lives in a good house, as do most hon. Gentlemen sitting on the Front Bench opposite, that is because he can afford to pay the higher rateable value and live in that sort of property. That is the general basis and principle in fixing rates throughout the country.
7.45 p.m.
This proposal goes completely contrary to anything that any Tory who has tried to better the rating system has suggested. For my part, I think that the system should be completely changed in a revolutionary fashion, but it would be out of order for me to discuss that further. The proposals in the Bill change the thing completely. As my right hon. Friend the Member for Poplar (Mr. Key), whom the Minister completely misunderstood, pointed out, it will change from
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imposing a charge on well-to-do people like bankers, Woolworth's, and other large shopkeepers of that kind and public houses to putting a burden on the backs of people living in ordinary houses. It will do that all over London.
The London County Council has worked out in detail what will be the cost in the county rate if this change is made. It will mean 1s. extra on the rates. That means that the people who are paying the extra will not be the shopkeepers, since they are to be excused 20 per cent. of their rateable values, but will be the poor people living in the back streets of London.
On that basis of sound principle, the Bill should be rejected. I agree with my hon. Friend the Member for Sowerby (Mr. Houghton); I should like to throw the whole thing out and, if the Tories will stay away, perhaps we will throw it out. But if we are to have it, then at least we should try to ease the pressure on those who will be hurt most.
When I think of what the Government have done in piling burdens on the poorest of our people, I am amazed that they have the cheek to bring this proposal forward. The increased cost of foodstuffs hits hardest the poorest of our people. The changes in fiscal policy which the Government have made hit the same people again most harshly.
The Deputy-Chairman (Sir Gordon Touche): The hon. Gentleman is going a little far from the Amendment.
Mr. Gibson: I was trying to show, Sir Gordon, that this is an additional burden upon the people who can least afford to bear it, and that it will be piled on top of many other burdens quite deliberately, so that the Tory Party may again help their well-to-do friends. That ought to be said, and I hope that the country will remember it. It is a pity that we could not have got it over a little earlier, before the vote took place in Lewisham today.
It is quite clear that the Government are proving, once again, that they are the party of the well-to-do. The effects of the Bill will be to take a charge off those who can well afford to pay it and put it on the shoulders of the poorest of the community. That is unfair and wrong. This Amendment would go a little way to easing the burden, and I hope that the Committee will insist upon it. The

1529
trouble is that there are no Tory Members here to convince about it, though they will all come rolling up later, when the Division bells ring, to reject the Amendment. I hope that the public will recognise that when hon. Members opposite vote, as they will, they will be voting without any knowledge of what the case for this Amendment is.
Mr. J. T. Price: The hon. Gentleman the Parliamentary Secretary, who sits there in lonely state on the Treasury benches, is, one might almost say without wishing to be disrespectful, like the boy on the burning deck. He sits there alone while this transaction is being put across the country, and that is something which we very strongly resent.
I have the honour to represent a Lancashire constituency. We have been extremely ill-affected by the loss of industrial rating in some of the industrial areas. The Minister was very skilful at the Box tonight. I compliment him on that, if for nothing else; he has, at least, shown more skill in the forensic sense than did the Minister of Defence yesterday, and it may be he will have a move up in the hierarchy if he repeats his performance. I have in mind here the Secretaryship of State for Air.
I want to divest the issue before us of the juggling with averages which was the main foundation of the Minister's brief. Let us get down to hard cash. I believe that the effect of the Bill will be an overall loss in revenue of £35 million per annum to local authorities. Local authorities can maintain the services to ratepayers for which they are responsible only if the loss is recouped elsewhere.
I observe that some of my hon. Friends who have been sitting through this debate are now so disgusted with the total absence of Government supporters that they have moved over to the other side of the Committee so that I may have friendly faces to look at. I share the feelings of disgust which have been ventilated, in a pleasant way, by my hon. Friends.
I have instructions from the people whom I represent to make the strongest protest against the Bill. Whatever the Minister says, the effect is that the responsibility for paying £35 million per annum will be transferred from many people
1530
who obtain relief under the Bill to householders and small owner-occupiers who are struggling to pay for houses at high mortgage rates. The Lancashire local authorities that I represent anticipate that they will have the difficult and unwelcome task of telling the ratepayers in the coming year that they will require an addition of between 1s. 9d. and 2s. in the rates.
Right hon. and hon. Friends of mine earlier said, with no reply from the Conservative benches, that relief is being given to people who do not need it, to great commercial combines, to business octopuses covering almost every town in the country, and to the great insurance companies and banks. It is no use any hon. Member opposite saying that the Government are merely trying to achieve equity because some people have been more harshly treated than others. In a matter like this, the essence of statesmanship ought to be to try to preserve justice and prevent hardship being caused. My hon. Friends and I have never objected to some kind of relief being given to the smaller shopkeepers, if they are being hard hit. The purpose of our Amendments is to limit the loss which local authorities will suffer. If we limit the 20 per cent. concession to the smaller shops which have a ceiling of £150 rateable value, we shall exclude from the calculations some of the great commercial firms which do not need relief in any case.
I am aware that on a narrow point like the present one it is difficult to deal with many aspects which would be more appropriate to the Question, "That the Clause stand part of the Bill." Nevertheless, there are many institutions which will not profit from the concession and which will be entitled to claim that they are being harshly treated. It is fallacious for the Minister to say that if the Government gave way now they would merely be adding another £6 million per annum to the £35 million which will be lost.
I would reiterate that there is strong feeling in Lancashire, particularly in my constituency, that no Government are morally justified in present circumstances—particularly the present Government, with their legislation in respect of rents and interest charges and other features of our economy which make it more difficult for ordinary people to pay their

1531
way—in giving relief to commercial undertakings, breweries and other concerns which are not entitled to it. The only way to deal with this matter, short of throwing out the Bill, which is the real way to deal with it, is to limit the concessions to those who need them and to remove from the shoulders of householders, who are already meeting constantly rising rate charges, the burden of an additional 2s. in rates which we believe will result from the Measure.
Mr. Lindgren: The Parliamentary Secretary has been a little unfair to the Committee. He has not dealt with the Amendment on the basis on which it was tabled. Previously the Government's case was based upon what was felt to be the unfair burden placed on small shopkeepers, and the discussion was about the little old lady with a baby linen shop in the back street and the poor old fellow who had bought a sweet shop at the corner of the street with the compensation given him when he was injured in the mines. Our second Amendment deals with that aspect.
We have been told by the Parliamentary Secretary that all that the Government are concerned to do and had it in mind When they were talking about the little shopkeepers, is to remove the incidence of rate burden on shop premises and miscellaneous properties. That is a complete departure from the basis of rating up to the present time. I interjected, when the Parliamentary Secretary was speaking earlier, that the value of a shop depends upon its profit-earning capacity. The greater the capacity of the shop to earn a profit, the greater its value. If it is in the rentable market, up goes its rent.
Mr. Glenvil Hall: That is a fundamental law of rent.
Mr. Lindgren: Now the Parliamentary Secretary says that at last the small shop, the public house, the office and the cinema are catching up on their real value, and because the incidence is greater than normal, the Government are going to reduce it. That is completely wrong. The Parliamentary Secretary has implied that the shops and miscellaneous properties have until now been subsidising domestic ratepayers because they have been assessed at 1939 values. That is
1532
completely untrue. What is true, however, is that domestic ratepayers have been subsidising shopkeepers and occupiers of offices because those premises have been under-assessed.
8.0 p.m.
This is the first time that the assessment of shops has been on a proper basis. In my own constituency is a shop which before revaluation had a rateable value of £20. On revaluation its rateable value rose to £130. Of course, the owners of the shop, a firm, grumbled. The Parliamentary Secretary says that such a rise is too steep and that it is unfair to make it so high. I say that it is distinctly unfair that ever since 1935 that shop should have been filching rates from the local authority—because that is what has been happening—at the expense of the domestic ratepayer. Can the Parliamentary Secretary justify that?
There is a by-election in North Lewisham and the Tories are going round posing as the great friends of the property-owning democracy. Some poor fellow in North Lewisham who bought his house in 1946–47—when he had the money—borrowed at 3 per cent.—because we had a Labour Government with a real sense of the value of money and its uses. He is now paying 6 per cent., doubling his interest charge on the same house in respect of the same money as he borrowed. The Government have relieved the bank, which is getting double the interest rates which it obtained ten years ago, and the poor domestic ratepayer is paying for the relief. The Government are saying to 'the bank, "Although you are getting double the profits, we shall relieve your rates by 20 per cent. and put it on the poor fellow who is already paying a doubled interest rate". I will give way to the Parliamentary Secretary if he can justify shifting the rate burden from the bank to the domestic ratepayer, when the domestic ratepayer is paying a double interest rate to the bank which is being relieved.
Mr. Bevins: The hon. Member is not being quite fair to the Committee. He knows perfectly well that there is at present a dual basis of assessment, which quite deliberately, by Act of Parliament, favours householders and, relatively speaking, is injurious to the tenants of other property. That being so, one cannot accuse the Government of outrageous

1533
conduct when we simply try to adjust the balance by making a 20 per cent. reduction.
Mr. Lindgren: The test is what is paid. I am one of those fortunate persons who rent a house. That rent in 1945 was what it was in 1939. After the Tories' Housing Repairs and Rents Act, 1954, it went up. Surely the value of the house is the same as it was before. Landlords of shops were able to say that on a profit-earning basis a shop was worth, say, £200. Because the shopkeeper, like the tenant of a house, adds rent and rates together, if the rates were low, only £50, the landlord could collect £150 as rent. If the rates were higher, the selling price of the shop fell, because the profit margin decreased.
The Parliamentary Secretary said that the domestic ratepayer was relieved by the last valuation. That is completely untrue. I have the return of rates levied per head of the population, a return issued by the Institute of Municipal Treasurers and Accountants. In the year 1955–56, the last on the old valuation basis, the rates per head in county boroughs were 182s. 3d. and in Metropolitan borough's 384s. 8d. In 1956–57, the first year of the new valuation, those figures rose to 217s. 3d. in the county boroughs and 464s. 1d. in the Metropolitan boroughs. So there has been no relief. The burden on the domestic ratepayer is higher and not lower than it was before.
Mr. Bevins Mr. Bevins indicated dissent.
Mr. Lindgren: I understood the Parliamentary Secretary to say—I will certainly withdraw if I am wrong, because I do not want deliberately to misrepresent him—that the incidence of rates on the domestic ratepayer in 1956–57 was less than it was in 1955–56 because of the increased rates paid by industry, shops and miscellaneous properties.
Mr. Bevins: There is nothing between us on this issue. What I said was that, pre-revaluation, domestic ratepayers as a whole were responsible for 59·83 per cent. of the total rates paid in England and Wales and that, subsequent to revaluation, that figure fell to 49 per cent. There is nothing inconsistent in those figures, which show that the relative share borne by householders has fallen, and the assertion of the hon. Member that payments
1534
per capita have risen, because it is common knowledge that expenditure by local authorities is rising almost all the time.
Mr. Lindgren: It is very nice to talk about percentages. It is like talking about the average wage and the average man. They do not exist. If the Bill goes through, on my house I shall have to pay £3 2s. a year extra in rates. Woolworth's, Marks and Spencer's, Barclays Bank and the Midland Bank will pay less. On the basis of ability to pay and equity, the greater burden should be on Woolworth's, Marks and Spencer's, Barclays Bank, the Midland Bank, etc. However the Parliamentary Secretary may talk about percentages, shops and miscellaneous premises are being relieved of a burden because it is being placed on others.
Mr. Albert Evans: Will my hon. Friend bear in mind that rates paid by a business house rank as a business expense, whereas the rates paid by the domestic ratepayer are paid out of income which has already been taxed?
Mr. Lindgren: My hon. and learned Friend the Member for Kettering (Mr. Mitchison) dealt with that point earlier. It is true. Those people can charge rates against Income Tax, but the ordinary ratepayer has to pay them out of his wages or salary.
We are very perturbed. We accuse the Government almost of fraud. The Bill has been introduced under the cloak of giving relief to the small shopkeeper. However, he is not getting as much relief as the large premises, because in many cases shopkeepers will get only a one-seventh reduction, because they have domestic accommodation over the shop. The real purpose is to relieve large-scale shopkeepers and people of that type with vested interests from paying the rate, and to pass it on to the normal ratepayer.
In spite of the fact that the benches opposite have been empty tonight, during the Second Reading debate not a single Member from that side of the House spoke in favour of the Clause standing as it is.
Mr. Glenvil Hall: Except the Minister.
Mr. Lindgren: I am naturally excluding the Minister and the Parliamentary

1535
Secretary who are in charge of the Bill. But they are supposed to be speaking on behalf of the party behind them.
Mr. Gibson: Where are they?
Mr. Lindgren: They will be here in a moment when I sit down and we have a Division. I know that their interest in the ordinary man in the street just does not exist. They are here to represent
vested interests, and are paid to be here by those vested interests. But for their contributions, hon. Members opposite would not be here. The Amendment ought to be accepted, and I ask the Parliamentary Secretary to accept it.
Question put, That the words proposed to be left out stand part of the Clause:—
The Committee divided: Ayes 165, Noes 141.

Division No. 61.]

AYES

[8.12 p.m.

Agnew, Cmdr. P. G.

Gibson-Watt, D.

Morrison, John (Salisbury)

Aitken, W. T.

Glover, D.

Mott-Radclyffe, Sir Charles

Alport, C. J. M.

Godber, J. B.

Nairn, D. L. S.

Amory, Rt. Hn. Heathcoat (Tiverton)

Gomme-Duncan, Col. Sir Alan

Neave, Airey

Arbuthnot, John

Graham, Sir Fergus

Nicholson, Godfrey (Farnham)

Armstrong, C. W.

Grant-Ferris, Wg Cdr. R. (Nantwich)

Oakshott, H. D.

Ashton, H.

Green, A.

O'Neill, Hn. Phelim (Co. Antrim, N.)

Atkins, H. E.

Gresham Cooke, R.

Osborne, C.

Baldock, Lt.-Cmdr. J. M.

Grimston, Sir Robert (Westbury)

Page, R. G.

Baldwin, A. E.

Gurden, Harold

Pannell, N. A. (Kirkdale)

Balniel, Lord

Hall, John (Wycombe)

Pickthorn, K. W. M.

Barber, Anthony

Harvey, John (Walthamstow, E.)

Pilkington, Capt. R. A.

Barlow, Sir John

Harvie-Watt, Sir George

Pitman, I. J.

Barter, John

Heald, Rt. Hon. Sir Lionel

Pitt, Miss E. M.

Baxter, Sir Beverley

Heath, Rt. Hon. E. R. G.

Pott, H. P.

Beamish, Maj. Tufton

Hesketh, R. F.

Powell, J. Enoch

Bell, Philip (Bolton, E.)

Hicks-Beach, Maj. W. W.

Price, David (Eastleigh)

Bell, Ronald (Bucks, S.)

Hill, Rt. Hon. Charles (Luton)

Price, Henry (Lewisham, W.)

Bevins, J. R. (Toxteth)

Hill, Mrs. E. (Wythenshawe)

Ramsden, J. E.

Bidgood, J. C.

Hinchingbrooke, Viscount

Redmayne, M.

Biggs-Davison, J. A.

Holland-Martin, C. J.

Rees-Davies, W. R.

Bishop, F. P.

Hornby, R. P.

Remnant, Hon. P.

Body, R. F.

Hornsby-Smith, Miss M. P.

Ridsdale, J. E.

Boothby, Sir Robert

Horobin, Sir Ian

Rippon, A. G. F.

Boyd-Carpenter, Rt. Hon. J. A.

Horsbrugh, Rt. Hon. Dame Florence

Robinson, Sir Roland (Blackpool, s.)

Braine, B. R.

Howard, John (Test)

Roper, Sir Harold

Brooke, Rt. Hon. Henry

Hughes Hallett, Vice-Admiral J.

Ropner, Col. Sir Leonard

Brooman-White, R, C.

Hughes-Young, M. H. C.

Russell, R. S.

Browne, J. Nixon (Craigton)

Hulbert, Sir Norman

Schofield, Lt.-Col. W.

Burden, F. F. A.

Hutchison, Sir James (Scotstoun)

Sharples, R C.

Campbell, Sir David

Iremonger, T. L.

Simon, J. E. S. (Middlesbrough, W.)

Carr, Robert

Irvine, Bryant Godman (Rye)

Steward, Sir William (Woolwich, W.)

Cary, Sir Robert

Jenkins, Robert (Dulwich)

Storey, S.

Channon, Sir Henry

Jennings, J. C. (Burton)

Studholme, Sir Henry

Clarke, Brig. Terence (Portsmth, W.)

Johnson, Dr. Donald (Carlisle)

Temple, J. M.

Conant, Maj. Sir Roger

Keegan, D.

Thomas, Leslie (Canterbury)

Cooper-Key, E. M.

Kerr, H. W.

Thompson, Kenneth (Walton)

Cordeaux, Lt.-Col. J. K.

Kimball, M.

Thompson, Lt.-Cdr. R. (Croydon, S.)

Craddock, Beresford (Spelthorne)

Lambert, Hon. G.

Thornton-Kemsley, C. N.

Crouch, R. F.

Leather, E. H. C.

Tilney, John (Wavertree)

Cunningham, Knox

Leavey, J. A.

Turton, Rt. Hon. R. H.

Currle, G. B. H.

Legh, Hon. Peter (Petersfield)

Vane, W. M. F.

Davidson, Viscountess

Lindsay, Hon. James (Devon, N.)

Vaughan-Morgan, J. K.

Vickers, Miss J. H.

D'Avigdor-Goldsmid, Sir Henry

Lloyd, Maj. Sir Guy (Renfrew, E.)

Wakefield, Edward (Derbyshire, W.)

Deedes, W. F.

Longden, Gilbert

Wall, Major Patrick

Dodds-Parker, A. D.

Lucas-Tooth, Sir Hugh

Webbe, Sir H.

Doughty, C. J. A.

Mackeson, Brig. Sir Harry

Whitelaw, W. S. I. (Penrith & Border)

du Cann, E. D. L.

Mackie, J. H. (Galloway)

Williams, R. Dudley (Exeter)

Duthie, W. S.

McLaughlin, Mrs. P.

Wills, G. (Bridgwater)

Eden, J. B. (Bournemouth, West)

McLean, Neil (Inverness)

Wilson, Geoffrey (Truro)

Emmet, Hon. Mrs. Evelyn

Maddan, Martin

Woollam, John Victor

Errington, Sir Eric

Manningham-Buller, Rt. Hn. Sir R.

Yates, William (The Wrekin)

Farey-Jones, F. W.

Marlowe, A. A. H.

Finlay, Graeme

Maude, Angus

TELLERS FOR THE AYES:

Fisher Nigel

Mawby, R. L.

Mr. Bryan and

Freeth, Denzil

Molson, Rt. Hon. Hugh

Colonel J. H. Harrison.

NOES

Ainsley, J. w.

Blackburn, F.

Brockway, A. F.

Allaun, Frank (Salford, E.)

Blyton, W. R.

Brown, Rt. Hon. George (Belper)

Allen, Arthur (Bosworth)

Boardman, H.

Brown, Thomas (Ince)

Allen, Scholefield (Crewe)

Bowden, H. W. (Leicester, S.W.)

Burke, W. A.

Awbery, S. S.

Bowles, F. G.

Burton, Miss F. E.

Bacon, Miss Alice

Braddock, Mrs. Elizabeth

Butler, Mrs. Joyce (Wood Green)

Champion, A. J.

Irvine, A. J. (Edge Hill)

Proctor, W. T.

Clunie, J.

Isaacs, Rt. Hon. G. A.

Pryde, D. J.

Collick, P. H. (Birkenhead)

Janner, B.

Randall, H. E.

Collins, V. J. (Shoreditch & Finsbury)

Jay, Rt. Hon. D. P. T.

Rankin, John

Corbet, Mrs. Freda

Jeger, Mrs. Lena (Holbn &St. Pncs, S.)

Redhead, E. C.

Cove, W. G.

Johnson, James (Rugby)

Reeves, J.

Craddock, George (Bradford, S.)

Jones, Rt. Hon. A. Creech (Wakefield)

Rhodes, H.

Darling, George (Hillsborough)

Jones, David (The Hartlepools)

Robens, Rt. Hon. A.

Davies, Ernest (Enfield, E.)

Jones, T. W. (Merioneth)

Roberts, Albert (Normanton)

Davies, Harold (Leek)

Key, Rt. Hon. C. W.

Roberts, Goronwy (Caernarvon)

Davies, Stephen (Merthyr)

Lawson, G. M.

Rogers, George (Kensington, N.)

Delargy, H. J.

Lever, Leslie (Ardwick)

Ross, William

Dodds, N. N.

Lindgren, G. S.

Short, E. W.

Dugdale, Rt. Hn. John (W. Brmwch)

Lipton, Marcus

Simmons, C. J. (Brierley Hill)

Ede, Rt. Hon. J. C.

McKay, John (Wallsend)

Skeffington, A. M.

Edwards, Rt. Hon. John (Brighouse)

McLeavy, Frank

Smith, Ellis (Stoke, S.)

Evans, Albert (Islington, S.W.)

MacPherson, Malcolm (Stirling)

Sorensen, R. W.

Evans, Edward (Lowestoft)

Mahon, Simon

Soskice, Rt. Hon. Sir Frank

Fernyhough, E.

Marquand, Rt. Hon. H. A.

Sparks, J. A.

Finch, H. J.

Mitchison, G. R.

Steele, T.

Fletcher, Eric

Monslow, W.

Stewart, Michael (Fulham)

Fraser, Thomas (Hamilton)

Moody, A. S.

Stones, W. (Consett)

Gibson, C. W.

Morris, Percy (Swansea, W.)

Summerskill, Rt. Hon. E.

Gordon Walker, Rt. Hon. P. C.

Morrison, Rt. Hn. Herbert (Lewis'm, S.)

Sylvester, G. O.

Grenfell, Rt. Hon. D. R.

Moyle, A.

Taylor, Bernard (Mansfield)

Grey, C. F.

Neal, Harold (Bolsover)

Thomas, George (Cardiff)

Griffiths, Rt. Hon. James (Llanelly)

Noel-Baker, Francis (Swindon)

Ungoed-Thomas, Sir Lynn

Griffiths, William (Exchange)

Oliver, G. H.

Viant, S. P.

Hale, Leslie

Orbach, M.

Warbey, W. N.

Hall, Rt. Hn. Glenvil (Colne Valley)

Oswald, T.

Wells, Percy (Faversham)

Hamilton, W. W.

Owen, W. J.

Wells, William (Walsall, N.)

Harrison, J. (Nottingham, N.)

Paling, Rt. Hon. W. (Dearne Valley)

West, D. G.

Hayman, F. H.

Pannell, Charles (Leeds, W.)

Wheeldon, W. E.

Henderson, Rt. Hn. A. (Rwly Regis)

Pargiter, G. A.

Wilkins, W. A.

Herbison, Miss M.

Parker, J.

Willey, Frederick

Holman, P.

Parkin, B. T.

Williams, W. R. (Openshaw)

Howell, Charles (Perry Barr)

Paton, John

Willis, Eustace (Edinburgh, E.)

Hubbard, T. F.

Pearson, A.

Winterbottom, Richard

Hughes, Emrys (S. Ayrshire)

Peart, T. F.

Zilliacus, K.

Hughes, Hector (Aberdeen, N.)

Pentland, N.

Hunter, A. E.

Plummer, Sir Leslie

TELLERS FOR THE NOES:

Hynd, H. (Accrington)

Popplewell, E.

Mr. J. T. Price and Mr. Holmes.

Mr. Lindgren: I beg to move, in page 1, line 7, after "premises", to insert "nor licensed premises."
If after the decisive intimation by the Committee in the last Division that the Government have no support for this Measure—not only are they unable to keep their supporters in the Chamber but apparently they cannot keep them in the House—I wish to ask the Minister whether he agrees with my right hon. Friend the Member for South Shields (Mr. Ede) that every local authority in the country would give him three hearty cheers if he would withdraw this Bill right away, and we—
The Deputy-Chairman: Order. The hon. Gentleman is straying rather far from the Amendment.
Mr. Lindgren: I was hoping that by inviting the Minister to withdraw the Bill, there would be no need for me to move the Amendment. But perhaps that is not likely, so I will return to the Amendment.
Here we have an Amendment to exclude public houses from the bonus payment which the Government are making.
1538
I may have made a mistake in drafting the Amendment. The definition of licensed premises may be wider or not exactly as it appears in the Amendment. I intended to refer to what are normally known as public houses. I invite the Minister to tell the Committee how he justifies the fact that brewery companies, which are, more and more, becoming monopolies by the process of one firm amalgamating with another, should get a 75 per cent. rate relief on the premises where their beer is produced when in many cases they are replacing the tenant of the public house by a manager. Under the old system a tenant took a public house from the brewery and paid rent to the brewery; but more and more it is the case that the breweries are dispensing with tenants and replacing them by managers. The position now is that there is a 75 per cent. rate relief in respect of the premises where the beer is produced, and the same firm which owns those premises now owns the shops in which their product is sold, namely, the licensed premises; and they are to receive a 20 per cent. rate relief in respect of those licensed premises.

1539
This provides an opportunity for the brewers to make a profit even where there is a tenant in the licensed premises. In many instances the brewers are putting up the rent which they charge to their tenants. If a 20 per cent. relief is given to the tenant of a public house, he will not, in fact, benefit from it. He may do so for a year, but as soon as the brewers realise what is happening he will be given notice that his rent is to be increased. The benefit given by the Government under this Bill will go to the brewers in the houses managed by them, and in the case of houses in which there are tenants it will go to the brewers in the form of increased rents.
Immediately this Government came into office they made a concession to the brewers who are, if not the best financial benefactors of this Government, at least one of their most enthusiastic supporters. The brewers got their first pay-off when the Government, almost before they had lost their victory blushes in 1951, introduced a Bill to take away the control of public houses by development corporations in new towns and hand over to the brewers all the value arising from the development in those new towns. Now the Government are giving another payoff to the brewers.
The Minister is reshaping the expenditure of the workers of this country. The right hon. Gentleman and his colleagues have put up the price of food. He is becoming enthusiastic about raising rents. In conjunction with the brewers, this Government put up the price of beer a long time ago. Now rates are to be increased in order to give a financial benefit to the brewers who already enjoy a 75 per cent. rate relief in respect of the premises where their beer is produced.
There might have been something to be said for giving a measure of rate relief to shopkeepers who have to buy their commodities and take trading risks. But here we are not dealing with retailers in the normal sense of the word. We are dealing with a group of people who manufacture a product and own the places where it is sold. We shall be interested to hear how the Minister can justify giving a 75 per cent. rate relief to the brewers on their breweries and a 20 per cent. relief on the premises where the product is sold.
1540
The right hon. Gentleman tells us that very shortly he will introduce a new Bill which will oblige brewers to pay 50 per cent. of the rates on the production side of their business. If that is so, may we ask that he should accept this Amendment as a gesture?
8.30 p.m.
Mr. H. Brooke: The hon. Member for Wellingborough (Mr. Lindgren) suggested at the outset of his remarks that the Amendment he put down was not the one he really meant to put down. Though it specifies "licensed premises" he really meant "public houses". The matter is relatively simple. It is a distinction which it is possible for most of us to establish in our own minds, although it seems somewhat curious that if the hon. Gentleman meant public houses he did not say "public houses".
Mr. Lindgren: There has been a change in definition between the Acts of 1910 and 1953.
Mr. Brooke: We can only be guided by the Amendment which the hon. Gentleman put on the Notice Paper. It is not always possible for me to understand the intricacies of the hon. Gentleman's mind. The Amendment would extend beyond public houses to hotels, if they were licensed, bars, clubs, and offlicences. It would be far wider than the public house.
Mr. Mitchison: Do clubs require a licence? My impression is that clubs have to be registered, but are not included among licensed premises. There is no statutory definition in the Act of 1953.
Mr. Brooke: The advice I have received is that although it is true that the 1910 Act, which is referred to in a later Amendment, was repealed by the 1953 Act, the latter contains a definition of licensed premises. I am advised that that definition should be interpreted in the way that I have informed the Committee.
However, I accept it that the hon. Member for Wellingborough meant what he said in his speech and not what he said in his Amendment, and that he is addressing himself to public houses. It was a bit of a surprise to me that the Labour Party appeared to have embraced teetotalism.
Mr. Lindgren: It is a question of fairness and not of teetotalism. If the right hon. Gentleman wants a test of my ability I am willing to give it to him.
Mr. Brooke: The Opposition have changed their views about fairness. Up to now, all these establishments, whether on the narrow interpretation of public houses or on the wider one that I have given, have been treated on the same rating basis as shops, offices and miscellaneous properties.
The hon. Gentleman is saying that his party made a serious mistake in the 1948 Act. It should have selected public houses at that time for special punitive rating treatment and it failed to do so. Having discovered the error that it made, it is now seeking to correct it by wishing to persuade the Government to discriminate against public houses on this point. [HON. MEMBERS: "No."] There is nothing more to the Amendment than that.
Mr. D. Jones: That observation is not worthy of a Minister of the Crown.
Mr. Brooke: All I am seeking to show to the Committee is that the Opposition are suddenly, out of the blue, seeking to establish that public houses should be put on a distinctive rating basis from all the other categories of establishments with which they have hitherto been uniformly treated. I do not think that a shadow of a case has been made out for that.
The only case the hon. Member sought to make out was that he felt that something ought to be done to penalise the brewers because the breweries were derated down to 25 per cent. He tried to present a case that the Government were grossly and hopelessly prejudiced in favour of the trade. He then suddenly remembered that, two days ago, I announced that the rate on breweries was to be doubled, and he saw that his argument would not really run. He had to change his ground.
I say in all seriousness, addressing myself to the real case that the hon. Gentleman is seeking to put to the Committee, that it cannot be sustained on any logical ground. We cannot single out public houses or any other forms of licensed premises and maintain that they should be dealt with on a different, distinctive rating basis from other kinds
1542
of premises which are just the same except that they are not licensed. We cannot distinguish for rating purposes the ordinary hotel where we can buy a drink, and the temperance hotel. We cannot really say that, down a line of shops, the one shop to have a different rating basis should be the off-licence because it happens to sell alcohol.
I appreciate the gesture that hon. Members opposite have sought to make by their Amendment. If they will give their attention to the point at issue they will see that if they were in charge of the country's affairs they could not possibly recommend the Committee to accept this Amendment.
Mr. Mitchison: The right hon. Gentleman has completely misunderstood both the arguments addressed to him and the character of this Amendment.
We think that the Bill is wrong, at any rate as regards Clause 1, from beginning to end, and we are trying to pick holes, one by one, in the vast quantity of institutions to which the right hon. Gentleman feels it necessary to give this emergency relief. We have already examined the cases of the insurance offices, the banks, and the rest, which suffer under such a sense of acute grievance that that must be remedied before anything else is dealt with in connection with rating. We are now examining the sad case of public houses, and we are wondering whether that needs similar treatment.
There is one remarkable peculiarity about public houses in rating matters, and it is that no single rating subject has been the subject matter of more differences and varieties of judicial decisions than public houses. If they could be treated like anything else our courts would not be so often troubled with them. It arises out of the character of public houses. The public house hangs on, in so many cases, to a brewery, and the right hon. Gentleman apparently considers that that is to be put right, not because he will rerate industrial property but because he will half-rerate industrial property. We will continue that argument on another occasion, but if he does think that that is a sufficient reason for not considering public houses separately, I say that I do not agree with him.
We are entitled to raise this matter, just as his hon. Friends have raised cases in the other sense about piers and the case

1543
of holiday camps has also been raised. It is right and proper, when considering a Bill of this sort, that we should cite some instances of the incredible folly and injustice which the right hon. Gentleman is committing by this Bill, and draw them to his attention, which is probably a hopeless proposition with regard to his doing anything, and also attract the attention of the public to what is happening.
I am well aware, as are all hon. Members, that the right hon. Gentleman has agreed all this beforehand, and that he is treating the Committee with the greatest possible contempt, for he made it clear earlier that he will not accept any Amendments of any sort—though his view is contrary to that of my experienced right hon. Friend the Member for South Shields (Mr. Ede)—because the local authorities cannot do anything about it if he does. The right hon. Gentleman does not pay the least attention to the facts.
In these circumstances, the Minister is the very last person to complain if we take one case after another to illustrate what we regard as the extremely foolish, unworkable and unjust character of what he is putting forward. If we select public houses, we have some reason to do so, because of the existence of tied public houses, and I do not pay the least attention to this question of definition. We did raise the point, and my hon. Friends made clear what we wanted to raise. As for the definition, the right hon. Gentleman is correct. One consolidation Act has been repealed by another, and the second one does not contain a definition of licensed premises at all, or, at least. I cannot find it. It certainly is not in the definition Clause.
The substance of the matter is this. Does the right hon. Gentleman really intend to give emergency relief to the breweries, and the thousands of public houses which they own, at the expense of domestic ratepayers? That is strictly parallel to the question: does the right hon. Gentleman intend to relieve the Prudential Insurance Company's offices at the expense of domestic ratepayers? If he thinks that we are selecting one case only, he really ought to be grateful to us for not having picked out fifty more anomalies which he will produce by this piece of misguided legislation.
Amendment negatived.
Mr. Sparks: I beg to move, in page 1, line 22, at the end to insert:
Provided that the deductions specified as aforesaid shall not reduce the amount payable below what would have been payable in the rate period ending on the thirty-first day of March, nineteen hundred and fifty-six. Where the amount of the rate payable would, but for this proviso, be less than the amount payable in the rate period ending on the thirty-first day of March, nineteen hundred and fifty-six, then the amount payable shall be the amount payable in the rate period ending on the thirty-first day of March, nineteen hundred and fifty-six.
It will be noticed by the Committee that Clause 2 and Clause 3 provide for ensuring that the British Transport Commission, the Central Electricity Authority and the gas boards shall pay no less in rates in the coming rating period than they paid in the year before the new valuation list because it was found that in fact they were paying much less in rates under the new list than under the old list.
This Amendment endeavours to do the same in respect of shop and miscellaneous hereditaments because, when Clause 1 is enacted and the rateable values of shops and miscellaneous hereditaments are reduced by one-fifth, many of them will actually pay less in rates than they did before the new valuation list came into force. They will pay less in rates after taking into consideration that next year the rates in most parts of the country will rise to make good the deficiency in rateable value as a result of this Measure.
I cannot conceive that that is the intention of the Government. We shall know whether it is when the right hon. Gentleman replies. In a situation in which all, particularly domestic householders, have to pay more in rates than before and when rate poundages are to go up next year, it is quite unreasonable for the right hon. Gentleman to take the attitude that many ratepayers shall, in respect of shops and miscellaneous premises, be entitled to pay much less than they did before the new valuation list.
We have examined this problem in my constituency. In the main street in Acton, High Street, the assessments of 51 shops were taken. It was discovered that the proposed assessment under Clause 1 would place 37 of them in a position in which they would pay much less in rates than in 1955–56, the year before the new valuation and after account had been

1545
taken of an increase in the rate poundage in the borough next year to make good the deficiency arising from this Measure.
8.45 p.m.
It is not easy at this stage to assess the facts, but my constituency is not an exception to the general rule, and what we found in Acton will be found to be the position in many parts of the country, particularly in London and other large towns and cities. This affects classes of shops in a higher category than those of the small shopkeepers, because High Street, Acton, is the main thoroughfare through the town and contains some very well-established shops of a substantial size.
It is not, in the main, the shopkeepers whose previous assessments were based on the 1934 values, and who now find that their valuations have increased very much, who will pay less in rates under the Bill than before the new valuation list was introduced. I am referring in many cases to shops which came into assessment later than 1934 and, having come into assessment later, were by comparison with the 1934 figures originally assessed at a somewhat higher figure. As a consequence of that, under the new valuation list their rateable values have not been increased as much, by percentage, as have those of shops which were last assessed in 1934.
Mr. A. Evans: This is an interesting argument which weighs with me, as I hope it will with the Minister. Has the position been tested in relation to shops of lower rateable values?
Mr. Sparks: This matter has only recently been drawn to our attention, and I am not in a position to give too precise details about which shops are affected and which are not affected. There may be exceptions to the trend which I am trying to describe, and I should not like to say that all the small shops assessed in 1934 are paying more in rates than they were in the year before the new valuation lists were introduced. There may be exceptions. It depends largely on the part of the country which we are discussing.
The preliminary survey suggests, however, that this is the position of many of the shops and miscellaneous properties: the rateable value of some has not risen as steeply as the rateable value of those which in the past were comparatively
1546
under-assessed. Those which were last assessed in 1934 now have a greater percentage increase than those which first came into assessment in 1939 or even 1945–46; in the case of the latter, the increases are, comparatively, much smaller.
The position which I have tried to outline in my Amendment ought to be safeguarded in the Bill, because there is no justification for giving a special privilege to certain types of shops and miscellaneous hereditaments by which they will pay less in rates, following the passage of the Bill, than they paid previously. The Minister has already confirmed the injustice of that by inserting Clauses 2 and 3 in which he says that it would be unfair for the British Transport Commission, the Central Electricity Authority and the gas boards to pay less than they paid in the years before revaluation. That same argument applies to shops and miscellaneous properties, and all I ask the right hon. Gentleman to do is to bring those shops and miscellaneous hereditaments that are to benefit from Clause 1 into line with Clauses 2 and 3 and so establish that minimum—that none pays less in rates than was paid in the year before revaluation.
Mr. H. Brooke: This is a complicated Amendment, and I should like to start by congratulating the hon. Member for Acton (Mr. Sparks) on the lucidity with which he explained it. I think, also, that he will not resent it if I say that the idea for it may have come from the special experience of the Borough of Acton. I grant that there are certain features in the rating arrangements there that merit attention. Having looked at them myself, I understand how he came to table this Amendment, although I shall not be able to recommend the Committee to accept it.
There might be some justification—at any rate, some theoretical justification—for the Amendment if it could be shown that there were no shops or offices which, before the 1956 revaluation, were bearing more than their fair share of the rate burden. In fact, that is not the case. Acton was one of those areas—in the days when borough councils were rating authorities, and before the days of centralised valuation—that had been assiduous in keeping up the shop assessments to, or near to, current value. That is how it comes about that, in such

1547
boroughs as Acton, the increase in the assessments of shop properties has been very much less than in the country as a whole.
Of course, where the increase in a shop or an office assessment has been unusually low, as it has been in Acton, one needs to look at the cause. The general cause is that there has been a tendency, locally, in the past to assess them in the old valuation lists on a standard of valuation rather higher than was applied to other properties in the area. Consequently, these shops and office premises were bearing, in that sense, a disproportionately high share of the burden.
That is not the only type of case which might arise. I am sure that hon. Members can vasualise—although there may not be any of these in the Borough of Acton—the type of shopping street or centre which has, in common parlance, rather gone down. We can all think of those. Shopping centres or neighbourhoods have their good days and their less good days, and the value of property rises and falls. When the valuers for the 1956 valuation came along, whether in Acton or elsewhere, and judged that there was not quite the same quality in that area—and by "quality" I speak not of the quality of the goods, but of the quality of trade—one would expect that any increases in valuation which they put upon those shops would be smaller than the average for the country as a whole.
Having said that, I would invite the Committee to look at the practical results which would follow were we to accept the Amendment. What would follow would be that properties of the same class, valued on the same basis and by the same method would, in fact, be rated on different principles, and clear unfairnesses would be revealed as between one shop and another. That is exactly what we have been seeking to eliminate nationally by having this system of centralised valuation.
The hon. Member may argue that there should be a smaller reduction made under Clause 1 for classes of property which have gone up less than the average in valuation. I am not quite sure whether hon. Members would equally argue, as they logically should, that there ought to be a larger reduction than 20 per cent. where an increase over the previous valua-
1548
tion has been larger than usual, but if we do go in this direction we get into very deep waters.
Mr. A. Evans: But the point of the Amendment is that these premises should be treated on a basis of equity, and that their rate payments should revert to the pre-1956 valuation.
Mr. Brooke: If the hon. Member will follow me, he will see that that would introduce some extraordinary complications which I do not think any of us could defend.
Mr. Evans: I grant that there may be complications and administrative difficulties, but my hon. Friend's Amendment does not propose that if there should be decreases where the assessment has been higher there should also be increases where the assessment has been lower. Surely the point of the Amendment is that all of these premises should be treated on a basis of equity, paying not less in rates than was paid before the 1956 valuation.
Mr. Brooke: I understood that the hon. Gentleman was putting to the Committee the point that because certain properties had had a relatively small increase in the new valuation list over the old valuation list they ought to have an exceptionally small reduction under Clause 1. I think that the Committee is bound to accept logically that those properties which show an abnormally large increase in the new valuation over the old valuation should in some way be entitled to an abnormally large reduction over and above 20 per cent. from what they would get otherwise under Clause 1, and I do not think that would be acceptable to either side of the Committee.
I was going to point out that the hon. Member would he likely to land not only us, but also Acton, in deep waters, if he will examine the practical effect of the Amendment, he will see that it will have no effect on properties which have been added to the valuation list since the new list came into force at the beginning of the year 1956–57. The direct consequence of that would be that in Acton he might have identical shops side by side in the same street, one completed before 31st March, 1956, and one after, and both paying the same rates now, but, the

1549
moment his Amendment came into force, paying different rates for ever after. I do not really believe that he could defend that to his constituents.
Mr. Sparks: That would not apply in Acton, because there is no room in Acton to build any more shops of any kind.
Mr. Brooke: I have always thought of Acton as a progressive sort of borough where all kinds of things might be happening.
I am not sure, also, whether the hon. Gentleman has considered what curious consequences will flow when there is a change in the rate poundage of Acton.
Mr. Blackburn: When there is a change of Government.
Mr. Brooke: Some of these shop properties could, as it were, be charged a higher rate poundage than the rest of the borough. Suppose that the rate poundage in Acton were to rise. That would affect all the other properties except these particular shops specified in the Amendment, in that the excess that they had been paying would dwindle, and then, if the rates fell again, the excess would be enlarged. All these consequences, which, perhaps, he has not pursued to the uttermost, would, I think, produce a situation which he would find very hard to defend before his constituents. I am quite sure that most hon. Members on both sides of the Committee would find it difficult to explain why two shops, one new, one old, but otherwise identical, should henceforth pay rates at different levels.
9.0 p.m.
I appreciate enormously the ingenuity which has produced this Amendment, but I think that it arises out of a rather special method of valuation of shop properties in Acton under the old régime. I believe that it would be a grave mistake if we were to attempt to generalise the hon. Member's ingenious suggestion and apply it to the whole country.
Mr. Lindgren: The Minister has rather dealt with this as if it were an Acton problem, but it is not. We have such things as new towns. The Labour Party started 14 new towns, and we know that the Tory Government have been trying to destroy them ever since they came into office. His hon. Friend the Member for Hertford (Lord Balniel), who is the Minister's P.P.S., knows Welwyn Garden
1550
City, where new shops have been coming on to the rate book right up to the day before valuation. In fact, the valuations were all very new and they have the actual rents. Being a new town, the shop values were dependent on the population likely to use them. In these areas the rents have been on a certain basis for seven years and because the population has increased in seven years there was a higher rent at the end of the seven years and after that a further increase in population and a further increase in rents.
What the right hon. Gentleman is saying is that a shopkeeper who took a property knowing its rateable value, knowing its rating in 1954 and 1955 and paying his rates then, should now, because the Government want to give a present to Marks and Spencer's and Woolworth's and the banks and the brewers, have his rates reduced by one-fifth. There is no question of hardship here. There is no question of this increase of 126 per cent. in their rateable value.
These are people, very largely, who accepted properties in the last few years. The local authority was a good local authority. The rating was really on the basis of value. They were fairly rated and fairly rented and this was accepted by both sides. Now they are to be relieved of one-fifth. My hon. Friend the Member for Acton (Mr. Sparks) does not claim to be a lawyer, but he is a man of the world and knows what goes on. Therefore, it is not possible for him to put down on paper clearly what people ought to do to keep within the law. But we should have no objection if the Minister would say that he accepts the spirit of the Amendment and would ask his draftsmen to put it into the Bill. The general principle to it is not one that we can object to. The Minister says that it is shocking that one shop side by side with another should have different rates. I have never heard him or his hon. Friends object to different rents being paid. Tenants of two different shops with two different landlords have had to pay different rents. There is no question of an anomaly between the two.
Mr. Sparks: If there were two shops side by side, of equal cubic content and value, there could be no difference.
Mr. Lindgren: We will give it to the Minister that it is a question of rents

1551
differing very often, but that where rates are concerned it would be questionable. Unless the Minister is willing to give us a better answer, I advise my hon. Friend to divide against the Government.
Mr. A. Evans: Having listened very carefully to what the Minister said in reply to the Amendment moved by my hon. Friend the Member for Acton (Mr. Sparks), I must say that he did not seem to me to meet the argument which is embodied in the Amendment. He rode off on the theme that Acton was a peculiar place and that the position in Acton was different from what it was in other parts of the country. He failed to meet the essential point of my hon. Friend's Amendment.
As I understand it, the case of the Government on Clause 1 is that it is necessary to reduce the valuations by 20 per cent. because shop and other premises in that category will be bearing an undue burden of rates, because those premises have been valued upon 1956 values whereas domestic premises are valued upon 1939 values. The Government seek to adjust that difference, and they go about it by reducing the valuation of shop and other premises by one-fifth.
That being the purpose of the Government, so we are given to understand, surely my hon. Friend's Amendment
meets that very point. It lays down that none of these premises shall pay less rates than they paid before the 1956 revaluation. Therefore, any extra burden of rates which they might have had to pay will be safeguarded by the essential purpose of the Amendment. One would have thought that if the Minister's real desire was to make sure that shop premises, valued upon 1956 values, as we know, did not bear more than their fair share of rates in comparison with domestic premises, he would realise that this Amendment meets that requirement and fulfils his intention as regards Clause 1.
I hope that the Minister will not leave the matter as he left it when he finished speaking. It is true that the Amendment stands in the name of one hon. Member only, that of my hon. Friend the Member for Acton; but, in my submission, it contains an essential point which the Minister, in his reply, did not meet. I hope that he will try to address himself to that before we pass on. The Amendment does in fact attempt to achieve what the Government wish to achieve, namely, some basis of equity between commercial and domestic premises.
Question put, That those words be there inserted:—
The Committee divided: Ayes 135, Noes 157.

Division No. 62.]

AYES

[9.9 p.m.

Ainsley, J. W.

Evans, Albert (Islington, S.W.)

Jones, Rt. Hon. A. Creech (Wakefield)

Allaun, Frank (Salford, E.)

Evans, Edward (Lowestoft)

Jones, David (The Hartlepools)

Allen, Arthur (Bosworth)

Finch, H. J.

Jones, T. W. (Merioneth)

Allen, Scholefield (Crewe)

Fraser, Thomas (Hamilton)

Key, Rt. Hon. C. W.

Awbery, S. S.

Gibson, C. W.

Lawson, G. M.

Bacon, Miss Alice

Gordon Walker, Rt. Hon. P. C.

Lever, Harold (Cheetham)

Blackburn, F.

Grenfell, Rt. Hon. D. R.

Lever, Leslie (Ardwick)

Blyton, W. R.

Grey, C. F.

Lindgren, G. S.

Boardman, H.

Griffiths, Rt. Hon. James (Llanelly)

McKay, John (Wallsend)

Bowden, H, W. (Leicester, S.W.)

Griffiths, William (Exchange)

McLeavy, Frank

Bowles, F. G.

Hale, Leslie

MacPherson, Malcolm (Stirling)

Braddock, Mrs. Elizabeth

Hall, Rt. Hn. Glenvil (Colne Valley)

Mahon, Simon

Brockway, A. F.

Hamilton, W. W.

Marquand, Rt. Hon. H. A.

Brown, Thomas (Ince)

Harrison, J. (Nottingham, N.)

Mitchison, G. R.

Burke, W. A.

Hayman, F. H.

Monslow, W.

Burton, Miss F. E,

Henderson, Rt. Hn. A. (Rwly Regis)

Moody, A. S.

Butler, Mrs. Joyce (Wood Green)

Herbison, Miss M,

Morris, Percy (Swansea, W.)

Champion, A. J.

Holman, P.

Morrison, Rt. Hn. Herbert (Lewis'm, S.)

Clunie, J.

Holmes, Horace

Moyle, A.

Collick, P. H. (Birkenhead)

Houghton, Douglas

Neal, Harold (Bolsover)

Collins, V. J. (Shoreditch & Finsbury)

Howell, Charles (Perry Barr)

Noel-Baker, Francis (Swindon)

Corbet, Mrs. Freda

Hubbard, T. F.

Oliver, G. H.

Cove, W. G.

Hughes, Emrys (S. Ayrshire)

Orbach, M.

Craddock, George (Bradford, S.)

Hughes, Hector (Aberdeen, N.)

Oswald, T.

Darling, George (Hillsborough)

Hunter, A. E.

Owen, W. J.

Davies, Ernest (Enfield, E.)

Hynd, H. (Accrington)

Paling, Rt. Hon. W. (Dearne Valley)

Davies, Harold (Leek)

Irvine, A. J. (Edge Hill)

Pannell, Charles (Leeds, W.)

Davies, Stephen (Merthyr)

Isaacs, Rt. Hon. G. A.

Pargiter, G. A.

Delargy, H. J.

Janner, B.

Parker, J.

Dodds, N. N.

Jay, Rt. Hon. D. P. T.

Parkin, B. T.

Dugdale, Rt. Hn. John (W. Brmwch)

Jeger, George (Goole)

Peart, T. F.

Ede, Rt. Hon. J. C.

Johnson, James (Rugby)

Pentland, N.

Plummer, Sir Leslie

Ross, William

Ungoed-Thomas, Sir Lynn

Popplewell, E.

Short, E. W.

Warbey, W. N.

Price, J. T. (Westhoughton)

Skeffington, A. M.

Wells, Percy (Faversham)

Probert, A. R.

Smith, Ellis (Stoke, S.)

Wells, William (Walsall, N.)

Proctor, W. T.

Sorensen, R. W.

West, D. G.

Pryde, D. J.

Soskice, Rt. Hon. Sir Frank

Wheeldon, W. E.

Randall, H. E.

Sparks, J. A.

Wilkins, W. A.

Rankin, John

Steele, T.

Willey, Frederick

Redhead, E. C.

Stewart, Michael (Fulham)

Williams, W. R. (Openshaw)

Reeves, J.

Stones, W. (Consett)

Willis, Eustace (Edinburgh, E.)

Rhodes, H.

Summerskill, Rt. Hon. E.

Winterbottom, Richard

Roberts, Albert (Normanton)

Sylvester, G. O.

Roberts, Goronwy (Caernarvon)

Taylor, Bernard (Mansfield)

TELLERS FOR THE AYES:

Rogers, George (Kensington, N.)

Thomas, George (Cardiff)

Mr. Pearson and Mr. Simmons.

NOES

Agnew, Sir Peter

Freeth, Denzil

Molson, Rt. Hon. Hugh

Aitken, W. T.

Gibson-Watt, D.

Morrison, John (Salisbury)

Alport, C. J. M.

Glover, D.

Mott-Radclyffe, Sir Charles

Amory, Rt. Hn. Heathcoat (Tiverton)

Godber, J. B.

Nairn, D. L. S.

Arbuthnot, John

Gomme-Duncan, Col. Sir Alan

Neave, Airey

Armstrong, C. W.

Gower, H. R.

Nicholson, Godfrey (Farnham)

Ashton, H.

Graham, Sir Fergus

Oakshott, H. D.

Atkins, H. E.

Grant-Ferris, Wg Cdr. R. (Nantwich)

O'Neill, Hn. Phelim (Co. Antrim, N.)

Baldock, Lt.-Cmdr. J. M.

Green, A.

Osborne, C.

Baldwin, A. E.

Gresham Cooke, R.

Page, R. G.

Balniel, Lord

Grimston, Sir Robert (Westbury)

Pannell, N. A. (Kirkdale)

Barber, Anthony

Gurden, Harold

Pickthorn, K. W. M.

Barter, John

Hall, John (Wycombe)

Pilkington, Capt. R. A.

Baxter, Sir Beverley

Harrison, Col. J. H. (Eye)

Pitman, I. J.

Bell, Philip (Bolton, E.)

Harvey, John (Walthamstow, E.)

Pitt, Miss E. M.

Bell, Ronald (Bucks, S.)

Harvie-Watt, Sir George

Pott, H. P.

Bevins, J. R. (Toxteth)

Heald, Rt. Hon. Sir Lionel

Powell, J. Enoch

Bidgood, J. C.

Heath, Rt. Hon. E. R. G.

Price, David (Eastleigh)

Biggs-Davison, J, A.

Hesketh, R. F.

Price, Henry (Lewisham, W.)

Bishop, F. P.

Hill, Rt. Hon. Charles (Luton)

Ramsden, J. E.

Body, R. F.

Hill, Mrs. E, (Wythenshawe)

Redmayne, M.

Boothby, Sir Robert

Holland-Martin, C. J.

Rees-Davies, W. R,

Boyd-Carpenter, Rt. Hon, J. A.

Hornby, R. P.

Remnant, Hon. P.

Braine, B. R.

Hornsby-Smith, Miss M. P.

Ridsdale, J. E.

Brooke, Rt. Hon. Henry

Horsbrugh, Rt. Hon. Dame Florence

Rippon, A. G. F.

Brooman-White, R. C.

Howard, John (Test)

Robinson, Sir Roland (Blackpool, S.)

Browne, J. Nixon (Craigton)

Hughes Hallett, Vice-Admiral J.

Roper, Sir Harold

Burden, F. F. A.

Hughes-Young, M. H. C.

Ropner, Col. Sir Leonard

Campbell, Sir David

Hulbert, Sir Norman

Russell, R. S.

Carr, Robert

Hutchison, Sir James (Scotstoun)

Schofield, Lt.-Col. W.

Cary, Sir Robert

Iremonger, T. L.

Simon, J. E. S. (Middlesbrough, W.)

Channon, Sir Henry

Irvine, Bryant Godman (Rye)

Steward, Sir William (Woolwich, W.)

Clarke, Brig. Terence (Portsmth, W.)

Jenkins, Robert (Dulwich)

Storey, S.

Conant, Maj. Sir Roger

Jennings, J. C. (Burton)

Studholme, Sir Henry

Cooper-Key, E. M.

Johnson, Dr. Donald (Carlisle)

Temple, J. M.

Cordeaux, Lt.-Col. J. K.

Keegan, D.

Thompson, Kenneth (Walton)

Craddock, Beresford (Spelthorne)

Kerr, H. W.

Thompson, Lt.-Cdr. R. (Croydon, S.)

Crouch, R. F.

Kimball, M.

Thornton-Kemsley, C. N.

Currie, G. B, H.

Leavey, J. A.

Tilney, John (Wavertree)

Dance, J. C. G.

Legh, Hon. Peter (Petersfield)

Turton, Rt. Hon. R. H.

Davidson, Viscountess

Lindsay, Hon. James (Devon, N.)

Vane, W. M. F.

D'Avigdor-Goldsmid, Sir Henry

Lloyd, Maj. Sir Guy (Renfrew, E.)

Vaughan-Morgan, J. K.

Deedes, W. F.

Longden, Gilbert

Vickers, Miss J. H.

Dodds-Parker, A. D.

Lucas-Tooth, Sir Hugh

Wall, Major Patrick

Doughty, C. J. A.

Mackeson, Brig. Sir Harry

Webbe, Sir H.

du Cann, E. D. L.

Mackie, J. H. (Galloway)

Whitelaw, W. S. I. (Penrith & Border)

Duthie, W. S.

McLaughlin, Mrs. P.

Williams, R. Dudley (Exeter)

Eden, J. B. (Bournemouth, West)

McLean, Neil (Inverness)

Wills, G. (Bridgwater)

Emmet, Hon. Mrs. Evelyn

Maddan, Martin

Wilson, Geoffrey (Truro)

Errington, Sir Eric

Manningham-Buller, Rt. Hn. Sir R.

Woollam, John Victor

Farey-Jones, F. W.

Marlowe, A. A. H.

Yates, William (The Wrekin)

Finlay, Graeme

Maude, Angus

TELLERS FOR THE NOES:

Fisher, Nigel

Mawby, R. L.

Mr. Wakefield and Mr. Bryan.

Motion made, and Question proposed, That the Clause stand part of the Bill.
9.15 p.m.
Mr. Mitchison: Might I move, Sir William, to report Progress so that the right hon. Gentleman may consider his position and that of the Government?
The Temporary Chairman (Major Sir William Anstruther-Gray): I am reluctant to accept such a Motion. I think we had better get on with discussing the Question, "That the Clause stand part of the Bill".
Mr. Blackburn: It is significant, Sir William, that you put the Question, "That

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the Clause stand part of the Bill", and not, "That the Clause, as amended, stand part of the Bill".
The Parliamentary Secretary in his opening speech on Second Reading, and the Minister in his closing speech, referred to the Bill as an interim Measure. Clause 1 is the Bill, and it is clear that if it had not been that the Government wanted to introduce Clause 1, we should never have seen anything of Clauses 2 to 6 at the present time. Is it not the position that practically all the Government's legislation with regard to local authorities consists of interim Measures? The Government's motto vis-à-vis local authorities seems to be "Keep them dizzy". No sooner have local authorities become accustomed to one set of laws and regulations than another comes along. Since the Conservative Government came into office in 1951 we have had ten changes in interest charges. We have had four changes in the rate of housing subsidies, so that the subsidies have now gone entirely, except for one or two special classes. Consequently, adding that to the high interest rate, to a great extent house-building is coming to an end.
Mr. J. T. Price: My hon. Friend will forgive me if I ask him to make it perfectly clear that interest charges have been constantly going up and subsidies for the public welfare constantly going down, which is a picture of the history of the Government in the last five years.
Mr. Blackburn: My hon. Friend and I are in agreement about this matter. If the Minister is not aware that house building is ceasing in many local authority areas, then his present information service is not very good.
In 1954 we had the Housing Repairs and Rents Act which was introduced by the present Prime Minister and which was "Operation Rescue." "Operation Rescue" was found to be "Operation Flop." The Prime Minister's Act had to be thrown overboard and another Measure introduced, the new Rent Bill. The present Minister should take comfort from the fact that he is dealing with the Rent Bill and this Bill, because judging by what happened to the Prime Minister, the present Minister must be in line for very high promotion.
In 1955 we had the Rating and Valuation (Miscellaneous Provisions) Act. No
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sooner had local authorities tried to get accustomed to the application of that Act, than along came the Minister with this Rating and Valuation Bill. Local authorities had not gone into their stride with the previous Measure. No local authority knows exactly where it is with the 1955 Act, for the simple reason that the Government insisted that twelve months should be allowed in which objections could be made. Even now, no local authority knows the sum total of objections or appeals to be made.
That is a very serious matter. In two towns in my constituency the amount outstanding, because of appeals, is equal in one case to a 10d. rate and in another case to a 1s. 2d. rate. They do not know how long it will take before the appeals are settled. Now the Government have come along with this Bill at a time when local authorities are already in a difficult position and when rates will have to be increased because of rising prices.
The Bill does not have the merits of the Local Government Act, 1929, as I said in the debate on the Money Resolution last Thursday, because the 1929 Act gave some compensation for the loss of rateable value when industry was derated to 25 per cent. and agriculture derated entirely. The only excuse which the Government can reasonably give for introducing the Bill is their own incompetence.
Obviously the Government knew exactly in 1955 what the position would be. The then Minister of Housing and Local Government was warned often enough. He was warned of the great outcry which there would be against what he was doing, and the large number of appeals which would be put forward. If anyone knew the position, it was he. He knew what the new valuation scale would be. If in his opinion it was likely to be unfair to shopkeepers and business premises, that was the time for him to decide what to do. He should not have put through that Measure, as he did, and then, a few months later, come forward with another to upset what he had done. The only excuse which the Government have is their own incompetence.
I regard as very serious the statement made by the Minister earlier tonight that he could not alter the Bill because it would upset financial officers of local authorities. Quite apart from the fact that he seems to have a very low opinion

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of the ability of financial officers, the rest of his argument was very dangerous. He said, "They know what is going to happen under the Bill. The Bill was printed on 21st December. Therefore, they have known since then exactly what was going to happen", implying that the Bill which the Government had printed on 21st December must definitely be the same Bill that emerges from the House.
The Government are introducing Bills and allowing no Amendments to them. Bills are being passed through the House without a single change. A similar criticism applies to the Money Resolutions being brought forward in connection with Bills. They are being drawn in such a restricted way that hon. Members are not able to move Amendments which they consider ought to be moved. The House is being made a cipher, or a rubber stamp for the decisions of the Cabinet or the Minister. There is no chance to use whatever wisdom there may be in the Committee or the House; the Government have a large majority, and we are merely a rubber stamp for whatever the Government care to put before us. It is a most dangerous position, and we must fight against it.
We are not allowed to bring forward any Amendment to the Bill, with regard to the rerating of industry. It is true that the Minister has promised that at some time in the future, after he has discussed the matter with local authorities, industry will be rerated to the extent of 50 per cent. instead of 25 per cent., but was there any reason why that provision could not have been included in the Bill? It is no use for the Minister to say, "I have to discuss this matter with the local authorities". We can tell him now that every local authority would agree with him if he said that he was going to rerate industry 100 per cent. He does not need to go to local authorities to ask what are their views on the rerating of industry; he knows exactly what those views are.
We shall have to accept the position. The Government have the majority. They have not accepted one Amendment on the Clause. They are using their majority to drive through their decisions. Their supporters are not even present to listen to the debate to discover what are the arguments, because they know that even
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if they listen and are convinced by the arguments that we put forward they will still not be allowed to vote according to their consciences, but will have to follow the decision of the Government. We must protest at what is happening in all these matters. I shall have great pleasure in voting against the Clause.
9.30 p.m.
Mr. Ronald Bell: I have great pleasure in supporting the Clause. I know that it is put forward by the Government as a temporary measure, and the only reason I have not sought, by means of an Amendment, to make it a permanent provision is that the Long Title of the Bill would make such an Amendment out of order.
I consider that this is a very much overdue amendment of the law upon which rating is based. At present, it is based upon the net annual value of the property. We have what has now become a permanent provision whereby that is altered in respect of industrial property which pays only 25 per cent. of the rate. I gather that the amount will soon be 50 per cent. Some hon. Members opposite have attacked that and, also, in the debates on the Bill, have attacked the provision of derating as something which is inherently unjust, saying that commercial premises should pay what some people have described as their fair share of the rate burden.
I will not enter into any argument about what ought to be the total contribution that taxation should make to the equalisation of wealth in the community. But, whatever we decide is the right contribution, we should try to make it in a reasonably compact and sensible way, and not mess up every bit of our taxation system with considerations of social policy. We should concentrate that operation into central taxation, and, if we can do that, we should then concentrate it into two or three taxes, leaving the others to be based on a more rationalised and specific consideration.
Net annual value, the value of property as the basis of rating, is a very old institution in our country. It goes back about three hundred and fifty years, from the time of the dissolution of the monasteries. When the monasteries were dissolved, the poor were not cared for in any other way, so the Poor Rate was introduce to care for them and—
The Temporary Chairman: Order. The hon. Gentleman is getting far away from the Question.
Mr. Bell: With respect, Sir William, I was describing the system which is modified by this Clause. Naturally, my reason for supporting the Clause is because I support the modification of that system. It is a system designed to charge a man according to the value of his property. It was adopted as the basis of rating law in this country simply because the rating law is based on the Poor Rate. The Poor Rate was instituted on the dissolution of the monasteries as the way in which people could relieve the poor. When we approach rates as a method of relieving the poor it is sensible—
Mr. Lindgren: Is it not a fact that the relief of the poor is a matter for the National Assistance Board, and has had nothing to do with local authorities since the 1948 Act?
The Temporary Chairman: That is not a matter for debate. The hon. Member for Buckinghamshire, South (Mr. R. Bell) is getting away from the Question.
Mr. Bell: With respect, Sir William, the hon. Member for Wellingborough (Mr. Lindgren) has made precisely the point I was about to make.
That is the reason this assessment, this basis, is anomalous. Our rates are no longer simply for the relief of the poor. They are something quite different in modern times. They are a charge for services rendered by the local authorities, services of a very varied kind with which we are all familiar; and the method of charging a man in direct relationship to the value of the property he occupies is no longer suitable as the basis of rating in present times.
Because I hold that view, I think that the change introduced by this Clause, which extends derating from industrial property to commercial property, is desirable in itself and is inherently just. Which of us imagines for a moment that the shop in the main street, which is, perhaps, valued at twenty times as much as the shop in the side street, gets twenty times as much value from the rates? Often enough it does not get any more value from the rates at all. I suggest that that is not a very sensible
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method of securing local revenue in modern times. It should basically be a charge for services rendered.
I hope that the principle enshrined in the Clause will gradually be a permanent part of the rating system of the country. Hon. Members opposite are not very willing to listen to a case with which they happen to disagree, but after a little more thought on the subject they will not disagree with me quite so much as they do now. We have to recast our method of financing local government and there is no great virtue in making it a party matter for hon. Members opposite.
The Deputy-Chairman: The hon. Member is getting too far away from Clause 1.
Sir Leslie Plummer: On a point of order, Sir Gordon. Is not the hon. Gentleman's speech the most interesting that we have yet had from the Government side of the Committee?
Mr. Bell: I am deeply susceptible to the compliment. I believe that what I was saying was not only interesting, but relevant. The system to which I was referring is modified by Clause 1. I was trying to make the point that hon. Gentlemen opposite should regard it as a matter of some principle that the system of rating in this country is basically the same as it was three hundred and fifty years ago.
Mr. J. Harrison: Three hundred years ago, if I remember rightly, the rate collector in Sherwood Forest was armed with a hatchet. There were no difficulties of the kind that have been mentioned today.
The Deputy-Chairman: These remarks have nothing to do with Clause 1. The hon. Member for Buckinghamshire, South must confine his remarks to the modifications made by the Clause.
Mr. Bell: I have a most interesting passage in my notes which I should like to read, but I fear I should be ruled out of order. It describes the method by which rates were levied three hundred years ago. I will show it to the hon. Member for Nottingham, North (Mr. J. Harrison). It starts with persuasion by the minister of the Church and ends up with the obstinate refuser being thrown

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into the local gaol. That method of enforcement is not relevant to Clause 1.
I was drawing attention to the principle of assessment. An Amendment of the kind I would like to see would be out of order, but I do not want to see the Clause passed without repeating what I have said on previous occasions, that the Clause foreshadows the real future shape of local government taxation. When we approach that subject, I hope that hon. Gentlemen will not do it in the partisan way that some of them have shown this evening.
Mr. Tom Brown: I want to register my protest against the acceptance of Clause 1. Sitting through the debate, I thought I was living in two Englands, one for the rich and another for the poor—because Clause 1 removes some of the burden that should be left on the shopkeepers' and business premises and passes it on to the poorer people, the domestic ratepayers.
The Ministry of Housing and Local Government performs many useful functions [HON. MEMBERS: "Hear, hear."] Yes, it does, and I give the Ministry credit. But that is its job, and one of the functions which the Department has to perform is to see that fair play is shown to all municipalities. When the statement on local government finance was made on Tuesday last, by the Minister, he tried to impress upon us that it was his desire and the desire of the Ministry to help the local authorities, but now the right hon. Gentleman comes along at this time, a most inconvenient time for municipalities, with a Bill which will make it more difficult for the local authorities to manage their financial affairs.
Throughout the country there is overwhelming evidence against Clause 1. I have received many dozens of letters, many coming from areas where the councils are not Labour-controlled, all protesting very strongly against what is contained in the Clause. I suggest that practically every local authority in Lancashire, including parish, rural district, urban district, borough and city councils, will experience financial difficulty as a result of this Clause, and I challenge the Minister to deny that. I have here a list supplied by the Lancashire County Council, indicating that these authorities are likely to experience great difficulty.
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I say to the right hon. Gentleman and to the Ministry that it is manifestly unfair to do this at this time, or, indeed, to do it at any time. It would have been much better if the Government had waited until there could have been a complete overall examination of local government finance, and then we could have put forward proposals which would have helped considerably the finances of local authorities. Instead of that, the Government come along and try to rush this Measure through. It does not behove the right hon. Gentleman to say on Tuesday that he and his Department are out to help the local authorities, and, on Thursday, to refuse the Amendments put down to the Bill from this side of the Committee.
An attempt has been made, in these Amendments, not to make the Bill a model Bill, but to improve it, and, to use a customary phrase of the Prime Minister, to get a just balance. We must have an even balance, but there is no balance at all in this Bill. All the benefits are on one side. They are on the side of those who are in a position to pay and against the poorer people.
One of the illustrations which we have given, and which has been rejected by the Minister, was the case of licensed premises. There, we are to give the brewers two concessions, one under the heading of derating and one by reducing by one-seventh or one-fifth the rating on business premises. In my judgment, it is manifestly unfair. The Minister and the Department ought to have waited a month or two longer and then have come forward with a Bill to which we could all subscribe to on a fair basis.
9.45 p.m.
On 31st January we had a debate on the effect of damage by mining subsidence. I am not going into that question now, Sir Gordon, because you would rule me out of order, but those local authorities which are affected will suffer a great deal more by this Clause because their rateable value will be reduced. They are experiencing difficulties now in trying to repair damage which has been done and will continue to be done so long as mining goes on. Their task will be more difficult by this Clause, because of a reduction in rateable value.
I wish to mention some local authorities in the constituency I have the honour

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to represent. We have to accept this Clause, but we should not do so without a strong protest, which I now make. It will reduce the rateable value of the township I have the honour to represent by £4,632 and a neighbouring urban authority, Up-Holland, will suffer a reduction of £1,635. Ashton-in-Makerfield, which is suffering great financial hardship through mining subsidence, will have a reduction of £6,500. How can we expect local authorities to remedy damage which has been done through subsidence when we make their position more difficult by reducing rateable values? With all the fairness with which I approach the question, I cannot believe that the Government are doing the right thing by pushing this Measure through the House and I protest against Clause 1 standing part of the Bill.
Mr. Sparks: I wish to oppose Clause 1, first, because it is the most objectionable Clause in the Bill and, secondly, because I think the right hon. Gentleman and the Government are taking deliberate steps in this Clause which will create untold difficulties in the future adjustment of our rating system to achieve equity.
All hon. Members who have had experience of local government will know what a nightmare the absence of any fair system of valuation for rating has been over the years because assessments in one part of the country compared with another have been so unbalanced. Many parts of the country were underassessed and others, by comparison, were overassessed. The state of valuation prevailing was in the utmost confusion.
As a result of that state of confusion it was agreed by both sides of the House—by hon. Members opposite as well as hon. Members on this side of the Cornmittee—that the time had come, after the lapse of twenty years, to revalue the hereditaments of England and Wales and to attempt to establish a uniform system of valuation for rating which would give a greater measure of equity and justice to the ratepayers, wherever they may be. To achieve those purposes, valuation for rating was taken out of the hands of local authorities—
The Deputy-Chairman: The hon. Member will appreciate that he is going rather far from the Question, "That the Clause stand part of the Bill."
Mr. Sparks: I was about to relate the cause of the Bill. I am endeavouring to show that by means of the Bill the Minister is undermining a basis of valuation for rating which for more than twenty years has been urgently required by local authorities. I cannot do that unless I complete, as I have almost completed, an outline of the background. This task of valuation for rating was given to valuation officers of the Inland Revenue.
The Deputy-Chairman: This is out of order on the Question. "That the Clause stand part of the Bill."
Mr. Sparks: The Clause interferes with the basis previously set out for valuation. It proceeds to effect a measure of derating on valuations which have been regarded as fair and just and which have been standardised throughout the country. The evil which already exists in the derating of industrial heraditaments is to be taken a stage further in order to derate shops and miscellaneous properties by 20 per cent. That is interfering very seriously with the equitable basis of valuation which the Inland Revenue valuation officers have computed. It is a challenge to their accuracy and to the whole basis of their assessments.
What does the Clause mean in relation to the rateable value of local authorities? The standard rateable value now established by the new valuation lists has already been lowered by industrial de-rating. The Minister is now proceeding to derate shops and miscellaneous properties. The effect of the Clause is to reduce by roughly £45 million the rateable value of shops and miscellaneous properties. Already industrial derating involves a loss of rateable value of £72 million, even taking into account the Minister's new proposals, to which he has referred several times today.
The Minister's new proposals are to derate industry by 50 per cent. instead of by 75 per cent. Even taking that into account, local authorities will lose £72 million of industrial rateable value. That, added to the £45 million loss of rateable value from the derating of shops and miscellaneous properties, gives a total of £117 million loss of rateable value to local authorities by measures of derating. It remains for the domestic ratepayers, who are by far the largest ratepayers in the

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country, to shoulder the burden involved in this loss of rateable value.
What does the right hon. Gentleman's proposal mean in terms of loss of revenue? Earlier today I tried to give some figures for loss of income to local authorities. The Minister queried them and suggested that they were wide of the mark. Those calculations were made very hastily on the spot and were very rough, but since then I have been able to obtain a more accurate figure of the precise loss of rate income which will result from the Clause 1 proposals.
The loss of rate revenue, taking into consideration the reduced rateable values contained in Clause 1, amounts to approximately £31½ million. That is to say, that loss is to be transferred in the main to the domestic householders. They will have to pay it. That additional payment will have to be made on top of the other burden which the householders are carrying as a result of industrial derating.
The right hon. Gentleman spoke more than once about how his new proposals for derating would assist the local authorities. He was trying to infer that his proposals would be a counter-balance to this loss on shops and miscellaneous properties. All that his proposals mean in relation to rate income is that the industries now paying approximately £28 million on the present year's valuation lists will pay just over £53 million. In other words, they will pay about £25 million more in rates, but what is significant is that the right hon. Gentleman said that it would not be fair to ask the taxpayers to finance that concession.
By that he means—and I hope that he will correct me if I am wrong—that the loss to the Treasury of tax arising from increased rates to be paid by industry will be made good by reduced Exchequer grants to local authorities. Therefore, we are entitled to assume that the loss of tax, which is equivalent to about 8s. 6d. in the £, will be deducted from the Exchequer grants. That will reduce the £25 million increased rate revenue to approximately £14½ million.
The balance of about £10,700,000 is the figure which he will take back in reduced Exchequer grants to make good to the Treasury the loss of tax resulting from the increased rates to be paid by
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industry. Actually, therefore, his concession is worth only about £14½ million to local authorities. By comparison, there is placed upon local authorities and domestic ratepayers an increased burden of £31 million, and they will then be left with nearly £17 million losses to be made good. The right hon. Gentleman's loudly-trumpeted and so-called concession to the ratepayers means very little indeed.
It has been most marked in this debate today that very little has been said either from the benches opposite or by the Minister and his Parliamentary Secretary about the burden on the domestic ratepayers. They have argued for the shopkeepers and the miscellaneous hereditaments and for everybody else. They have said that the shopkeepers are bearing a heavy burden, along with the banks, the publicans, the theatres, the cinemas and all the others, but never a word has been said about the ordinary householders. Their attitude has always been that everybody deserves to be considered except the householders, and that the householders can be left with increased burdens year by year whilst other sections of the ratepayers are given relief.
10.0 p.m.
The Minister went on to juggle with percentages and tried to show that the domestic ratepayers are not paying quite so large a percentage of the rates as they were last year and that therefore they must be better off. But that is not the proper measure of the burden falling upon the ordinary folk, including the domestic ratepayers.
We have these significant figures before us by way of comparison. If we take the amount of rates paid by ratepayers in 1914 we find that they represented a burden of £1 18s. 11d. per head of the population. In 1940 the population were paying £4 17s. 1d. per head on the rates levied. In 1950 they were paying £6 10s. and in 1956 £9 0s. 5d. In the present year 1956–57 it will be found that the rate burden is equal to £10 18s. 6d. per head of the population.
Those figures may seem small but, in fact, they represent a considerably increased burden upon the ordinary people who year by year have been asked to carry heavy burdens by way of rate increases. The burden varies according to the part of the country which one

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considers. The heaviest burden is borne by the population of London. In 1955–56—the year before the new valuation list, and it will be very much heavier under the new list—people were paying £17 2s. per head on the rates levied as against £12 5s. per head in 1948–49.
London bears by far the highest burden in the country. I think it will be found when this year's figures are produced that the cost to London people per head of the population will be far above £17 2s. which it was last year, and it will probably be more than £20 per head.
Mr. Mitchison: A little over £23.
Mr. Sparks: I do not want to weary the Committee too much with these figures, but taking the administrative counties outside London, in 1948–49 the population in those counties bore a rate burden of £5 10s. per head. In 1955–56 it went up to £7 17s. What the figures are for this year I do not know, but they will be considerably higher.
In the county boroughs the cost has gone up from £6 9s. per head of the population in 1948–49 to £9 5s. in 1955–56. In the non-county boroughs and urban districts it has gone up from £6 3s. to £8 15s. In the rural districts it has gone up from £3 19s. to £5 17s., and in Wales it has gone up from £4 10s. to £6 17s.
These figures are all one year old and, as I have said, the information for the present year is not yet available; but when it is, having regard to the fact that the expenditure of local authorities is up by £87 million this year compared with last year—from £401 million to £488 million—it will be found that the figures per head will be much higher than those which I have given tonight.
The position is rapidly being reached where the ordinary domestic ratepayers are having burden after burden placed upon their shoulders. They are having an additional burden placed on them by Clause 1 of the Bill. Rents are to be increased, and in the new valuation list, which will come along by and by, these householders will experience another crack of the whip because their assessments will rise very considerably. In fact, in the Committee upstairs, we are
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now laying down the basis of the new assessments for rates in the new valuation list by doubling the gross values of rents of controlled premises, but I cannot talk about that tonight because I should be quite out of order if I did so.
So the domestic ratepayers are having a very hard and difficult time as a result of the policy of the Government. There is no justification whatever for Clause 1. The new valuation list put right a series of anomalies in the rating system of the country. If the rating assessments of some shops and some miscellaneous properties appear to have gone up to rather a high figure, that is due entirely to the fact, as my hon. Friend the Member for Sowerby (Mr. Houghton) said, in a very fine speech which he made earlier tonight, that they have enjoyed for more than twenty years underassessments and have not been called upon to pay their fair share of rates to the local authorities.
Now that they have been caught up by a system of valuation which is designed to be fair and just in equity to all ratepayers, the right hon. Gentleman wants to maintain the inequality and perpetuate the anomalies which the new valuation list attempted to eliminate. So the Measure is a thoroughly reactionary one. It merely shifts the burden from one set of ratepayers to another. It does not give to the domestic ratepayers the justice which they are entitled to receive from this House, namely, relief from the staggering burden which they are carrying from year to year.
Mr. Charles Doughty: I will not unduly detain the Committee which, I know, is anxious to divide on the Question, "That the Clause stand part of the Bill." This Clause is one which will give fair justice to that half of the community which pays rates upon its shop and other hereditaments. We talk as if there are two separate sets of people, one which keeps shops and other hereditaments and one which lives in private dwellings. They are, in fact, exactly the same people, because shopkeepers also live in private dwelling-houses.
Mr. Mitchison: How does the hon. and learned Gentleman house a limited company?
Mr. Doughty: If the hon. and learned Member is unaware of the simple facts of life, I will explain them to him in

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detail. The limited companies have managing directors, directors and managers. Each one of these lives in a separate house, or hereditament.
Mr. Lindgren Mr. Lindgren rose—
Mr. Doughty: I cannot deal with two interruptions at once. I am telling the hon. and learned Member for Kettering (Mr. Mitchison), who obviously does not know, the simple facts about limited companies. People live in private dwellings, and in the case of a limited company it is not one person but a great many.
Mr. Lindgren: To carry that argument a little further, most of those charge their rents and rates against their businesses.
Mr. Doughty: In the case of their businesses, but not in the case of their private dwellings. If I may, with respect, say so, that is quite untrue. If they attempted to do it, the Income Tax authorities would not allow it for one minute, and the hon. Member knows it.
This Clause gives justice to those whose rates are assessed on shops and similar premises and is a very fair and honourable Clause in a very important Bill. The position is that they have been assessed in a manner which, they feel, has treated them with injustice; and I must say that I feel sympathy with that. They have been assessed at present values instead of 1939 values, and this Measure goes some way towards bringing matters as regards such premises into fair balance with the position of those who live in private dwellings. I could elaborate on this topic at some length, but I know that the Committee is anxious to pass the Clause, so I will say no more.
Mr. Mitchison: I beg to move, That the Chairman do report Progress and ask leave to sit again.
I do so in order to ascertain the Government's intentions. It is perfectly plain that many hon. Members have observations to make on Clause 1, and, if I may say so, with few exceptions such observations as we have had already indicate the importance and value of the observations which are about to come. We should, however, be in a better position to appreciate those observations if we were able to hear them at an earlier hour of the day.
I do not think the right hon. Gentleman is likely to be seriously inconvenienced;
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we heard today that this Bill is to be further proceeded with during next week. I trust, therefore, that the right hon. Gentleman will be able to tell the Committee that he now proposes to adjourn, and that we may resume discussion on the Motion, "That the Clause stand part of the Bill," on a day next week.
Mr. H. Brooke: If the hon. and learned Gentleman the Member for Kettering (Mr. Mitchison) really has this unique power to foresee all that is going to be said by his hon. Friends on future occasions, that gift must be of great value to his party Whips. My understanding of the matter is that it has been agreed through the usual channels that it would be appropriate to devote a day and a half to the Committee and remaining stages of the Bill. Accordingly, at half-past three this afternoon business for next Wednesday was announced, which included the finishing off of this Bill and some other legislative business. That was my understanding; I shall be corrected if I am wrong.
Mr. E. Fletcher Mr. E. Fletcher rose—
Mr. Brooke: I should like to continue, if I may; I want to be helpful to the Committee. My hope had been that we would complete the Committee stage of the Bill this evening and then devote our time next Wednesday to a debate on Third Reading. I quite appreciate that a number of hon. Members might wish to speak on the Third Reading of this important Bill.
I am in the hands of the Committee. If the hon. and learned Member for Kettering can give me an assurance that, if we adjourn at a reasonably early hour this evening, it will be possible to complete the remaining stages of the Bill by seven o'clock on Wednesday so that the House can then proceed to the other business which has been announced, I can tell him that I am doing quite enough now not to have any personal wish to sit late tonight; but we must secure the passage of the Third Reading of the Bill by a reasonable hour on Wednesday. If that assurance can be given, I should like to meet the wishes of the Opposition; but if in fact we should be leaving too much over for consideration next Wednesday, then I think we shall have to proceed a little longer tonight.
Mr. Mitchison: May I first assure the right hon. Gentleman that my knowledge of the value of my hon. Friends' future observations is based on a knowledge of their character and experience; he can rely upon that. May I next remind him that nothing whatever was said in the announcement of business today about the completion of this Bill. We were told merely that further consideration of the Bill would take place next week. I trust that we shall be in a position to adjourn now and proceed to further consideration of the Bill, without any such undertaking from our side of the Committee as that for which the Minister has asked, at a suitable time next week. May I remind the right hon. Gentleman once more that we shall be in a better position to deal with the matter when we are fresh and when we are not having invitations from his hon. Friends to divide?
10.15 p.m.
Mr. Brooke: The amount of work that remains for us is this. We have to complete the discussion of Clause 1, and I quite appreciate, as my eyes have told me, apart from the prognostications of the hon. and learned Member for Kettering (Mr. Mitchison), that there are several hon. Members who wish to contribute to the debate on this subject. There are Amendments to Clause 3 to be debated. My understanding is that the new Clauses may not be found to be in order, so that there is not as much as would appear on the Amendment paper that will actually fall to be debated.
The substantial business, and I think I shall carry the Committee with me on this, is to complete the main discussion on Clause 1 and then to debate the Third Reading of the Bill. If it is possible to reach an understanding between the two sides of the Committee to complete the remaining stages of the Bill by seven o'clock next Wednesday, I certainly do not want to press the Committee to sit longer. However, I am bound to say that we cannot let the Bill run on for an indefinite period. As the progress today has not been as great as I had hoped, I cannot advise the Committee to accept the Motion unless, as I say, some such reasonable assurance as I have suggested can be arrived at.
Mr. Mitchison: There is, of course, a certain unreality in the right hon. Gentle-
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man's expression of his interest in the Bill since he has already made it perfectly clear, not for the first time, that he is not going to accept any Amendment whatever may be the arguments and reasons in favour of it. But, allowing for that, I think that the right course at the moment is to withdraw the Motion and to intimate that we shall revert to the subject later in the night. That being so, I beg to ask leave to withdraw the Motion.
Motion, by leave, withdrawn.
Question again proposed, That the Clause stand part of the Bill.
Mr. A. Evans: I am sorry that we should have to continue the debate on the Clause at this time of night, but the Minister has left us no option. It is surprising that the right hon. Gentleman has insisted throughout our deliberations today that no part of Clause 1 should be amended in any respect. That is the more surprising in view of the widespread opposition which exists in the country to the Clause. The Minister must surely be aware—although from his attitude one would think that perhaps he was not—that every association of local authorities throughout the country has gone on record in opposition to the Clause. In the face of that widespread opposition, the Minister has insisted that the Clause remain unaltered.
The opposition to the Clause is not confined to the local authorities and to my hon. Friends. Forty hon. Members on the Government side of the Committee failed to register their support for the Clause. The Government are in a very weak position as a result of the Clause.
Mr. Ellis Smith: How do we know there are only 40 Conservative Members who do not support the Clause?
Mr. Evans: In view of the widespread opposition to the Clause, one would have thought the Minister would have been more amenable to our Amendments.
I want to place on record the severe burden which the Clause will place on my local authority. The Metropolitan authorities will suffer very severely. Apparently it is not appreciated that authorities like the Metropolitan Borough of Islington will carry an extremely heavy burden, a higher burden even than that which will be carried by Oxford and

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Cambridge together. My borough will lose rate income to the extent of £250,000 as a result of the Clause. The responsibility for paying that money will be taken from prosperous concerns, such as banks and multiple stores, and transferred to domestic ratepayers.
It is surprising that a Minister concerned with local government should so often put forward Measures which are apparently against the interests of local authorities. On many occasions we have had legislation which is against the interests of local authorities, but never in my experience have I known a Minister so rigidly oppose Amendments supported by every local authority association in the country, as on this occasion.
Mr. Proctor: All the decisions of the Government about rating and valuation during the last few years have been foolish. We had a revaluation which was many years overdue, and the basis of it was 1939 values for some property, 1955 values for other property, and a quarter of the 1955 values for the great industrialists. It was obvious to anyone who studied the situation that that would work out unfairly for some sections of the community.
I have no hesitation in stating that I think it worked out unfairly for shopkeepers, especially the small shopkeepers, who are in great difficulties and have not the same facilities for passing on charges as some of the great industrialists have. We were bound to get unfairness on that basis. The obvious and proper thing to have done would have been to alter the basis on which industrialists paid one-quarter of their rates. That plea was made by every hon. Member on this side of the Committee, but the Government absolutely refused it.
We are face to face with a conspiracy on the part of the Government to throw the whole burden of the future development of local government upon domestic ratepayers. We have seen that done in housing, where the whole burden of new housing has been thrown on local ratepayers and upon the housing estates of local authorities. The whole basis has been made unfair.
I want to draw attention to the statement of the Minister, on Tuesday. A great deal of praise has been given to that statement. He accepted the principle of increasing the rate burden of the
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industrialists from 25 to 50 per cent. If he had brought that proposal into the Bill, that would have been a fair compromise for a temporary situation. He gave great praise to the local authorities. He said that he was to review the local government system and then he said—and this was rather ominous—that it was essential to improve the financial relationship between local national government.
The Deputy-Chairman: The hon. Member must confine his remarks to the Clause.
Mr. Proctor: I am dealing with what has brought the Bill about. I want to point out that it would have been fair if the 50 per cent., which the industrialists are to pay, had been provided for in the Bill. When the Minister referred to the 50 per cent., he said that the Government intended to make a major recasting of the financial relationship between the Exchequer and local authorities.
The Deputy-Chairman: Order. The hon. Member must confine himself to the Clause.
Mr. Proctor: Will it he possible for me to point out that the Minister said he intended to revise Exchequer grants?
The Deputy-Chairman: That is not in the Clause with which we are dealing.
Mr. Proctor: The Bill does not meet the present injustice. Had the Government accepted the Amendments to the Clause, the 50 per cent. to be paid by industry would have been included in the Clause and the problem would have been settled in a fair and just manner. The Government's real intention is to so recast the future relationship between local authorities and the Government as to deprive local authorities of the value of the rerating of industry when it takes place. What is harmful is that the Government do not propose to bring forward rerating of industry to deal with what is manifestly an unfair situation.
Without the rerating of industry, and the payment by the great industries of their full share of local rates, an unfair burden is being carried by the other classes of ratepayers.
10.30 p.m.
Mr. H. Butler: I had hoped that the Minister would accept the Motion to report Progress. Obviously, I cannot discuss that matter now, but I suggest

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that it would be advisable not to make a hurried decision on the Clause. We should not rush it through, because the guts of the Bill are in it.
It is true that a representative gathering of local authorities unanimously decided—and I should hate to use the language which they used about the Clause—that there ought to be some consultation between the local authorities and the Minister. It would be advisable to consider the implications of this provision at a time of day when we have clearer heads and possibly clearer thoughts.
There is one technical matter which I wish to discuss. I have been advised by someone who was a rating officer before rating valuation was taken over by the Inland Revenue that there are certain hereditaments covered by the Clause, such as cinemas and licensed premises, where part of the basis of valuation is calculated by reference to profits. During the war I was chairman of an assessment committee, and we had to consider certain factors which had arisen from the war, such as the fall in profits of petrol stations because of rationing. We had to decide whether that should be taken into account in fixing the rateable value of the premises. Similarly, some cinemas were closed for the safety of the population, and we had to consider the losses involved.
I understand that under Clause 1 those hereditaments the gross value of which is ascertained by reference to the profits basis already have an advantage. An hon. Member opposite intervened to suggest that a managing director of a company with shops in Regent Street and Bond Street, Manchester, Leeds, Liverpool, Brixton, and even in Hampstead, where the Minister lives, was also a ratepayer as a householder. Such a man might have a considerable number of shops throughout the country, but obviously he would be a domestic ratepayer in only one place unless he also had a country house and a flat in Chiltern Court paid for out of the profits of the company. But assuming that he was an honest man, a reasonable sort of fellow, he would normally have one house.
We are entitled to assume that the man referred to did not live in Regent Street, Manchester, Liverpool and so on,
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but only in one or two of these places. Therefore, the property in which he lived, and for which he paid rates as a domestic ratepayer, was not on the same basis as the property with which he dealt as director or manager of a limited company. He would get certain benefits from the operation of the Clause which would not be passed on to him as a domestic ratepayer, wherever he might live, even if it happened to be in Hackney Wick in a house of £10 rateable value, in a slum.
I revert to the implications of the Clause as it affects properties the rateable value of which is in part determined by the profitability of the business. I do not know how far this Bill will deal with that situation.
When I sat in an assessment committee or as a magistrate to determine whether a public house was redundant, the barrelage at the public house was examined to ascertain how many barrels were sold and whether the premises were required at that spot. When we had decided on the assessment we had to take into account the value. In these days people do not drink so much beer out of barrels. I believe that they have it out of bottles, or rather the beer comes out of the bottles and they drink it out of glasses; that is, if they are civilised people, as we are in Hackney.
In Clause 1 there is a factor which has to be determined by someone. So far as I can ascertain there is no reference to this matter in the Bill. My hon. and learned Friend the Member for Kettering (Mr. Mitchison), as a member of what are called steering committees, has attempted on many occasions to instruct me in the meaning of the expression "to leave out line so-and-so and to insert line something else", but I must confess that I cannot follow it. However, from reading the Bill it seems to me that no such provision has been made.
The rating officer who drew my attention to the matter states that the assessments on profit-based hereditaments were not generally increased in the same proportion as other commercial properties in relation to the previous values for assessment. I do not know whether that is dealt with here, but in addition to my general opposition to Clause 1 and to the whole Bill because of its implications,

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I oppose it because it is passing on a burden to people who in many cases are overburdened already.
Many hon. Members on this side of the Committee assume that assessments on residential property have remained at the former figure or been reduced. But the figure for my house has been increased from £34 to £53 and, as a consequence of the Bill, I shall have to pay 53 times Is. 8d. It annoys me to think that the brewing companies will take some of my money and give it to brewery company directors who do not even live in the neighbourhood in which I reside.
Mr. Houghton: Does my hon. Friend realise that, like the shopkeepers, he was under-assessed?
Mr. Butler: I am grateful to my hon. Friend, but I shall not fall for that one. It so happens that I have made a proposal to the authority, and I hope that at some time in the distant future I shall be able to object to the assessment of my property.
That aspect of the matter constitutes one of our objections to the Bill. In my own borough there are many appeals to be heard and it is impossible to say when they will all have been heard. Taking all these factors into account, I can assure my hon. Friend that I do not agree with the assessment made in my case. When the local authority was responsible for the assessment I could talk to "the boys"—[Laughter.]—but the Inland Revenue Authorities are a little more distant. I still feel that I have had a bad deal. I maintain that we should discuss this matter at considerable length, and I hope that the Minister will be able to explain the technical point which I have raised.
I understand that cinema owners do not now make profits out of showing the statistics of Sabrina, but out of selling ice cream. If this benefit is to be passed on to those individuals, I think that we should have some statement from the Minister about whether the basis of assessment to which I have referred is to be used in that case. I oppose the Bill on many other grounds in addition to those which I have mentioned.
Mr. Granville West: One of the effects of the Bill will be that the Minister of Housing and Local Government will be regarded as Minister for an entirely different purpose. The legis-
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lation which he has brought forward since he has occupied his present office has not been to encourage either housing or local government. Perhaps he will tell us whether there has ever been in the history of local government a Minister who has faced such widespread opposition as he is facing from the local authorities which it is his function to serve. I know of no authority which is in favour of the proposals which the Minister is bringing forward.
The rating and valuation system is anachronistic. I find a good deal of sympathy with the arguments of the hon. Member for Buckinghamshire, South (Mr. R. Bell). He took the view—although I do not agree with his conclusions—that the present rating system is so absurd that he favoured the Clause because it went some way towards diminishing the rating and valuation system.
Mr. Houghton: I thought the hon. Gentleman supported the Clause because it made rating more absurd than ever.
Mr. West: That was the logic of the argument. He supported the Clause because it created such further anomalies in the system that sooner or later the system would break down, and we should even have the Minister settling down to devise a system whereby justice and fairness can be achieved in the raising of local revenue. There is great difficulty in present circumstances. We must find a means whereby local revenue can be raised and at the same time the independence of the local authorities be maintained. That is the great difficulty which all reformers of rating systems have had to face.
We have been trying to achieve uniformity in the rating system. The reason why valuation was transferred to the Inland Revenue was to achieve some measure of uniformity. What uniformity are we achieving? The domestic occupier is rated upon a 1939 valuation while industrial hereditaments are rated upon the present commercial basis, but are allowed derating to the extent of 75 per cent. Shops are now assessed on the current value and are to receive a 20 per cent. relief. We are reaching a situation of such confusion that the Minister ought to scrap the Bill and devise one that will be fair to all people.
Small shopkeepers ought to be warned that they will not get anything like the

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benefit that they are led to believe they will get from the Bill. They will be bearing the burden for the large multiple stores which have been able out of their profits to make delightful properties with all sorts of amenities ranking for Income Tax rebate and which, because they have increased the letting value of their premises, will get the 20 per cent. allowance. The small shopkeeper will have to pay increased rates by reason of the concessions made to the multiple stores. Here we have an extension of the injustice to the small taxpayer.
10.45 p.m.
The domestic occupier will have to pay increased rents under the Rent Bill, and the right hon. Gentleman is at the same time increasing the rates which he will have to pay. Gradually the small householder will be forced into a position in which, with increasing unemployment and short-time working as a result of the policies of the right hon. Gentleman and his colleagues, increased rents, increased rates and the higher cost of living, he will find it completely impossible to make ends meet. At the same time the big multiple stores, which in recent weeks have issued bonus shares because of vast profits they have accumulated, are to get the benefit of the 20 per cent. allowance.
It is most unjust and unfair. Hon. Gentlemen opposite and the right hon. Lady opposite, the Member for Manchester, Moss Side (Dame Florence Horsbrugh), should view this matter in the interests of the people which they represent. They should recognise that here an injustice is being perpetrated on the small householder. I appeal to them to say that this Clause ought not to be allowed to pass. For my part, I shall be proud to vote against it.
Mr. James Simmons: I speak because I have an obligation to do so. When I was elected I said that I would represent the whole of my constituents and not just those of one party.
I have had a communication from my urban district council, which has not a single Labour representative on it. They are all Conservatives, but no one has put their point of view and it devolves on me to do so. That council points out that if Clause 1 is agreed to its total rateable value will be reduced by £5,000 and the product of 1d. rate will be reduced by approximately £18.
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Staffordshire County Council also has a Tory majority—
Mr. Julian Snow: Temporarily.
Mr. Simmons: I agree with my hon. Friend that it is a temporary aberration on the part of the electors who allowed the Tories to get a majority on the county council. The council is perturbed about this Bill, and especially about Clause 1. It says:
"The loss of rateable value in 1957–58 is estimated at £416,000 and consequently the product of a penny for 1957–58 is less than it would otherwise have been by some £1,616. The county rate levied in 1956–57 (including the rates levied for Special County Purposes) was 9s. 8d. in the £. But for the Bill a rate levy of the same amount in 1957–58 would have produced an additional £216.895. As a result of the Bill it is now estimated to produce an additional £36,110 only—a loss of £180,785."
That is what the Clause means to the Conservative-controlled Staffordshire County Council.
"The additional sum which could have been raised in 1957–58 without any increase in the county rate would have been a material contribution to the county council's estimated increased requirements for next year. As a result of the Bill, this material contribution is not available and can only be produced by an increase of 5.6d. in the county rate."
These Conservative-controlled authorities therefore strongly object to the Clause as adding an unjustifiable burden to the general ratepayers in the urban districts and the county.
This Bill is a piece of class legislation. The small shopkeepers now take the place of the widows and orphans about whom we used to hear so much in Tory propaganda in the old days. The Tories sheltered the big shareholders and big company directors behind a screen of widows and orphans. During the war we heard about the enemy using women and children as screens for the troops and we condemned them for it, but the Tory Party has always used the weak and the helpless to screen its despicable actions against the majority of the people.
Consider the position of the brewers. When I was a youngster we did not have motor-coaches—that will show how old I am—but we went out in charabancs on Band of Hope trips. When we passed a public house we used to sing. "Let us close the public houses and join the Band of Hope". The brewers have joined the Band of Hope. Their Band of Hope is the Tory Party. The Tory Party helped them in the new towns.

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The brewers will still be derated by 50 percent., even under the Government's new proposals. Now we are asked to debate the public houses a little further.
I may be biassed, but I do not believe in "booze". It is a horrible thing. It is responsible for crime and for juvenile delinquency. The brewers are already responsible for costing the country an enormous sum of money for police, remand homes and lunatic asylums, because "booze" drives people mad. The brewers are a burden on the community. We have to pay all this money on measures to counteract the effect of strong drink upon the people, and now we are being asked to make a further concession to the brewers in this Clause.
The small shopkeepers will be also-rans among those who benefit from the Bill. They will be the least of those in the community who derive any benefit from the Clause. Woolworth's, Marks and Spencer's, British Home Stores, Wolfson—we know that he is Great Universal Stores Ltd. [An HON. MEMBER: "The wolves."] They are all wolves. All these financial sharks and wolves are to derive enormous benefit from the Clause.
Mr. William Yates: I would rather the hon. Member did not refer to "The Wolves" like that.
Mr. Simmons: I can tell Staffordshire men that I do not refer to Wolverhampton Wanderers in the context in which I referred to the wolves and sharks of big business, who will derive enormous benefit from the Bill. Yet hon. Members opposite have the infernal impudence and the colossal cheek to pose as the friends of the small shopkeeper. The small shopkeepers will not benefit by—I do not know the proportion, but it is a very small one as compared with that derived by the great multiple stores.
Then the "bookies" will come in as well. It is polite, of course, to call them commission agents—it sounds better—but I call them "bookies". Their offices will be derated—and look at the swindles they will get away with. And what about the football pools—Littlewood's, Vernon's, and the rest of them? The rateable value of their offices will be reduced. Look at the swindles they get away with. Someone gets £75,000 with a lucky line, and then gets killed soon afterwards. Nearly every winner of £75,000 meets with an untimely end or
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gets into trouble. But Littlewood's and Vernon's do not; they can afford to give out 75,000 "quid" again and again in order to make their enormous profits. This Bill will help them.
This is a monstrous Bill, and it is a monstrous imposition upon the intelligence of our people to ask them to believe that the Government, by Clause 1, are showing that they are in sympathy with the small shopkeepers. Their sympathy is with the people with the moneybags, who pay a bit into the party funds for Tory Election purposes.
Mr. H. Brooke: After that rousing speech I am concerned about the future of hon. Members. I do not want them to go to bed with frenzied minds, which might keep them awake tonight, after this debate. It has rather changed its inactive character in the last few minutes. An hour or so ago I resisted the Motion of the hon. and learned Gentleman the Member for Kettering (Mr. Mitchison) to report Progress. I felt that we had not got far enough to render it possible, in view of the number of hon. Members who wished to speak, to complete the Bill within a reasonable time next Wednesday.
I understand, however, that there have been conversations through the usual channels; and now that it has been possible, in this last hour, for a number of hon. Members to make their contributions, I am given to understand that it should be possible to complete the discussion of this and the remaining Clauses. and the Third Reading, by about 8 o'clock on Wednesday of next week. On that understanding, I beg to move, "That the Chairman do report Progress and ask leave to sit again."
Mr. Mitchison: I merely rise to confirm the understanding which the right hon. Gentleman has stated, and to say that some of my hon. Friends and others of us may wish to continue the debate on the Question" That the Clause stand part of the Bill, "which will, of course. correspondingly abbreviate the discussion on the Third Reading. Finally, may I say that, having sat so long, we are reluctant to go to bed before hearing the result of the by-election at Lewisham. North?
Question put and agreed to.
Committee report Progress; to sit again upon Monday next.

FACTORY DEVELOPMENT, MERTON (PLANNING PERMISSION)
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Oakshott.]
10.59 p.m.
Mr. Julian Snow: The matter I desire to raise tonight is a somewhat tragic story of the frustration of an industry in this country in the face of what I can only describe as a complete dichotomy of interest and ambition between two Departments of Government. I realise perfectly well that within the space of approximately twenty minutes I cannot hope to give a very detailed account of what has transpired in this case. Nevertheless, I shall hope to prevail on the Minister to have another look at a decision which he took in the matter of the location of an industry in London which is trying to operate in overcrowded and hopelessly inadequate conditions, and which tried to fulfil its ambition to obtain new land.
The history in this case is, I fear, somewhat typical of what goes on too often with enterprising firms which find themselves confronted with that vast new bureaucracy which has, I think, been called the "new despotism," which my own party bears equal responsibility for producing and which we now must try and get into gear and suited to the economic requirements of our country. Years ago, I wrote a little pamphlet on the location of industry. I fear that it is not known, and practically nobody here has ever read it; but what I said then still holds good. Our job in administering the affairs of this country is to try to make things easy for a man or an industry trying to do something good for the country's economy, not to put difficulties in the way.
For fifteen months, from the moment when it obtained a development certificate from the Board of Trade, this company strove to secure planning permission from an urban district council in Surrey so that it might secure and use land for a new factory. The seriousness of the case, in my judgment, lies in the unmerited frustration of what was a very great enterprise. For obvious reasons, I
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do not wish to mention the name of the company, although I have in fact sent to the Minister a very detailed brief on the case so that he knows most of the facts. So far as I can judge, there is not a bit of party politics in the matter at all, and therefore I was not very worried lest he should be able to "get one over" on me if I did send him the brief.
This company has a big export potential and a very promising market in the United States. I may perhaps say, incidentally, that it is a company which manufactures powered hand tools, such as drills, buffers and the like. It was quite recently approached by an enormous American chain store and mail order company to provide 10,000 units, but was simply unable to accept the order, an order which would have been worth in the neighbourhood of £160,000 sterling and which would, incidentally, have earned dollars.
The Minister may say that the procedure has been gone through as laid down by existing legislation, notably under the Town and Country Planning Act, 1947; an appeal was made, an inquiry was held by an inspector of his Department, the Minister considered his inspector's report and then gave his decision. He may say that he cannot really go back on his decision.
If the Minister were to reply on those lines, I should quite understand it, but I should make two important points. I cannot find any law which says that a Minister cannot have second thoughts. Indeed, I claim that there is at least one case, involving a cement company in Derbyshire, when the noble Lord, Lord Silkin, then Mr. Silkin, did as Minister in fact go back on a decision made by him after a public inquiry, though in that case he gave it in favour of the planning authority.
Since I submitted the documents in this case to the Minister to examine, a rather curious thing has happened. The land in question is being reserved by the Surrey Planning Authority for the use of non-conforming users within the county. Yet, although the Minister has allowed two appeals in the case of industries from outside which wanted to go to this land, since I sent the Minister the documents a third case has come up.

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This is the case of a company which apparently wants to bottle and distribute—and I find it wholly deplorable—what I would describe as "a soft American drink". I gather I am not offending any company when I use the suffix of the hyphenated name of this drink, which is a "Cola" drink. I cannot understand how it is possible for any planning authority to say it is not right that an outside industry manufacturing powered tools which has a big export trade should have this land, yet it is right for an outside industry to come in and have a bottling and distributing organisation on the same land.
If the Minister has occasion after this Adjournment Motion to examine it, I will give him this information—that I do realise this "Cola" bottling plant will occupy only something like two-thirds of the requirements of the company of which I am talking. But, as a matter of principle, it seems quite unreasonable that our export ambitions and aspirations should be treated in this way. If the Minister sticks to the claim that a decision, once given, is irrevocable, then there is very little that can be done by this firm—a firm established in 1940, at a critical time, with great success behind it, and now being confronted with all these difficulties.
What is left to the company to do? Does it start an application order again and again go through the whole system of trying to get permission? The land in question, in point of fact, is owned by a reputable company which gave an option to the company which I am discussing. The curious thing is that these owners were given permission to develop in 1946. Yet, when the Minister was applied to, to ask if that permission was still valid, his Department said that they were not prepared to express an opinion.
What is going on behind the scenes? I sometimes wonder whether important cases like that ever really get to the Minister. I have been a member of the governing body of this country, and I am aware that the Minister is physically incapable of seeing every case. When I tell the House that this company's proposed factory site is within 900 yards of the frontier between Metropolitan London and Surrey, they will realise how artificial is the distinction which is being levelled against this company. This company is a non-conforming user in the
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Metropolitan area, yet because it happens to be 900 yards on the wrong side of the frontier it is being treated in this way.
I also want to discuss the conduct of the inquiry. Although an industrial development certificate had been given by the Board of Trade, after an exhaustive inquiry into all aspects of the case, including a visit to the site and consideration of all the planning responsibilities so far as that Department was concerned, when it came to the inquiry, there was no representative of the Board of Trade there. We all know the weakness of this procedure—a matter at present before the Franks Committee, and one which I brought to the attention of Sir Anthony Eden some time ago in connection with the proposed atomic power plant at Bradwell-on-Sea, in Essex. One cannot examine witnesses who might be favourable to one's case, because they come from another Department of the Government.
In this case, the deputy clerk of the urban district council conducted the case on behalf of the planning authority. I have no wish to imply criticism of the gentleman, but the deputy clerk of an urban district council is hardly the appropriate person to engage in a case in which experienced Queen's Counsel are appearing for the objectors and the applicants. I do not think that he had the necessary knowledge and experience behind him. Of all things, he had apparently been briefed to say that this company had not been trying hard enough in the export market. What a farce such an inquiry is!
I have sent the Minister figures of this company's export achievements. The industrial development certificate, when granted, included the phrase:
"… proposed development conforms to the proper distribution of industry in the country as a whole."
In the foreword to the development plan for Surrey, the then chairman of the county council made this comment about planning in general:
"There is a general recognition and acceptance today of the need for sound town and country planning, so far as this can be achieved within the practical limitations of our country's difficult economic situation."
Within that context, what a shabby way to treat an enterprising company which wishes to enter the county!

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Is there any evidence to show that the land will be used for non-conforming users for which it is reserved? As a matter of fact, it is land which is expensive to develop and only a fairly solid company could go into that sort of expense. I am prepared to bet that within five years, unless something is done about this sort of case, that land will still be undeveloped and not built on. There is no record whatsoever of a non-conforming user having been rehoused on this land.
I want to revert to the sort of figures for exports of this company with which we are dealing, and I make no apology for emphasising exports. I think the Minister will accept that this is a prime consideration. This company is at present exporting goods valued at about £167,000. It believes that if it had this land and could build this new factory, on present form—one must have these balances in one's argument—it could export goods valued at about £630,000, a fairly substantial proportion of that sum in dollars. Furthermore, although present production is largely concerned with electric motor powered tools, a new market is developing for tools operated by a compressed air system, in other words, a vast potential market waiting to be entered.
There is another point. Supposing this company is made to transfer its operations to a site far away. What will happen to its labour force, a large proportion of which is women? It takes three months for a woman to be trained for winding operations. I am not an electrical engineer, but the Minister and I probably understand what is involved in that. If the factory were sent away, it would certainly lose most of the women winders and staff, because women are not easy to shift. They want to be near their homes and, at best, are prepared to commute. Unless the new factory is near Fulham, the company will lose a large part of its existing trained female labour.
At the inquiry a Mr. Gale gave evidence in support of the county planning authority, to be more precise, in support of the urban district council. Mr. Gale. I suppose, had been brought into consultation with Mr. Durrant, the chief planning officer of the county. At the inquiry, Mr. Gale said two rather significant
1588
things. If I had not seen the typescript of the report of the inquiry, I should not have believed it. I quote to the Minister what Mr. Gale said:
"I agree that the industrial development certificate will have been given after a review by the Board of Trade of all the circumstances, national and local."
I do not desire to take any evidence out of context. When the Minister looks at the document, he will accept that it is not out of context. Mr. Gale also said:
"My objection is founded"—
And this is county Chauvinism if ever I saw it—
"upon the county boundary"—
which is nine hundred yards away.
"I cannot consider the matter apart from the county, because my appearance here is to implement the county policy. I cannot, therefore, concede that the county policy can be in any way wrong."
I would just revert in history to the inquiry into the Surrey county plan. On the 14th day of that particular inquiry, Mr. Durrant, who was the chief planning officer, referring to another objector on that occasion who wanted to develop—the Minister knows the name—said:
"If this company had a development certificate from the Board of Trade, I would feel that would be,the answer to the planning authority. They would accept the fact that the labour position would not be upset by the influx of a new firm."
When this evidence given by the chief planning officer was brought to the attention of Mr. Gale at this inquiry, he said:
"That does not affect my view."
I ask the Minister how he can reconcile these two points of view.
I am particularly anxious to try to help this firm. I am in the happy position of not having to disclose an interest, not even a constituency interest. The hon. Member opposite in whose constituency this factory site lies, whom I did consult about the propriety of rasing this matter, had no objection. I think that the Minister is duty bound to have another look at this case. I have tried to show that there has been an occasion where the Minister had a look at a decision made. I have said that I do not think there is any law which prevents him from looking at this decision. I believe that new factors have arisen—for instance, allowing this "Cola" bottling industry to come in virtually in the same position

1589
—a few yards away from the site I am discussing tonight.
I think that we owe much to a firm which is the inspiration of a family of enterprise and which can make a big contribution to exports, but which has been treated very badly indeed. That is where my case rests. I would ask the Minister to investigate it again.
11.19 p.m.
The Parliamentary Secretary to the Ministry of Housing and Local Government (Mr. J. R. Bevins): The hon. Member for Lichfield and Tamworth (Mr. Snow) has raised several questions on one particular case which concerns the policy of planning authorities towards industries which are concentrating particularly on the export trades. He has made it clear that he is concerned primarily with this one particular firm, at present based in the London area. I am very much obliged to the hon. Member for the way he has co-operated with me and my Department in the discussions in this case.
At the present time this firm occupies premises in the London area, covering an area of about 38,000 sq. feet, and as the hon. Gentleman rightly said, the firm wishes to put up a factory of about 60,000 sq. feet in the Merton and Morden District Council area. It applied to the planning authority for permission to go ahead. It was refused that planning permission chiefly on the ground that the use of premises for industry in metropolitan Surrey should be restricted to the use by non-conforming industries whose relocation was desirable—non-conforming industries being those industries which are already located in non-industrial areas, as a rule in the Greater London area.
There is no doubt at all that the industrial competition—and indeed other competition—for land in metropolitan Surrey is very acute indeed. In order to prevent the continual expansion of the Metropolis, the Surrey County Council is co-operating in trying to establish a green belt, which is in fact included in the county development plan, which has not yet been approved but is at present under consideration.
As one would expect, on the London side of the green belt demand for land is
1590
very, very great indeed. That being so, the local planning authority in allocating what limited land is available tries to keep a balance between competing demands. In those circumstances, I think it was very natural that Surrey should decide, as it did, to reserve land for industrial development for the relocation of those non-conforming industries which have got to remain within the area. The fact that the land available for industrial use in metropolitan Surrey can, unfortunately, take only a fraction of the industries which will be displaced from non-industrial London areas is in itself very important.
The hon. Gentleman has expressed doubts whether this limited area of land in metropolitan Surrey will ever in fact be taken up—in the near future, at any rate—by industrialists coming out of London. I agree with him entirely that so far this land has not been taken up, but I urge him to consider that in the circumstance it can hardly be otherwise because the resiting of badly-situated industries in London cannot be done all at once, and very often it will have to wait until the area where they are sited—that is, in London, Fulham or wherever it may be—is to be re-developed.
The hon. Gentleman also referred to the fact that the Board of Trade issued an industrial development certificate and that subsequently the planning authority, upheld by my right hon. Friend, took a course which apparently was in conflict with the decision and action of the Board of Trade; but, again, while the Board of Trade undoubtedly did issue the certificate, it is also true that the certificate itself carries no assurance that planning permission will be forthcoming at a later date. It is simply an essential preliminary without which an application for planning permission cannot be made.
It is important to understand that the granting of an industrial development certificate is without prejudice to the planning decision which, after all, is based on considerations affecting the use of land rather than consideration that affect trade or the future of our export industry.
This firm's appeal against the planning refusal which was inflicted upon it was dismissed by the then Minister of Housing and Local Government on the ground

1591
that its proposal meant not merely a relocation of its works, but also a substantial expansion. I concede at once that from the purely commercial point of view that may seem curious, but to have allowed the appeal would certainly have conflicted with Surrey's policy to reserve the available land simply for relocation of non-conforming industries rather than their relocation and expansion. That is an important distinction which has been quite deliberately made by the Surrey County Council and which forms part and parcel of the statement of policy which accompanies its development plan.
I agree with the hon. Gentleman about the need for speedy decisions, and, indeed, more speedy decisions than have been forthcoming in the last year or two. As the House knows, planning authorities are required in the ordinary course of events, to give their decisions in two months, and it is to be regretted that in this case the firm had to wait about five months.
Mr. Snow: It is expensive, too.
Mr. Bevins: I agree. It is also true that if an applicant has not received a decision from a planning authority within two months, he has the right to appeal to the Minister as if the application had, in fact, been turned down. I also desire to express my regret that the consideration of this firm's appeal took as long as six months. In mitigation, I can only say that the Department of my right hon. Friend has been extraordinarily busy in the consideration of appeals in recent times, but I should like to add an assurance that steps have been taken to expedite the consideration of these appeals.
The hon. Gentleman has also complained—I understand the nature of his complaint and sympathise with it—that in the administration of planning we ought to recognise the high and urgent claims of the export trade. While that may be so, it is not always easy to reconcile commercial and planning con-
1592
siderations. They do not always march together. Very often planners defer to the point of view of business people and exporters, and generally to commercial considerations. But it is not always possible to do so. Unfortunately, this was such a case, chiefly, as I say, because of the deliberate and avowed policy of the Surrey planning authority.
The hon. Gentleman asked whether anything could be done about the decision of the Minister, and suggested that there might have been times when the decisions of Ministers have been revoked. From advice I have been able to obtain, these planning decisions on appeal are final and irrevocable and if this firm or other firms desired to reopen the issue, the initial procedure would have to be gone through all over again.
I have discussed this matter with the hon. Gentleman, and while I can hold out no hope of any modification of my right hon. Friend's decision on the appeal, we are most anxious to be helpful, because, of course, exports are important, as the hon. Gentleman rightly says. If he would be prepared to leave it with my right hon. Friend and myself, we should be prepared to discuss this matter with the Board of Trade with a view to suggesting suitable alternative sites where perhaps labour difficulties are not very great and where planning obstacles are not likely to arise. For the moment, I cannot go beyond that. I assure the hon. Gentleman that, so far as it is possible for my right hon. Friend and myself to be of assistance, we shall be only too glad to help.
Mr. Snow: I am grateful to the hon. Gentleman for his final remarks. I am optimistic that he will do something about this, bearing in mind that it is vital that this firm should not have to lose its trained female staff. In my judgment, a site must be found near to the existing site, and I hope that he will do something about that.
Question put and agreed to.
Adjourned accordingly at twenty-nine minutes past Eleven o'clock.

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Preamble
The House met at three of the clock, The EARL OF DROGHEDA on the Woolsack.
Prayers

CINEMATOGRAPH FILMS BILL
3.5 p.m.
Amendments reported (according to Order).
Clause 2:
Levy on exhibitors
(3) The Board of Trade shall discharge the duty imposed on them by subsection (1) of this section in such manner as will secure—
(b) that the amount to be so yielded in respect of each such period after the first will, in their estimation, be neither less than two million pounds nor more than five million pounds.
LORD LUCAS OF CHILWORTH LORD LUCAS OF CHILWORTH moved, in subsection (3) (b), to leave out "five" and insert "seven" [million pounds]. The noble Lord said: My Lords, I have placed this Amendment on the Marshalled List not with any great hope that the noble Lord, Lord Mancroft, will accept it, but to illustrate to him the fluidity, if I may use that expression, of this particular problem. Noble Lords will remember that upon the Committee stage I sought to remove from the Bill the minimum and the maximum figure which is inserted in Clause 2 (3). Your Lordships will see that paragraph (a) of that subsection reads:
"that the amount to be yielded by way of the levy in respect of the first period in respect of which it is imposed will, in their estimation, he approximately three million seven hundred and fifty thousand pounds."
The next paragraph in the subsection states:
"that the amount to be so yielded in respect of each such period after the first will, in their estimation, be neither less than two million pounds nor more than five million pounds."
I argued that to have a limit either one way or the other was completely wrong, because the economic circumstances of those who have to pay the levy, the exhibitors, and the economic requirements of those who will receive the levy,
854
the makers, will be outside the range of either £2 million or £5 million. I thought that my suggestion was eminently sensible. I thought that the Government's reply was non-sensible. But that is the ordinary way of argument, and I do not suppose that the noble Lord, Lord Mancroft, will agree with me.
But it has transpired, oven since we debated this matter in your Lordships' House, that the all-industry committee which was set up, charged with co-relating the information that will enable the industry to present its case to the Chancellor of the Exchequer for a remission of the excessive burden of entertainments tax, now says that the minimum requirement of the producing side of the industry will be really £7 million, not less. So I sock to put in here the figure of £7 million I want the noble Lord to be aware—if he expects any further Amendment of mine, in which economic circumstances are taken into account—that£2 million will not come into any sensible calculation; that£5 million will take the place of £2 million, and the maximum figure will be something which I cannot really estimate, and no one in the industry can estimate, at the present time. That is the reason why I am putting forward this Amendment at this stage of the Bill. I shall be very happy if the noble Lord will accept it. I shall not be disappointed if he does not, because I am certain that the battleground of this particular subject will move from your Lordships' House to the confines of the consultations which will take place between the film industry, the Chancellor of the Exchequer and the President of the Board of Trade in the not-too-distant future. I beg to move.
Amendment moved—
Page 3, line 4, leave out (" five") and insert ("seven").—(Lord Lucas of Chilworth.)
THE PARLIAMENTARY SECRETARY, MINISTRY OF DEFENCE (LORD MANCROFT): My Lords, like so many of the arguments which the noble Lord, Lord Lucas of Chilworth, has advanced with regard to this Bill, this argument is superficially attractive, and one which, at first blush, it is not easy to discountenance. There is, of course, no magic about these figures of£2 million at one end, £3¾ million in the middle and £5 million at the other end. I have not tried to justify them actuarially, nor

855
would I try to argue against the noble Lord's £7 million as a mathematical or business forecast. But why stop at £7 million? I can make a good case for £9 million. And since, on the Report stage, we are not allowed to make more than one speech, I could leave my noble friend Lord Fairfax of Cameron to make an admirable speech for £11 million. But we have to draw the line somewhere. We have to fix some sort of a scale. I argued this point both at Second Reading stage and at the Committee stage.
LORD LUCAS OF CHILWORTH: The noble Lord is quite right in saying that we are not allowed to make more than one speech but that does not prevent my asking a question. So may I ask the noble Lord this? Suppose, in the discussions which are to ensue, the industry makes a cast-iron case for the £11 million which he has just mentioned. What happens then? Do the Board of Trade have to go to Parliament with an amending Bill, or do the Board of Trade have to say to the industry: "Well, we admit your case; it is absolutely cast-iron, but the Statute says five so you must go hungry away"
LORD MANCROFT: I think the answer is perfectly clear. In those circumstances, we should require an amending Bill. I think that must be so. I will try to answer the noble Lord's question further in a few moments, but let me now come back to the reasons why we are trying to stick to the £2 million and the £5 million.
The arguments which we advanced, on Second Reading and at the Committee stage were, broadly, that the producers need to know what the lower limit may be, in order that they can foresee reasonably stable conditions in which to work some time ahead; and exhibitors, who, after all, have to pay, want to be reassured about the total amount they may be expected to contribute. I think I expressed the hope—which I trust was not merely a pious one—that both sides would recognise the need of the other for having an upper and lower limit; and I may add that both these limits in our opinion appear to be reasonable. Is an upper limit of £5 million reasonable? I suppose the producers' arguments against it could be that such a limit fixed for
856
the next ten years takes no account of a possible increase in the number of films produced, nor of a possible increase in costs; nor, I suppose, of a possible change in the value of money. The exhibitors—and possibly the Chancellor of the Exchequer would march with them on this point—would be bound to ask where the money was to come from, however desirable and justifiable it might be to provide it. The economic circumstances of the producers, the exhibitors, and indeed the country as a whole, have to be considered and balanced against each other; and, if we did not know it before, after the passage of this Bill we shall be well aware that that is extremely complicated.
I concede to the noble Lord that in five years' time a sum of £7 million, and possibly even £10 or £11 million, might be both justifiable and possible; but—and this is where we part completely I—do not think it is either of these things in present circumstances. I agree that we are legislating for the future, but we must not lose sight of the fact that £7 million for this fund represents an amount considerably more than the present earnings of producers from showings in the United Kingdom; we cannot get over that mathematical fact. If I were pro posing this Amendment, instead of the noble Lord, it would be hard for me to stand here and justify a fund and form of financial assistance of the order he proposes. The noble Lord asked what would happen if the Government's prognostications proved false, and the fund was not enough to be able to do the job Parliament wants it to do. All I can say is that, taking all the circumstances into account, the upper limit of £5 million at the moment seems to be reasonable and one which may command acceptance from the people who, after all, have to pay. But if in three or five years' time it should prove that the noble Lord is right, though I hope not, and that that amount is unreasonable, I am certain that the right thing to do would be to have it considered and debated afresh by both Houses of Parliament and amended, upwards or downwards, by fresh legislation.
We must face the fact that writing into the Bill a limit of £7 million would immediately give rise in the minds of those concerned to the thought: why stop at

857
£7 million; why not £9 million, or £10 million, or £11 million? We have calculated a figure of £5 million as the right upper limit. We may be wrong, but I think that it is financially sound and desirable to limit the amount to that sum. I do not want to tell the noble Lord that his calculations are wrong, because he may be right and I may be wrong, but we have calculated this figure very carefully, though admittedly not on an actuarial basis, as the top limit to which producers may look with hope and exhibitors with fear, I think that it is the right figure to fix, though I do not say that one day we may not have to reconsider it; but the time is not now, in this Bill.
LORD ARCHIBALD: My Lords, as usual, the noble Lord, Lord Mancroft, has made a most persuasive defence of the Government proposal, but he will not be surprised that I do not find it entirely convincing. His argument that £5 million is calculated by the Board of Trade as being a reasonable upper limit would have been more convincing if he had given some idea of the factors which they took into account in their calculation. He has completely failed to refer to the point which my noble friend made and which, by the way, I made on Second Reading: that the all-industry tax committee, having got out voluminous figures, unanimously agreed that £5 million is the amount required at present, not the amount that may be required in a few years' time, when, possibly, more films are being made or when costs have gone up. Therefore, it is somewhat extraordinary to find £5 million being defended as a reasonable upper limit to put into a Bill which is to operate for a period of ten years.
I think the noble Lord will agree that if, in a few years' time, the producers find, and the Board of Trade consent, that the upper limit of £5 million is completely inadequate, it will be poor consolation to them to know that it can be changed by new legislation. We are all familiar with the plea "We are in complete sympathy with you. We agree that this should be done, but there just is not any Parliamentary time available for new legislation." And on that plea, the industry may drift along for years on what is acknowledged to be an inadequate basis. It is easy to ridicule £7 million as the
858
figure and say, "Why not £9 million or £11 million?"—or £13 million or £15 million? That simply emphasises the logic of our earlier Amendment, which was rejected, to take out the limit altogether and leave it to the good sense of the Board of Trade, which we appear to trust more than the noble Lord who speaks for it.
LORD MANCROFT: Make it a straightforward subsidy, in fact.
LORD ARCHIBALD: It is no more a subsidy in tie one case than in the other. If there is no limit in the Bill and next year the Board of Trade fix the amount, not at £3¾million, but at £4 million, that £4 million is no more a subsidy if there is no limit than it is when there is a limit of million.
The £4 million will be paid under the same principle, under the same legislation, and it is really too bad for the noble Lord to suggest that merely taking away the upper limit changes the method of payment. It does not do anything of the kind. In any case, it is not a subsidy. The noble Lord knows as well as I do that this is merely a transfer of entertainments tax from the Treasury to the producers, using the exhibitors as the mechanism of transfer. It has been that since the Eady plan was first adopted, and that it is going to be that in future is indicated by the reference of the noble Lord to the fact that the Chancellor of the Exchequer, who marches with the exhibitors on this, would also have to look twice at it. I do not think there is any doubt that the upper limit of £5 million is completely unrealistic. An upper limit of £7 million would make it only a little more realistic, but it certainly would be better. It would be best to have no limit at all and leave it to the good sense of the Board of Trade, but if we are not to have that I support £7 million as being a more reasonable figure than £5 million to have in the Bill.
LORD LUCAS OF CHILWORTH: My Lords, still keeping within the rules of order of Report stage, I can reply to the noble Lord, Lord Mancroft. Unlike my noble friend, I find the noble Lord's argument absolutely convincing—but not against this Amendment. The noble -Lord used precisely the same argument against this Amendment as I used on Committee stage in support of my noble

859
friend's Amendment to leave out the figure altogether. The figure might be £9 million or £11 million.
LORD ARCHIBALD: It might be £1 million.
LORD MANCROFT: Is the noble Lord leaving out of his calculations the fact that the producers may hit upon greater efficiency and greater production and bring down the figure?
LORD LUCAS OF CHILWORTH: No, certainly not. The £7 million is only the top limit. At the end of the period you could give the producers 2½d.; that would not affect the figure of £7 million which I seek to put in the Bill. The Bill would then say that "it shall not be more than £7 million." What the noble Lord and I should do is periodically to change sides, because the noble Lord can put up a better argument in support of my Amendments when he replies on one date, and I am certain that I could put up a better defence than he puts up on another date. However, we cannot work Parliamentary procedure like that. Nevertheless, my object has been achieved, because the noble Lord has admitted to the industry—and I hope the industry will read it with great interest—that the figures in this Bill are completely meaningless.
LORD MANCROFT: No.
LORD LUCAS OF CHILWORTH: Yes; the noble Lord has said that, if he will forgive my saying so. He has said that it is not £2 million, it is not £5 million, and it may be £11 million—and if the industry want £11 million and they make a case for that amount, there will, of course, have to be an amending Bill. Why put in any figure at all? However, so long as the industry now know that they need have no inhibitions at all when they discuss this matter with the right honourable gentlemen the Chancellor of the Exchequer and the President of the Board of Trade, and need not be guided by these figures but can talk about any figure so long as they can justify it with fact, figures and argument, that is all I want. I now have not the slightest objection to asking your Lordships' leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
LORD LUCAS OF CHILWORTH LORD LUCAS OF CHILWORTH moved to add to subsection (3):
"and, in determining the amount referred to in paragraph (b) of this subsection, regard shall be paid to the prevailing economic circumstances of both exhibitors and makers of British films as well as the prevailing level of production of such films."
The noble Lord said: My Lords. I hope that what I have already said to your Lordships may be the basis upon which the noble Lord, Lord Mancroft, can accept this Amendment. Subsection (3) (b) of Clause 2 says:
"that the amount to be so yielded in respect of such period "—
that is, the period of one year for the next ten years—
"after the first will, in their estimation "—
that is, the estimation of the Board of Trade—
"be neither less than two million pounds nor more than five million pounds."
I then seek to add to that the words given in my Amendment. I attach great importance to this Amendment, and I hope to convince the noble Lord, Lord Man-croft, that it is right that Parliament should lay down to the Board of Trade, in this new departure—because this statutory levy is a completely new departure—the principles which shall be followed in arriving at the amount of the levy upon the exhibitors.
The argument that I should have advanced against my previous Amendment, if I had been the noble Lord, would have been this. The one thing we have got to guard against in the British film industry is the production of bad films. We have been through that phase in the British film industry. The level of production must be the level of good production. As the noble Lord, Lord Mancroft, said—and I pray in aid of my Amendment his own words—there are two vital factors. The first is the economic circumstances of those who have to find the money—that is, the exhibitors. I am not going over the old argument of the number of cinemas that are shut—179, I believe, last year—the number that are operating at a loss, in dire distress, clinging only to the slender hope—I think slender, though they may not think so slender—that they are going to have a substantial contribution from the Chancellor of the Exchequer in reduction of entertainments tax.
I have heard it argued, quite logically, that the minimum amount of relief of entertainments tax to make the exhibitor's business of opening his cinema a profitable proposition has to be in the region of £20 million to £21 million. One of the economic circumstances that the Board of Trade must consider is how much effect this levy is going to have on the price of admission, because I am told that the prices of admission to the cinemas of this country to-day are, by and large, at top level. As a matter of fact, they have gone over top dead centre, and it is now a case of diminishing returns; and any addition to the price of admission to the cinemas of this country will mean lower attendances, more closings, less entertainments tax and more cases of hardship in the industry. So that if the nearly £1 million that is going to be piled on the top of the expenses of this industry immediately this Bill comes into operation as an Act is not recouped out of entertainments tax, it will undoubtedly mean that cinema prices in this country, by and large, will have to go up. Neither the noble Lord nor the President of the Board of Trade has yet found a way of getting blood out of a stone or money out of a bankrupt cinema. That is one of the economic circumstances that must be taken into consideration at one end of the scale.
The economic circumstance to be taken into consideration at the other end of the scale is the amount of money that must be ploughed back into production because of the necessity to keep the British producer in existence. As I have said before, it is impossible for him to see any further profitable outlet in his home market in this country, because it represents only 15 per cent. of the total market of the world. Those are dire circumstances which those in the industry have battled against ever since it has been an industry and successive Governments have recognised, not, only by quota but by the inception of the Film Finance Corporation which we shall discuss upon another Amendment. So I feel it is vitally important, in view of the rapidly changing circumstances, that Parliament should, in this Bill, which sets up this statutory levy, lay down the broad principles upon which the amount to be levied shall be considered and the amount the producer will get at the beginning of every year. I hope, with the noble Lord, that not
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only will the exhibiting side of this industry have a more prosperous time, but that the production side will, too, and that this basis will prove to be of lasting good to both. I beg to move.
Amendment moved—
Page 3, line 4, at end insert the said words.—(Lord Lucas of Chilworth.)
3.30 p.m.
LORD MANCROFT: My Lords, I must confess to the noble Lord. Lord Lucas of Chilworth, that when I first saw his Amendment on the Order Paper a day or two ago I was not inclined to accept it. It struck me as being, to say the least, redundant. I thought it would occur to everybody that it would be only natural that the considerations which the noble Lord has put into his Amendment would, of course, be uppermost in the minds of those who were determining the amount. Now that I have had a moment or two to think it over, and having listened to his persuasive argument, I think there is a great deal more in it than at first occurred to me. We have spent a long time on this Bill, and there is one point which I have already made once or twice, but which I wish to make again. It does not matter how many levies or loans you have, or how many tax remissions—none of those will turn a bad film into a good film. By and large, good films make money and bad films lose money. I say, "by and large" advisedly, because we all know atrocious films that have coined money, and we all know films which we have admired immensely but which have been serious "flops" at the box office. But, by and large, it is the good film which makes money. It is the efficiently produced and skilfully made film that we are trying to encourage by this Bill, and if the insertion of these words will shine a spotlight on to that need, then I shall certainly be prepared to accept them. They may to a purist appear redundant, but if they will help the producer to realise that that is what is in Parliament's mind—to produce good and economic films in front of all the loans and tax remissions we are talking about —it will be all to the good. As I am certain that I and the noble Lord are at one over those sentiments, I shall be happy to accept his Amendment.
LORD LUCAS OF CHILWORTH: My Lords, I will not aid one word in case I spoil the most excellent case that I have put up—so excellent that it has convinced the noble Lord. My only words are going to be words of gratitude. I can tell him that what he has said will give great satisfaction to all sides of the industry.
On Question, Amendment agreed to.
LORD MANCROFT LORD MANCROFT moved, after subsection (5) to insert:
"(6) When the Board of Trade propose to make regulations under this section, they shall, before making the regulations, consult with the Cinematograph Films Council."
The noble Lord said: My Lords, this Amendment and Amendment No. 4 standing in my name are an attempt on the part of the Government to meet a point made by noble Lords opposite on previous stages of the Bill, and to honour an obligation which I gave during the Committee stage. It does not, I readily admit, go as far as noble Lords opposite would want. They wanted to make it a statutory obligation upon the Government to consult producers and exhibitors upon various matters raised in the Bill.
We argued—and I will not repeat the arguments—against them. We said that once you provide for statutory consultation with one professional body or another, you open wide the gates, and you could make a perfectly good case for statutory consultation with, I think it was, eleven accredited bodies which might well claim to have their views sought on this, that or the other point in the Bill. I think that would be wrong. It would cause interminable delay, and it would cause quarrels and arguments. I think it would place upon the Board of Trade, in certain circumstances, an undesirable burden, and therefore we rejected those Amendments. We thought it was perfectly right that there should be put into the Bill the obligation to consult the Cinematograph Films Council, which in any case the Board of Trade would have consulted, but the statutory consultation with which would do no harm and might well go into the Bill. So that is what we do by these two Amendments. We are making it obligatory for the Board of Trade to consult the Cinematograph Films Council upon
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all those points on which, during Committee stage, your Lordships decided consultation with this outside body was desirable, if not necessary.
Just so that I may try to put at rest the minds of noble Lords who feel that we have not gone far enough, I should like to remind your Lordships of the constitution of the Films Council in respect of which we are now placing a statutory obligation in this Bill. If anyone should think that all interests would not be properly represented and all views put to the Board of Trade, I think the composition of the Council, if it is not already familiar to your Lordships, will set your minds at rest—I will mention only one or two people whose names will be familiar to your Lordships. From the producers' side there is Mr. Arthur Rank from the distributors' side, Sir Arthur Jarratt and Mr. S. Eckman; on the exhibitors' side, Mr. Cecil Bernstein, Sir Alexander King and Sir Philip Warter. Among the trade union representatives we find Sir Tom O'Brien and Mr. G. H. Elvin, and among the independent members there is Mrs. Eirene White, M.P., all sitting under the chairmanship of the Master of Pembroke College, Cambridge.
I have picked out only a few names as those being more familiar to your Lordships. This is a highly representative and highly competent Council. It is perfectly competent to give the Board of Trade all the information they could possibly require, being fully in touch with all branches of the industry. If that Council is not capable of giving the Board of Trade the advice they want or, indeed, advice which they do not want and do not like—hostile advice, if need be—then I think it should be abolished. But I do not think it ought to be abolished. I think it is doing a first-class job of work. In inserting this statutory obligation into the Bill, I think we shall be enhancing its reputation, and that it will be an advantage to the Bill, an advantage to the Board of Trade and, indeed, an advantage to the Council. I hope that I have now persuaded noble Lords opposite that it would also be an advantage to the films industry as a whole. Therefore, I hope that your Lordships will agree to these two Amendments, the first of which I now move. I trust that I have persuaded noble Lords that there is no necessity to increase the number of people whom the

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Board of Trade should consult. I beg to move.
Amendment moved—
Page 3, line 11 at end insert the said subsection.—(Lord Mancroft.)
LORD ARCHIBALD: My Lords, I am sure that I am speaking for others besides myself when I say that naturally we welcome this Amendment, which certainly goes a certain way to meeting the arguments which we put forward during the Committee stage of the Bill. It is true that the Cinematograph Films Council is an excellent, well-qualified, and experienced body, and consultation with that Council can do nothing but good. There is a minor criticism perhaps: that the Films Council contains certain interests that need not be involved in the consultation. Bit that is, as I say, a minor point.
The noble Lord, Lord Mancroft, will remember, however, that during the Committee stage, when resisting the proposal that organisations of producers and exhibitors should be consulted, he said that it would be wrong to make the consultation with them a statutory obligation, but that they would in fact and in practice be consulted. His words on one occasion were [OFFICIAL REPORT, Vol. 201 (No. 27), col. 394]:
"I am sure that we shall consult everybody whom a reasonable person taking an objective view of the industry would say should be consulted."
If, therefore, the noble Lord can assure us that that position still stands, and. that without any statutory obligation the Board of Trade will, as a matter of practice, consult, shall I say, the obvious and relevant organisations, then from my point of view I shall be satisfied.
LORD MANCROFT: I willingly give the noble Lord that assurance.
LORD LUCAS OF CHILWORTH: My Lords, I should indeed be churlish if I raised any great objection to what the noble Lord wants to put into this Bill, but may I just say that one of my objections to the Films Council, which is not entirely taken out of my mind, is this. My experience of consultative bodies on purely trade matters of this description which contained independent members has been indeed sad, because, time without number, perhaps the two sides of the industry—in this case, the producers and the exhibitors—have not found it possible
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to agree and the independent members have made a decision upon a subject of which apparently they know nothing. However, perhaps it will not happen in this case. The names which the noble Lord read out were, to me, impressive. Still, with the heat and burden of the debate of yesterday buzzing around my head, the Chairman of the Films Council would have carried more weight with me if he had come from Oxford and not from Cambridge—but I suppose that is only a very biased personal view. I thank the noble Lord for going as far as he has. So far as I am concerned. I wish the Council the best of good fortune in their deliberations. May they serve the cinema industry in this capacity as well as they have served it in the capacity which they have enjoyed up to the present.
On Question, Amendment agreed to.
Clause 3 [Payments by Agency to makers of British films]:
3.42 p.m.
LORD MANCROFT: My Lords, this is exactly the same point as was contained in the previous Amendment, beg to move.
Amendment moved—
Page 3, line 38, at end insert—
("(3) When the Board of Trade propose to, make regulations under this section, they shall, before making the regulations, consult with the Cinematograph Films Council.")—(Lord Mancroft.)
On Question, Amendment agreed to.
Clause 4:
Power of Commissioners of Customs and Excise and their officers to obtain information.
4.—(1) The Commissioners of Customs and Excise shall have power, for the purpose of enabling them properly to perform their functions tinder this Part of this Act, by notice in writing served on an exhibitor, to require him—

(a) to furnish to such person as may be specified in the notice such returns or other informatics as may be so specified;

(b)to keep such records as may be so specified;

and any officer of theirs may at all reasonable hours enter any premises occupied for the purposes of his business by an exhibitor and may require him or any person employed by him in connection with his business to produce for examination by the officer such hooks or other documents relating to the exhibitor's business as the officer may specify.
(2) If any person on or to whom a notice or requisition is duly served or made under the foregoing subsection fails to comply will

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the notice or requisition, he shall, unless he proves that he had reasonable excuse for the failure, be guilty of an offence under this subsection and be liable, on summary conviction thereof, to a fine not exceeding one hundred pounds.
(3) If any person in purported compliance with the requirements of a notice under subsection (1) of this section to furnish returns or other information makes a statement or furnishes a document, which he knows to be false in a material particular or recklessly makes a statement, or furnishes a document, which is false in a material particular he shall be guilty of an offence and shall be liable, on summary conviction, to imprisonment for a term not exceeding three months or to a fine not exceeding one hundred pounds, or to both such imprisonment and such a fine.
(4) An offence under this section may be tried by a court having jurisdiction either in the county or place in which the offence was actually committed or in any county or place in which the alleged offender resides or carries on business.
(5) For the purposes of section three hundred and one of the Customs and Excise Act, 1952 (which penalises the delivery of false documents and the making of false statements to the Commissioners of Customs and Excise or their officers), the collection of the levy imposed by virtue of this Part of this Act shall be deemed not to be an assigned matter.
LORD LUCAS OF CHILWORTH LORD LUCAS OF CHILWORTH moved, in subsection (1), to leave out all words from "power" down to "Act" and to insert instead:
", so far only as it may be required to enable them to discharge their duty of collecting or recovering the levy from exhibitors,"
The noble Lord said: My Lords, noble Lords will, I think, remember the long and protracted argument we had on the Committee stage upon Clause 4 of this Bill, especially upon subsection (1) which I think on reflection I perhaps rather harshly criticised as a "snoopers' charter". It gives unlimited powers to any officer of the Commissioners of Customs and Excise to enter premises and to do anything according to the whim or the will that came into his head. After a long and protracted argument, the noble Lord admitted the justice of our complaint, which I thought was very gallant of him. Both he and I have tried to overcome it. I have tried to make it specific beyond any doubt whatsoever that the Customs and Excise shall have the power
"so far only as it may be required to enable them to discharge their duty of collecting or recovering the levy from exhibitors, by notice in writing served on an exhibitor, to require him"
and so on.
May I say at once that, after I had put this Amendment upon the Order Paper, the noble Lord, Lord Mancroft, to honour the undertaking he gave your Lordships to have another look at the matter, put down an Amendment to page 4, line 9. After the word "and" he wishes to insert ", for that purpose, any officer of theirs may" et cetera. I thought that that was a valuable addition to my Amendment. I thought that he had just covered the last possible loophole that I might have left uncovered. I want to ask the noble Lord whether he will accept my Amendment, and I will readily agree to his Amendment, so that we can go forward and say jointly: "We have really removed the last vestige of doubt that he and I have been trying to overcome."
I like my Amendment. I think it is eminently sensible to put in these words, because that is what their only function can possibly be—to collect or recover the levy. If that, and only that, is what we mean them to do, then I cannot see that there can be the slightest argument against putting them in the Bill. We have all had experience of the exuberance of Government inspectors and I think they should have shackles and halters put upon them, allowing them only the powers for carrying out the function it is intended that they shall carry out. I have one other Amendment to the clause later on, as the noble Lord will see, but I will leave comment upon that until then. I hope that the noble Lord may, in the course of his remarks, accept my Amendment in conjunction with his. Then we shall have made this clause really tight. I beg to move.
Amendment moved—
Page 4, line 2, leave out from ("power") to ("Act") in line 3 and insert the said new words.—(Lord Lucas of Chilworth.)
LORD MANCROFT: My Lords, the two Amendments on the Order Paper—the one which the noble Lord is now moving, and the one standing in my name—both seek to do the same thing. Your Lordships will remember that we were worried lest we were giving a charter to snoopers. There is certainly no reason at all why some officer of the Customs and Excise who is seeking to look at the books of a cinema proprietor to decide what is the proper sum for him to pay should, to use the simile of the noble Lord, Lord Lucas of Chilworth, have the

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right to examine the proprietor's marriage lines. I agree with him entirely. The only point where we parted at all was that he argued that one could not tell whether the ledger actually did contain the proprietor's marriage lines or whether it was only a little hit of book "cooking".
I agree with the noble Lord that we should not turn this Bill into a "snoopers' charter". We have both tried to meet this point. If I say that I think my Amendment is much better than his, I am not being boastful, because I did not draft mine—the draftsman did—whereas the noble Lord, Lord Lucas of Chilworth, had to wrestle with his own. I think he has dug a pit and fallen into it himself. 133 a pure piece of draftsmanship, he has perpetuated the fault that he wanted to get away from. The draftsman assures me that the words in my Amendment, which are "for that purpose", completely cover the point of the noble Lord. He also advises me that the words that the noble Lord has put down, by a matter of draftsmanship, I am sure accidentally, merely perpetuate the very thing that the noble Lord is trying to do away with.
LORD LUCAS OF CHILWORTH: Would the noble Lord tell me why?
LORD MANCROFT: One would merely substitute for my draft a lengthier form of words. The purpose of Clause 4 is to give the Commissioners of Customs and Excise certain powers. The Bill, as now drafted, suggests that these powers should be
"for the purpose of enabling them properly to perform their functions under this part of this Act."
The noble Lord's Amendment would give them power
"so far only as it may be required to enable them to discharge their duty of collecting or recovering the levy from exhibitors."
The draftsman tells me that that is merely saying the same thing but at slightly greater length. If the noble Lord looks at it again, the draftsman's alternative covers the point about which the noble Lord is worried. I am assured that that is so.
LORD LUCAS OF CHILWORTH: I do not agree with the draftsman at all.
LORD MANCROFT: Well, I have looked at it very carefully. What I would
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suggest to the noble Lord is that he should accept my Amendment and I will reason it out with him by writing it out at full length. Draftsmanship is not an easy task to undertake across the Floor of the House, and if, by any chance, he should prove right and I am proved wrong, we will certainly undertake to put the matter right at a later stage in the Bill in another place. I am advised—and I must take the advice I am given—that on this point the noble Lord is wrong and that the words put into my mouth are correct. Perhaps the noble Lord will be good enough to withdraw his Amendment and to accept mine, on condition that I will look at it again to make quite certain that we are right.
LORD ARCHIBALD: My Lords, I think it may be convenient if we took the two Amendments together, as has already been done. I should like to put to the noble Lord, Lord Mancroft, the suggestion that his Amendment is not quite so good as he thinks it is, and that in fact it may be in the wrong place. When we were discussing this subject we did not object, to empowering the officer to enter at all reasonable hours. What we did object to was that the officer should have power to require the production of books and documents, and so on, on too great a scale. I am not a lawyer and I may be corrected on this point. Unless the noble Lord can assure me that the words "for that purpose," which are to be put in after "and" in line 9, will also qualify "may" in line I would suggest to him—I hope that he will look at this carefully, as this is not a partisan suggestion but a purely practical one—that instead of putting in the words "for that purpose" after "and" in line 9, it would be better in fact to put them in line 11. The entry of the premises is not the point; the limitation "for that purpose" relates to his requiting the production of books.
LORD LUCAS OF CHILWORTH: My Lords. I am grateful to the noble Lord, Lord Mancroft, because I know that he is genuinely trying to meet us in this matter. But I must argue with his friend —his learned friend, I expect—the draftsman, because I have not dug any pit. All I want to do is this. Instead of the words
"The Commissioners of Customs and Excise shall have power, for the purpose of enabling them properly to perform their functions under this Part of this…"

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I want to put in the words
"The Commissioners of Customs and Excise shall have power, so far only as it may be required to enable them to discharge their duty of collecting or recovering a levy from exhibitors."
There is no difference in intent, as I quite agree with the noble Lord; but it is more specific. The only function of these inspectors will be to collect or recover the levy. But I am going to accept the noble Lord's offer, because I know that he is making a genuine attempt to meet the point. If, on the next stage of the Bill, he comes to your Lordships and says that the best advice open to Her Majesty's Government is that he is right and that I am wrong, I shall, of course, accept it, because, after all, they, and not I, have the responsibility.
I think there is something in what my noble friend says. What my noble friend is getting at is that we do not say that any officer for that purpose may not at all reasonable hours enter any premises. We do not mind his entering the premises; what we object to is the fact that the Commissioners of Customs and Excise are to
"have power, for the purpose of enabling them properly to perform their functions under this Part of this Act, by notice in writing served on an exhibitor, to require him"—
to do two things: to furnish returns and to keep records. The noble Lord, Lord Mancroft, wants to say "and for that purpose any officer may" do any one of these things. My noble friend suggests—and I think there is something in his suggestion—that the clause should read in this way:
"and for that purpose may require him or any person employed by him in connection with his business to produce for examination by the officer such books or other documents relating to the exhibitor's business as the officer may specify."
That is where I want the noble Lord to see the sense of my first Amendment. It is not for the purpose of the exhibitor's business. His business is to open a cinema, to show films, to sell tobacco, chocolates and ice-cream, and to do things like that. I say that it is nothing to do with the Customs and Excise officials how much profit he makes on ice-cream. But that is the purpose of his business. I say the only thing that the Customs and Excise officials have the right to do is to examine his books in relation to the amount of the levy he has
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to pay. He does not pay levy upon his ice-cream sales or his chocolate sales or on his revenue from advertising on the screen. Why should be allow his books to be examined for that purpose? That is the argument we had before and where we parted company.
If the noble Lord will look at this clause again, he will see—if I may say so with the greatest respect to his friend, the draftsman—that it is a badly drafted clause from beginning to end. What we are trying to do is to make it read as the noble Lord and, I have not the slightest doubt, the draftsman intend it to read. The first part of this clause reads in this way:
"The Commissioners of Customs and Excise shall have power, for the purpose of enabling them properly to perform their functions under this Part of this Act, by notice in writing served on an exhibitor to require him"—
to keep records and to furnish returns. Then it goes on to an entirely different subject—namely,
"and any officer of theirs may at all reasonable hours enter any premises occupied for the purposes of his business by an exhibitor and may require him or any person employed by him in connection with his business to produce for examination by the officer such books or other documents relating to the exhibitor's business as the officer may specify."
That is not the purpose of Part I of this Bill at all; it is not the purpose of this Bill at all, and from first to last it has nothing whatsoever to do with the Customs and Excise people. I hope I have made myself abundantly clear to the noble Lord. The only object is to examine the exhibitor's books in so far as they relate to the amount of levy which he pays upon what he has collected for selling his seats. Any other account in connection with his business has nothing to do with the Customs and Excise, and we object to giving to any of their inspectors the right to go into a man's place of business and to examine his books for that purpose. I am quite willing to rest on that argument, because we cannot re-draft this clause across the Floor of the House on Report stage. I am willing to leave myself with the noble Lord. After his distinguished career at the Bar I am certain that he could pull this clause to pieces in a court of law. I am not a barrister but I have done my best to tear it to pieces. I hope that now the noble Lord and his learned friend the draftsman will produce a better clause than this at the next stage of the Bill.

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If it will help the noble Lord, I do not mind accepting his Amendment and withdrawing mine if we may return to the matter between now and the next stage of the Bill. Perhaps the noble Lord would care to follow the same excellent practice as he has hitherto followed so that we might have consultations on the matter between now and the next stage to see whether we can agree, so that we do not have a lengthy argument across the Floor of the House on Third Reading. With your Lordships permission, I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
LORD MANCROFT: My Lords, the late Lord Badeley gave us all some good advice when we came back after the war and started to learn the Rules of your Lordships' House. One piece that has always stuck in my mind was this: "Never hunt south of the Thames, and never try to redraft a Bill on your feet." I have always tried to carry out both pieces of that excellent advice. The noble Lord, Leal Lucas of Chiltworth, has for the last ten minutes been cheerfully and eloquently barking up the wrong tree. I have been following his argument as best I can, and I am wholly unconvinced; but we will certainly look at the point again. If the noble Lord accepts this Amendment I believe that it can do no harm and believe, although he does not agree, that it will meet his point. We will certainly look again and have consultations, if that will please him, because on this point we both want to do the same thing. I ask your Lordships to accept this Amendment on that condition. I beg to move.
Amendment moved—
Page 4, line 9, after ("and") insert (", for that purpose,").—(Lord Mancroft.)
On Question, Amendment agreed to.
LORD LUCAS OF CHILWORTH LORD LUCAS OF CHILWORTH moved, in subsection (1), after the last word "may" to insert "reasonably". The noble Lord said: My Lords, when the noble Lord is looking at this draft would he give careful consideration to this Amendment. If accepted, it would mean that subsection (1) would read that any officer of the Customs and Excise:
"may at all reasonable hours enter any premises occupied for the purposes of his business by an exhibitor and may require him or any person employed by him in connection with his business to produce for examination
874
by the officer such books or other documents relating to the exhibitor's business as the officer may reasonably specify."
I will quote the best case that I can think of quickly, though I know the noble Lord may say that what I am doing is perhaps putting thousands of pounds into the pockets of the poor lawyers through argument over the interpretation of the word "reasonably."
Would it be reasonable for an inspector who is going through the books of this cinema proprietor to see that his returns are correct, and that his payment of levy is as much as it should be, to demand the production of the exhibitors bank pass-book? Would that be a reasonable request? I do not think it would be, yet under this Bill the officer could do so. He could ask the exhibitor to produce for examination:
"such books or other documents relating to the exhibitor's business as the officer may specify."
The officer can demand production of any document. He can demand to see the private arrangement of the exhibitors finance; he can demand to see who has loaned him money and on what terms. Is that reasonable? Does the noble Lord not think it would be a good idea to put in the word "reasonably"? Would the noble Lord consider that when he is considering the other points? I beg to move.
Amendment moved—
Page 4, line 14, after ("may") insert ("reasonably").—(Lord Lucas of Chilworth.)
LORD MANCROFT: We are now back again to the old problem, the "marriage lines." The trouble with the word "reasonably" is that though it is a very reasonable word no one knows what it means.
LORD LUCAS OF CHILWORTH: A reasonable man does.
LORD MANCROFT: But who is a reasonable man? We know that a reasonable man is defined in various Statutes (though, so far as I know, "a reasonable woman" never has been), and how are we going to see that what the noble Lord wants to do is carried into the Act? I have explained to the Committee several times that the difficulty is that the officer is not going to demand to look at the "marriage lines" and should be prevented from doing so, for they have no relevance whatever to

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the task he has in hand. But how does he know, unless he is able to pull down a ledger and examine it or to look at a bank account, whether or not it is a document which it is reasonable to look at? If the noble Lord thinks that the Bill as drafted gives an officer the right to pry into wholly irrelevant matters, we will certainly meet him, and try to do away with that; but we must not deny the officer the right, within reason, to look at a document to see whether or not it is relevant to the matter he is then investigating. It is there that the noble Lord and I possibly part company.
I was going to suggest that it was not necessary to accept this Amendment because my previous Amendment, Amendment No. 6, covered the point. I still think so. Since we have agreed between us to reject the Amendment of the noble Lord, Lord Lucas of Chilworth, and to accept my Amendment, on condition that we look at the whole point again, we will include in our investigation an examination into the point about inserting here the word "reasonably." We do not for a moment want to suggest that an officer should pry into a cinema proprietor's private affairs, but by putting in the word "reasonably" one rather suggests that he might otherwise act unreasonably, which I am quite sure is the last thing that any officer would dream of doing. I cannot accept this Amendment, but if the noble Lord will withdraw it we will certainly look at the point again in the light of the other Amendment we have discussed.
LORD LUCAS OF CHILWORTH: I am very grateful to the noble Lord. He has a simple faith in inspectors. I hold them in abhorrence.
LORD REA: Hear, hear!
LORD LUCAS OF CHILWORTH: I do not trust inspectors as the noble Lord, Lord Mancroft, does, because I believe that anybody who has the slightest qualification to be an inspector has an inquiring mind.
LORD MANCROFT: That is what he is there for.
LORD LUCAS OF CHILWORTH: And he is apt to overstep discretion. One thing I was always taught when I occupied a position similar to that which the
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noble Lord now occupies was that when a Government Department, "go to town" to put powers into a Bill, believe me! they "go to town." This clause as it now stands would appear to any intelligent person to give an inspector the right to enter premises and play plain, merry havoc, and do just precisely what he liked, under the guise that this was to enable those august gentlemen, the Commissioners of Customs and Excise, to carry out their duties under Part I of the Bill.
LORD MANCROFT: Why would he want to do that?
LORD LUCAS OF CHILWORTH: Can the noble Lord answer the question: Why do Government inspectors want to pry into a lot of things? If so, he will answer a question which thousands of people have asked for thousands of years. I have never yet had the answer, and I do not suppose that anybody will ever find it. It may be natural inquisitiveness and over-exuberance of enthusiasm for their trade or calling; but I wish at all times to curtail their activities for that purpose. The only reason why we have this clause in the Bill at all is to track down the rogue and the crook, not to annoy and persecute the honest man. It is the task of the noble Lord, Lord Man-croft, to draw the line between those two classes. Here he invites the inspector to say that everybody is a crook and a rogue—
LORD MANCROFT: Oh, no.
LORD LUCAS OF CHILWORTH:—until he has satisfied himself that they are not.
LORD MANCROFT: Oh, no.
LORD LUCAS OF CHILWORTH: Oh, yes. So let the noble Lord take it back and look at it again, and I feel certain that in the end we shall obey the dictum which the noble Lord has attributed to the late Lord Badeley: we will not try to do this on our feet; we will try to do it on some other occasion. I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
4.10 p.m.
LORD LUCAS OF CHILWORTH LORD LUCAS OF CHILWORTH moved to leave out Clause 4. The noble Lord said: My Lords, I have put down this Amendment for the purpose of getting an explanation from the noble Lord,

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Lord Mancroft. Naturally, I do not wish to leave out the clause, but on the Report stage the only way I can interrogate the noble Lord on a point which I wish to have cleared up, is by putting down an Amendment. Your Lordships will remember the excellent dictum expressed by the noble Lord, Lord Fairfax of Cameron, during the Committee stage of the Bill, when he laid it down on behalf of Her Majesty's Government—quite wisely, I thought—that what is sauce for the goose is sauce for the gander. So I put in a clause, precisely similar to Clause 4, which gave the Agency the same powers of investigation in order to see that the producer who wished to be not so honest as Lord Mancroft wished him to be with his returns for claiming on the levy did, in fact, put in returns which were as accurate and as honest as those of the exhibitor were required to be under this clause.
The noble Lord, who was in his most convincing form, quite convinced me that my Amendment was not necessary. After all, he said, unless the Agency were satisfied beyond any argument or doubt that a man did deserve the money, he would not get it. I bought at the time that that was reasonable. But, like all those very persuasive arguments coming from those who have practised for long at the Bar, this did not seem so persuasive on later study. When I came to study, in Hansard, what the noble Lord said, his agreements did not convince me as much as they had formerly done. I wonder whether he will now tell me what would happen in this sort of case. A producer submits his returns and his figures, and he makes a claim to have a share of the levy as a film of his has passed its registration test and grossed the requisite amount. He is then paid money from the levy. But after he has been paid, some doubt arises as to the accuracy of information which he gave—perhaps the inaccuracy was inadvertent; or it may have been due to the fact that produce's, like exhibitors, are only human. It may even have been due to "malice aforethought"—in other words, the producer was a crook. But he has got the money. How do the Agency recover it?
The Customs and Excise have a power of recovery. They can sue in the courts to recover money as a civil debt. But
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the Agency cannot get money back. What do they do? Does not the noble Lord think that they should have power to recover money that has been improperly obtained? If the noble Lord will satisfy me that under the terms of the Bill they have the power to do what the Customs and Excise have power to do, I shall be perfectly satisfied. Frankly, however, I cannot find it, and that is the reason why I have put down this Amendment. Does not the noble Lord agree that there should be provided in this Bill power to sue for and recover levy money improperly procured or obtained from the Fund in precisely the same way as the Customs and Excise can sue for the recovery of a civil debt which has not been paid? I beg to move.
Amendment moved—
Leave out Clause 4.—(Lord Lucas of Chilworth.)
LORD MANCROFT: My Lords, the noble Lord, Lord Lucas of Chilworth, has now raised quite a different point from the one which he argued at the Committee stage. His original point, which caused him to observe that what is sauce for the goose is sauce for the gander, was over a comparison between the obligation upon the cinema proprietor to produce books and figures and the obligation upon the producer to do the same. The point I was making, in answering the noble Lord on the Committee stage, was this. The cinema proprietor, somewhat naturally, does not want to make a payment unless he has to. He does not want to pay a penny more than he is statutorily bound to do. So a dishonest cinema proprietor—presumably there may be dishonest cinema proprietors, though I very much doubt it—tries to "cook" the books. This Bill gives the officer the right to look at the relevant books. Exactly how relevant they are is the point we have been arguing.
LORD LUCAS OF CHILWORTH: If the noble Lord will look at Clause 4, he will see that it gives the officer the right not only to examine the books but also to take proceedings. Subsection (4) states:
"An offence under this section may be tried by a court having jurisdiction either in the county or place in which the offence was actually committed…"
and so on. The purpose of this subsection is to enable the Commissioners

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of Customs and Excise to sue. They can do anything. I think the noble Lord will appreciate that it is a bit wide.
LORD MANCROFT: I appreciate what are the powers that are laid down in that clause. But let us compare them with the obligations of the producer. He wants his share of the fund to repay him upon the success (we hope), or otherwise, of a film which has been the rounds and has shown results at the box offices. He goes to the Agency and he says: "It appears that my rights under the Bill are to have £x." Before that money is paid out, the Agency are clearly going to satisfy themselves that this is as the producer says; otherwise they will not pay out the money. Therefore, there is no need, I maintain, to put into the Bill a right for the Agency to demand any particular ledger, for fear it contains the producer's marriage lines, because, clearly, they will not pay the money unless they are satisfied. Putting it bluntly: "No ledger, no 'lolly'."
The noble Lord says: supposing a dishonest producer cooks his books, how are the Agency going to put matters right? I should have thought that a criminal action could be brought on the grounds of fraud, if it were a case of deliberate "cooking" of the books. Or a criminal action might be brought for obtaining money by false pretences. I should not like, at the moment, to give the noble Lord a definite ruling upon that. If the noble Lord will look at Clause 3 (2) (e), he will see that it states that Regulations under the section may:
"Provide for the making of provisional payments and the recovery of overpayments."
Does that not cover innocent overpayments—the case of a wrong claim that was perfectly innocent? Surely the ordinary criminal law will cover a criminally wrong claim. I should have thought that these two cover the noble Lord's points completely.
LORD LUCAS OF CHILWORTH: My Lords, I can only address your Lordships again with your Lordships' permission, which I hope you will grant. I do not think that what the noble Lord has said does cover my points. I do not think it meets the points at all. The case is not one of overpayment; it is a case of a wrongful act. If your Lordships will look
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at Clause 4 (3), you will see the penalty on the exhibitor:
"If any person in purported compliance with the requirements of a notice under subsection (1) of this section to furnish returns or other information make a statement, or furnishes a document, which he knows to be false in a material particular or recklessly makes a statement, or furnishes a document, which is false in a material particular he shall be guilty of an offence and shall be liable, on summary conviction, to imprisonment for a term not exceeding three months or to a fine not exceeding one hundred pounds, or to both such imprisonment and such a fine."
The exhibitor may go to prison. The qualification for receiving a Levy payment under this Bill is the same as the qualification for registration as a British film, as laid down in the Cinematograph Films Act, 1948. It is extremely complicated: there are nice calculations of employment ratios; salaries of two stars of foreign nationality may be deducted from the cost of production, and so on. These were the qualifications for the purposes of the film quota, which were transferred to registration as a British film under the voluntary levy. Now we are making them a legal obligation, punishable with fines and imprisonment.
If this Levy is worthwhile, there are heaps of opportunities for false statements to be made and for Levy grants to be obtained by those not entitled to them. It is not a case of overpayment, or of a mistake. And as such grants may run into millions of pounds, I should have thought the noble Lord would be willing to consider that the Board of Trade owe it to the exhibitors, who have to find this money, to safeguard them, so far as possible, by seeing that the money does not find its way into the pockets of those not entitled to it. If the noble Lord says that this already is covered under the law as it stands outside the Bill, I think I might be satisfied.
LORD MANCROFT: That must be so if a statement is fraudulent.
LORD LUCAS OF CHILWORTH: Sauce for the goose and sauce for the gander! Why have in this Bill the penalties for a fraudulent statement by an exhibitor and not the penalties for a fraudulent statement by a producer?
LORD MANCROFT: They are two entirely different offences. They are technically different.
LORD LUCAS OF
CHILWORTH: I see; it is not so fraudulent for a producer to make a false statement to obtain Levy grant as it is for an exhibitor to make a false statement to prevent his having to pay it.
LORD MANCROFT: it is not a difference in morals; they are different in law.
LORD LUCAS OF CHILWORTH: I know something about morals, but I confess that I know very little about the law. Perhaps the noble Lord will consider what I have said before the next stage so that I can have his answer. With your Lordships' permission, and with my thanks far allowing me to speak for a second time to put my case, I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
Clause 10:
Extension of time within which, and purposes for which, loans may be made by Corporation
10.—(1) For paragraph (b) of subsection (1) of section one of the Cinematograph Film Production (Special Loans) Act, 1949 (which. as amended by the Cinematograph Film Production (Special Leans) Act, 1954, empowers the National Film Finance Corporation to make, during the eight years beginning with the passing of the first-mentioned Act, loans to be employed in financing the production or distribution of cinematograph films to persons who in the judgment of the Corporation, while having reasonable expectations of being able to arrange for the production or distribution of cinematograph films on a commercially successful basis, are not for the time being in a position otherwise to obtain adequate financial facilities for the purpose on reasonable terms from an appropriate source) there shall be substituted the following paragraph:—
"(b) to make, during the period of eighteen years beginning with the passing of this Act, loans to be employed in financing the production or distribution of cinematograph films to persons who, in the judgment of the Corporation, have reasonable expectations of being able to arrange for the production or distribution of cinematograph films on a commercially successful basis ".
4.25 p.m.
LORD ARCHIBALD LORD ARCHIBALD moved to leave out subsection (1) and to insert:
"(1) In paragraph (b) of subsection (I) of section one of the Cinematograph Film Production (Special Loans) Act, 1949, as amended by the Cinematograph Film Production (Special Loans) Act, 1954, for the words 'eight years' there shall be substituted the words eighteen years'."
The noble Lord said: My Lords, in moving this Amendment I find myself in considerable difficulty. We have dealt with this clause both on Second Reading and on Committee stage and we have not yet heard any statement of the Government's case. It should be understood that the Government are really making the amendment in this case and I am moving the status quo: Our positions are reversed on this matter. Under the Act which set up the Film Finance Corporation it was clearly laid down that the Corporation should lend money to film producers who could not get their finance through normal sources. The Government are proposing to change that by making an amendment to the present position. They are going to give the Corporation power to lend money to any film producer, whether he has difficulty in getting his finance from other sources or not, and that is such a radical change that one would have expected that some very substantial and fundamental argument would have been put forward.
We might have been told, for example, in what respect the Act as it stood is working badly, but we have not been told that the Act is working badly. Therefore, we are bound to look round and try to imagine why the Government want to make this radical change. Is it that during the current financial year, which ends, I think, in April, the Film Finance Corporation, for the first time, is finding difficulty in putting its funds to a proper use? Is it not having a sufficient call on its resources to make its operation worth while? If that is the argument, and it means that there are not now so many producers requiring help from the Film Finance Corporation because they now find their finances elsewhere, that may be a reason for limiting the activities of the Corporation, but it would hardly be an argument for saying that in future the Corporation should lend to all and sundry.
The difficulty is that one has to try to imagine why this change is being made. Therefore, we have to look at Clause 10 along with Clauses 11 and 12, which we have not really discussed on any previous occasion. If we take them all together, it is possible that a pattern begins to emerge. I am putting this hypothetical case in the hope that it can be demolished and replaced by the Government's real

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case, which we have not heard yet. It has been suggested that what is behind this wholesale amendment of the present Cinematograph Loans Act is an intention that in future the Corporation should lend only to producers from whom it is sure of recovery of its loans. That does not mean that it should lend only on films which are sure to be profitable, because there is no one in the world who can say that; no one in Hollywood, London or elsewhere can prophesy which films are going to be profitable.
But it is possible to select the producing units of companies to which loans are made and to do so on the basis that it will be only companies which will be able to repay the loans, whether the films are profitable or not. In other words, it is loans to companies rather than loans on films. If the Corporation in the future is to operate on that basis—and I hope it will not—if it continues to take a share of the profits, and if there continue to be a number of profitable films, then the Corporation will become a most useful profit-making organisation and it will certainly be able to fulfil the obligations of Clause 11 and not default on its borrowings from the Board of Trade. It could then become, in fact, such a sort of profitable investment trust that it might be possible to sell its assets advantageously, as envisaged in a subsequent clause.
If that is the suggestion—and, as I say, I hope it is not—it would have nothing whatever to do with the functions for which the National Film Finance Corporation was originally set up. I cannot imaging that the Government propose such a radical alteration, although, in a situation where they have not put their reasons for making this drastic alteration in the law, they must not grumble if people seek interpretations which can be put on the amendments which they have put forward. So far, as I say, no justification has been given for any change. We have not been told that the old system has worked badly; it has not been argued that the new system would work better. Therefore, in the absence of any justification for the change, my Amendment would provide that the National Film Finance Corporation would carry on in the future as it has done in the past, with the same powers and the same limitations, but for an additional ten years. I hope that
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I have got that point technically correct on this occasion. As I have said, I am moving the Amendment mainly in the hope of extracting from the Government on this occasion some justification for the radical, fundamental amendment which they have put forward. I beg to move.
Amendment moved—
Page 7, line 6, leave out subsection (1) and insert the said new subsection.—(Lord Archibald.)
LORD FAIRFAX OF CAMERON: My Lords, the noble Lord, Lord Archibald, in his remarks conjured up an amusing picture of the Government's possible intention to fatten up the Corporation for market. I can assure him that that is certainly not their intention. I hope to give the noble Lord adequate reasons for this proposed change in the law, and I hope also that I may clear up some of the points he has raised. Clauses 10 and 11 are linked together in this matter and must be looked at together, although this Amendment and the Amendment on the next clause should be taken separately. The effect of this Amendment is to extend the lending powers of the National Film Finance Corporation for another ten years, while retaining the limitation in the existing legislation on their use. Existing legislation places on the Corporation the following obligation:
"Loans to be employed in financing the making and distribution of cinematograph films to persons who, in the judgment of the Corporation, while having reasonable expectations of being able to arrange for the production or distribution of a cinematograph film on a commercially successful basis…".
So far as we go there, the proposed new Bill and the Amendment would be the same; but from here on the noble Lord wants included what is the present legislation:
"…are not for the time being in a position otherwise to obtain adequate financial facilities for the purpose on reasonable terms from an appropriate source."
The Corporation, on the face of the present legislation, has therefore the somewhat anomalous obligation to lend only to those who cannot obtain money elsewhere—and I quote the conditions—
"on reasonable terms from an appropriate source",
—sit may not be entirely clear what that always means—and yet, at the same time,

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to limit themselves to films which are likely to be successful; in other words, films which might be expected to be credit-worthy.
The new provision is more straightforward, in that it puts only one limitation on the Corporation—namely, that the films financed are likely to be commercially successful. There is nothing in this Amendment which is going fundamentally to alter the character of the National Film Finance Corporation. In that connection, I would, in passing, refer to a remark of the noble Lord, Lord Archibald, on the Committee stage, when he said that the National Film Finance Corporation was introduced for a specific purpose—namely, to help those who could not get help elsewhere. I think he was, at the same time, indicating that he thought that might not be the case under the proposed legislation. The point on this—and it is rather a technical one—is that the banks do not finance the end or risk money for film production, but only the front money. In other words, they discount the distributor's guarantee for up to about 70 per cent. of the cost of the film. They are certainly not likely to start changing that now. Therefore, the Corporation will continue to do what it was introduced to do—namely, to find the risk money for producers. I want to make that quite clear. It may well be a long time before the film industry can do without the services of a special investment body such as the National Film Finance Corporation.
The revised clause which the Government have put forward gives just a little more flexibility to the Corporation and, while it certainly enables them to comply more easily with the terms of the legislation, it should also enable them in some cases to make a little more money. In connection with this point, I should like to say that the Government feel that they could not lay the duty on the Corporation which is contained in Clause 11, to pay their way, unless in Clause 10 we removed the restriction which prevents them from accepting profitable business if it offers itself. No one other than the Corporation is going to find the risk money for film production, and it will remain their first duty to supply this need of the production industry. But we need not, and should not, ask the Corporation
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to pay their way and yet, at the same time, turn away good business.
It may even be that, because of this fact, that we hope the Corporation will be financially solvent, they could sometimes take risks which they would not otherwise take. The National Film Finance Corporation have tried for the past eight years to steer a sensible middle course between their obligations (which are fairly numerous) to confine their loans to films likely to be commercially successful, to maintain a measure of British film production and to encourage a high level of quality and the emergence of independent producers. There is no reason for thinking that the present legislation will materially change this aim; indeed, it may well help in its achievement.
Finally, the relations between the Corporation and the Board of Trade have always been close and cordial. It is true that in the last resort there is a power of direction in the hand of the Board of Trade, but that this power will need to be used is almost unthinkable. The Corporation have built up a sound tradition, and if they think fit they will certainly be the first to consult the Government Department concerned. I am sure the noble Lord will appreciate that. I hope that those fairly full reasons for this change will be of some help to the noble Lord in understanding why we are doing it.
LORD LUCAS OF CHILWORTH: My Lords, would the noble Lord forgive me if I say that I have never heard such a weak argument in my life? I do not attribute it to him, although he had to say it. Will the noble Lord tell me this? Do the Film Finance Corporation require to have their whole status altered? Has this been done at their request?
LORD FAIRFAX OF CAMERON: Their status is not being altered.
LORD LUCAS OF CHILWORTH: Forgive me, I shall prove to your Lordships that it is. I conclude that the Film Finance Corporation have not made the request. If the noble Lord wants the Corporation to compete with the banks of the country, why does he not say so?
LORD FAIRFAX OF CAMERON: They are not competing with the banks.
LORD LUCAS OF CHILWORTH: Forgive me; they are competing with the banks. They are competing with the ordinary channels of finance, because what you are asking them to do, both in this clause and the next, is to conduct their business so that they shall make a profit, and they have not the obligation put upon them, which they had when the original Film Finance Corporation came into being, to help the industry produce films.
If, when I stood at that Dispatch Box, and introduced the Cinematograph Film Production (Special Loans) Act, 1949, I had made the speech which the noble Lord has just made on this Bill, I should have been torn limb from limb. I can just imagine the rhetorical heights to which the noble Earl, Lord Swinton, who in those days was leading for the Opposition on film matter's, would have soared: here was public money on risk competing with those pillars of private enterprise. What a shocking thing! Now the noble Lord comes here and says that, in spite of the fact that there is a clause in this Bill to tell the Film Finance Corporation that they can sell themselves at any time, this is not what he called a "fattening-up for the market" process.
LORD FAIRFAX OF CAMERON: I never called it that.
LORD LUCAS OF CHILWORTH: No I said that the noble Lord said my noble friend was accusing the Government of "fattening-up" the Film Finance Corporation for market. Those are the very words. I wrote them down as the noble Lord said them.
What are the Government doing with the Parcels Service of the British Transport Commission, and the meat company of the British Transport Commission? The Minister of Transport is at least honest. He says. "Of course, what I want these two companies to do now is to make good profits, and I shall get a better price for them when I want to sell them." Honesty sometimes comes out in some peculiar places. Let me read to the noble Lord, Lord Fairfax of Cameron, what Lord Swinton actually said when the Special Loans Act was before the House —I quote from Volume 160, column 432, of the OFFICIAL REPORT of February 1, 1949. These are the noble Earl's words:
"Here I come to what I consider is the crux of the matter. Even now it seems to me that
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the Government do not seem able to make up their minds whether the Corporation is to insist upon a safe security or whether it is to take a sporting risk. If it is going to rest upon security—' Safety first'—I think it will do very little business. If the Corporation is going to lend only where its risk is effectively underwritten by the distributors, then I do not think the distributors will take much risk, and I do not think the Bill will do the producers much good. If we are going into this business at all—and in the peculiar circumstances which are apparent from our discussion I think we ought to go into this business—then we have to take a risk. After all, as the noble Lord has frankly reminded us"—
I think that refers to myself, as moving the Second Reading—
"the Government take a great deal of money out of this business already; £38 million is going out of the industry, not to the producer but in entertainments tax. It is not unreasonable that a little of that money should be ventured back in a risk."
That was the real purpose of this Bill. That was why it was written into the Cinematograph Film Production (Special Loans) Act, 1949, that the whole object of the Film Finance Corporation was to find money for that class of independent producer who could not find money from the ordinary channels of finance.
I remember saying at that time that if the Government lost the whole £5 million they had put into this Film Finance Corporation and kept the industry alive, like the million cow, to produce over £30 million a year in entertainments tax. I thought it would be a jolly good business bargain—and I still think so. And they did lose quite a lot of it. If the day has arrived when you do not want special aid to the industry, why not say so? Has the day arrived when the British producer does not want and has no need to go to the Film Finance Corporation to borrow money on some peculiar methods —the Film Finance Corporation very likely take a share of the profits and offer a slightly lower interest? The noble Lord, Lord Fairfax of Cameron, must not shake his head at me and say that they do not. They do. Gracious me! I was brought up on this. The Film Finance Corporation had various arrangements with producers. They had loaned money for as low as 4½ per cent. Sometimes the grumble has been that they have taken too much of the profits where the collateral and security was not sufficient; where no bank or any other money-lending house would look at them, or the distributors

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would not take them. That is why there have been films made.
The Government are now saying, "Of course that is not necessary now"—the noble Lord will read it in Clause 10. They have taken out the words
"…to make during the eight years"—
this is now eighteen years—
"beginning with the passing of the first-mentioned Act, loans to be employed in financing the production or distribution of cinematograph films to persons who, in the judgment of the Corporation, while having reasonable expectations of being able to arrange for the production or distribution of cinematograph films on a commercially successful basis …"
and are substituting the new wording in subsection (1) (b). I should take that as a directive that the Corporation are not to lend money unless those conditions are fulfilled. What else can I do? When you come then to the next clause, which, as the noble Lord quite rightly says, has to be read in conjunction with this, it says:
"It shall be the duty of the National Film Finance Corporation to exercise and perform their functions in such manner as appears to them best calculated to secure the avoidance of default's being made in the discharge, as regards any loan made to them after the passing of this Act, of their obligations with respect to repayment of the principal of the loan and the payment of interest on any sum for the time being outstanding in respect of it."
I should take that as a directive that I have to make sure that I have guarantors and security; that I must eliminate, so far as I possibly can, every chance of risk.
If you say that, then the reason for bringing the Film Finance Corporation into existence has gone. Why not let the people go to the "angels"—the banks and the finance houses—to do the finance in the ordinary way of business? If the noble Lord says, "Now they have got to make a profit", he can put the State's money at risk to the first big producer who comes along, and whether it assists the production of the films by the independent producer for the good of the industry does not matter. The Corporation have only one thing to do; and that is to make money. There is no let or hindrance. They can put all this money into a big company. They can choose whom they like; there is no inhibition. They have not to take notice of the directive that was obtained in the original Act that loans shall be made to
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"persons who…are not for the time being in a position otherwise to obtain adequate financial facilities for the purpose on reasonable terms from an appropriate source."
I am not going to argue this matte any longer. You now want the Film Finance Corporation to run as an ordinary banking concern. You want the State's money invested up to £5 million and the Corporation have to show an adequate return. The Corporation can go to anybody who wants money and can adopt precisely the same attitude as a bank would adopt, requiring collateral security or guarantors. They can have a mortgage on the man's house, on his wife's jewellery and everything else—that is what you want them to do. That is the directive. They have to take every precaution to see that their principal and interest are fully secured.
That is entirely foreign to the original conception of the Film Finance Corporation. If the Government have made up their minds that there is no more room for this Corporation, I do not mind. Say so, and wind it up altogether. But do not put in one clause that they can sell themselves to any buyer and they have got to make a profit, so that they have to fatten themselves up for the market. It is so entirely different from the conception that the Government had in 1949 that, if my noble friend desires to ask your Lordships to express in the Division Lobbies your opinion as to whether we should revert to 1949 and keep the present Act in force for the next ten years, as I understand my noble friend's Amendment to read, I shall advise all my noble friends on this side of the House to join him, because we stand by the principle which we enunciated when we introduced the 1949 Act into Parliament.
4.55 p.m.
LORD ARCHIBALD: My Lords, I must join with my noble friend Lord Lucas of Chilworth in expressing again disappointment at the inadequacy of the reasons given for this change. A good deal of the argument which we heard from the noble Lord, Lord Fairfax of Cameron, was quite wide of the mark. When, for example, he told us about the 70 per cent. and the 30 per cent., I did not really see what relevance that had to the question of to whom the Corporation is to lend money. May I tell him that on that point I do not think he got his facts quite right? I do not blame him for

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that, because film finance is a very complicated matter, and those who have not had to deal with it may be forgiven if they do not follow it through all its various features. But I think it is true to say that the Film Finance Corporation has, in most cases, lent to 70 per cent.; in some cases it has lent to 100 per cent. but I doubt whether there are many cases in which it lends tie 30 per cent. which is most at risk.
In fact, if the noble Lord would make further inquiry, he would find that there is an increasing tendency on the part of the Corporation to insist that the producer should find same, if not all, of that risky 30 per cent., whether it be by deferring his own fee as a producer, director or script writer, by putting in some money that he may have earned on a previous film or by one means or another. The Film Finance Corporation is not, in fact, as the noble Lord led us to believe, carrying the whole of the 30 per cent. risk on the whole of the films that are being financed—far from it. I think we have got rather a mistaken picture of the situation there. But let us go back to what is really at issue here.
Under the Act of 1949 and under the Government amendment of that Act, the Corporation is still charged with the obligation of lending only on films which have reasonable expectations of being commercially successful. There is no change proposed in that. We know that the Corporation are doing a very fine job. I want to say that the Film Finance Corporation have, as he noble Lord, Lord Fairfax of Cameron, said, steered a fine middle course between all the difficulties with which they had to contend. But, in doing that, they have not been any more successful than the film industry in forecasting what is going to be a commercially successful film. That is something that nobody can do. Of course, it would be quite improper of an Act of Parliament to empower the Corporation to lend money on films which everybody thought were going to be commercially unsuccessful, so I think we are all at one on the need for having this provision in the legislation, even though we recognise that, in practice, it is asking them, in effect, to have a better crystal ball than the industry itself has.
But the change is only that they are in future to be empowered to lend money to
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people who could get their money elsewhere. We have not heard any argument which is worthwhile and substantial really directed to that point. The suggestion that it may enable the Corporation to operate more successfully—that is to say, to make more profit—will not really hold water. It is not a question of whether a film is likely to be commercially successful that determines whether or not a producer can get his money elsewhere; it is a question of what sort of company is he and what sort of assets has he got? There are just as many commercially unsuccessful films made by big corporations with substantial assets as by independent producers with no assets at all. Therefore, lending to these other people will not put the Finance Corporation in a better position, and it is quite mistaken to argue the matter in that way.
No answer has been given to the argument that people who can get their finance elsewhere may come along and use up an undue proportion of the Film Finance Corporation's resources and leave an insufficient amount available for lending to independent producers who cannot get their finance elsewhere and for whom the Bill is intended. I do not want to hold up the House unduly, but I feel strongly about this matter. I do not feel so strongly about the change as about the inadequacy of the reasons that we have been given for it. If we have heard the last word from the Government on this subject, then I shall have to ask the House to decide on it.
LORD MANCROFT: My Lords, if the noble Lord, Lord Archibald, puts it like that, I am in duty bound to say a few words, because my noble friend Lord Fairfax of Cameron has no right of reply. He has said almost all there is to be said about these two Amendments—as we know, they march closely together; in fact, we cannot consider Clause 10 without Clause 11. Would your Lordships be good enough to look at Clause 11 and see exactly what it is that the clause seeks to do? I beg your Lordships not to be misled by the rather harsh words in the margin of the print of the Bill—
"Duty of Corporation to pay their way."
What the clause actually says is—
"It shall be the duty of the National Film Finance Corporation to exercise and perform their functions in such manner as appears to them best calculated to secure the avoidance of default's being made in the discharge"—
LORD MATHERS: There is an apostrophe "s" in "default's."
LORD MANCROFT: I had not noticed that—
"as regards any loan made to them after the passing of this Act."
No vast and vital change is being made in the policy at the moment. I may tell the noble Lord that the policy which we are now advocating has been arrived at after full consultation with the Corporation.
The noble Lord, Lord Archibald, argued, I remember, on Second Reading, that the 1949 Act, which the noble Lord, Lord Lucas of Chilworth, has been discussing, would never have gone through if the Corporation had been entitled to lend to all and sundry and to compete with the banks. The answer to that is surely this: that when the 1949 Act went through there was no levy, and the Corporation were in a position in which it would surprise no one if they lost money. It was looked upon as a rescue operation, and as short-lived. To-day, as we have been arguing for several days on this Bill, the position is quite different. I think we all realise that if the Corporation do not raise money, it is just not going to be forthcoming to film production. The Corporation will be with us for a long time to come. The whole conception of a rescue operation has now gone, and instead we are giving producers not just a levy which they did not have when the 1949 Act was passed, but a much larger levy than they have ever had before. I am certain that it would be wrong in such circumstances to expect losses by the Corporation without inquiring into them pretty carefully, or to accept such losses with resignation.
LORD LUCAS OF CHILWORTH: The noble Lord has said that we are going to give the producers a larger levy
than ever they have had before. How do you know? Are you guaranteeing them? The levy is going to be got out of the exhibitors.
LORD MANCROFT: There is no guarantee, of course we have argued that at very great length, too. That is what we are trying to legislate for.
LORD LUCAS OF CHILWORTH: The noble Lord is arguing about Clause 11, not Clause 10.
LORD MANCROFT: Yes, I know. All we ask now is that the Corporation should try to set out, under this part of the Bill, to maintain their resources intact. We will not move backwards and forwards again over that. I believe that these new clauses in lie Bill—the new constitution and aims of the Corporation—are right when viewed in the light of the changed circumstances of the industry, and I do not believe that the alarming forecast of noble Lords opposite will really come about at all. It is not the aim and object of the Bill, and I can see no reason why it should happen. All we are doing in these clauses is to try to give the Corporation the chance to run themselves, if they possibly can, on a profitable basis. I am certain that that is a correct provision to put in the Bill. If the noble Lord thinks it is a wrong provision, then I am sorry we can convince him no further. There is no more subtlety in it, and there is no more in it than that. I believe it to be a fundamental point that we should put the Corporation in a position, if they can do it, to pay their way. If we have not convinced noble Lords opposite, then I am afraid we must challenge them in a Division.
On Question, Whether the said Amendment shall be agreed to?
Their Lordships divided: Contents, 10; Not-Contents, 40.

CONTENTS

Attlee, E.

Amulree, L.

Mathers, L.

Listowel, E.

Archibald, L.

Pakenham, L.

Lucan, E. [Teller.]

Lucas of Chilworth, L.

Rea, L.

Strabolgi, L. [Teller.]

NOT-CONTENTS

Salisbury, M. (L. President.)

Morley, E.

Davidson, V.

Munster, E.

De L'Isle, V.

Reading, M.

Onslow, E. [Teller.]

Falmouth, V.

Albemarle, E.

Perth, E.

Goschen, V.

Dundee, E.

Hailsham, V.

Gosford, E.

Cherwell, V.

Massereene and Ferrard, V.

Home, E.

Colville of Culross, V.

Stonehaven, V.

Amherst of Hackney, L.

Fairfax of Cameron, L.

Moyne, L.

Ashton of Hyde, L.

Hawke, L. [Teller.]

Remnant, L.

Baden-Powell, L.

Howard of Glossop, L.

Rennell, L.

Bennett of Edgbaston, L.

Kinnaird, L.

Rochdale, L.

Chesham, L.

Mancroft, L.

Rockley, L.

Conesford, L.

Merrivale, L.

Somers, L.

Derwent, L.

Milverton, L.

Waleran, L.

Resolved in the negative, and Amendment disagreed to accordingly.

Clause 11:
Duty of Corporation to pay their way
11. It shall be the duty of the National Film Finance Corporation to exercise and perform their functions in such manner as appears to them best calculated to secure the avoidance of default's being made in the discharge, as regards any loan made to them after the passing of this Act, of their obligations with respect to repayment of the principal of the loan and the payment of interest en any sum for the time being outstanding in respect of it.
5.11 p.m.
LORD ARCHIBALD LORD ARCHIBALD moved to omit Clause 11. The noble Lord said: My Lords, we have already been over a good deal of the ground on this Amendment and I am not going over it all again. As it is the last Amendment, may I express a personal view? I am sorry that on the Report stage, and very largely on the Committee stage, this Bill has seemed so much to be in the nature of a double duel between two noble Lords on this side of the House and two on the other side. For myself, I apologise for the amount of time that I have taken up, but this is a serious matter—
LORD MANCROFT: It is indeed—
LORD ARCHIBALD:—and one affecting an important industry. It is only proper that we should take adequate time to discuss a measure which affects that industry for ten years ahead. During the discussion we have had certain assurances from noble Lords who are speaking for Her Majesty's Government. Those assurances have been substantially that the provisions dealt with by the Amendment which has just been defeated and this present Amendment will not radically change the operation of the Film Finance Corporation; and I hope time will show that those statements are correct.
On this particular Amendment I want to make just one point. I have argued before that these provisions could be taken, let us say, by the managing director and directors of the Corporation, as a directive to be much more restrictive,
896
rigid—savage almost—in the selection of the enterprises to which they make loans, so that they may not, in turn, default on their borrowings. I am told that I am wrong in that, but I hope that it may be possible for a spokesman for Her Majesty's Government to say something which will be in the nature of a directive to the directors of the Film Finance Corporation to tell them that I am wrong, and why. So that there may be a reply, I beg to move the Amendment.
Amendment moved—
Leave out Clause 11.—(Lord Archibald.)
LORD FAIRFAX OF CAMERON: My Lords, as the noble Lord has said, this is in fact the other half of the cherry—the first half we discussed on the previous clause. On the Committee stage, in recalling the origin of the Film Finance Corporation, the noble Lord, Lord Lucas of Chilworth, said that it existed to lose money, and he reminded the House of his earlier remarks that it would be a good day's work if they lost the whole lot, the £5 million, but kept the independent producer in business. No doubt the noble Lord will remember that.
LORD LUCAS OF CHILWORTH: I repeated it this afternoon.
LORD FAIRFAX OF CAMERON: Her Majesty's Government do not see the Corporation in this rôle at all. The House may remember that when the Corporation were set up, hopes were expressed that they would help to put the film industry back on its feet again and could then be dispensed with. But there is now general agreement within the industry that we cannot yet dispense with the Corporation. First, their powers were extended from five years to eight years, and now they are to be extended to a maximum of eighteen years. Her Majesty's Government could not contemplate with equanimity the prospect of the Corporation's continuing to make losses over that period of time, and the Corporation certainly could not do so on the old scale without considerable addition to their resources.

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These losses of the Corporation which have, at times in the past, been heavy are a form of hidden subsidy for the industry. We believe that any assistance given to the industry should be overt. What Her Majesty's Government aim to do by this Bill is to give film producers, by means of the levy, such overt assistance, to a degree which will, we hope, enable producers, taking the successful films with the unsuccessful films, to do much better. So long as film production, taken overall, is unprofitable, the Corporation are going to lose money, for they often bear the end risk; but as production with the aid of the Levy and with the growing efficiency of the industry becomes more profitable, so should the Corporation's activities become more profitable. It is a misrepresentation of the policy of Her Majesty's Government to say, as was said during the Committee stage, I believe by the noble Lord, Lord Archibald, that by this clause Her Majesty's Government are trying to take the element of risk out of film financing. That, alas! is beyond the capacity of any of us. What it does, however, is to require the Corporation, in the light of the improved position for film producers, to perform their functions, which are: to lend to films having reasonable prospect of commercial success, and to do so in a manner best calculated to avoid default in the discharge—and this is now important—not of the loan made by them to the producer, but of loans made to the Corporation from time to time from which they draw their resources.
Of course, sometimes the Corporation's "best calculation" may go wrong and several films may make a loss, part of which will fall upon the Corporation, but other films will do better than expected. Perhaps it would help noble Lords to understand the effect of this clause if I were to explain that the loans made by the Board of Trade to the Corporation are for periods not exceeding five years, and repayments are consequently being made at frequent intervals, and, of course, fresh borrowings may be made at the same time. The Corporation does not just turn over the money borrowed by them and then make fresh borrowings if they lose the earlier money. Consequently, there is nothing to prevent the Corporation from actually making a loss in any one year without infringing this
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clause. Noble Lords need not fear, therefore, that the effect of the clause would be to require the Corporation only to support gilt-edged propositions. There are no gilt-edged propositions, as noble Lords will know well, in film finance. The Corporation's functions are to finance films and that is to say that their functions are to take risks, though I hope that the business will be less risky in future. In short, Clause 11 makes explicit the desire of the Government that the Corporation shall over the extended period of its existence maintain its capital intact. It may not be able to do so, in view of the risky nature of its business; but at least it must try to do so.
LORD LUCAS OF CHILWORTH: My Lords, may I ask whether that long reading from a brief is supposed to be the answer to the one slight interrogation made by my noble friend Lord Archibald? My noble friend just asked for some assurance; he said he was not going to argue. If the noble Lord opposite, after the highly controversial statement he has made, wants to argue this all over again. I am prepared to accommodate him; but we did not wish to detain your Lordships by discussing the case all over again. This shows the disadvantage of reading a brief in answer to an argument. Perhaps I might ask Lord Mancroft whether he would reply to my noble friend's simple request, as we do not wish to put your Lordships to the trouble of dividing. If the noble Lord, Lord Fairfax of Cameron, wishes to quote what I said, may I advise him to quote a little more of the context and then he might get it accurate. What I said was this: if it should be necessary to save the industry, a loss of £5 million would be a good day's work—not that it would be a good day's work to lose £5 million. There is a vast difference. However, I have nothing to add to what I have said, and perhaps Lord Mancroft will now think it worth while to reply to the point raised by Lord Archibald.
LORD MANCROFT: The noble Lord, Lord Lucas of Chilworth, is being a little harsh, if I may say so. I am afraid my attention was a little distracted while Lord Archibald was speaking, but if I understood him aright he asked whether there was intended to be a change of policy; whether the Corporation are to

899
take a tougher attitude than in the past. But perhaps the noble Lord would not mind repeating his question.
LORD ARCHIBALD: What I said was that in the course of the discussion on the previous Amendment—I think I am right in this—Lord Fairfax of Cameron said that, although there were these changes, there would be no radical change in the operation of the Corporation and that it had been indicated that the Corporation would not take this as a directive to be harsh, rigid or savage in the scrutiny of their loans. If I could have some reassurance about that matter I should be grateful.
LORD MANCROFT: I had understood the noble Lord correctly. I can certainly give him the assurance for which he asks. It is not intended that the Corporation should adopt a policy of rigidity, toughness or harshness in the scrutiny of loans. But it is intended that they should so conduct their business that they will try, in accordance with the words of the clause, to
"perform their functions in such manner as appears to them best calculated to secure the avoidance of default's being made."
Trying to conduct themselves in ways "best calculated to secure the avoidance of default" does hot mean a radical change of policy. It means that there will undoubtedly be a very slightly different slant in the Corporation's mind. As I have explained at length before, it is only a directive to the Corporation that the time has come when they must try to avoid risks if they can. It is not an instruction to them to be harsh and brutal in the future conduct of their affairs. That assurance I can certainly give the noble Lord.
LORD ARCHIBALD: I thank the noble Lord very much.
On Question, Amendment negatived.

TRANSPORT (RAILWAY FINANCES) BILL
5.26 p.m.
Read 3a(according to Order), and passed.

CONSOLIDATED FUND BILL
Brought from the Commons, endorsed with a Certificate from the Speaker that the Bill is a Money Bill within the meaning of the Parliament Act, 1911 and read la.
HOUSE OF LORDS OFFICES
Second Report from the Select Committee: made, and to be printed.
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