Orders of the Day — Valuation for Rating Bill

Part of the debate – in the House of Commons at 12:00 am on 21st May 1953.

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Photo of Mr Joseph Godber Mr Joseph Godber , Grantham 12:00 am, 21st May 1953

That may be so, but it is at any rate a voluntary payment of tax. Rates are quite different and distinct in that they are fixed arbitrarily.

For myself, I have always thought rates a thoroughly bad form of tax which I should be happy to see abolished altogether, but I doubt whether that is practical politics at present. This links up with the whole question of Government finance. Like many other hon. Members who have already referred to me leading article in "The Times" yesterday, I should like to read out what seemed to me the most important part. There were some parts with which I agreed and some with which I certainly did not agree. Naturally, I shall not read out the parts with which I disagree. The part that struck me most forcibly was this passage: Measured against the responsibilities of local authorities, rates have been a dwindling source of revenue over a long period. This has led inevitably to the dangerous centralisation of the machinery of government, and the vitality of local self-government is being imperilled thereby. Services best left to a suitably re-organised and better financed local government have been taken over by Whitehall, and in performing the functions left to it local government has become dangerously dependent on government grants. This financial crisis is the true crisis of local government today, though much less discussed than the related defects of organisation and boundaries. With that part I thoroughly and entirely agree.

As one who has served some years on a county council, I was always struck by the weakness of the financial background of the whole of local government, and the fact that the amount of money raised locally in the form of rates amounted, on average, in the authority with which I was concerned, to less than 33⅓rd per cent. of the money being spent. That seemed to me a thoroughly unhealthy state of affairs, which was bringing about the very effects mentioned in that article. Of course, it never has been local government; that has always been a misnomer. Local administration was even failing to be local in that respect; and the domination of the central Government by means of its financial pressure was so great that many good men who could put in useful work in local government were not coming forward to do so. That is probably common ground between us. That is the basis on which we should be looking at the whole question of local government finance.

I feel most strongly that there are, or should be, other means by which local government could be financed. I believe that rates are a bad thing in themselves. I agree that local government finance should be produced by rates to some extent, but I do not think it should be any higher than the present basis, and probably less. I do not see why some other form of local revenue should not be found to take the place of part of the rates, which would at any rate augment the rates and give local authorities a local source of finance greater than that which it would receive from the central Government.

That would be the basis on which I should like to see something done. I obviously cannot follow up this point further, but I do not see why there should not be some form of Excise Duty, perhaps, collected and administered locally. We have got too set in our minds over the whole question of local government finance. Rates should not be the be-all and end-all in that respect. They are at present the largest source of locally produced revenue for local government.

I should now like, if I may, to touch on re-rating which has been mentioned by one or two hon. Members, particularly the hon. Member for Clapham (Mr. Gibson). I have noticed that the subject has appeared in a number of Questions on the Order Paper lately, clearly indicating that certain hon. Members are thinking very strongly on the lines of re-rating. I am not at all certain whether the re-rating of industrial property might be justified, but I am quite certain that the re-rating of agricultural property would be absolutely unjustified, for the same reasons as those given by my hon. Friend the Member for Hertford (Mr. Walker-Smith), that it is sheer and utter folly to re-rate at a time when the price of agricultural produce is subsidised. To re-rate agricultural property at this time is the same, in effect, as putting a tariff on imported foodstuffs. Would hon. Gentlemen opposite suggest that?