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Equalisation Grants (Money Resolutions)

Volume 464: debated on Tuesday 10 May 1949

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When the Landlord and Tenant (Rent Control) Bill was in Committee, an Amendment was placed on the Order Paper requiring the local authority to keep a register showing the standard rent of every house in its area to which the Rent Restrictions Acts apply. This Amendment was not called, because it was out of Order. After some discussion my right hon. Friend the Minister of Health undertook to look into the position and consider whether any change in the rules of procedure was desirable. The reason why the Amendment was out of Order is briefly as follows:

The Local Government Act, 1948, introduced a new system of equalisation grants payable to local authorities whose rateable value per head is below the average. This grant differs from the old block grant which it replaced in that any increase in the expenditure of an authority receiving equalisation grant results directly and immediately in an increase in its equalisation grant. Consequently any Bill increasing rate-borne expenditure by more than an insignificant amount now requires cover in the Financial Resolution for the resulting increase in equalisation grant. The Government considered this position at the time when the Local Government Act became law, and decided that, while it would require certain changes in Procedure in relation to Private Bills, no change should be proposed in relation to public Bills.

The duties placed on local authorities by the Landlord and Tenant (Rent Control) Bill, as introduced, were not sufficient to cause expenditure of more than an insignificant amount, and it was not therefore considered necessary to provide in the Financial Resolution for any increase in equalisation grant. The Amendment requiring local authorities to keep registers of the rents of all houses to which the Rent Restrictions Acts apply would have caused considerable expense to the rates, and therefore an increase in equalisation grant. As the Financial Resolution did not provide for such an increase, the Amendment was out of Order and could not be called.

At first sight my right hon. Friend was inclined to take the view that the rules should be amended so as to enable Debate on such proposals to take place in the future, but now that there has been an opportunity to examine the matter, we do not think that any change is required. Where a Public Bill, as introduced, puts any substantial duty on local authorities, a Financial Resolution will be put down for the Bill to cover the resulting increase in equalisation grant, and we can draft it in wide terms, which will not prevent hon. Members from moving Amendments which might increase the charge on the rates.

The only question that arises is, therefore, whether we should invite the House so to amend its Procedure that a Clause putting a substantial duty on local authorities could be moved in Committee, on a Bill which did not put any such duty on them when it was introduced. We do not think that such a change is necessary; the particular circumstances that led to the difficulty on the Landlord and Tenant (Rent Control) Bill are not likely to be of very frequent occurrence.

In view of the fact that a very large call is made at the present time upon local authorities to give information to enable landlords and tenants to ascertain the standard rent, and as that entails upon local authorities a heavy expenditure, does not my right hon. Friend think it advisable that the Government should recommend a change to enable standard rents to be registered, instead of continuing to incur the daily expense that now falls on local authority officers?

On the merits of the case, we do not so think. I am not so much referring to the merits of the Amendment which my hon. Friend the Member for East Islington (Mr. E. Fletcher) was proposing, but to a point of procedure. I think that the statement I have made is in itself sound.