The only purpose of this short Bill is to abolish the rather outmoded system known as the half-rent system. The Act under which this system has been in operation for a considerable time past has been archaic and a complete anomaly in the general set-up of the rating system as we know it. To make things a little bit more complicated, although the system was known as the half-rent system, it was later changed to become in effect the quarter-rent system. Then, to become really helpful, there were reductions made again so that we had the situation where the fraction ratio charged varied throughout the country. We had in county council areas rates being paid on 50 per cent, which was half-rent, in the areas of Cork Corporation and Limerick Corporation, 33 per cent, Dublin and Dún Laoghaire Corporations, 22 per cent, Waterford Corporation, 60 per cent, borough and urban district councils, 50 per cent, and town commissioners nil for the purpose of town charges.
By the time I had worked all this out I was just about as confused as I imagine many other Senators in the House also were. Indeed, when I read the debate which had taken place on this Bill in the other House I got the distinct impression that perhaps the Members of the Upper House were not the only ones to be somewhat confused about the half-rent system. However, what everyone seems to be in general agreement on is that it is clearly an anomaly in present-day circumstances and ought to be removed. Apparently, the original intention was that usually where the tenant was either a charitable institution or a public or scientific body, the rates payable by the owner would be paid in theory initially under the 1849 Act on half the rent received.
Clearly, once the rate in the pound went beyond £2 in the £1 the owner of the property was at a serious financial loss. Even in cases where, as in Dublin city and Dún Laoghaire Corporation areas the rates were payable at only 22 per cent of the rent received, with the absolutely fantastic charges which the rate in the pound is now demanding the property owner was still paying more by way of rates than he was receiving by way of rent. It was only right that there should be some legislative measure to remedy this situation.
The point in this Bill which surprises me most of all is that it has taken so long to emanate. It is quite clear that for a considerable number of years this system must have been apparent to everybody as one which no longer operated successfully and was merely an embarrassment. The first concrete proposal to abolish it came in 1960 but the then Minister for Local Government was not inclined to move on it at that time. Some sort of extension system was allowed to bring the system through to the year 1970. Then the inter-departmental committee on local finance and taxation in their second report, published in 1967, set out the situation of the half-renting system and made the case for its abolition. It seems strange that it has taken from 1967 until now to produce what, as the Minister has said, is a very short and innocuous Bill.
We now have the Bill and I think it would be fair to say that it is to be welcomed from all sides of the House. One of the rather annoying sections to it is section 3, which allows this retrospective clause under which the Government can from time to time, when it so suits them, although the previous legislation should have expired in 1970, by means of a circular from the Department of Local Government continue the system in operation for a further year. Yet, in a tardy way, the Government produces their Bill and backdate it to a month long past. When local authorities and other bodies ask for retrospective legislation from the Department of Local Government they are always met with a very firm and definite "no" and an assurance that retrospective legislation is bad legislation and should not be countenanced under any circumstances. But when the Department of Local Government have difficulty in producing a five or six section Bill and produces it some six or nine months after the operative date from which they would like to see it operating, they merely insert what they are beginning to call a "saver clause". I am not sure whether it should not be called "a face saver".
The retrospective element of it is not essentially bad. It is not at all bad in this case. But it would be well if the draftsmen and those concerned in framing local government legislation were to remember their saver clause when they get requests in other fields of local government for retrospective legislation to remedy outstanding and obvious ills in the local government code.
The other aspect which upsets me about this Bill is this. Again, if I may emphasise it, it is a very short Bill which will not detain the House very long. Yet being so short and designed merely to correct an anomaly which has been in existence for over 100 years, it is introduced to the Dáil and Seanad in the months of June and July, 1971. Since late in 1970 the Minister for Local Government has been promising that a White Paper on reform of the whole system of local finance and local taxation and the rating system would be published in the immediate future. As Members of the House will know, in the interim a White Paper on local government services generally was published and circulated rather in a vacuum, because no one felt he could comment on it due to the lack of a White Paper on the reform of the financial structure of local government. However, with the White Paper still being promised, we have now presented to us a minor Bill to amend in a small way the rating code.
What upsets me is that, if the Minister and his Department see fit to introduce this Bill at this stage and bring it to both Houses of the Oireachtas, it does not augur well for anyone who had hoped there might have been sweeping changes and definite proposals on the reform of the whole rating code in the forthcoming White Paper. If that had been the case quite obviously this Bill would have been left over until such time as the main Bill and legislative measures to change the entire rating system were drawn up. I am a little fearful and disappointed that the arrival of this Bill here today is a very definite indication from the Government that they have no intention of making sweeping changes in the rating system.
Another indication which would seem to confirm that opinion is the Minister's remarks when speaking on this Bill in the Dáil on Wednesday, 23rd June 1971. In the Dáil Official Report, Volume 254, No. 13, column 2155, he says:
It removes an obvious anomaly in the rating system, one that can involve injustice and can be dealt with without affecting the overall rating system, which must remain.
Here we have the Minister for Local Government assuring us that the overall rating system must remain and, coupled with that, we now have a five section Bill designed to change a small anomaly in the whole of the rating code. Yet we have a promise of a White Paper with, one had hoped, very definite proposals on changes and improvements in the rating structure and the method of raising finance for the operation of local authorities generally. The most significant thing to be taken from this Bill is that the White Paper will be a non-event when it eventually arrives.
The Minister referred I think here today—and certainly during the course of the debate in the Dáil—to the fact that while the abolition of the half-rent system will cost the Exchequer approximately £30,000 more this year, it will in certain cases mean that local authorities will have to bear the loss of a certain income which they receive at present. Perhaps, when he is replying, the Minister will clarify how he envisages that local authorities will suffer because of the passing of this piece of legislation.
The Bill is to be welcomed because it eliminates a rather annoying factor in the rating code. At the same time it is a Bill to be regretted because it seems to be a clear indication that this is probably the nearest we will get to sweeping reform of the rating system from the present Government.