In relation to this section, am I to understand that this is the section which cancels the notion of assessing rates on rents or half-rents? Does this cover the situation adequately? Should there not have been a subsection or a further section setting out that, while the rates on rents notion was being abolished in respect of certain buildings, the rates on the valuation system in respect of those same buildings would come into operation, or is this a natural consequence of this section anyway?
Local Government (Rateability of Rents) (Abolition) Bill, 1971: Committee and Final Stages.
SECTION 1
Question proposed: "That section 1 stand part of the Bill."
The State normally pays rates on property which it occupies on the ordinary or poor law valuation. It is only where there were old leases that this applied and where the property was not owned by the State. The amount paid by the owner who was liable for half-rent rates was deducted from the amount which the State paid which was based on the poor law valuation of the premises.
I am afraid I was not present when the Minister was speaking and perhaps he answered my question then. Does this mean that in a situation which we were familiar with, when a charity bought property, the liability for the rates shifted to the lessor? Instead of the charity being liable for rates the lessor became liable for rates on the half-rent. This half-rent was determined in different parts of the country according to the different percentages of the sum involved. Is this correct?
The second part of what the Senator says is correct, but I think the Senator said at the outset that if a premises was purchased by a charitable organisation, if the charity were the owners of the premises and if they qualified for rate exemption, then they were free of rates and would not have to pay. This only applies where the premises are occupied by the charity, and is thus exempt from rating, is owned by another person and that person, if he has not provided or made some arrangement in the lease with the charity or other State body which occupies his property, was obliged to pay rates based on a proportion of the rent which he received for that property. In modern leases the arrangement was made that the lessee had to pay the rates liability. If the charity owns the premises and is deemed to be an organisation which is exempt from rates, then this question does not arise.
There will be a shift of liability in that case. Let us take, for example, a property in Dublin which is held under a long lease and the charity buys it. Generally, the lessor's consent is required in such a case. If it actually happens, there is a shift of liability for the rates. The charity, because they are a charity, cease to be liable for the rates of the property, but there is a liability on the lessor of the leasehold premises which now goes?
Yes. If he sells the property there is no longer an obligation.
I just want to follow this out. Does this mean that there is no question of a shift of liability? Say that I am an investor in property of this kind do I, as a result of this Bill, find myself liable to more rates or do I find myself free from rates if a charity occupies it?
The Senator would be free from rates in the future.
It really clears up a lot of mess.
The £30,000 involved is surely an additional bounty which the State will have to take. The situation which Senator FitzGerald was talking about is where a charity became a sub-tenant or took up an existing lease and in that way the owner suddenly found himself being liable for the rates. In this particular case surely this is the less than 1p element in which Dublin Corporation will have to pay— the liability which is shifting away from the charity and the owner of the property and will have to be borne by the local authority?
It should be remembered that one new penny could be called two old pence. Two old pence, in Dublin city, two years ago would have produced an income of something in the region of £26,000 or £27,000 for Dublin Corporation. It would probably be even more now, although one finds it more difficult to glean information about the financial affairs of Dublin Corporation at the moment. Nonetheless, while the Minister is talking about an additional £30,000 the Central Exchequer will have to bear by way of additional rate bounty, it is fair to point out that apparently Dublin Corporation will have to bear almost an equivalent amount because of the introduction of this legislation. This is not to say that it is not a good thing to have the liability passed from the owner where his property is occupied by a charity; but it should be remembered that the local authorities will in some cases, have to bear a fairly hefty reduction in their income because of it. It is not just the State who will be footing the Bill.
This is so.
Question put and agreed to.
Sections 2 and 3, inclusive, agreed to.
SECTION 4
Question proposed: "That section 4 stand part of the Bill."
Section 4 is a cause of contention. It can be introduced in a Bill which is presented to the House by the Minister to suit the Minister's purpose. It can refer to the fact that the Department of Local Government send out a circular in anticipation of the decisions of the supposed law makers of the country, the Dáil and the Seanad. They send out a circular to the local authorities and tell them to continue in operation for another financial year the provisions of a piece of legislation which officially went out of existence on 31st March, 1970. By means of a roneod circular emanating from the Custom House the local authorities continue to operate the legislation for a year.
All this is met in a glib fashion by slipping section 4 into this Bill and the equivalent sections into other Bills which have come from the Department of Local Government to cover up what is, I must say, apparently the ineptitude of the Department in presenting Bills and having Bills go through the Houses of the Oireachtas in good time.
I do not think it is good enough that officials of local authorities are directed by circular to carry out what is, in effect, an unlawful procedure for over a year in the hope and expectation that the Government are going to introduce a saver clause into the legislation when they get around to introducing it and that the Houses of the Oireachtas are going to accept that. I suggest to the Minister that, where it is quite obvious that a piece of legislation is going to expire on a certain date, there should be adequate steps taken to either replace it by that date or just to discontinue its provisions once it has gone out of date. But to send out a circular and then introduce what is now blatantly being called a saver section is, to my mind, not good legislation. I am sorry to have to say that, but I notice it particularly in legislation which emanates from the Department of Local Government.
I should like to join in support of Senator Boland on this. It seems to me to be an extraordinary attitude of mind on the part of any Department of State, and I am now going to call on all Senators to have a look at what is proposed to us. Things have been done in anticipation that we will save the people who have done them. Let us not save them by not passing this section. What will be their position if we do not pass it? Who will be responsible for the moneys that have not been collected or spent as the case may be? The saver refers to a section. The Minister cannot be blamed for legislation by reference, because he is inheriting a long tradition. If we were doing our duty we should be coming up here with books that high containing all the Acts that are referred to in Schedules carefully marked and studied, considered reflectively and spoken upon wisely. How would we do our job at all if this was the way in in which we had to do it? Why the devil can you not set out section 24 of 1946 in this and tell us what you have done that you are asking us now to save you from? Why should it run as the next section or as the ultimate section? Why should it be made run from the 1st April, 1970, when I would rather run it from the 1st April, 1971? Perhaps the other Senators will agree with me. Will the Minister explain?
I already explained that.
Perhaps the Minister would deal with my comment on section 4. Why should any civil servant do something in anticipation of this Legislature enacting an Act which it may choose not to enact? What is the consequence of our declining to enact it? Who are supposed to be the counter-signatories? Are they the gentlemen behind the Minister or the gentlemen elected by the representatives of the people here? Who are the counter-signatories? Who are the people making the decisions? The Minister has got his Cabinet with him in this. Surely he has not got his party with him on this? I am sure they sense their position is being challenged and infringed and are as outraged as I am by this proposal.
We are waking up now.
You will suitably react. Why "in anticipation of this Act?" This is the phrase I think Senator Boland resented and I resent also. "In anticipation of this Act". Why should this be? I am sure the Minister will give an adequate reply.
First of all, I have referred to this question of March, 1970, as against March, 1971. The 1960 Act mentioned in section 2 lapsed on the 31st March, 1970, and it was not possible to introduce the legislation in time before that date. This is why we intended introducing it and this is why we advised by circular the local authorities to apply it and that we would validate that by including a section in this Bill. This section to extend the legislation to 1971 then is to validate the action taken last year. It was originally intended to include the provisions in this Bill in the 1970 Act, but due to the complexity of the existing law relating to half-rents which, I think, the House will accept one has to go back to 1838—can be quite complex, it was not possible; and, rather than cause a delay in introducing the Act which allowed for rates to be paid by instalments and allowed local authorities to introduce a rates waiver system, it was decided to go ahead with the 1970 Act and to follow on with this small Bill to cover the half-rents. That is more or less the reason behind the thinking in the Department in allowing the extension of the year and in now invalidating it in this Bill and anticipating that the House would accept it.
It is not good law. The precedent is in the fact that it has been done by the same Department.
Is there precedent for that?
The precedent is in a recent Act.
It does seem to assume that we are going to do things because somebody else has made decisions. What if we do not do them? I would not like to suggest to the Minister that he might not have a majority here on some occasion. It might be and, if this were so, who would be out of pocket and how would that be dealt with? If the Legislature decided not to save—this is the phrase used—I should like the Minister to tell the House now who would be at a loss if we did not save them? The comptroller and Auditor General, I take it, has a peek at this at some point.
It is a very interesting question. There are many precedents for sections such as this in previous Bills which are now Acts and this is not an unusual practice. I can only assume that, if such a situation did arise and that the House did not pass the legislation, some other provision would have to be made to allow for the difficulties created through the non-validating of the steps which were taken in anticipation of legislation being passed.
The unfortunate people would be at a loss.
I do not want to get myself tangled with the legal luminaries on this, but there are personal considerations involved. Anybody who is on a local authority knows very well that there were certain times when, through pressure of problems of one kind or another, certain remissions have to be made on rates. Anybody who is an active member of a local authority knows they have been made. There was always difficulty with auditors to know whether you had legal authority to do these things or not.
I am not very enamoured with the idea of bringing in a section that authorises you for one or two years. I would prefer to lay it on the line. Anybody who understands the practical application of this will realise that if you enshrined it in the legislation that this thing can go on, a system of permissiveness, you could not run a local authority. There may be times when people come under stress which has not been anticipated and the local authorities may, because of the peculiar circumstances that appertain to a particular case, decide that they would make a remission of rates for that year. But I do not think you could enshrine this in legislation.
I agree with the observations made by Senators Alexis FitzGerald and Boland that this seems a peculiar way of doing it. But circumstances know no bounds. I have a certain amount of experience on this matter, and things have to be done sometimes. These may be repulsive to me but because of necessity I have to do them. I am not terribly impressed by the way this matter has been dealt with, but it is something that has to be done. As far as I conceive it, what the Minister wants is to get the House to confirm that what he did was done in good faith.
If we want to solve this problem about who should and should not get remissions, we should come back here and look for a more comprehensive Bill. This is a perpetual problem. I have seen how a great injustice could be done to individual people because of peculiar circumstances that arose from their mode of life and which would probably disappear in a year or two. All you are trying to do is help them over the fence and eventually things are sorted out.
I am not criticising Senator Alexis FitzGerald or Senator Boland, but there is a case for this. Whether this is the best way to do it is a matter for debate, I think, in the present circumstances, the Minister should get this Bill. I would say I am talking to the converted.
We are prepared to give the Minister the Bill.
The question is whether we should legalise the things we did ourselves.
It is not unusual, as Senator Honan has rightly said, for local authorities to anticipate legislation. I am wondering if in this case the Minister has advised the local authorities concerned that this legislation is pending and that this clause is only giving legislative effect to what the Minister intends to do.
Personally I dislike either retrospective or prospective legislation, but if it involves any case of hardship I must say I would agree with Senator Honan that this peculiarly-worded clause probably achieves a useful objective. I hope it will not be taken as a precedent because I think it is something that should not be normally written into legislation. However, where any case of hardship might be involved we would be justified in anticipating legislation, which I think, in effect, is what this Bill proposes to do.
In actual fact there have been many precedents for this. Even last year before we passed the Housing Act giving increased grants the Department were, for three to four months before it was passed, sending out the new housing grants for the people.
Was that not terrible?
If they did not do that they would have had to send out new estimates to everybody. The minute the Bill was passed all the applications would have had to be sent out again and the people would have to be told the grants had now been increased and some of them would have been drawing on them. It would have held up grants to people who would have had half their houses completed and should have got portion of their grants. The Bill took quite a while to get through and that was a fairly long Bill.
Five sections.
This is one particular Bill, but the Senator said this created a precedent. I remember quite a number of them. Particularly in relation to housing grants you will find that the Department have been issuing them before the legislation has actually been passed.
It is no answer to a charge of murder to say you proved you have murdered five other people.
The whole difficulty about it and the reason why I wanted to make a case about it in this instance is this. First of all, the Department of Local Government seem to be particularly guilty in this regard. I would agree with Senator Honan's very interesting discourse on rates remission, although, with respect, I do not think it is appropriate to this Bill.
The difficulty I would envisage perhaps some time in the future is that from the Department would emanate a rather controversial instruction on the roneod paper to carry out certain things to which the Government would later give legislative effect. It could happen that in the interim between the roneod instruction going out and the green Bill going through the House, the Government could fall and there could be an election and the new Government might decide that it did not particularly like this controversial proposal at all and it was not going to give legislative effect to any such thing.
Where then would be the conscientious officials in the local authorities throughout the country who in good faith had acted on the instruction, from the Department, which had no legal standing whatsoever and which the new Government were saying was completely contrary to their policy, which they had always said was contrary to their policy, which they had always promised they would not implement if they were in power, and which they had no damn intention of implementing now that they were in power?
Supposing, supposing two men were frozen.
The supposing might come sooner than some of the Senators on the far side of the House think.
By that time the Senator might be elevated to the Lower House!
I am very glad to see Senator Honan has such confidence in my future political career. I am sure that if I am elevated I will be one of the very few to go down there with an easy and happy heart.
However, I do quite seriously wish to register my objection to section 4 as a matter of principle and to the absolutely dreadful tag which the draftsman has now put on it of "saver". It was bad enough when they were blatantly having it printed and introducing it into legislation, but when they start to actually call it what it is, a face saver, it is just going too far altogether in legislation going through the House. Out of deference to the public servants and local authorities throughout the country who would be seriously embarrassed if this section did not go through and who would then. I suppose, having been surcharged by the auditor, have to take their own individual legal steps against the Department of Local Government and the Minister, I think we had better agree to it in this particular case.
In so far as it may possibly affect the pocket of any county councillor I would be in favour of passing this section.
Question put and agreed to.
SECTION 5.
Question proposed: "That section 5 stand part of the Bill."
The same objection applies to subsection (7) here. We have a piece of legislation which was introduced in 1960 and in that piece of legislation it is clearly stated that that Act was to lapse on the 31st March, 1970, so the Department of Local Government had ten years in which to concoct legislation and from somewhere in the labyrinth of corridors to throw up this marvellous, complicated five-section Bill in time to have it passed by the 31st March, 1970. Here we are now being asked to pass a Bill which ought to have been introduced in the early months of 1970. It is just indicative of the length of time it takes for any proposal to come from the Custom House and it does not augur very well for the matter we were referring to earlier, the early arrival of the White Paper on the reform of local government, finance and taxation.
Question put and agreed to.
Schedule agreed to.
Title agreed to.
Bill reported, without amendment, received for Final Consideration and passed.
The Seanad adjourned at 10 p.m. until 10.30 a.m. on Thursday, 8th July, 1971.