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9° Novembris, 1927.]

Mr. St. John Raikes.] Yes.

Chairman.] The Committee do feel they ought to be getting on.

Mr. St. John Raikes.] Yes, my Lord. I am not going to waste time in any way, if I can help it. I do not propose to repeat one word, of course, of what I have said, and I am grateful to the Committee for their indulgence in allowing me just to address them briefly on this question of cost. I can sum it up very shortly. As I have told you there are three figures that I propose to deal with. Our position at the present momentthat is to say, if the figures put forward by the Ministry are reliable, that is to say, if the estimate of the cost of works is not exceeded, if administration and maintenance are kept down to £10,000, and if the whole of the land comes into rating, and if the Government provide their full half of the cost of works-will be the position that we arrived at before the adjournment, that is, that the lowlands will be saddled with a charge of 31d. per acre, or translated into rate, a rate of 2s. That is the position if the Promoters are right.

Chairman.] Does that take into consideration that this rate is spread over the whole of the County?

Mr. St. John Raikes.] No, my Lord, I am dealing with the actual figures which apply to the lowlands only. We arrived at that I do not think there is any question about it-in the summer. Those really are the figures. I am taking them from the Promoters' case. There will be a tax representing 31d. or roughly 2s. 6d. an acre or, translated into a rate on annual value, 2s. That is the Promoters' case. That is what we are starting with.

Now, my Lord, it follows that if the works estimates are exceeded by any considerable sum-and we say that the amount that they will be exceeded by is £860,000-that would involve a further annual charge upon the lowlands alone of £45,000 per annum in round figures. Now, my Lord, if administration and maintenance amount not to £10,000 per annum-that is £9,000 for administration and £1,000 for maintenance, which I shall show is an absolutely ridiculous figure-but, as we estimate, to £81,000 per annum on the ordinary contractors' basis, that would mean a further annual payment of no less than £71,000 per

annum.

We have evidence with regard to the land that will not come into rating, and 63205

[Continued.

that evidence amounts to this, that it is probable of course, it is a difficult figure that about 8 per cent. of the land will not come into rating. If that is so, that will impose a further burden upon the portion of the land in the lowlands that does come into rating of something like £4,000 per annum. We, therefore, on the evidence that I propose to lay before you, get an additional figure of annual payment in round figures of £120,000. According to the estimate which is made by the Promoters the amount that the whole of the lowlands will have to find annually is £52,000 to £53,000; I am taking £52,000 as a round figure. If we are correct with regard to this additional annual payment which we say will fall upon us, that figure of £52,000, which represents a 2s. rate, will be turned into a figure of £172,000 per annum. The whole of that would have to be borne by the lowlands unless the Government consented to bear half of the further excess cost of works. I do not know whether they would or not, but dealing with it from the point of view of the lowlands only at the present

moment

Chairman.] May I draw attention to the Report, page 33?

Mr. St. John Raikes.] Yes, my Lord. I am going to deal with the Report in a moment, if I may, very shortly. Chairman.] Yes.

Mr. Campbell.] It rather mentions that in the Report there. That is why I drew the attention of the Chairman to it.

Mr. St. John Raikes.] I am coming to page 33 in a moment.

Mr. Campbell.] "At the beginning of the proposed works it will be much higher, but it should be gradually reduced." Does that cover your point?

Mr. St. John Raikes.] No. I am coming to that in a moment, and I will deal with that, if I may, in its proper order. The effect of this additional cost would be this. On the acreage basis in place of a rate per acre of 31d. you would get a rate approximating to 103d. or 8s. 6d. If you translate that into a rate on annual value you get in place of a rate of 2s. a rate of 6s. 8d. In addition to that there arises the question of the Middle Level which I will dismiss in a sentence. You have heard that they contemplate and are in fact bound to carry out certain arrangements for pumping. They already have a contract before them with regard to that, and P 2

9° Novembris, 1927.]

the actual figure that it will cost them outside the Government grant to instal the necessary pumping plant is £60,000. So far as the Middle Level itself is concerned that would mean an acreage tax of 84d., translated into a rate on annual value of 6d. If you add the 84d. to the 8s. 6d. I have already given, you get a charge per acre, so far as the Middle Level who is my largest client is concerned, of 9s. 24d. and a rate on annual value of 7s. 2d.

Now, my Lord, we will turn to the Report of the Commission which the honourable Member was referring to just now. First of all I want to refer on that page to paragraph 112. They say: "The area of the district as we propose it should be defined is about 420,000 acres "-that is the lowlands-" and the net annual value is as follows," and they set out the net annual value. "It would thus require on an acreage basis a rate of 6s. 10d. an acre or (if the rating is on annual value and agricultural land is rated on its net annual value and other hereditaments at one-third of that value) a rate in the £ of just under 4s. 10d. on agricultural land and just over 1s. 7d. on other property to realise the sum required." You see, my Lord, that there the Commissioners' estimate that without any assistance from the Government, payment on the acreage basis would be 6s. 10d. The rate on net annual value would be 4s. 10d. You compare those figures with the figures I have already given you of 8s. 6d. and 6s. 8d. Now if you turn to page 35, paragraph 119, they continue to deal with the question of rates. They say: "That these rates are obviously too high"-those are the rates they have already referred to as 6s. 10d. and 4s. 10d." to be borne by the districts in question, does not seem to require our endorsement, especially when it is borne in mind that they are in addition to the ordinary rates for poor law, district and county purposes and to the tithe, land tax, etc. We cannot contemplate imposing upon this heavily-rated

area a

charge, in respect of the tidal river and works connected therewith, equivalent to a rate of 6s. 10d. per acre, and, unless some substantial assistance from other sources is forthcoming, the entensive works which are necessary to put the tidal river into a satisfactory condition could not be undertaken." There you see, my Lord, they suggest in effect a subsidy

[Continued.

which, on page 37, paragraph 125, they do in fact propose. "In all the circumstances we recommend that the State should find, by way of grant, one-half of the sums required for the works proposed in the tidal river and subsidiary thereto amounting to £2,500,000. The grant would thus amount to £1,250,000, and it would be spread over the period during which the works were under execution. The remaining £1,250,000 would have to be found by the Board." In the following paragraph 126, they say: "If these recommendations are carried out, the loan charges to be met by the Ouse Drainage Board would be reduced from £133,000 to £67,000 per annum, and if credit is given for the contributions from the County Councils which we have recommended, the total annual liability to be met by the Ouse Drainage Board would amount to £53,000 instead of £143,000 "I may point out, my Lord, that that figure of £53,900 is represented now by the figure of £52,000 odd which appears in the Table which is produced by the Promoters-" and the flat rate would be reduced from 6s. 10d. to 2s. 6d. per acre." Now, my Lord, that 2s. 6d. per acre flat rate, of course, is again represented in these proceedings by the proposed rate on net annual value of 2s., that is, that 2s. 6d. really represents the 31d. which has been put before us in these Rooms. That is the amount which the Commissioners suggest should be imposed upon the lowlands and it is quite obvious, looking at those paragraphs, that the conclusion they arrived at was that an acreage tax of 2s. 6d. or a rate on annual value of 2s. was as much as, in their opinion, could be safely imposed. Anything like an acreage tax of 6s. 10d. or a rate of 4s. 10d. they could not contemplate imposing on this heavily rated district.

The figures that I am going to put before you show that under the Bill, of course, if our evidence is accepted, the charges to be made upon the lowland districts will be far in excess of those which the Commissioners themselves in their Report, declared to be impossible.

I am going to deal just for one moment with the paragraph to which my attention was just drawn, page 33, paragraph 111. There it is estimated by the Commission that administration and other charges will amount to £9,000 per annum. I have no doubt the Commission had certain data to go upon there

9° Novembris, 1927.]

because the present Ouse Board is in existence and probably they had some foundation for that figure. Of course, my attention is called to the footnote to say that that figure does not include the salary of the paid Chairman and so

on;

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as a matter of fact that comes out of the fund for contingencies, so I need not trouble about it. The important point is this question of maintenance and miscellaneous work, to which the honourable Member has just drawn my attention. They say: Say £1,000." Then it follows on: "The figure under Maintenance' is a final figure. At the beginning of the proposed works it will be much higher, but it should be gradually reduced as the works approach completion, and when they are completed the cost should be nominal for many years." Now, my Lord, if it were not for that note that figure of £1,000 would be absolutely farcical. All this trouble has arisen with regard to these rivers because in the past they have not been maintained, they have been neglected. If £1,000 only were to be spent on this over 40 miles of river with all these works it would mean that there would be no maintenance of any sort or kind, and the river would gradually relapse into the condition from which it is now proposed to rescue it. It is merely a nominal figure. It is pointed out there that it will be much higher before the works are completed. That, if I may venture to say so, is an obvious error on the face of it because there may be a very considerable charge for repairs before the works are completed. But the question of the maintenance of the works cannot appear at all until there are some works to maintain. You see that there is no allowance made for money at all in spite of that note for the actual cost of maintenance. It is simply thrown in the air; it will at a certain period be much higher and then it will gradually decrease. Lord, I appeal without any hesitation to anyone who has even the slightest engineering knowledge to say that it is-I do not want to use too strong a termsurprising that anyone should suggest that after you have completed your works the cost of maintaining them gradually decreases until is becomes nothing. That is the meaning of that paragraph, But, my Lord, the astounding thing to my mind is that not only does that paragraph, which means less than nothing, appear in the Report, but the figure has

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My

[Continued.

apparently been adopted by Mr. Binnie in his table. Now, if you turn to the long table at the end of the second day

Chairman.] The paragraph surely does not read quite as you suggest. It says, "At the beginning of the proposed works it will be much higher, but it should be gradually reduced as the works approach completion, and when they are completed the cost should be nominal for many years."

Mr. St. John Raikes.] Yes, my Lord, that is what I quarrel with. The suggestion that the cost of maintaining these works, after they are put up, and after they have been standing the stress of the river, should gradually decrease, seems to me so astounding

Chairman.] For a certain number of

years.

Mr. St. John Raikes.] For many years. Chairman.] For many years

Mr. St. John Raikes.] That is the point which I wish to call evidence on. Colonel Heneage.] May I ask Counsel a question on this? Assuming that this is so for a moment, the point raised is that at the beginning the proposed works will be much higher, but if you turn to the loan charges for new works, £132,000, at the beginning, that will be much lower. Have you taken that point into consideration?

Mr. St. John Raikes.] Quite. I have to take it broadly, which is that the works will be completed in 10 years' time. There will be up to the time that the works are completed, first of all, a certain amount of what you may call repair work in the existing banks to keep them going, and also as the works themselves are gradually put in there will be some maintenance, but I am taking it, of course, that this full figure is from the date of the completion of the works, when my evidence will show that you can only arrive at the cost of maintenance by using certain formule which applied to similar works elsewhere, and they work out at the figure that I have given. The figures are so large that I have not really troubled in a sense about the first 10 year period; that no duobt will be dealt with by my witness, if necessary. But, my Lord, as I was saying, the really astounding thing to my mind is this, that Mr. Binnie has apparently adopted this figure, or, rather, these two figures of £9,000 and £1,000. At the top of this long table at the end of the

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are

9° Novembris, 1927.]

Second Day, after page 77, if you look at the word Appendix at the top, you find in the third line of the statement "Administration, maintenance and miscellaneous work, £10,000." Now, my Lord, of course that is adding the £9,000 for administration to the £1,000 which was put out as a merely tentative figure in the report for maintenance; that is spread over the whole period. My Lord, I am proposing to put before the Committee the view that that is a colossal blunder which goes to the root of the whole of the finance, of this scheme. My Lord, if I were to satisfy you that that £1,000 was even one-seventh of the amount required instead of, as we say, one-seventieth of the amount required, I should ask you what reliance you could place upon Mr. Binnie's other figures if he had made an error so great as that. Taken in conjunction with this question of excess expenditure, which we say will be required, I think you will be satisfied, even if you come to the conclusion that the truth lies between two extremes, that a burden too heavy to be borne by this trict will be placed upon it. you accept our figures-and, my Lord, our figures will be presented by Sir Alexander Gibb, who my learned friend took the opportunity in his gracious way of complimenting on the fair way he had given his evidence on the previous occasion-and you, of course, will have to judge of their value, but even if you discount them heavily, the cost of this scheme is going to be so enormous as regards the lowlands that it is going to be impracticable.

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I promised I would be short and I have endeavoured to be so, but I should like

to

sum up our position. If you are driven, however reluctantly, to the conclusion that this Bill is not a feasible one from the point of view of finance there is only one course open to you, and that is to reject it. Even so, even if you are driven to that course, and I venture to think you will be when you have heard the evidence, the time spent on this Inquiry will not, I venture to think, have been wasted because it will expose the weak spots in the present scheme, and it will enable the Ministry after some delay perhaps, to bring for ward a scheme that may at any rate prove more acceptable to those in this room than the present one, because, my Lord, it is curious that with one exception on which there is no appearance,

[Continued.

that of the South Level, the whole of those who are called upon to contribute under this scheme have combined to oppose it and to say that the scheme itself is bad in essence. The crux of the scheme is finance, and if it imposes a burden such as is foreshadowed in this Bill, the scheme cannot be a success, but will be a failure as the 1920 scheme was, only on a much larger and much more impressive scale.

Mr. Macmillan: May I intervene for a moment to say that my learned friend has now made a very drastic attack upon the maintenance charges. I have looked through the cross-examination of Mr. Binnie, whose figures are being attacked, and the only question I can see-there may be others-is at Question 993: "There is a point that we raise in our petition. I see that, in addition to the capital charges, you put down only £1,000 a year for maintenance?-(A) I think it was put in this way, that it would ultimately come to £1,000 a year, but it will be very much higher until the works are all carried out." Then instead of the question being put, "What a preposterous figure, Mr. Binnie, have you ever a figure of that sort ?" the next question is, "Do you think that the Ministry might be willing to make some provision with regard to assisting the question of maintenance ?" That is the basis of the attack on Mr. Binnie's figures which we are going to hear. I think Mr. Binnie should have had an opportunity of having this put to him.

seen

Mr. St. John Raikes.] We were in a great difficulty. I quite agree with my learned friend that Mr. Binnie should have an opportunity of dealing with those matters which should have been put to him in the first instance, matters that could not be put to him.

Mr. Campbell.] Arising out of what has just been said, it was the point 1 raised at the beginning, and that is why I pointed out this clause. It seems to me we are going to repeat what we have already had, and what we have had an opportunity of hearing. If all the learned Counsel are going to act in the same manner we can have a repetition of everything that we have had in the three weeks of the Session.

Mr. St. John Raikes.] I am sorry, but I have endeavoured to keep my word and avoid repeating what I have already said.

Mr. Campbell.] I do not doubt you have kept your word. The Chairman said that we should not have evidence

9 Novembris, 1927.]

[Continued.

that we have already had, and I wanted us to keep our word.

Mr. St. John Raikes.] I have endeavoured, and I think successfully, not to repeat one word of what I have already said, and the evidence I am

Sir ALEXANDER GIBB is again by Mr. ST. JOHN

5250. Sir Alexander Gibb I want to take this very shortly. First of all, you have already appeared in the Chair and given evidence with regard to the estimate of Mr. Binnie?-I have, yes.

5251. You say that he has under-estimated the cost of the work by £860,000? -Yes.

5252. I merely put that to get the figure. I want you to deal with this question of administration, maintenance and miscellaneous works. The amount, as you know, as provided in the table of Mr. Binnie is £10,000 per annum?—Yes.

5253. As I have already stated to the Committee, that is divided in the Commission's Report into £9,000 and £1,000 for maintenance ?-It is.

5254. You have also observed the note in the Commission's Report in regard to that sum for maintenance being much higher before the works are completed? -I have, yes.

5255. I want you just to deal very shortly both with that sum of £1,000 and also with the note of the Commissioners? In the first place, I do not think £1,000 is sufficient for the maintenance of those works. I think it is totally insufficient-the sum of £1,000for maintaining that long length of river. It practically means that there will be no maintenance after these works are finished. If there is no maintenance then the probability is that the works will go back to the same state that they are in now; perhaps not quite so bad, but that has been the whole trouble, that the works have not been maintained. The money that is being spent on the works at present might really be looked upon as a deferred maintenance payment, money that it is necessary to spend now because it has not been spent at the proper time. With regard to the footnote the point about that is that there is no maintenance until the works are completed. The usual way when a contract is let is for the maintenance, which I take it is referred to, then to be included in the contract. The con

63205

proposing to give now is evidence that has not already been given.

Chairman.] I could not trace this point in the evidence of the Middle Level before.

called in and further examined RAIKES as follows.

tractor as a rule takes on maintenance for one year, and maintenance proper begins after that period; the whole of that maintenance ought to have been included in the original sum which I think is under-estimated.

5256. Now in dealing for one moment more with that £1,000, whether the cost of maintenance is higher or lower there does not appear to be any allowance for it at all in the tables that have been put before us; that is to say, they may say it will be higher, but there has been no allowance made for its being higher in the way of charge?--I have not been able to see any.

5257. With regard to this question of maintenance I said I would take it very shortly. Have you gone into the question of what the cost of the maintenance of works of this character would be?I have, yes.

5258. What test have you applied to the works in order to arrive at the annual charge for maintenance?-To say with certainty what the maintenance of any works, and especially river works and tidal works will be, is very difficult, and the only method I know, and it is one which is quite a usual one, is to take the capital cost of the works and to put a percentage on to it per annum for maintenance. I have taken each item, or each part of the work in the scheme, and I have put against it a certain percentage, which I believe is a fair one, for the cost of the maintenance for the next 50 years, say. On that I have made up a total of practically £72,000; that is this figure.

5259. Per annum?-Per annum.

5260. That is on your own figures of the cost of the works?-That is on my own figures of the cost of the works. On Mr. Binnie's figures it comes to less.

5261. You, first of all, dealt with this question of maintenance on your own estimated cost of the works?-Yes.

5262. You got that figure of nearly £72,000?-Yes.

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