ABOLITION OF TITHE

Dominion, Volume 30, Issue 41, 12 November 1936, Page 3

ABOLITION OF TITHE

Loss to the Church

ISSUE OF GOVERNMENT

STOCK

One hundred years ago the British Parliament abolished tithes payable or leviable in kind and substituted for this ancient liability on landowners an annual money payment known as tithe rentcharge. Now, in its turn, tithe rentcharge is abolished under the new' Tithe Act which has received the Royal Assent. In exchange for the rights to be surrendered the titheowners receive Government scrip bearing interest at 3 per cent., and the capital cost of this expropriation of the titheowners is about £70,000,000. This guaranteed Government stock will be redeemable at par in 60 years. Over a similar period redemption annuities will be payable to the State by those who have hitherto been tithepayers, and these annuities will meet the interest and sinking fund charges on the £70,000,000 issue of stock. This means that by 1996—at the latest— the land of England and Wales will be finally freed of the charge originally imposed by tithes, and in the intervening years the progressive diminution of the term of the liability should materially benefit the capital value of the land affected. There is a possibility that land may bo freed or the charge before 1996, for the Act provides that if at any time before the end of the 60 years redemption period the Treasury are satisfied that all commitments under the scheme have been mqt, Parliament may extinguish the redemption annuities forthwith. The ownership of about two-thirds — some £2.000,000—0f the total amount of tithe rent charge is vested in Queen Anne’s Bounty on behalf of incumbents of the Church of England, and it i» estimated that the compensation payable to tho bounty will be about £50,000,000. In addition to this there will bo a separate payment to Queen Anne’s Bounty of £2.000,000, which will go toward creating the fund necessary to implement the undertaking that the existing life interests of tho 7000 incumbents concerned shall be safeguarded. The total amount of capital required for this maintenance of life interests is £5,500,000, and £3,000.000 of this will have to be taken from the capital amount of compensation payable to the bounty. it is estimated by Queen Anne’s Bounty that after all existing life interests have terminated there will be an ultimate loss to benefices alone of £436.000 a year, which, capitalised on a 3 per cent. basis, amounts to £14.500,000.

The total ultimate loss to the church, capitalised on the same basis, is estimated at £16,500,000— although there are hopes that this loss may be reduced by a reinvestment of funds. Tho Central Board of Finance, at the request of two archbishops, will shortly issue an appeal to such landowners as may not wish to profit by the reliefs under the new Act to contribute to a tithe compensation fund which will be applied to the reduction of the ultimate losses to benefices.