The Taranaki Herald. (DAILY EVENING.) SATURDAY, SEPTEMBER 13, 1913. THE LAND BILL.

Taranaki Herald, Volume LXI, Issue 144197, 13 September 1913, Page 2

The Taranaki Herald. (DAILY EVENING.) SATURDAY, SEPTEMBER 13, 1913. THE LAND BILL.

One of the strongest and most effective planks in the platform of tho Reform Party prior to the last general election was its land policy, especially that portion of it which proposed to extend the option of the freehold to Crown tenants. It was largely that policy which placed Mr. Massey on the Treasury benches. Time and opportunity were not given him last year to submit to Parliament all the reforms he had advocated, though a substantial portion became law. A further instalment is contained in the Land Laws Amendment Bill just introduced. The leading feature of this is the clause which proposes to give owners of leases in perpetuity of settlement lands the right to purchase the fee-simple. It is the feature too which is likely to be most hotly contested, though tlie House which gave ordinary ■Crown tenants the right to convert leases in perpetuity into freehold can scarcely do otherwise titan -extend the privilege to settlement lands tenants. It was to be expected that-opponents of the freehold would call this a “colos,sal bribe” and a “sacrifice” of the public estate, although it is nothing of the kind. The State made a-shockingly- bad bargain in leasing its land for 999 years and should consider-itself fortunate if it can get out of it on anything like reasonable terms. Clause 48 proposes to give tho tenants the right at any time within five years after the passing of the Bill to purchase tho fee-simple at a price to be ascertained.as follows: —A new valuation is to bo made ■of the capital value of tho land at the date of the notice of intention to purchase; from this capital value is to he deducted the value of'improvements effected by tho lessee and of any other improvements to which he is entitled, the resulting sum being the “present capital value,” which in no-case shall bo less than the original capital value. The amount by which the present capital value exceeds the original capital value being ascertained, an actuarial computation is to he made of tho present value of such excess if payable at the expiration of the. existing term of the lease, the rate«of interest-for the purpose of such computation being five per cent, per annum. The- amount (if any) thus ascertained is to be added to the original capital value, and tho result is to he .the purchase price. In most cases the excess over' the original capital value will he trifling; hut if the State can induce the tenants to purchase the freehold at the original capital value it will get out of its present bargain on as good terms as it has any right to expect. The State’s interest in the lands let on lease in perpetuity is confined to the original capita* value and to such powers of taxation as it may have on the tenant’s improvements. What is called the unearned increment is worthy nothing to the State with so long a lease. If what was grazing land when leased a few years ago, worth £2 an acre, had become town lands worth £2OOO an acre to-day, the State would have no present interest in tho £1993 of added value, and its reversionary interest, which it could not turn into profit until the thirtieth

century, TOnld "be very smalL Tfie tenant, on the other hand, has a proprietary interest in the added value; because he can sell his goodwill for a substantial sum. Therefore the State is giving nothing away and making no sacrifice if it sells as proposed in this Bill. On the contrary, as soon as it sells the freehold it acquires the right to tax the capital value, whether that is £2 dr £2OOO an acre. It cannot tax its own interest in a leasehold. Thus it is clear the State will be better off if the tenants agree to purchase. Another important feature of the Bill is the section dealing with the aggregation of private lands. Complaint is constantly made that the Government is not forcing the breaking up of large estates. Previous Governments have failed to do it, and this or any other Government must fail to satisfy the extremists for the simple reason that no Government can confiscate lands which have been acquired under the laws of the country. Taxes may be imposed sufficiently heavy to make it good business to sell, but they cannot be made confiscatory. There is a limit even to the powers of the State in that direction. As a matter of fact, subdivision of large estates is proceeding more rapidly now than ever it did under former Governments. "'What has to be guarded against is allowing aggregation to go on, and Mr. Massey’s Bill makes an honest attempt in this direction, where no attempt has hitherto been made. Part 7 of the Bill provides that when an owner of rural land acquires more land the Minister may require the Land Purchase Commissioners to report to him upon the circumstances of the aggregation and the suitability of the land for acquisition by the Crown. If the board reports that in its opinion such aggregation is contrary to the public interest in respect of close settlement, the Minister may recommend the. Governor to take the land, or a portion of it, by proclamation, giving compensation which shall in no case exceed the purchase money paid or agreed to be paid for the land by the owner who acquired it by wav of aggregation. In other words, if the owner of a farm buys out his neighbour, and this is deemed to bo inimical to dose settlement, the State may take the land so acquired at the price pafd—not more in any case —and dispose of it again under the Land for Settlements Act. This is a very important advance upon any legislation passed hy previous Governments. There are other important proposals in the Bill, but these strike ns as the most important.