The Bill was introduced by Lord Avebury, read a first time and ordered to be printed.
Grand Committee Debate
On 15 January 2015 the Grand Committee of the House of Lords debated a question from Lord Avebury:
“To ask Her Majesty’s Government what steps they are taking to abolish the liability of private householders and others for chancel repairs”.
The Bishop of Derby took part in the debate.
The February 2015 Synod Agenda
At the meeting in February Synod will debate gs1980 the Report of the Simplification Task Group.
The terms of reference of the Task Group were:
“To consider concerns raised about the constraints caused to the mission and growth of the Church of England by existing canons, legislation, regulations and procedures and to bring forward options and proposals for simplification and deregulation, and to report back to Archbishops’ Council and the Board of Governors of the Church Commissioners by November 2014”
The Simplification Task Group called for evidence of ‘constraints caused to the mission and growth of the Church’ by the legislation affecting the Church, and given the incomprehension and ill-will generated by the outdated law of Chancel Repair Liability, it is surely an obstacle to mission that needs to be dealt with.
There is no mention of Chancel Repair Liability in that paper, or anywhere on the Synod Agenda: it is a subject which has hardly been debated in Synod since 1982 when the Synod accepted a report recommending phasing out of the liability.
Past Synod Debates
In July 2011 there was the following question and answer:
Mr Robin Lunn (Worcester) asked the Presidents of the Archbishops’ Council:
In view of the resolution of the General Synod in 1982 supporting the phasing-out of chancel repair liability and its eventual extinguishment, which has still not been reflected in changes to the law, what steps does the Church intend to take to encourage an Act of Parliament to tidy this matter up once and for all?
Mr Andrew Britton: In February 1982, the Synod was informed that chancel repair liability operated in a way that was arbitrary and inequitable and that the Law Commission intended to recommend legislation. The Law Commission reported in November 1985, recommending that certain types of chancel repair liability should be abolished in 10 years. Parliament did not implement the recommendations. However, in 2003 the Government legislated so that chancel repair liability would cease to apply to land purchased after 12 October 2013 unless the liability was expressly recorded on the registered title of the property. That will mean that, in a little over two years’ time, anyone purchasing property will know definitively whether it is affected by chancel repair liability. Concerns that the liability might operate in an arbitrary and inequitable way have therefore been addressed, albeit in a different way from that envisaged by the Synod nearly 30 years ago.
It is a common misconception that the Government “legislated so that chancel repair liability would cease to apply..”. No amendment has been made to the Chancel Repairs Act 1932 to relieve from liability those who purchase the property which is subject to unregistered CRL after 12 October 2013. CRL is not mentioned in the Land Registration Act 2002 as it now stands. It is not within the definition of an ‘interest in land’ but it exists, irrespective of whether it is an interest in land or not. The Land Registration Act 1925 in identifying CRL as an overriding interest was stating a fact, that CRL is not required to be set out in title deeds (a deed of covenant by each lay rector being unnecessary) so the repeal of that Act, and its replacement by an Act which now makes no mention of CRL, has had no effect in law.
PCCs and Deanery Synods Act
Many PCCs have decided not to register or enforce CRL, and those that have decided to register, have mostly decided not to enforce it anyway, or only to enforce it against large estate owners or farmers rather than ordinary residents. As reported in the Church Times on 8 March 2013 the PCC of Saffron Walden has agreed to waive any liability:
PCC waives liability tax
THE PCC of St Mary’s, Saffron Walden, in Essex, has decided not to register chancel-repair liability (CRL) against households in the parish, writes Ed Thornton. It was thought that collecting the tax ran “contrary to Sharing God’s love”. The Saffron Walden Reporter reported last week that the PCC’s decision had been accepted by the Charity Commission. The Government has passed legislation that requires PCCs to register liability, where it exists, with the Land Registry, by October this year (News, 12 October). St Mary’s has no plans to make repairs to its chancel roof before that date. The Rector of St Mary’s, the Revd David Tomlinson,said: “Looking to this outdated law to finance some remedial work on the church building would run contrary to our aim to share God’s love and to serve the people of Saffron Walden. “Hence, I am delighted that we have been able to clarify this matter, and to let all the residents of Saffron Walden know that there is no need to take out insurance against this historic liability. “St Mary’s is a magnificent parish church, there for everyone, and
I am sure that the parochial church council, along with all those who love and value it, will be determined to maintain it in good condition for successive generations.”
The Hereford Deanery Synod passed a motion on 21 May 2013:
Chancel Repair Liability:
The following motion was proposed by Christopher Whitmey and seconded by Reverend Rob North and passed unanimously:
“This Synod invites the Diocesan Synod to debate the following motion, ‘As no meaningful progress has been made since 1982 when General Synod agreed to phase out chancel repair liability, this Synod asks that a Measure, equivalent in effect to The Compulsory Church Rate Abolition Act 1868, be introduced forthwith to enact that Chancel Repair Liability is a voluntary matter and not compulsory’, and if passed to forward it to General Synod.”
Is Lord Avebury’s Bill not a welcome as a long overdue modernisation and simplication of the law?
The Bill should be welcomed as it will relieve the Church Commissioners, and Deans and Chapters of Cathedrals of liabilities. The Church Commissioners and the Cathedrals will still be free to make grants to churches out of the money they save. However if the Synod wishes to retain the liabilities of the Church Commissioners and ecclesiastical and educational bodies under the proviso to section 31(2) of the Tithe Act 1936, Lord Avebury is willing to amend his Bill to make an exception for those liabilities. He recognises that there is no strong argument for the abolition of non-land-based CRL. If the Church Commissioners, Deans and Chapters and other ecclesiastical and educational bodies wish CRL to be abolished, they should, perhaps, pay compensation to the PCCs affected, as the received compensation stock from the Government for the extinguishment of their title rentcharges under the Tithe Act 1936.
The remaining liability is on those generally small fragmented parcels of titheable land (only a small proportion of the original titheable land) which belonged to lay rectors, so that the tithe rentcharges merged in the land; much of this is no longer in agricultural use, having been sold for housing or commercial development, so the tithes would have ceased to be payable, if they had not been converted to tithe rentcharges under the Tithe Acts (which are not related to the value of the cereal produce of the former farmland).
There is also land allotted to a lay rector under an Enclosure Award in lieu of tithes of the common fields. Who ever paid tithes of the common fields? They were vested in the lord of the manor, who was usually the lay rector, and he would not pay tithes to himself. The existence of these tithes was theoretical. The land allotted may have remained in use as common land and the tithes may not have been paid, so this ‘paper only’ allotment of land in lieu of tithes would have had no legal effect, and it is uncertain whether the allotment of land in lieu of tithe always resulted in additional CRL being imposed on the owner of the land. He would still have received tithes – as not all the tithes ceased, as only some of the common land, not all the land in the parish, was covered by the Enclosure Award. The lay rector would have continued to receive tithes from previously enclosed tithed land. CRL in theory payable on the former common land may never have been collected and so have lapsed and would be treated in law as abandoned, or would never have existed.
The Secretary General has said that CRL is not an ecclesiastical matter but a matter of the common law of England, which is for Parliament rather than the General Synod to legislate on.
The Lord Bishop of Derby nevertheless intervened in the debate, and intimated that PCCs could seek compensation from the Government for the abolition of CRL, as abolition without compensation would (he said) infringe their human rights under Article 1 of Protocol 1 of the European Convention on Human Rights. This however does not apply to the future income which may be claimed under legislation if it is not repealed in the meantime, when there is no legitimate expectation that the law will not be changed.
For example, if Parliament legislates to reduce the amount of child support maintenance that can be claimed by a parent with care from an absent parent, the parent with care cannot take the Government to the European Court of Human Rights. Similarly the Government may reduce welfare benefits. What Parliament gives, Parliament can take away.
Under the doctrine of the supremacy of Parliament, there is no enforceable right to future income which may be payable under legislation, if it is not changed. Such legislative change is within the ‘margin of appreciation’ enjoyed by national legislatures, recognised under European Human Rights law.
He said: “..in my own diocese in Derby, one of the former Dukes of Devonshire had quite a lot of liability in a number of parishes of which he was a patron. Years ago he commuted this responsibility in return for a financial payment, and he now has no liability at all”.
It is a good thing, of course, that members of the aristocracy are wealthy enough to be able to afford to contribute to church repairs, and that they are able to provide large lump sums to commute the liability. But most of those who are in theory liable have not the means to make such payments: they receive no tithes.
The Ecclesiastical Dilapidations Measure 1923 does not provide a fair system of apportionment and compounding. There is limited apportionment under the Tithe Act 1936 and no apportionment under Enclosure Awards. Since then the Synod has on several occasions amended the law relating to CRL so it cannot be said that it has no legislative competence.
The Bishop seems not to accept the competence of Parliament in this matter, as he has intimated that PCCs may make a complaint to the European Court of Human Rights and claim compensation if Parliament legislates to abolish CRL. PCCs are independent charities and that they have a heavy burden of responsibility in maintaining their churches, with little Government funding, and that the Archbishops’ Council could not prevent
PCCs from making a complaint to the European Court of Human Rights if they were so minded, but it would be a misuse of charitable funds and they would have a difficult task to show that the legislation is not within the ‘margin of appreciation’ enjoyed by national parliaments. The right to property which is protected by the ECHR does not include the possible right to future income, and the 1982 decision of Synod means that there is no reasonable expectation that CRL will not be abolished.
It would not be reasonable given the considerable support which the UK Government already provides to churches, not least the Listed Places of Worship Grants Scheme, under which the VAT on church repairs is remitted, the VAT on nave and tower repairs as well as chancel repairs. If the chancel is 20% of
the church building the Government is in effect already paying for all chancel repairs. There is also the current grant of £15m for church roofs announced by the Chancellor in his October statement.
There should be a fair system of apportionment and compounding and it must be recognised that the Ecclesiastical Dilapidations Measure 1923 does not provide this. Apportionment under the Tithe Act 1936 is only down to the tithe field level, and there may be introduced an amendment to the 1923 Measure to provide a fair system of compounding and apportionment. There is no statutory provision for Enclosure Award liability to continue under the Tithe Act 1936 and doubts therefore exist on whether that form of liability has not already been legislated out of existence, although the argument was not made in the Aston Cantlow case due to concentration on the human rights issue.
The ending of the overriding status of CRL under the Land Registration Act 2002 seems to have made no difference – insurance is still necessary and it provides no cover against the blight of CRL notices, which can be registered unilaterally, without evidence as the law stands. Many have been registered incorrectly. The Chancel Repairs Act 1932 does not give a lay rector a defence to claims based on the lack of any registration at the Land Registry. It is very strange that many solicitors do not seem to understand this simple but important point.
Is it not time for a debate in the Archbishop’s Council and also in the Synod on this?
The Lord Bishop of Derby expressed the view that there must be some kind of compensation for the abolition of CRL, as some people (such as the Duke of Devonshire) had commuted their liability and paid compensation, and he said: “It is a well known constitutional principle that Parliament does not deprive a subject of a right in the nature of property without providing compensation… It would be fair to give parishes notice and some kind of recompense for having to take on an even greater burden of the maintenance of buildings. It is just a question of how it is done… We are fully behind this… There is a very strong case that there needs to be some element of compensation to be fair to all concerned”.
How was the compensation calculated when under the Tithe Act 1936, tithe rentcharges were extinguished, and related chancel repair liability transferred to PCCs? Cannot the same system be used today?
The tithe rentcharges which were not extinguished were those which were payable by lay rectors to themselves – that is those that were merged in the lay rector’s own land. The Records of Ascertainment the Seventh Schedule of the 1936 Act refers to these rentcharges as follows:
“…the [Tithe Redemption] Commission shall ascertain the amount of those rentcharges which:
(c) was so vested between the twenty-sixth day of February, nineteen hundred and thirty-six, and the appointed day as to render the provisions of section twenty-one of this Act applicable thereto; [Provisions as to tithe rentcharge vested in owner of land charged].
(d) was merged or extinguished under the Tithe Acts in land to which the provisions of section one of the Tithe Act, 1839, apply; [“where any tithes or rent-charge shall have been or shall hereafter be released, assigned, or otherwise conveyed or disposed of under the provisions of the said Acts, or any of them, or of this Act, for merging or extinguishing the same”]
and shall ascertain, as respects each of those rentcharges, the proportion (in this Part referred to in relation to that rentcharge as “the appropriate proportion”) which the amount thereof bears to the apportionable amount of rentcharge liability.”
So each parish with CRL arising from merged tithe rentcharges has a Record of Ascertainment held in the National Archives, which states the amount of any tithe rentcharge merged in the land of the lay rector under paragraph (c) or (d) above, and the total amount of the apportionable rentcharge liability.
It might be thought somewhat illogical and unfair that those lay rectors who owned land out of which tithe rentcharges were payable, were not compensated for the extinguishment of their tithe rentcharges; though they were not required to pay tithe redemption annuities, they were left with CRL, indefinitely, while others who had been receiving tithe rentcharges payable out of land not owned by them, were both compensated for the loss of the profit element of those tithe rentcharges, and relieved of CRL immediately.
Those who had been receiving tithe rentcharges from other property owners received compensation stock for the extinguishment of their tithe rentcharges (after the deduction of “the sum required for repairs” – such an amount “as may be reasonably sufficient, having regard to the condition of the chancel or building at the appointed day, to provide for the cost of future repairs thereof and to provide a capital sum the income of which will be sufficient to insure it for a sum adequate to reinstate it in the event of it being destroyed by fire”. They were not required to pay tithe redemption annuities – it was the tithe-rentcharge payers who paid tithe redemption annuities instead of tithe rentcharges, until 1977.
To rectify this unfairness the owners of land in which tithe rentcharges merged (that is those who are now lay rectors with land based CRL under the Tithe Act 1936) should notionally be credited with the capital sum which they should have received as compensation stock, and debited with the tithe redemption annuities which they would have had to pay (based on the amount of the tithe rentcharges merged in their land), if they had not been treated differently. The amount of any excess should be paid to the Diocesan Authority, in return for the release of the lay rector from CRL. That is, the excess amount, by which the value of the compensation stock exceeded the net present value on the appointed day (2nd October 1936) of the tithe redemption annuities which would have been payable in place of those tithe rentcharges, until 2nd October 1977 including the double payment on 1st October 1977 provided for in section 56 of the Finance Act 1977, which reads as follows:
“Section 56 Annuities under Tithe Acts 1936 and 1951.
The amount payable on 1st October 1977 on account of any annuity under the Tithe Acts 1936 and 1951 shall be double what it would be apart from this section; and as from 2nd October 1977 all annuities then charged under those Acts shall be extinguished”.
Any lay rector who has paid chancel repair costs to the Church since 2nd October 1936 (or his heirs and assigns) should have the present value of those payments refunded to him, out of any such excess, before the balance is paid to the Diocesan Authority. The Diocesan Authority should not receive both compensation for the loss of chancel repair rights and payments in respect of chancel repair costs for the same period.
However, since the calculations would be complex and time consuming to carry out, it may be questioned whether it would be useful to do so. The Chancellor of the Exchequer (Denis Healy) stated in 1977 that the tithe redemption annuities received, together with the interest earned on them, were more than sufficient to cover the cost which had been incurred by the Government in 1936 in issuing the compensation stock in 1936 for the extinguishment of the tithe rentcharges. They cancel each other out. Therefore it would have been fair to relieve from liability those remaining lay rectors (who had not received compensation stock and had continued to be exposed to the risk CRL) with effect from 2nd October 1977, the date on which Denis Healy should have done so.
If anyone can do these calculations I would be very interested to hear. To inform the debate, it would be useful to have information such as:
- What was the total amount of the compensation stock paid out by the Government to tithe rentcharge owners under the 1936 Act?
- What proportion of this was paid to tithe rentcharge owners?
- What proportion was paid to Diocesan Authorities in respect of chancel repair and insurance costs?
- What proportion was paid to ecclesiastical and educational bodies under the proviso to section 31(2) of the 1936 Act?
- What is the present value of the original compensation stock – if it has been redeemed, what would it have now been worth if it had been reinvested in similar Government stock?
- How much has been paid each year since 1st October 1936 by lay rectors in respect of land-based chancel repair liabilities?
- How much has been paid each year since 1st October 1936 by ecclesiastical and educational bodies for chancel repairs in discharge of their CRL liabilities?
- How much has been paid by Governmental bodies for chancel repairs each year?
- How much has been paid each year by PCCs for chancel repairs which was not claimed from lay rectors who were in theory liable?
If this information were available I believe it would show that Diocesan Authorities and PCCs have voluntarily relieved most lay rectors of their liability, and they have received very little from lay rectors for land-based CRL, and they and the Diocesan Authorities have been well compensated for the loss of tithe rentcharges under the 1936 Act and that the amounts they received then for chancel repairs if prudently invested would have more than covered the costs they have incurred in carrying out chancel repairs which were originally the responsibility of lay rectors whom they have not voluntarily relieved.
9 February 2015
I have tried to work out a formula for compounding
If compensation has to be paid I would suggest it is calculated as follows:
It is to be assumed (in the absence of better evidence) that half of the tithe rentcharge would have been required for chancel repairs and the other half would have been retained by the tithe rentcharge owner. Where he was also the payer of the tithe rentcharge, he simply retained that half. The other half, his own money, he used to pay for the chancel repairs. Other tithe rentcharge payers had to pay tithe redemption annuities for 40 years until 1 October 1977. Therefore he should be charged 40 years purchase – a capital sum representing the present value of a payment of half the tithe rentcharge for 40 years at say 5% interest.
This is calculated as follows:
PV = present value
A = half the amount of the tithe rentcharge merged in the land of the lay rector (adjusted for inflation)
r = 0.05
R = 1.05
n = 40
PV = A ((R^n) – 1)
(R^n) x r
The present value of £1 per annum for 40 years with interest at 5% is £17.16. So a lay rector whose merged rentcharge was worth £2 in today’s money, would pay £17.16. The value of £2 in 1936 is approximately 1/60th of its present value. So this would apply to a rentcharge in 1936 of 3.33p, or 8d.
It would be useful to check Records of Ascertainment where acreages are given and the related tithe rentcharges to get an idea of the average rate of tithe rentcharge per acre. This could then be used to produce a formula for general use. As cereal production became mechanised it is clear that the relative value of cereal reduced – in the 19th century it was relatively far more expensive than it is today or was in 1936.
Now of course in some cases the lay rector’s individual property may only be part of the tithe field identified on the tithe apportionment map, out of which an apportioned tithe rentcharge was payable, so he could at the same time relieve all the lay rectors owning part of that tithe field, or request further apportionment. A substantial landowner with a large liability might well wish to do so.
Where tithes ceased to be payable under an Enclosure Award, as land was allotted to a lay rector in lieu of them, if it could be proved that the tithes were paid before the Enclosure Award and that afterwards the land was enclosed by the lay rector and used for agriculture, and did not remain common land, it would be fair to assume that the amount of the rentcharge which would have been payable if the tithe had not been extinguished would have been charged at a similar rate per acre. However it would not be fair for Parliament to legislate further, as the liability of the owners of such land is highly debatable, and has never been debated in Court, and it would infringe their human rights for Parliament to impose an arbitrary new tithe rentcharge on them, if they and their predecessors have never before been charged for CRL. It is very unlikely that Parliament would see fit to pass any such legislation.
Based on a Record of Ascertainments on which is stated the acreage of the land affected by an amount of tithe rentcharge, making adjustment for inflation I believe that a tithe field of one acre (4,840 sq yds) would have a tithe rentcharge on it of about £11 per annum in today’s money, and converting this to the equivalent in metric hectares (10,000 sq metres) the tithe rentcharge per hectare would be (10000/4046.9) x 11 = £27.18, say £27. The present value of this annual amount for 40 years with interest at 5% is £463.32. The present value of an acre of agricultural land averages at £8,500 according to Savills survey (2013) so £21,003.73 per hectare, or £2.10 per square metre.
The compounded sum to extinguish a tithe rentcharge should therefore be say 5p per square metre, which is about 1/42nd of the value of the land. So a typical house plot measuring 30m x 10m would have to pay £15.00 to get rid of the liability. Such a formula would make it easy to calculate the amount payable to compound. I do realise that this would not actually cover the cost of repairing the chancel, but taken together with the compensation paid in 1936 it should in theory do so. Fairness dictates that lay rectors whose liability survived the 1936 reforms should be treated the same as the tithe payers who were relieved of tithe redemption annuities in 1977, and in these calculations I have tried to replicate what was done for the tithe rentcharges in 1936.