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Wednesday, 26 October 1910

Senator MILLEN (New South Wales) . - I wishnow to invite the attention of the Committee to an amendment of a different character, and one which, I hope, will be approached in a somewhat different spirit. I desire to point out the conflict which occurs in the three definitions dealing with " improved value," " unimproved value," and " value of improvements." I shall deal with the last of these first. It reads - "Value of improvements," in relation to land, means the added value which the improvements give to the land at the date of valuation, irrespective of the cost of the improvements.

When we turn to the " unimproved value " in relation to land, we naturally assume what is a matter of fact, namely, that the unimproved value of land is its full value, less the value of improvements. But, under the definition of " unimproved value " there is the possibility of a different results being arrived at. The definition reads - " Unimproved value," in relation to land, means the capital sum which the fee-simple of the land might be expected to realize if offered for sale on such reasonable terms and conditions as a bond fide seller would require, assuming that the improvements (if any) thereon or appertaining thereto and made or acquired by the owner or his predecessor in title had not been made.

That definition puts improvements on a different basis from that which has been adopted in the following definition. There is a conflict between the two.

Senator Pearce - No.

Senator MILLEN - Let me give an instance. Eliminating all the words which have no bearing on my argument, the first definition of " unimproved value" is based on the assumption that the improvements had not been made. Let us take a piece of land and see how the position would work out. Under that paragraph, the unimproved value of a piece of land the improved value of which is £3 per acre, and the cost of improving which was 5s. per acre, would be £2 15s. per acre. That is the value which a bond fide seller would require, assuming the improvements had not been made. But when we attempt to arrive at its "unimproved value under the next definition, a very different result is brought about. The lane? I repeat, is worth £3 per acre, and the improvements cost 5s. per acre. But although they cost only 5s. per acre, they may have added very much more than that amount to the value of the land. They may, indeed, have added to its value by -£i per acre. If we deduct that added value of the land from its full value, we shall see that its unimproved value is only ^2 as against £2 15s. under the preceding provision. I therefore move-

That all the words after " require," in the definition of " Unimproved value," be left out, with a view, to insert in lieu thereof the words " less the value of the improvements."

The words of the clause are cumbersome and vague, and if for no other reason than because of its simplicity, the amendment should be accepted. It would be a great improvement on the clause, and,_in addition, it would remove the conflict which exists between the definition which I am seeking to amend and the succeeding definition. From the experience of New South Wales I am satisfied that the more simple the language in which we set out these definitions the better it will be for those who have operations under the Bill. In the minds of everybody the unimproved value of land is its improved value less the value of the improvements.

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