The advances made under this Act were to be repaid by annual instalments (which included interest and sinking fund), extending over a period of forty-nine years.
In 1888, the £5,000,000 given under the Act of 1883 being practically exhausted, an additional sum of £5,000,000 was advanced to the Land Commission for the purposes of land purchase (51 and 52 Vic., c. 49). Under the “Ashbourne” Acts 25,367 tenants (on 1,355 estates) became purchasers of their holdings, and the loans made amounted to £9,992,536. The rate of sale was seventeen years' purchase of the rents. (Report of the Irish Land Commission, 1902, p. 89.) Under these Acts 101 estates were purchased in the Landed Estates Court for re-sale to tenants, and loans were issued to 2,029 tenants, amounting to £531,277.
Purchase of Land Acts, 1891 and 1896 (the “Balfour Acts”).
The funds advanced to the Irish Land Commission for the purposes of land purchase having again become exhausted, Mr. Balfour, in 1891, introduced a new system under which the landlord or vendor was paid in a specially created guaranteed Land Stock (exchangeable for Consols at the option of the vendor), equal in nominal amount to the purchase money. This stock bears interest at the rate of 2-¾ per cent. per annum, and cannot be redeemed until the expiration of thirty years from the date of the passing of the Act of 1891. The dividends and sinking fund payments [pg 188] required for this stock are paid out of a “Land Purchase Account,” established by the Land Commission (Section 4), to which all moneys received on account of any purchase annuity for the discharge of an advance are paid. If this Land Purchase Account is at any time insufficient to meet the dividends and sinking fund payments (owing, for instance, to default in the repayment of instalments), the deficiency is to be a charge on a “Guarantee Fund,” established for the purposes of the Act (Section 5). This fund consists of a cash portion and a contingent portion. The cash portion is mainly made up of the Irish Probate Duty (now Estate Duty) grant, and an Exchequer contribution, and the contingent portion consists of the Irish share of the local taxation (Customs and Excise) duties and certain local grants (Section 5). Any deficiency in the Land Purchase account is to be paid out of this Guarantee Fund. This financial expedient, of course, throws the securing of the repayment of the advances for land purchase on the ratepayers of the county, as any default will be recouped by deductions from the various payments and contributions in aid of rates that make up the Guarantee Fund. The amount of stock that could be issued for each county for purposes of Land Purchase was limited to twenty-five times the share of the county in the guarantee fund by the Act of 1891 (Section 9). This limit, having been reached in the case of Co. Wexford, by Mr. Wyndham's Purchase of Land (Ireland) Act, 1901 (1 Edw. VII., c. 3) the limit was extended to fifty times the share of that county in the guarantee fund. By the Act of 1903 (Section 46) the limit for each county was raised to thirty times its share in the guarantee fund, which limit might be further raised to sixty times where the Treasury, on the certificate of the Lord-Lieutenant, [pg 189] were of opinion that such increase in advances could be made without any risk of loss to the Exchequer.
Taken on the basis of the financial year 1909-10 the Guarantee Fund for all counties of Ireland amounted to £2,797,126. On the above figures the capitalized value of the Guarantee Fund on the thirty times basis is at present £83,913,780, but owing to increases beyond this thirty times limit which have been sanctioned by the Treasury, in certain counties the present capitalized value of the fund stands at £89,323,685.
The total charge on the fund up to March 31st, 1910, was about 48-¾ million pounds in respect of advances made on the security of the fund, and, taking pending applications for advances into account, the approximate charges amounted at that date to about 105 millions.
The Act of 1891 was amended in various respects by Mr. Gerald Balfour's Act of 1896, which introduced, among other changes, a method of reducing every decade (up to thirty years after the advance was made), the annuity to be paid by the tenant purchaser. As under the “Ashbourne Act” of 1885, this annuity was calculated at £4 per cent. on the purchase money, 2-¾ per cent. being for interest, and 1-¼ per cent. being for sinking fund. Under Mr. Gerald Balfour's system, during the first decade after the purchase the annuity is calculated on the original advance, and during the second and third decades on the portion of the advance which is ascertained to be unpaid at the end of the previous decade. At the end of the third decade the annuity is calculated on the amount of the advance then outstanding and runs until the entire debt is paid off. The Act of 1896 also permitted the Land Commission to dispense with the whole or any part of the guarantee deposit required under the Act of 1885 if [pg 190] the security for the repayment of the advance was considered to be sufficient without it (Section 29).
The number of loans issued under these Acts of 1891 and 1896 to tenant purchasers up to March 31st, 1910, was 46,828, amounting in all to £13,145,762, and being at the rate of 17.7 years' purchase of the rents (Land Commission Report, 1910, p. 110).
Irish Land Act, 1903 (the “Wyndham Act”).
I have traced the history of the Irish Land Acts down to 1896. Some short Acts were added to the code during the following years to clear away certain difficulties, and in 1903 Mr. Wyndham brought in and passed his Irish Land Act, which may be said to have opened a new era in Irish agrarian legislation. Under it a new body known as Estates Commissioners was formed, and included in the Land Commission to administer land purchase in Ireland.