As it currently operates, inheritance law is both divorced from the principles which gave rise to it and at odds with modern values. As a result it is one of the chief causes of inequality.

Note: The text below focuses on land because originally land was the only form of wealth-generating property and therefore served as a template for laws on inheritance of forms of capital which developed later.

Inheritance law is divorced from the principles which gave rise to it because, although a testator’s power to bequeath productive property derives from a responsibility which the state delegated to landowners, it has come to be seen as a privilege to be exercised as he or she pleases. Land ownership used to be part of the machinery of government – landowners were essentially the local authorities of their day – and one of their responsibilities was nominating a successor to take over when they died. Over the centuries, the other responsibilities which accompanied landownership were taken over by other bodies but the power to nominate their successor remained with the landowner.

The hereditary principle as an element of law does have a solid foundation; there are good reasons why responsibility for nominating a successor should have been delegated to the current holder, because generally the existing owner was the person who was best placed to know who would make best use of the property. The existing owner knew who had a relationship with the land already, whereas the state had only minimal knowledge of it. But that represents a pragmatic reason for the law to presume in favour of a nominated heir; it does not constitute a right.

Reform

The reforms discussed below are not currently part of our manifesto and will need explicit approval from the membership to become party policy. However, they do cover issues which would fall foul of our proposed requirement for coherent law and are therefore areas where reform of some kind is likely to be necessary.

Reforming inheritance law to make it consistent with modern values and its historical roots should be relatively easy.

The roots of current law lie in the power landlords formerly exercised over the people living on their land, and their responsibility to nominate a successor to take on that power. The very first step, therefore, would simply be to clarify that the power to nominate a successor is a responsibility which the state delegates to the current owner, rather than a privilege.

That step does not, in itself, alter anything of substance. It would still fall to current owners to nominate their successor as they do today but, as agents of the Crown, they would be expected to consider the broader public interest rather than just the interests of those close to them. That step leaves the details, of exactly what the public interest is, to be worked out later but it would break the stranglehold of cross-generation control of land and the consequential accumulation of wealth. Further steps in that process would establish limits to what any individual could reasonably receive, in total, by bequest (and probably also by gift).

Below are draft clauses for a reform bill on inheritance of land:

  1. Every individual who has rights of citizenship by birth shall have a right (‘their birthright’) to inherit, directly or indirectly, a fair share of the nation’s stock of private residential, agricultural and industrial land. The law shall define what constitutes a fair share with due regard to:
    • the need for efficient allocation and effective stewardship of the nation’s primary natural resource;
    • people’s need for certainty in the enjoyment of their landholdings.
  2. The law shall provide, as far as is practicable, for everyone to:
    • claim all or part of their birthright;
    • leave all or part of it unclaimed, in the stewardship of others;
    • dispose of all or part of it, temporarily or permanently, by contract or gift, once they have reached an age and condition of full discretion.
  3. A fair share of land-market-value shall generally be considered an acceptable substitute for a fair share of actual land.
  4. All holders of a freehold estate in land shall be deemed to hold the future interest in that land as trustees for future generations. Their duty as trustees shall be secondary to their own rights in respect of enjoyment of the land but shall be primary in all questions regarding transfer of ownership. As trustees they shall have a responsibility to nominate a successor to take over their rights and responsibilities after their death. Only natural persons and agencies of the state shall be permitted to hold freehold estates in land.
  5. All holders of agricultural land in excess of their own fair share shall be deemed to hold it as trustees for those who have left their shares unclaimed. Landholders’ duty as trustees shall be considered secondary to their right to work the land as they see fit but shall be a primary consideration in all questions regarding transfer of ownership and in any change from agricultural use. Trustees shall give due regard to the principle that nobody should be deprived of means of subsistence, nor unnecessarily forced into a position of dependency, in considering whether to hold or relinquish their trusteeship.

Notes:
Legal definitions of land include buildings.
A fair share of land-market-value implies changes to the existing land market. Those changes and a strategy for introducing them gradually are outlined in the section on Land Currency.

 

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