From the dissolution of the Central Land Board in 1959 there were no financial charges on land development, but the change of government in 1964 led to a white paper proposing the establishment of a land commission with the objects of providing a steady supply of land for development and imposing a betterment levy. The commission was planned by the Ministry of Land and Natural Resources and established by the Land Commission Act 1967, which placed it under the direction of the Minister of Housing and Local Government and the Secretary of State for Scotland.
The commission was given powers to acquire land compulsorily or by agreement and dispose of it to public authorities or private companies for development, or to build on it itself. Where land was disposed of it was to be held by a restricted form of tenure called 'crownhold', with the object of retaining for the benefit of the crown any element of value accruing as the result of development.
The commission was also empowered to assess and collect a betterment levy of 40% on the development value realised in land transactions or on development. A number of groups were exempted, including local authorities, new town development corporations, housing associations, statutory undertakers and owner occupiers, and disputes over the assessment of the levy were referrable to the Lands Tribunal. From 1969 increases in value of less than £1,500 were exempt.
The powers of the commission came into force on 6 April 1967. It comprised a chairman, deputy chairman, six part-time members drawn from professions mainly concerned with land and one civil servant serving as director and secretary. They were appointed by the two responsible ministers; one member was appointed after consulting the Welsh Office. The headquarters of the commission were at Newcastle upon Tyne, with a chairman's office in London.
The commission was organised into a number of divisions. The Finance Division was responsible for the financial and accounting work of the Land Commission, involving the maintenance of three funds and accounts. These were the Land Commission Vote Account, which met the expenses of the commission relating to the collection of betterment levy from funds provided annually by Parliament, the Land Acquisition and Management Fund for payments and receipts in respect of land trading, and the Betterment Levy Account for receipts from betterment levy.
The assessment of betterment levy and the negotiation of prices at which the commission purchased land were based on valuations by the Valuation Office of the Board of Inland Revenue which was represented by liaison officers at headquarters and regional offices of the Commission.
The Levy Division dealt with questions of assessment and payment of betterment levy. The Lands Division was concerned with the acquisition, management and disposal of land for development. The Legal Division was a purely headquarters division, consisting of professional legal advisers.
Regional offices were established in Scotland, Wales and nine English regions. Each office was organised under a regional controller into Lands, Levy and Estates Divisions, with the advisory services of a Valuation Office liaison officer and a regional advisory committee composed of prominent persons concerned with land and its development.
The commission was subject to strong criticism from various individuals and groups from the time of its inception, and the Conservative Party was committed to its abolition from an early stage. Following a change of government in 1970 it was decided to wind it up. The Land Commission Dissolution Act 1971 empowered the Secretary of State for the Environment to dissolve it by statutory instrument, which he did with effect from 1 May 1971. Betterment levy was ordered not to be charged on transactions taking place after 22 July 1970. Residual work concerned with the management and disposal of its property passed to the Department of the Environment.