Session 2012 - 13
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Local Government Finance Bill


Local Government Finance Bill
Schedule 1 — Local retention of non-domestic rates

22

 

Part 7

Levy payments, safety net payments and distribution of remaining

balance

Regulations about calculation of levy payments

20    (1)  

The Secretary of State may by regulations make provision for

5

calculating—

(a)   

whether a relevant authority is required to make a

payment under this Part of this Schedule (a “levy

payment”) to the Secretary of State for a year, and

(b)   

if so, the amount of the levy payment.

10

      (2)  

The regulations must make provision for calculations for a year to

be made after the end of that year.

      (3)  

The regulations may, in particular, make provision for

calculations in relation to a relevant authority to be made—

(a)   

if the relevant authority is a billing authority, by reference

15

to the total paid to it in respect of the year under sections

43 and 45, subject to such adjustments as may be specified

in the regulations;

(b)   

if the relevant authority is a major precepting authority, by

reference to the total paid to it for the year under

20

regulations under paragraph 8 (payments by billing

authorities to major precepting authorities), subject to such

adjustments as may be specified in the regulations;

(c)   

by reference to payments of a kind specified in the

regulations made to the authority by the Secretary of State;

25

(d)   

by reference to such other factors as may be specified in the

regulations.

      (4)  

The regulations may, in particular, make provision for

adjustments to an amount calculated under provision made under

sub-paragraph (3) by reference to changes affecting the calculation

30

of such an amount for an earlier year but not taken into account in

that calculation.

Calculation of levy payments

21    (1)  

The Secretary of State must calculate in relation to each relevant

authority—

35

(a)   

whether it is required to make a levy payment for a year,

and

(b)   

if so, the amount of that payment.

      (2)  

The calculation must be made—

(a)   

as soon as is reasonably practicable after the end of the

40

year, or

(b)   

if a direction is given to the authority under paragraph 40

(direction to make calculations or supply information) for

the purposes of this paragraph, as soon as is reasonably

practicable after the time specified in the direction,

45

           

whichever is the later.

 
 

Local Government Finance Bill
Schedule 1 — Local retention of non-domestic rates

23

 

      (3)  

The calculation must be made in accordance with regulations

under paragraph 20.

      (4)  

As soon as is reasonably practicable after making a calculation in

relation to a relevant authority, the Secretary of State must notify

that authority of—

5

(a)   

whether, in accordance with the calculation, it is required

to make a levy payment for the year, and

(b)   

if so, the amount of that payment in accordance with the

calculation.

Levy payments following calculations

10

22    (1)  

If a calculation under paragraph 21 shows that a levy payment is

to be made to the Secretary of State by a relevant authority, the

authority must make that payment to the Secretary of State.

      (2)  

The levy payment—

(a)   

must be made on or before such day and in such manner

15

as the Secretary of State may specify, and

(b)   

if not made on or before that day, is recoverable in a court

of competent jurisdiction.

Regulations about calculation of safety net payments

23    (1)  

The Secretary of State may by regulations make provision for

20

calculating—

(a)   

whether the Secretary of State is required to make a

payment under this Part of this Schedule (a “safety net

payment”) to a relevant authority for a year, and

(b)   

if so, the amount of the payment.

25

      (2)  

The regulations must make provision for calculations for a year to

be made after the end of that year.

      (3)  

The regulations may, in particular, make provision for

calculations in relation to a relevant authority to be made—

(a)   

if the relevant authority is a billing authority, by reference

30

to the total paid to it in respect of the year under sections

43 and 45, subject to such adjustments as may be specified

in the regulations;

(b)   

if the relevant authority is a major precepting authority, by

reference to the total paid to it for the year under

35

regulations under paragraph 8 (payments by billing

authorities to major precepting authorities), subject to such

adjustments as may be specified in the regulations;

(c)   

by reference to payments of a kind specified in the

regulations made to the authority by the Secretary of State;

40

(d)   

by reference to such other factors as may be specified in the

regulations.

      (4)  

The regulations may, in particular, make provision for

adjustments to an amount calculated under provision made under

sub-paragraph (3) by reference to changes affecting the calculation

45

 
 

Local Government Finance Bill
Schedule 1 — Local retention of non-domestic rates

24

 

of such an amount for an earlier year but not taken into account in

that calculation.

Calculation of safety net payments

24    (1)  

The Secretary of State must calculate in relation to each relevant

authority—

5

(a)   

whether the Secretary of State is required to make a safety

net payment to the authority for the year, and

(b)   

if so, the amount of that payment.

      (2)  

The calculation must be made—

(a)   

as soon as is reasonably practicable after the end of the

10

year, or

(b)   

if a direction is given to the authority under paragraph 40

(direction to make calculations or supply information) for

the purposes of this paragraph, as soon as is reasonably

practicable after the time specified in the direction,

15

           

whichever is the later.

      (3)  

The calculation must be made in accordance with regulations

under paragraph 23.

      (4)  

As soon as is reasonably practicable after making a calculation

under this paragraph in relation to a relevant authority, the

20

Secretary of State must notify that authority of—

(a)   

whether, in accordance with the calculation, the Secretary

of State is required to make a safety net payment to the

authority for the year, and

(b)   

if so, the amount of that payment in accordance with the

25

calculation.

      (5)  

This paragraph is subject to regulations under paragraph 26

(payments on account).

Safety net payments following calculations

25    (1)  

If a calculation under paragraph 24 shows that a safety net

30

payment is to be made by the Secretary of State to a relevant

authority, the Secretary of State must make that payment to the

authority.

      (2)  

The safety net payment must be made in instalments of such

amounts, and at such times, as the Secretary of State determines

35

with the Treasury’s consent.

      (3)  

This paragraph is subject to regulations under paragraph 26

(payments on account).

Regulations about payments on account

26    (1)  

The Secretary of State may by regulations make provision—

40

(a)   

for a relevant authority to request the Secretary of State to

make a calculation before the end of a year (an “in-year

calculation”) of—

 
 

Local Government Finance Bill
Schedule 1 — Local retention of non-domestic rates

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(i)   

whether the Secretary of State is likely to be

required to make a safety net payment under

paragraph 25 to the authority for the year, and

(ii)   

if so, the amount of the payment;

(b)   

about the time at which and the manner in which a request

5

must be made, and the information that must be provided

in connection with the request;

(c)   

about the circumstances in which the Secretary of State

may or must make an in-year calculation in response to a

request;

10

(d)   

about the making of an in-year calculation, including for

the Secretary of State to make the calculation by reference

to estimates of any of the amounts mentioned in paragraph

23(3).

      (2)  

The regulations may make provision—

15

(a)   

about the timing of an in-year calculation in response to a

request;

(b)   

about the notification of the results of an in-year

calculation to the relevant authority to whom it relates;

(c)   

for the making, as a result of the calculation, of a payment

20

(a “payment on account”) to the authority before the end of

the year to which the calculation relates.

      (3)  

The regulations may, in particular—

(a)   

make provision in relation to an in-year calculation that is

similar to that made by paragraph 24, or apply that

25

paragraph with modifications in relation to such a

calculation;

(b)   

make provision in relation to a payment on account that is

similar to that made by paragraph 25, or apply that

paragraph with modifications in relation to such a

30

payment.

      (4)  

The regulations may make provision—

(a)   

about the calculation under paragraph 24 to be made in

relation to a relevant authority for a year where a payment

on account has been made to the authority for the year;

35

(b)   

for the making of a further payment by the Secretary of

State to the authority, or of a payment by the authority to

the Secretary of State, as a result of that calculation.

Calculation of remaining balance on levy account

27    (1)  

The Secretary of State must, in each year other than the first year

40

for which this paragraph has effect, calculate whether there is a

remaining balance on the levy account for the year.

      (2)  

The calculation must be made as soon as is reasonably practicable

after—

(a)   

all of the calculations required by paragraph 21(1)

45

(calculations of levy payments) have been made for the

previous year, and

 
 

Local Government Finance Bill
Schedule 1 — Local retention of non-domestic rates

26

 

(b)   

all of the calculations required by paragraph 24(1)

(calculations of safety net payments) have been made for

the previous year.

      (3)  

The calculation must be made as follows—

           

Step 1

5

           

Calculate the aggregate of the amounts of all of the levy payments

calculated for the previous year under paragraph 21(1).

           

Step 2

           

Add any amount credited to the levy account for the year in

accordance with paragraph 19(2) (credit from previous year) to the

10

amount found under step 1, or subtract any amount debited to

that account in accordance with paragraph 19(3) (debit from

previous year) from the amount found under step 1.

           

Step 3

           

Subtract from the amount found under steps 1 and 2 the aggregate

15

of the amounts of all the safety net payments calculated for the

previous year under paragraph 24(1).

           

Step 4

           

Subtract from the amount found under steps 1 to 3 the amount (if

any) that is required to be distributed under paragraph 28

20

(distribution of remaining balance) in the year.

      (4)  

If the amount found under step 4 in sub-paragraph (3) is a positive

amount, that is the remaining balance on the levy account for the

year.

Distribution of remaining balance

25

28    (1)  

The Secretary of State may determine that an amount equal to the

whole or part of the remaining balance on a levy account for a year

is to be distributed among one or more relevant authorities (rather

than being treated in accordance with paragraph 19(2)).

      (2)  

If the Secretary of State makes a determination under sub-

30

paragraph (1), the amount referred to in that sub-paragraph may

not be distributed unless—

(a)   

the basis (“the basis of distribution”) on which the

Secretary of State intends to make the distribution is

specified in a local government finance report, and

35

(b)   

the report is approved by resolution of the House of

Commons.

      (3)  

Before making such a local government finance report, the

Secretary of State must notify such representatives of local

government as the Secretary of State thinks fit of the general

40

nature of the basis of distribution.

      (4)  

If such a report is approved by resolution of the House of

Commons, the Secretary of State must calculate what amount (if

any) falls to be paid to each relevant authority as its share of the

amount referred to in sub-paragraph (1).

45

      (5)  

The calculations must be made—

 
 

Local Government Finance Bill
Schedule 1 — Local retention of non-domestic rates

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(a)   

as soon as is reasonably practicable after the report is

approved, and

(b)   

in accordance with the basis of distribution specified in the

report.

      (6)  

As soon as is reasonably practicable after making the calculations,

5

the Secretary of State must notify each relevant authority of—

(a)   

whether a payment is to be made by the Secretary of State

to the authority out of the amount referred to in sub-

paragraph (1), and

(b)   

if such a payment is to be made, the amount of the

10

payment.

      (7)  

If the calculations show that a payment is to be made by the

Secretary of State to a relevant authority, the Secretary of State

must make that payment to the authority.

      (8)  

A payment from the Secretary of State to a relevant authority

15

under this paragraph must be made—

(a)   

at such time, or

(b)   

in instalments of such amounts and at such times,

           

as the Secretary of State determines with the Treasury’s consent.

Relationship with other provisions

20

29         

This Part is subject to Parts 9 (pooling of authorities) and 10

(designation of areas and classes of hereditament).

Part 8

Transitional protection payments

Regulations about deemed and actual rating income

25

30    (1)  

The Secretary of State may by regulations make provision for

calculating in accordance with the regulations—

(a)   

the total amount which would be payable to a billing

authority in England in respect of a year under sections 43

and 45 if—

30

(i)   

regulations under section 57A (transitional relief

following compilation of local rating list) were not

in force for the year, and

(ii)   

the authority acted diligently, and

(b)   

the total amount which would be payable to a billing

35

authority in England in respect of a year under sections 43

and 45 if the authority acted diligently.

      (2)  

The regulations may include provision for adjustments to be made

to an amount calculated under provision under sub-paragraph (1).

      (3)  

The regulations may, in particular, make provision for

40

adjustments to that amount by reference to changes affecting the

calculation of such an amount for an earlier year but not taken into

account in that calculation.

 
 

Local Government Finance Bill
Schedule 1 — Local retention of non-domestic rates

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      (4)  

In this Part of this Schedule—

(a)   

a billing authority’s “deemed rating income” for a year

means the amount calculated for the authority and the year

under provision under sub-paragraph (1)(a) and (2), and

(b)   

a billing authority’s “actual rating income” for a year

5

means the amount calculated for the authority and the year

under provision under sub-paragraph (1)(b) and (2).

Regulations about transitional protection payments

31    (1)  

The Secretary of State may by regulations make provision for the

making of a payment (a “transitional protection payment”) for a

10

year—

(a)   

by the Secretary of State to a billing authority in England,

or

(b)   

by a billing authority in England to the Secretary of State.

      (2)  

The regulations must provide for the amount (if any) of a

15

transitional protection payment in relation to an authority for a

year to be calculated by reference to its deemed and actual rating

income for the year, so that—

(a)   

if its deemed rating income for a year exceeds its actual

rating income for the year, the Secretary of State is to be

20

liable to make a transitional protection payment to the

authority for the year of an amount equal to the excess;

(b)   

if its actual rating income for a year exceeds its deemed

rating income for the year, the authority is to be liable to

make a transitional protection payment to the Secretary of

25

State for the year of an amount equal to the excess;

(c)   

if its deemed rating income for a year is equal to its actual

rating income for the year, no transitional protection

payment is to be made to or by the authority for the year.

      (3)  

The regulations may, in particular, make provision—

30

(a)   

about the making of calculations, and the supply of

information to the Secretary of State, by a billing authority

in connection with the determination of the transitional

protection payment (if any) to be made to or by the

authority;

35

(b)   

about the assumptions and adjustments to be made, and

the information to be taken into account, in making such

calculations;

(c)   

about the consequences of non-compliance with provision

under paragraph (a) or (b), including (in particular)—

40

(i)   

for the making by the Secretary of State of

calculations, or of assumptions as to the

information that would otherwise have been

supplied by the authority;

(ii)   

for the suspension of payments to the authority.

45

      (4)  

The regulations may, in particular, make provision—

(a)   

for the making by a billing authority or the Secretary of

State of a payment on account of a transitional protection

payment;

 
 

 
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Revised 10 May 2012