Local Government Finance Bill (HC Bill 142)

Local Government Finance BillPage 30

(5) In this section “primary legislation” means—

(a) an Act of Parliament;

(b) a Measure or Act of the National Assembly for Wales.

40 Financial provisions

5There is to be paid out of money provided by Parliament—

(a) any expenditure incurred by the Secretary of State in consequence of
this Act, and

(b) any increase attributable to this Act in the sums payable under any
other Act out of money so provided.

41 10Extent

This Act extends to England and Wales only.

42 Commencement and short title

(1) The following provisions of this Act come into force on the day on which this
Act is passed—

(a) 15sections 8, 13 and 14 and Schedule 3;

(b) sections 39 to 41 and this section;

(c) any power to make regulations under or by virtue of this Act.

(2) The remaining provisions of this Act come into force in accordance with
provision contained in regulations made by the Secretary of State by statutory
20instrument.

(3) Regulations under subsection (2) may—

(a) make different provision for different purposes or in relation to
different areas;

(b) make such transitory or transitional provision, or savings, as the
25Secretary of State considers necessary or expedient, including (in
particular) such adaptations of provisions of this Act brought into force
as appear to be necessary or expedient in consequence of other
provisions of this Act not yet having come into force.

(4) This Act may be cited as the Local Government Finance Act 2017.

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SCHEDULES

Section 1

SCHEDULE 1 Local retention of 100% of non-domestic rates

Part 1 5Amendments of Schedule 7B to the 1988 Act

Introductory

1 Schedule 7B to the 1988 Act (local retention of non-domestic rates) is
amended as follows.

Non-domestic rating accounts

2 10Part 1 (main non-domestic rating accounts) is amended as follows.

3 (1) Paragraph 1 (main non-domestic rating accounts) is amended as follows.

(2) In sub-paragraph (1), for “a “main non-domestic rating account”” substitute
“the “non-domestic rating account””.

(3) In sub-paragraph (2)—

(a) 15for “Each such account” substitute “The non-domestic rating account
for a year”;

(b) for “a main non-domestic rating account” substitute “such an
account”.

(4) In sub-paragraph (3)—

(a) 20in paragraph (a), for “each such account” substitute “the non-
domestic rating account for a year”;

(b) in paragraph (b), for “each such account” substitute “the account”.

(5) The heading before paragraph 1 becomes “Non-domestic rating accounts”.

4 (1) Paragraph 2 (credits and debits) is amended as follows.

(2) 25For sub-paragraphs (1) and (2) substitute—

(1) For each year there are to be credited (as items of account) to the
non-domestic rating account kept for the year such relevant
receipts as the Treasury may direct.

(1A) In sub-paragraph (1) “relevant receipts”, in relation to a year,
30means—

(a) amounts received under Part 3 of this Act by the Secretary
of State in the year, and

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(b) other amounts received under this Act by the Secretary of
State in the year in connection with non-domestic rates.

(2) For each year there are to be debited (as items of account) to the
non-domestic rating account kept for the year such relevant
5payments as the Treasury may direct.

(2A) In sub-paragraph (2) “relevant payments”, in relation to a year,
means—

(a) payments made under Part 3 of this Act by the Secretary of
State in the year, and

(b) 10other payments made under this Act by the Secretary of
State in the year in connection with non-domestic rates.”

(3) For sub-paragraph (3) substitute—

(3) An amount may also be debited (as an item of account) to the non-
domestic rating account kept for a year if it is for use for the
15purposes of local government in England.”

(4) Omit sub-paragraph (4).

5 (1) Paragraph 3 (end of year calculations) is amended as follows.

(2) In sub-paragraph (1), omit “main” (in both places where it occurs).

(3) In sub-paragraph (2), omit “main” (in both places where it occurs).

(4) 20In sub-paragraph (3), omit “main” (in both places where it occurs).

6 The heading of Part 1 becomes “Non-domestic rating accounts”.

Abolition of local government finance reports

7 Omit Part 2 (which provides for the determination of the central and local
share and the preparation of a local government finance report specifying
25those shares).

Payments by billing authorities to major precepting authorities

8 Part 4 (payments by billing authorities in England to major precepting
authorities in England) is amended as follows.

9 In paragraph 9 (regulations about payments), omit sub-paragraphs (2) and
30(8).

10 Omit paragraph 11.

Principal payments in connection with local retention of non-domestic rates

11 Part 5 (principal payments in connection with local retention of non-
domestic rates) is amended as follows.

12 (1) 35Paragraph 12 (determination of payments) is amended as follows.

(2) In sub-paragraph (1)—

(a) for “The local government finance report for a year must specify”
substitute “The Secretary of State must specify, for each year,”;

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(b) for ““the basis of calculation”” substitute “the “principles of
allocation””.

(3) After sub-paragraph (1) insert—

(1A) The principles of allocation for a year must be specified in a
5statement (a “principles of allocation statement”) made by the
Secretary of State.

(1B) A principles of allocation statement may specify the principles of
allocation for such year or years (“relevant years”) as are specified
in the statement.

(1C) 10If before the beginning of a relevant year the Secretary of State
makes a principles of allocation statement specifying revised
principles of allocation for that year, the revised principles of
allocation have effect for that year.”

(4) For sub-paragraph (2) substitute—

(2) 15Before making a principles of allocation statement, the Secretary of
State must consult such representatives of local government as the
Secretary of State thinks fit about the general nature of the
principles of allocation.

(3) As soon as is reasonably practicable after making a principles of
20allocation statement, the Secretary of State must send a copy of the
statement to each relevant authority.”

(5) The heading before paragraph 12 becomes “Principles of allocation”.

13 (1) Paragraph 13 (calculations following local government finance report) is
amended as follows.

(2) 25For sub-paragraph (1) substitute—

(1) This paragraph applies where the Secretary of State makes a
principles of allocation statement.”

(3) In sub-paragraph (2)—

(a) for the words from the beginning to “approved” substitute “Before
30the beginning of each relevant year”;

(b) after “must” insert “, for that relevant year”.

(4) In sub-paragraph (3)—

(a) for “the year to which the report relates” substitute “a relevant year”;

(b) after “make” insert “for the relevant year”.

(5) 35In sub-paragraph (4), for the words from “is not exercisable” to the end
substitute “for a year is not exercisable after the making of any amending
statement for the year under paragraph 15.”

(6) In sub-paragraph (5), for “the basis of calculation specified in the report”
substitute “the principles of allocation specified in the statement”.

(7) 40The heading before paragraph 13 becomes “Determination of payments for a
relevant year
”.

14 (1) Paragraph 14 (payments following local government finance report) is
amended as follows.

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(2) In sub-paragraph (1), after “Secretary of State” (where it first occurs) insert
“for a relevant year”.

(3) In sub-paragraph (2), after “relevant authority” insert “for a relevant year”.

(4) In sub-paragraph (11)—

(a) 5after “sub-paragraph (1)” insert “for a relevant year”, and

(b) in paragraph (a), for “the year to which the local government finance
report relates” substitute “the relevant year”.

(5) In sub-paragraph (12)—

(a) after “sub-paragraph (2)” insert “for a relevant year”, and

(b) 10in paragraph (b), for “the year to which the local government finance
report relates” substitute “the relevant year”.

(6) In sub-paragraph (13)—

(a) after “sub-paragraph (6) or (7)” insert “for a relevant year”, and

(b) in paragraph (a), for “the year to which the local government finance
15report relates” substitute “the relevant year”.

(7) In sub-paragraph (14)—

(a) after “sub-paragraph (9) or (10)” insert “for a relevant year”, and

(b) for “the year to which the local government finance report relates”
substitute “the relevant year”.

(8) 20The heading before paragraph 14 becomes “Making of payments for a relevant
year
”.

15 (1) Paragraph 15 (amending reports) is amended as follows.

(2) For sub-paragraphs (1) and (2) substitute—

(1) After a principles of allocation statement has been made, the
25Secretary of State may make an amending statement for such
relevant year or years as are specified in the amending statement.

(2) An amending statement under this paragraph for a relevant year
must contain amendments to the principles of allocation specified
for the year in the principles of allocation statement.

(2A) 30An amending statement for a relevant year—

(a) may be made at any time before the end of the year
following the relevant year, but

(b) may not be made for any relevant year following the year
in which the amending statement is made.

(2B) 35Only one amending statement may be made for each relevant
year.”

(3) For sub-paragraph (3) substitute—

(3) Before making an amending statement, the Secretary of State must
consult such representatives of local government as the Secretary
40of State thinks fit about the general nature of the amendments the
Secretary of State proposes to make.”

(4) Omit sub-paragraph (4).

(5) In sub-paragraph (5)—

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(a) for “after the report is laid before the House of Commons” substitute
“after making an amending statement under this paragraph”;

(b) for “report” substitute “amending statement”.

(6) Omit sub-paragraph (6).

(7) 5The heading before paragraph 15 becomes “Amending statements”.

16 (1) Paragraph 16 (calculations following amending report) is amended as
follows.

(2) In sub-paragraph (1), for the words from “if” to the end substitute “if an
amending statement for a year is made under paragraph 15.”

(3) 10In sub-paragraph (2), for “after the amending report has been approved”
substitute “after making the amending statement”.

(4) In sub-paragraph (3), after “make” insert “for the year”.

(5) In sub-paragraph (4)—

(a) after “sub-paragraph (3)” insert “for a year”;

(b) 15in paragraph (a), for “the year to which the amending report relates”
substitute “that year”;

(c) in paragraph (b), for the words from “amending report” to the end
substitute “amending statement is made.”

(6) In sub-paragraph (5), for the words from “basis of calculation” to the end
20substitute “principles of allocation specified in the principles of allocation
statement as amended by the amending statement.”

(7) The heading before paragraph 16 becomes “Calculations following amending
statement
”.

17 (1) Paragraph 17 (payments following amending report) is amended as follows.

(2) 25In sub-paragraph (9)(a), for “amending report” substitute “amending
statement”.

(3) In sub-paragraph (10), for “amending report” substitute “amending
statement”.

(4) The heading before paragraph 17 becomes “Payments following amending
30statement
”.

Abolition of levy payments

18 (1) Omit Part 6 (levy accounts).

(2) In Part 7 (levy payments, safety net payments and distribution of remaining
balance), omit—

(a) 35paragraphs 22 to 24 (levy payments), and

(b) paragraphs 29 and 30 (calculation and distribution of remaining
balance on levy account).

(3) The heading of Part 7 becomes “Safety net payments”.

Safety net payments

19 40Part 7 is amended as follows.

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20 (1) Paragraph 25 (regulations about calculation of safety net payments) is
amended as follows.

(2) For sub-paragraph (2) substitute—

(2) The regulations may, in particular, make provision about the
5timing of calculations for a year.”

(3) In sub-paragraph (3)(d), at the end insert “(including estimates of any of the
amounts mentioned in paragraphs (a) to (c)).”

21 In paragraph 26 (calculation of safety net payments), omit sub-paragraphs
(2) and (5).

22 (1) 10Paragraph 27 (safety net payments following calculations) is amended as
follows.

(2) After sub-paragraph (1) insert—

(1A) The Secretary of State may by regulations make provision about
the time and manner in which a safety net payment is to be made
15(including for payment by instalments).”

(3) Omit sub-paragraphs (2) and (3).

23 After paragraph 27 insert—

“Safety net reconciliation payments

27A (1) The Secretary of State may by regulations make provision for a
20payment (a “safety net reconciliation payment”) to be made by the
Secretary of State to a relevant authority, or by a relevant authority
to the Secretary of State, where—

(a) a calculation of a safety net payment is made by reference
to an estimate of an amount, and

(b) 25it is subsequently determined that the actual amount is
more or less than the estimate.

(2) The regulations may, in particular, make provision—

(a) for calculating whether a safety net reconciliation payment
is to be made and, if so, the amount of the payment;

(b) 30about the timing of such a calculation;

(c) about the notification of the results of such a calculation to
the relevant authority to whom it relates;

(d) about the time and manner in which such a payment is to
be made (including for payment by instalments).”

24 35Omit paragraph 28 (regulations about payments on account).

Pooling of authorities

25 Part 9 (pooling of authorities) is amended as follows.

26 (1) Paragraph 34 (designation of pool of authorities) is amended as follows.

(2) After sub-paragraph (1) insert—

(1A) 40Before making a designation the Secretary of State must consult—

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(a) every relevant authority that would be affected by the
designation, and

(b) any other person appearing to the Secretary of State to
have an interest in it.”

(3) 5Omit sub-paragraph (2).

(4) For sub-paragraph (3) substitute—

(3) The Secretary of State may revoke a designation.”

(5) In sub-paragraph (5), for the words from “paragraph 12(2)” to the end
substitute “paragraph 13(6) (notification of whether any payments are to be
10made by or to a relevant authority under paragraph 14(1) or (2)).”

(6) Omit sub-paragraph (6).

(7) In sub-paragraph (8)—

(a) for “paragraph 12(2)” substitute “paragraph 13(6)”;

(b) omit “, unless sub-paragraph (9) applies”.

(8) 15Omit sub-paragraph (9).

27 After paragraph 34 insert—

34A (1) A designation under paragraph 34 must specify a lead authority
to exercise the functions specified in the designation.

(2) The Secretary of State may vary a designation by—

(a) 20specifying a different authority as the lead authority,

(b) specifying additional functions to be exercised by the lead
authority, or

(c) varying or removing any function specified in the
designation under this paragraph.

(3) 25Before varying a designation under sub-paragraph (2), the
Secretary of State must consult the authorities covered by the
designation.

(4) After varying a designation under sub-paragraph (2), the
Secretary of State must notify those authorities.”

28 30In paragraph 35 (conditions to which designations are subject), in sub-
paragraph (1), for the words from “subject to” to the end substitute “subject
to one or more conditions requiring the authorities to which the designation
relates, if it is revoked, to take the steps specified in the conditions before the
revocation takes effect.”

29 (1) 35Paragraph 36 (effect of designation in relation to Part 5) is amended as
follows.

(2) In sub-paragraph (2), for “amending report” substitute “amending
statement”.

(3) In sub-paragraph (3)—

(a) 40in paragraph (a)—

(i) for “the local government finance report for the year”
substitute “a principles of allocation statement”;

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(ii) for “an amending report under paragraph 15 in relation to
that report” substitute “an amending statement under
paragraph 15 for any year specified in that principles of
allocation statement”;

(iii) 5after “pool” insert “for the year”;

(b) in paragraph (b)—

(i) for “local government finance report” substitute “principles
of allocation statement”;

(ii) for “amending report” substitute “amending statement”.

(4) 10In sub-paragraph (4), for “reports” substitute “statements”.

30 (1) Paragraph 37 (effect of designation in relation to Part 7) is amended as
follows.

(2) In sub-paragraph (1), for the words from “paragraph” to “account)”
substitute “paragraph 25 or 27A (safety net payments and reconciliation
15payments)”.

(3) Omit sub-paragraphs (3), (5) and (6).

(4) In sub-paragraph (7)—

(a) in paragraph (a), for “paragraph 22, 25, 28 or 30” substitute
“paragraph 25 or 27A”, and

(b) 20in paragraph (b), for the words from “under” to “regulations”
substitute “under paragraph 26 based on regulations under
paragraph 25, or calculations under regulations made under
paragraph 27A,”.

(5) In sub-paragraph (8), for the words from “paragraphs” to “apply” substitute
25“neither paragraph 27 (safety net payments following calculations), nor any
requirement to make a payment under regulations made under paragraph
27A, applies”.

31 In paragraph 38 (further provisions about effect of designation), in sub-
paragraph (3), for “appointed in accordance with conditions under
30paragraph 35(1)” substitute “specified in accordance with paragraph 34A”.

Other consequential amendments

32 Part 10 is amended as follows.

33 (1) In paragraph 39 (designation of areas), sub-paragraph (1)(d) is amended as
follows.

(2) 35Omit sub-paragraphs (i), (ii), (vii), (ix) and (x).

(3) In sub-paragraph (v), for “(calculations following local government finance
report)” substitute “(determination of payments for a relevant year)”.

(4) In sub-paragraph (vi), for “amending report” substitute “amending
statement”.

(5) 40After sub-paragraph (viii) insert—

(viiia) regulations under paragraph 27A (safety net
reconciliation payments).”

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34 (1) In paragraph 40 (designation of classes of hereditament), sub-paragraph
(1)(d) is amended as follows.

(2) Omit sub-paragraphs (i), (ii), (vii), (ix) and (x).

(3) In sub-paragraph (v), for “(calculations following local government finance
5report)” substitute “(determination of payments for a relevant year)”.

(4) In sub-paragraph (vi), for “amending report” substitute “amending
statement”.

(5) After sub-paragraph (viii) insert—

(viiia) regulations under paragraph 27A (safety net
10reconciliation payments).”

35 (1) In Part 11, paragraph 45 (interpretation) is amended as follows.

(2) Omit the entries for the following expressions—

  • “basis of calculation”,

  • “the central share”,

  • 15“local government finance report”,

  • “the local share”,

  • “levy account”,

  • “levy payment”.

(3) In the entry for “main non-domestic rating account”, omit “main”.

(4) 20After the entry for “pool of authorities” insert—

  • ““principles of allocation” has the meaning given by paragraph
    12(1);

  • “principles of allocation statement” has the meaning given by
    paragraph 12(1A);”.

(5) 25After the entry for “relevant authority” insert—

  • ““relevant year”, in relation to a principles of allocation
    statement, has the meaning given by paragraph 12(1B);”.

(6) After the entry for “safety net payment” insert—

  • ““safety net reconciliation payment” has the meaning given by
    30paragraph 27A(1);”.

Part 2 Amendments of other legislation

Local Government Finance Act 1988

36 (1) Section 76 of the Local Government Finance Act 1988 (interpretation of Part
355) is amended as follows.

(2) In subsection (4), for “Secretary of State” substitute “Welsh Ministers”.

(3) In subsection (5)—

(a) for “Secretary of State” substitute “Welsh Ministers”, and

(b) for “him” substitute “them”.

(4) 40Omit subsection (6).