Local Government Finance Bill (HL Bill 39)

Local Government Finance BillPage 20

SCHEDULES

Section 1

SCHEDULE 1 Local retention of non-domestic rates

After Schedule 7A to the LGFA 1988 insert—

Section 59A

Schedule 7B 5Local retention of non-domestic rates

Part 1 Main non-domestic rating accounts

Main non-domestic rating accounts

1 (1) The Secretary of State must, for each year, keep an account, to be
10called a “main non-domestic rating account”.

(2) Each such account must be kept in accordance with the provisions
of this Schedule that apply to a main non-domestic rating account.

(3) The Secretary of State—

(a) must keep each such account in such form as the Treasury
15may direct, and

(b) must, at such time as the Treasury may direct, send copies
of each such account to the Comptroller and Auditor
General.

(4) The Comptroller and Auditor General—

(a) 20must examine, certify and report on any account of which
copies are sent to the Comptroller and Auditor General
under sub-paragraph (3), and

(b) must arrange for copies of the account and of the
Comptroller and Auditor General’s report on it to be laid
25before each House of Parliament.

Credits and debits

2 (1) For each year the following are to be credited (as items of account)
to the main non-domestic rating account kept for the year—

(a) amounts received by the Secretary of State in the year
30under section 54 (central rating: liability),

(b) amounts received by the Secretary of State in the year
under section 59 (contributions in aid),

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(c) amounts received by the Secretary of State in the year
under paragraph 6 (payments in respect of the central
share) and amounts received by the Secretary of State in
the year under regulations under paragraph 7
5(administrative arrangements for such payments),

(d) amounts received by the Secretary of State in the year
under paragraph 12 (payments following local
government finance report),

(e) amounts received by the Secretary of State in the year
10under paragraph 15 (payments following amending
report), and

(f) amounts received by the Secretary of State in the year
under regulations under paragraph 31 (transitional
protection payments).

(2) 15For each year the following are to be debited (as items of account)
to the main non-domestic rating account kept for the year—

(a) payments made by the Secretary of State in the year under
regulations under paragraph 7,

(b) payments made by the Secretary of State in the year under
20paragraph 12,

(c) payments made by the Secretary of State in the year under
paragraph 15, and

(d) payments made by the Secretary of State in the year under
regulations under paragraph 31.

(3) 25If a local government finance report for a year has been approved
by resolution of the House of Commons, an amount may be
debited (as an item of account) to the main non-domestic rating
account kept for the year, for use for the purposes of local
government in England.

(4) 30The amount that may be debited under sub-paragraph (3) for a
year may not exceed—

(a) the total amount credited for the year under sub-
paragraph (1)(a), (b) and (c), minus

(b) the total amount debited for the year under sub-paragraph
35(2)(a).

(5) The reference in sub-paragraph (3) to use for the purposes of local
government in England includes the making of payments under
an Act or an instrument made under an Act (whenever passed or
made) to—

(a) 40billing authorities in England,

(b) precepting authorities in England,

(c) levying bodies in England (and for this purpose “levying
body” has the meaning given by section 74(1)), or

(d) bodies to which section 75(1) applies.

45End of year calculations

3 (1) As soon as is reasonably practicable after the end of each year, the
Secretary of State must calculate—

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(a) the aggregate of the items of account credited to the main
non-domestic rating account kept for the year, and

(b) the aggregate of the items of account debited to the main
non-domestic rating account kept for the year.

(2) 5If the aggregate mentioned in sub-paragraph (1)(a) exceeds that
mentioned in sub-paragraph (1)(b), an amount equal to the excess
must be—

(a) debited (as an item of account) to the main non-domestic
rating account kept for the year, and

(b) 10credited (as an item of account) to the main non-domestic
rating account kept for the next year.

(3) If the aggregate mentioned in sub-paragraph (1)(b) exceeds that
mentioned in sub-paragraph (1)(a), an amount equal to the excess
must be—

(a) 15credited (as an item of account) to the main non-domestic
rating account kept for the year, and

(b) debited (as an item of account) to the main non-domestic
rating account kept for the next year.

Part 2 20Determination of the central and local share

Determination of the central and local share

4 The Secretary of State must, for each year and in relation to each
billing authority in England, determine—

(a) the percentage (“the central share”) that is to be the billing
25authority’s central share for the year for the purposes of
Part 3 (payments to the Secretary of State in respect of the
central share), and

(b) the percentage (“the local share”) that is to be the billing
authority’s local share for the year for the purposes of Part
304 (payments by billing authorities to major precepting
authorities).

Local government finance reports

5 (1) A determination under paragraph 4 must be specified in a report,
to be called a “local government finance report”.

(2) 35The Secretary of State must lay, or make arrangements for laying,
the local government finance report before the House of
Commons.

(3) As soon as is reasonably practicable after a local government
finance report is laid before the House of Commons, the Secretary
40of State must send a copy of the report to each relevant authority.

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Part 3 Payments to the Secretary of State in respect of the central share

Payments to the Secretary of State in respect of the central share

6 (1) This paragraph applies if a local government finance report for a
5year is approved by resolution of the House of Commons.

(2) Each billing authority in England must make a payment for the
year to the Secretary of State of an amount equal to the central
share of the billing authority’s non-domestic rating income for the
year.

(3) 10For the purposes of sub-paragraph (2), an authority’s “non-
domestic rating income” has the meaning given by regulations
made by the Secretary of State.

(4) The regulations may, in particular, define that term by reference to
the total which, if the authority acted diligently, would be payable
15to it in respect of the year under sections 43 and 45, subject to such
adjustments as may be specified in the regulations.

(5) The regulations may, in particular, make provision for
adjustments by reference to changes to the calculation of the
amount of a billing authority’s non-domestic rating income for an
20earlier year but not taken into account in that calculation.

Regulations about administrative arrangements

7 (1) The Secretary of State may by regulations make provision about
the administration of payments under paragraph 6.

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

(a) 25about the time and manner in which a payment under
paragraph 6 or under regulations under this paragraph is
to be made (including for payment by instalments), and as
to the consequences of non-payment;

(b) about the making of a payment by a billing authority to the
30Secretary of State or vice versa where—

(i) a payment under paragraph 6 is made in the course
of the year to which it relates, and

(ii) it is subsequently determined that the amount of
the payment required to be made under that
35paragraph is more or less than that actually made.

Part 4 Payments by billing authorities to major precepting authorities

Regulations about payments

8 (1) The Secretary of State may by regulations make provision
40requiring billing authorities in England to make payments for a
year to major precepting authorities in England.

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(2) The regulations must provide that a billing authority is not
required to make a payment for a year unless the local
government finance report for the year has been approved by
resolution of the House of Commons.

(3) 5The regulations may, in particular, make provision as to—

(a) the billing authorities that are required to make payments
under the regulations;

(b) the major precepting authorities that are entitled to receive
payments under the regulations;

(c) 10the amounts of the payments that are required to be made.

(4) The regulations may, in particular, make provision for the amount
of a payment to be made by a billing authority for a year to be such
proportion of the local share of its non-domestic rating income for
the year as is specified in or determined in accordance with the
15regulations.

(5) For the purposes of sub-paragraph (4), an authority’s “non-
domestic rating income” has the meaning given by the
regulations.

(6) The regulations may, in particular, define that term by reference to
20the total which, if the authority acted diligently, would be payable
to it in respect of the year under sections 43 and 45, subject to such
adjustments as may be specified in the regulations.

(7) The regulations may, in particular, make provision for
adjustments by reference to changes to the calculation of the
25amount of a billing authority’s non-domestic rating income for an
earlier year but not taken into account in that calculation.

Regulations about administrative arrangements

9 (1) The Secretary of State may by regulations make provision about
the administration of payments under regulations under
30paragraph 8.

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

(a) about the making of calculations, and the supply of
information to a major precepting authority, by a billing
authority in connection with the determination of a
35payment to be made under regulations under paragraph 8
or this paragraph;

(b) about the assumptions and adjustments to be made, and
the information to be taken into account, in making such
calculations;

(c) 40about the consequences of non-compliance with provision
under paragraph (a) or (b);

(d) about the time and manner in which a payment under
regulations under paragraph 8 or this paragraph is to be
made (including for payment by instalments), and as to the
45consequences of non-payment;

(e) about the making of a payment by a billing authority to a
major precepting authority or vice versa where—

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(i) a payment under regulations under paragraph 8 is
made in the course of the year to which it relates,
and

(ii) it is subsequently determined that the amount of
5the payment required to be made under the
regulations is more or less than that actually made;

(f) for the audit of calculations made, or information supplied
to a major precepting authority, by a billing authority in
connection with the determination of a payment under
10regulations under paragraph 8 or this paragraph;

(g) about the consequences where a calculation or information
certified by the audit does not match that made or supplied
by the billing authority, including (in particular) about the
use of the certified calculation or information.

15Part 5 Principal payments in connection with local retention of non-
domestic rates

Determination of payments

10 (1) The local government finance report for a year must specify the
20basis (“the basis of calculation”) on which the Secretary of State
intends to—

(a) calculate which relevant authorities are to make payments
under this Part of this Schedule to the Secretary of State for
the year,

(b) 25calculate which relevant authorities are to receive
payments under this Part of this Schedule from the
Secretary of State for the year, and

(c) calculate the amount of each payment within paragraph
(a) or (b).

(2) 30Before making the local government finance report for a year, the
Secretary of State must notify such representatives of local
government as the Secretary of State thinks fit of the general
nature of the basis of calculation.

Calculations following local government finance report

11 (1) 35This paragraph applies if a local government finance report for a
year is approved by resolution of the House of Commons.

(2) As soon as is reasonably practicable after the report has been
approved, the Secretary of State must—

(a) calculate which relevant authorities are to make payments
40under this Part of this Schedule to the Secretary of State for
the year,

(b) calculate which relevant authorities are to receive
payments under this Part of this Schedule from the
Secretary of State for the year, and

(c) 45calculate the amount of each payment within paragraph
(a) or (b).

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(3) Subject as follows, the Secretary of State may, at any time before
the end of the year following the year to which the report relates,
make one further set of calculations of the kind described in sub-
paragraph (2).

(4) 5The power to make a further set of calculations under sub-
paragraph (3) is not exercisable after the approval by the House of
Commons of any amending report made under paragraph 13 in
relation to the local government finance report.

(5) Calculations under this paragraph must be made in accordance
10with the basis of calculation specified in the report.

(6) As soon as is reasonably practicable after making calculations
under sub-paragraph (2) or (3), the Secretary of State must notify
each relevant authority of—

(a) whether any payments are to be made by the authority to
15the Secretary of State in accordance with the calculations,

(b) whether any payments are to be made to the authority by
the Secretary of State in accordance with the calculations,
and

(c) if any payments are to be made by or to the authority, the
20amount of each payment.

Payments following local government finance report

12 (1) Where calculations under paragraph 11(2) show that a relevant
authority is to make a payment to the Secretary of State, the
authority must make that payment to the Secretary of State.

(2) 25Where calculations under paragraph 11(2) show that the Secretary
of State is to make a payment to a relevant authority, the Secretary
of State must make that payment to the authority.

(3) The following provisions apply if calculations (“the revised
calculations”) are made under paragraph 11(3) for a year.

(4) 30In this paragraph “the original calculations” means the
calculations for the year under paragraph 11(2).

(5) Sub-paragraph (6) applies where—

(a) a payment the revised calculations show as falling to be
made by a relevant authority to the Secretary of State
35exceeds that shown as falling to be made by the original
calculations, or

(b) a payment the revised calculations show as falling to be
made by the Secretary of State to a relevant authority is less
than that shown as falling to be made by the original
40calculations.

(6) The authority must make a payment to the Secretary of State of an
amount equal to the difference.

(7) Where the original calculations did not show that a relevant
authority was to make a payment to the Secretary of State, but the
45revised calculations show that the authority is to make a payment
to the Secretary of State—

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(a) the authority must make that payment to the Secretary of
State, and

(b) the authority must make a payment to the Secretary of
State of an amount equal to the amount of the payment
5shown by the original calculations as falling to be made by
the Secretary of State to the authority.

(8) Sub-paragraph (9) applies where—

(a) a payment the revised calculations show as falling to be
made by a relevant authority to the Secretary of State is less
10than that shown as falling to be made by the original
calculations, or

(b) a payment the revised calculations show as falling to be
made by the Secretary of State to a relevant authority
exceeds that shown as falling to be made by the original
15calculations.

(9) The Secretary of State must make a payment to the authority of an
amount equal to the difference.

(10) Where the original calculations did not show that the Secretary of
State was to make a payment to a relevant authority, but the
20revised calculations show that the Secretary of State is to make a
payment to the authority—

(a) the Secretary of State must make that payment to the
authority, and

(b) the Secretary of State must make a payment to the
25authority of an amount equal to the amount of the
payment shown by the original calculations as falling to be
made by the authority to the Secretary of State.

(11) A payment by a relevant authority to the Secretary of State under
sub-paragraph (1)

(a) 30must be made on or before such day in the year to which
the local government finance report relates, and in such
manner, 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.

(12) 35A payment by the Secretary of State to a relevant authority under
sub-paragraph (2) must be made—

(a) in instalments of such amounts, and

(b) at such times in the year to which the local government
finance report relates,

40as the Secretary of State determines with the Treasury’s consent.

(13) A payment by a relevant authority to the Secretary of State under
sub-paragraph (6) or (7)

(a) must be made on or before such day after the end of the
year to which the local government finance report relates,
45and in such manner, 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.

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(14) A payment by the Secretary of State to a relevant authority under
sub-paragraph (9) or (10) must be made—

(a) at such time, or

(b) in instalments of such amounts and at such times,

5as the Secretary of State determines with the Treasury’s consent;
but any such time must fall after the end of the year to which the
local government finance report relates.

Amending reports

13 (1) After a local government finance report has been made, the
10Secretary of State may, at any time before the end of the year
following the year to which the report relates, make in relation to
the report one or more amending reports under this paragraph.

(2) An amending report under this paragraph must contain
amendments to the basis of calculation specified in the local
15government finance report.

(3) Before making the report, the Secretary of State must notify such
representatives of local government as the Secretary of State
thinks fit of the general nature of the amendments the Secretary of
State proposes to make.

(4) 20The Secretary of State must lay, or make arrangements for laying,
the report before the House of Commons.

(5) As soon as is reasonably practicable after the report is laid before
the House of Commons, the Secretary of State must send a copy of
the report to each relevant authority.

(6) 25Where an amending report under this paragraph has been
approved by resolution of the House of Commons, the Secretary
of State may not make a subsequent amending report under this
paragraph in relation to the same local government finance report.

Calculations following amending report

14 (1) 30This paragraph applies if an amending report for a year made
under paragraph 13 is approved by resolution of the House of
Commons.

(2) As soon as is reasonably practicable after the amending report has
been approved, the Secretary of State must—

(a) 35calculate which relevant authorities are to make payments
under this Part of this Schedule to the Secretary of State for
the year,

(b) calculate which relevant authorities are to receive
payments under this Part of this Schedule from the
40Secretary of State for the year, and

(c) calculate the amount of each payment within paragraph
(a) or (b).

(3) Subject as follows, the Secretary of State may make one further set
of calculations of the kind described in sub-paragraph (2).

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(4) The power to make a further set of calculations under sub-
paragraph (3) is not exercisable after whichever is the later of—

(a) the end of the year following the year to which the
amending report relates, and

(b) 5the end of the period of 3 months beginning with the day
on which the amending report is approved by resolution of
the House of Commons.

(5) Calculations under this paragraph must be made in accordance
with the basis of calculation specified in the local government
10finance report as amended by the amending report.

(6) As soon as is reasonably practicable after making calculations
under sub-paragraph (2) or (3), the Secretary of State must notify
each relevant authority of—

(a) whether any payments are to be made by the authority to
15the Secretary of State in accordance with the calculations,

(b) whether any payments are to be made to the authority by
the Secretary of State in accordance with the calculations,
and

(c) if any payments are to be made by or to the authority, the
20amount of each payment.

Payments following amending report

15 (1) This paragraph applies if calculations (“the revised calculations”)
are made under paragraph 14(2) or (3) for a year.

(2) In this paragraph “the relevant previous calculations” means the
25last calculations of the kind referred to in paragraph 11(2) or (3) or
14(2) made for the year.

(3) Sub-paragraph (4) applies where—

(a) a payment shown by the revised calculations as falling to
be made by a relevant authority to the Secretary of State
30exceeds that shown as falling to be made by the relevant
previous calculations, or

(b) a payment shown by the revised calculations as falling to
be made by the Secretary of State to a relevant authority is
less than that shown as falling to be made by the relevant
35previous calculations.

(4) The authority must make a payment to the Secretary of State of an
amount equal to the difference.

(5) Where the relevant previous calculations did not show that a
relevant authority was to make a payment to the Secretary of State,
40but the revised calculations show that the authority is to make a
payment to the Secretary of State—

(a) the authority must make that payment to the Secretary of
State, and

(b) the authority must make a payment to the Secretary of
45State of an amount equal to the amount of the payment
shown by the relevant previous calculations as falling to be
made by the Secretary of State to the authority.