Select Committee on Office of the Deputy Prime Minister: Housing, Planning, Local Government and the Regions Written Evidence


Memorandum from the Office of the Deputy Prime Minister and the Department for Culture,

Media and Sport (RL 20)

EXECUTIVE SUMMARY

  1.  This memorandum describes the transition process which allowed existing licence holders to convert to the new licences required under the Licensing Act 2003 (the 2003 Act) and what can be drawn from the experience of implementation. In preparing this memorandum, ODPM has worked with the Department of Culture, Media and Sport (DCMS) to prepare a joint response.

  2.  The 2003 Act marks the end of the six existing outdated licensing regimes which needed reform by integrating them into a single, more efficient and effective system of licensing that meets the needs of a vibrant, modern society and is fit for purpose. It also provides a balanced package of freedoms and safeguards, protecting the rights of business, individuals and communities while clarifying their responsibilities.

LICENSING ACT 2003

  3.  The 2003 Act requires each licensing authority to carry out its licensing functions with a view to promoting four statutory licensing objectives. These are:

    —  the prevention of crime and disorder;

    —  public safety;

    —  the prevention of public nuisance; and

    —  the protection of children from harm.

  4.  The modernisation of the legislation also supports our wider aims to introduce more proportionate and effective regulation, greater choice for consumers, encouragement of family friendly premises and further development of the richness and diversity of live music, dancing and theatre, regeneration and protect residents from anti-social behaviour and nuisance.

  5.  The key measures contained in the Act include:

    —  Flexible opening hours for premises, which will help to minimise public disorder resulting from fixed closing times;

    —  A single premises licence will bring together six existing licensing regimes (alcohol, public entertainment, cinemas, theatres, late night refreshment house and night cafés) thereby cutting down on red tape;

    —  Premises licences to be issued by the licensing authority after notification to and scrutiny by the police and other responsible authorities;

    —  Personal licences to be issued by licensing authorities after scrutiny by the police where the applicant has been convicted of certain offences.

  6.  Section 182 of the Licensing Act 2003 provides that the Secretary of State must issue, and may from time to time revise, guidance to licensing authorities on the discharge of their functions under the 2003 Act.

  7.  Guidance under this section was issued in July 2004 and was prepared in consultation with an advisory group including a wide range of organisations, agencies and Government Departments, and took into account the views of over 650 other organisations, residents' associations, businesses and public bodies that contacted the Government about licensing reform and the Guidance.

  8.  The Guidance will be kept under constant review in consultation with the key stakeholder groups and will be amended or supplemented as necessary at any time to address issues arising from implementation affecting local communities, licensing committees, the police, applicants for licences and club premises certificates, those giving temporary events notices and performances. We have agreed that the first review of the guidance will begin in November 2005 to reflect lessons learnt in the licensing process.

TRANSITIONAL PERIOD "RE -LICENSING" PROCESS

  9.  The term "transitional period" refers to the period between the first appointed day (1AD) and the second appointed day (2AD). The 2003 Act requires a period of at least six months between the issue of Section 182 Guidance and 1AD. However, in the event the Government set a seven-month period by naming 7 February as 1AD. This was to accommodate the views of the industry and local authorities that 1AD should not directly follow the Christmas period and that applicants should have some time to consider their licensing authority's policy statement that had to be published by January.

  10.  It was recognised that the transitional period would be a difficult and demanding time for licensing authorities, responsible authorities and applicants in dealing with the anticipated 190,000 applications—made up of 180,000 existing premises license holders and 10,000 new applicants. This is made up of not only pubs (60,000) and clubs (1,800) but 46,600 off license premises and about 20,000 registered members clubs. In addition, around 200,000 individuals were expected to convert to obtain personal licences or apply for new ones.

  11.  Existing licence holders had from 1AD to 6 August to exercise their right to apply to convert their existing licences ("grandfather rights") to new premises licences or certificates.

  12.  Prior to 1AD, some stakeholder were concerned that licensing authorities would be deluged by an immediate rush of applications. In practice, however, there was an extremely slow start to applications being received after 1AD. By May, only 3% of expected applications had been received. The rate of applications started to pick up over the summer following action both on a local level by local authorities, police and others and through activity at a national level by the Government in partnership with trade and local authority organisations. A significant peak of activity by applicants to secure Grandfather rights in the last few weeks before 6 August led to around 75% of applications being submitted by this date. Indications are that around 98% of expected applications are now in.

  13.  Of those anticipated applications outstanding, the Government's discussions with local authorities suggest some are because businesses are adjusting their business practices to remove the need for a licence and others who are planning to use temporary entertainment notices, at least in the short term. Many licensing authorities are now using their intelligence of the local licensing market to follow up on a case by case basis those premises they anticipated needing a licence who have not yet applied.

  14.  Feedback for local authorities and trade groups suggest that the main affected sectors are now at virtually 100%—this includes pubs, bars, nightclubs, registered members' clubs, supermarkets, theatres and cinemas. A targeted effort has been made by the Government, with trade and partner support, to target at risk groups. These groups include night cafés and takeaways, small stores and restaurants and other independent businesses generally. We believe that the majority of village halls and sports clubs that want a licence have applied, although village halls in particular will have a number that wish to rely on temporary event provisions, rather than obtain a full licence. The Government is confident that the vast majority of those who need a licence on 24 November have applied in time.

  15.  The transitional period will end on the second appointed day which, subject to Parliamentary approval, is scheduled for 24 November 2005.  From this point, new premises licences and club premises certificates take effect and new powers come into play which will enable the licensing system to start delivering on its objectives.

  16.  Both the Local Government Association and the Association of Chief Police Officer want to ensure there is no delay in the second appointed day, a view shared by organisations representing the on and off licence trade, sports clubs and village halls. Delaying full implementation of the 2003 Act would require new applications for temporary permissions and licences to cover the Christmas period and additional expense for applicants and local authorities, undermining the efforts of local government, councillors, police, business and communities and applicants who have worked together to get the system in place.

  17.  The emerging trends from applications for the new system show that the Licensing Act is achieving the objective of creating a more flexible system of opening hours:

    —  about 40% of applications (74,000) are to vary existing licences, not just opening hours but increases in premises offering food later into the evening, or public entertainment for example.

    —  Very few premises have applied for 24-hour licences, and only a few have been granted, mainly for supermarkets and off licences. Licensing authorities are reporting a genuine variation in licensing hours as opposed to a general shift to later opening.

    —  In addition a small number of premises have had their licence to simply convert what they have now revoked on application on the advice of the police, an example of how the Licensing Act is providing greater protection in extreme cases to close licensed premises.

  18.  It is also showing that communities and authorities are engaging in the process. Local authorities tells us that, of the applications to vary licences around half have attracted representations from "responsible authorities" or "interested parties", with residents accounting for 50% of representations. In two-thirds of cases representations have been resolved through mediation avoiding the need for hearings, suggesting a flexibility among applicants, authorities and interested parties to work out solutions together.

  19.  However, where cases are being taken to hearings, local authorities report that licensing committees are responding to residents' concerns by adding conditions or adjusting hours in 95% of cases.

  20.  In general, licensing authorities report that they are coping with the current workload of representations and hearings. Although it is recognised that this is as a result of sustained effort and hard work over the last four months.

  21.  In summary, the transition to the new system heralds a new era where a streamlined and effective licensing system can respond to policing and community concerns but also give more flexibility to businesses and choice to consumers. However, as is inevitable in such transformational reform some specific technical and unanticipated issues have arisen including:

    —  Golf clubs: DCMS have reassured them on several issues. However, concerns remain over the fairness of the fees regime and the interpretation by some local authorities of some of the requirements of the Act (such as plans of premises).

    —  Amateur Sports Clubs: believe the increase in fees to have an alcohol licence is unfair and will threaten grassroots sport.

    —  Parish Councils: some feel they are not being given sufficient say over licensing decisions. This will often come down to interpretation as to whether a Parish Council is an organisation that represents interested parties.

    —  Village Halls: some Halls do not feel that having a full premises licence to sell alcohol is appropriate to them, but are concerned that the limits on the light touch regime for temporary events is too restrictive in the number of events that can be held.

    —  Touring circuses: concerns that, as they need a licence for each site, this could mean they need to apply for 40+ licences. They believe this threatens the viability of all but the biggest circuses and is unfair as static attractions have to obtain only one licence.

LISTENING AND LEARNING LESSONS

  22.  That is why the Government put in place mechanisms for monitoring and reviewing the process. Measures to learn lessons from the transitional period and the implementation of the Licensing Act 2003 include:

    —  A High Level Group to monitor implementation and review the impact of the Act;

    —  An Independent Fees Review Panel, chaired by Sir Les Elton, to ensure the fees are set at the right level for local government and licensees;

    —  A transition feedback form for local authorities to report how licensing reforms are progressing during the busy transition period;

    —  An agreement to review and update Guidance as necessary; and

    —  Independent research to establish live music activity in England and Wales prior to and following the implementation of the Act.

    —  An evaluation of the crime and disorder aspects of the 2003 Act by the Home Office.

High Level Group (HLG)

  23.  The Government has worked with a high level group of stakeholders to cut across traditional boundaries and share information and knowledge openly to ensure a transparent transitional process.

  24.  The HLG is chaired by James Purnell, the DCMS Minister for Licensing and includes representation from the licensed trade organisations, community organisations, local government, the police and other Government departments.

  25.  This group met throughout the transitional period and shared information on the process to ensure early warning of potential issues and the opportunity to resolve problems quickly. The HLG has helped developed a partnership of parties that are all committed to successful operation of the Licensing Act 2003. It will continue to meet after the second appointed day and will help monitor the on-going implications of the Act.

Independent Fees Review Panel

  26.  The Government has worked with local government prior to the introduction of the 2003 Act to plan for the introduction of the licensing scheme. The application fee levels take account of consultation with local authorities during 2003 and meetings with local authorities and the Local Government Association to take into account anticipated costs.

  27.  We believe that from the information available at the time, the fee regime was set at a level sufficient to fund administration, inspection and enforcement costs associated with the discharge of local authority functions under the 2003 Licensing Act.

  28.  The Government remain committed to a regime that is self-funding and agreed to ensure from the outset that the fees are set at the right level for all stakeholders affected by the new legislation. There remain different predictions as to the implications of the Act and wide variations in the expected costs.

  29.  Therefore, the Government have established an Independent Panel, chaired by Sir Les Elton, to review the licensing fee, income and expenditure incurred during the transition period. The panel is due to provide an early report later this year before completing its full independent review in the autumn of 2006.  The Government will then wish to review the fee regime in light of the findings of the Independent Panel.

Transitional Period Feedback

  30.  In addition to the licensing fee review and to help ensure swift action if any licensing authority finds itself under exceptional pressure DCMS has:

    —  included a feedback form on their website (www.culture.gov.uk) which any licensing authority can use to send quantitative and qualitative information about the implementation of the Act during the transitional period;

    —  used this information to supplement normal communications and discussions with LACORS and in the high level group; and

    —  Sought to use these mechanisms to identify any particular authorities experiencing exceptional difficulties and pressures in discussion with LACORS and the LGA.

  31.  The new licensing regime will be easier and more efficient as six licences will become one. All decisions will be taken by licensing authorities who are democratically accountable. For years alcohol licence fees have not been reflecting the true costs and taxpayers have effectively been subsidising all those who hold licences or certificates for the sale or supply of alcohol (estimated to be to worth about £25 million a year). This will not be the case under the new system.

Review of Guidance

  32.  As mentioned above the statutory guidance to the Licensing Act included a commitment to keep guidance under review in consultation with stakeholders. In discussion with the Local Government Association it has been agreed to begin a review of the guidance in November 2005 to allow for early lessons from the implementation process to be incorporated into the guidance.

Monitoring the impact of the 2003 Act

  33.  A range of studies are planned or under-way to evaluate the impact of Licensing Act. This will include the impact on particular sectors, such as village halls. As part of the process the first baseline study of live music in England and Wales has been undertaken, which will allow the impact of the Act on live music to be considered when fully operational in 2006.

  34.  The Home Office will be evaluating the impact of the changes brought about by the Licensing Act on levels of crime and disorder. A range of measures will be used to assess the impact of the new Act at both a national and local level. These include national surveys, which aim to assess change in levels of alcohol related victimisation and offending. These will be supplemented by case studies involving five towns and cities in England. The local case studies will look at patterns of recorded crime and disorder in relation to licensed premises and extended hours, and where possible, accident and emergency and ambulance service will also be assessed. Information will also be collected from surveys among local residents as well as qualitative interviews with representatives from the local authorities and the police, and from a range of local businesses, including licensees

PROMOTION OF GOOD PRACTICE AND INNOVATION

  35.  The transition process introduced new opportunities for residents, local authorities and the police and encouraged business to adopt good practice in premises management. The Government remains committed to ensuring that these tools are widely promoted and adopted to ensure their effective and strategic use. Ministers are undertaking a regional tour to cover a range of licensing and tourism related issues.

  36.  The Government plans to build on these powers through the Violent Crime Reduction Bill currently before Parliament through Alcohol Disorder Zones, Drinking Banning Orders, 48-hour closure powers for premises persistently selling alcohol to underage drinkers, directions to leave a locality for up to 48-hours and expedited review of alcohol licenses where premises are associated with serious crime and disorder.

  37.  Through our Cleaner, Safer, Greener Communities How to Manage Town Centres programme, Alcohol Misuse Enforcement Campaigns and the work of the Live Music Forum, we will be working with practitioners at all levels to ensure awareness, action and outcomes arising from these new tools.

FORWARD LOOK

  38.  Our primary aim is to ensure the Licensing Act 2003 delivers its objectives—prevention of crime and disorder; public safety; the prevention of public nuisance; the protection of children from harm.

  39.  The Licensing Act is addressing current challenges, not creating them. Crime and disorder is fuelled by alcohol at present, with around half of violent crime being linked to alcohol and one in five violent incidents occurring in the vicinity of pubs and clubs each week. The new powers for the police and others will strengthen the ability of responsible authorities to act quickly against poorly managed premises which contribute to these statistics.

  40.  The previous inflexible licensing laws contributed to this. The four licensing objectives of the new system were developed after extensive and detailed consultation and a lengthy review of the existing law conducted between 1998 and 2001.

  41.  The Licensing Act will not, on its own, prevent crime and disorder, public nuisance, promote public safety, or protect children from harm. However it has potential for becoming a vital part of the solutions.

  42.  Licensing authorities will prepare and publish a licensing policy statement every three years, setting out how the authority intends to exercise its licensing functions and must itself be prepared with a view to promoting the licensing objectives. The lessons learnt over the last year will help develop influence over the market and drive co-ordination of policies on crime and disorder, transport and town centre management.

  43.  In conclusion, local government, the police, residents and the licensed trade have successfully responded to the challenge of converting to the new system, which will allow the introduction of a streamlined and effective licensing system that is fit for purpose in a modern and vibrant economy.


 
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Prepared 17 March 2006