Clause
168
Collection
Mrs.
Lait:
I beg to move amendment No. 605, in
clause 168, page 95, line 35, leave
out ‘may’ and insert
‘must’.
The
Chairman:
With this it will be convenient to discuss
amendment No. 606, in clause 168, page 95, line 41, at end
add—
‘(7) Regulations under
this section may make provision concerning the holding and investment
of funds raised by way of
CIL.’.
Mrs.
Lait:
It is not often that I wish to be prescriptive in my
dealings with local authorities—or anyone else, for that matter.
However, I want assurances from the Government that the community
infrastructure levy does not necessarily need to be paid in money when
there are other ways of reimbursing a community. For example, someone
could donate land, or construct a facility that does not involve the
community other than to ensure that it is what the community wishes. By
tabling an amendment that proposes to replace “may” with
“must” and by trying to build flexibility into the
community infrastructure levy, it makes the levy more easily
deliverable by those who are being asked to pay.
Amendment No. 606 would make
the levy payable at the beginning of the development. That then begs
the question that if money is paid over, will it be used immediately?
If it is not going to be used immediately,
who is liable for the funds? If it is a large development and it takes
two or three years before the infrastructure is in place, or even begun
to be built, who benefits from any investment income or interest? What
is the flexibility of being able to invest the money? Those sorts of
boring practicalities are possibly more in the Minister’s
Treasury remit than in the remit of the Department for Communities and
Local Government. If the project goes wrong and a poor investment is
made, there could be problems. Will he enlighten us on those two very
techie
points?
John
Healey:
The hon. Lady puts her points
down by describing them as techie. They are both rather important. On
amendment No.605, which is designed to probe the issue of payments in
money or payments in kind, we are discussing the matter with local
authorities and the development industry. We are anxious to get their
view on how this might best work. At this point in the process, I
believe that the amendment would remove any flexibility for us to draw
our conclusions at the appropriate time. I will ensure that she is kept
fully informed on any progress that we
make.
Amendment No.
606 raises a very important point, which is not just techie but is of
significant interest in both senses of the word. We believe that the
powers under the provisions for local authority investments cover what
the hon. Lady wants. However, I will reflect further on the amendment
and if necessary will come back with observations and reflections. We
may return to the matter at a later stage if further amendments are
required.
3.15
pm
Mrs.
Lait:
As the Minister has been so helpful, I throw in
another thought. If the Government are to allow local authorities to
issue bonds, will money going into a CIL be useable in local government
bonds? That really is techie.
John
Healey:
It is techie; it goes beyond
even the long title of the Bill. However, I will look at the matters
raised by the hon. Lady on investment and CIL receipts. If necessary, I
will table further amendments to ensure that the issue is covered, and
I will update her and other members of the Committee at the appropriate
stage.
Mrs.
Lait:
I am grateful to the Minister for his very positive
response and look forward to receiving the information he has promised
us. I beg to ask leave to withdraw the
amendment.
Amendment,
by leave,
withdrawn.
John
Healey:
I beg to move amendment No. 560, in
clause 168, page 95, line 38, leave
out ‘one’ and insert
‘a charging authority or other
public’.
The
Chairman:
With this it will be convenient to discuss
Government amendments Nos. 561 to
565.
John
Healey:
These clarifying amendments make it clear that if
circumstances require it, a number of authorities may collect the levy
on behalf of a charging authority. They also make it clear that
authorities
empowered to collect the levy on behalf of a charging authority may be
other public authorities and not just charging authorities. The other
public authorities would collect but not set the levy; the
responsibility for setting would remain with the charging authority.
The amendments will permit regulations to give us the flexibility to
provide for specific local
circumstances.
The
purpose of amendments Nos. 562 to 565 is to provide greater detail on
possible enforcement measures. They confirm and clarify that surcharges
may be imposed, provide for the enforcement of payment through civil
proceedings, and allow regulations to empower charging authorities to
stop development until a community infrastructure levy liability is
assumed.
Finally, in
the interests of fairness for all those who pay the levy, acts or
omissions may warrant criminal prosecutions in some circumstances.
Before there is a sharp intake of breath across the Committee, examples
might include persistent evasion of payment or the provision of false
information relating to payment, and the obstruction and assault of
charging authority officers who may be trying to carry out their duty
to investigate non-payment, all of which the Government believe could
apply to the levy. They are set out in the amendments.
However, there is a question
about the proper limits on the term of imprisonment that could be
imposed for criminal offences under the levy, and we shall return to
that, probably on Report.
Mrs.
Lait:
Will the Minister enlighten us on the nature of the
discussion he has had with the industry about those proposals and where
he has got to on that, because while there are good developers, there
are also those who are perhaps less than satisfactory? That question
arises from a case in my constituency. We discovered a developer who
had run out of money and was unable to finish the development, and
there is no effective enforcement against him.
Although we will have a
community infrastructure levy, there is no effective way to force a
developer who runs out of money to finish a development. There is
technical enforcement, but no effective enforcement. If a bust
developer has paid the community infrastructure levy and is committed
to it but does not complete the development, would the powers that come
into play then force him to complete the development, and how can that
be done when they have paid the community infrastructure
levy?
John
Healey:
I am sorry to hear of the situation in the hon.
Lady’s constituency, but those powers are related to the
enforcement of the liability to pay the levy. In all probability, were
a levy to be part of the system in such a case, the developer would
have already paid the
levy—
Mrs.
Lait:
That does not help
me.
John
Healey:
The enforcement powers might not
help the hon. Lady with regard to getting the development completed in
her constituency, but they are not really designed to do
that.
Amendment agreed
to.
Amendment
made: No. 561, in clause 168, page 95, line 39, at end insert
‘authority.’.—[John
Healey.]
Clause
168, as amended, ordered to stand part of the
Bill.
Clause
169
Enforcement
Amendments
made: No. 562, in clause 169, page 96, line 4, at end insert
‘or
surcharge;’.
No.
563, in
clause 169, page 96, line 8, after
‘pending’, insert
‘assumption
of liability for CIL or
pending’.
No.
564, in
clause 169, page 96, line 10, at
end insert
‘(including, in particular,
offences relating to evasion or attempted evasion or to the provision
of false or misleading information, and offences relating to the
prevention or investigation of other offences created by the
regulations).’.
No.
565, in
clause 169, page 96, line 10, at
end insert—
‘(g) for
enforcement of sums owed (whether by action on a debt, by distraint
against goods or in any other way).’.—[John
Healey.]
Mrs.
Lait:
I beg to move amendment No. 607, in
clause 169, page 96, line 10, at
end insert—
‘(2A)
Regulations made under this section may may make provision for land
owners and developers to reclaim CIL should infrastructure not be
delivered in accordance with
agreements.’.
The
purpose behind the amendment was brought to our attention by the Royal
Institution of Chartered Surveyors. It is a very reasonable question to
ask and I look forward to the Minister’s answer. There could be
instances in which there is a failure to deliver the infrastructure
that has been promised. In previous debates I have cited some possible
reasons for failure, such as changes in Government priorities and poor
financial control. Will the developers be able to claim back CIL if the
partners fail to deliver their part of the bargain? Would the developer
have to take the other organisations to court, would there be an
automatic repayment, would the developers be expected to go ahead and
provide the infrastructure or would the levy automatically transfer to
another project? I would be interested to hear the Minister enlighten
us with his views on this
matter.
Dan
Rogerson:
The amendment raises an interesting point.
However, I am a little concerned about the way in which it is drafted.
The phrase “in accordance with agreements” is a little
wide. I can see the point that is being made. An important development
might be held up by the lack of infrastructure promised by CIL.
However, to say that it must be in accordance with the original
agreement implies that it should be in accordance with it to the
letter. Issues might arise in the course of delivering a development,
for example, through further planning considerations, which mean that
it is delivered in a slightly different way. I would hate to see the
developer in question being able to take the money back by saying that
the result is not exactly to the letter of the
agreement.
Mrs.
Lait:
If I had the resources at my command to get all of
my amendments right, I would probably get on a lot better. The
same is true for the hon. Gentleman. However, if the Minister is
prepared to accept our arguments, we will be very happy to amend the
drafting of the
amendment.
Dan
Rogerson:
I accept the hon. Lady’s point and I am
glad that a fine-toothed comb has not been run over the amendments that
stand in my name because I am sure that they are not perfect. I can
understand her question, but the CIL provisions must be written in a
tight, binding way to ensure that developers cannot slip away from
their
obligations.
John
Healey:
I, too, am a little concerned about the hon.
Lady’s drafting, but I understand the point that she makes in
her defence. I am also concerned about the points of substance that the
hon. Gentleman mentioned. It is difficult to see how the amendment
would work when agreements are not part of the CIL. It will be raised
whether or not the owner or developer agrees. As we discussed under the
previous clause, an authority might raise and collect the levy
liability but then bank it for some time before allocating it to a
scheme some way down the track. We would not want the developer to be
able to challenge and reclaim the money that they have paid in such
circumstances.
To deal
with the spirit of the hon. Lady’s point, it is a central
element of the design of the levy that it should be raised to support
the development of infrastructure. Although we are discussing clause
169, the hon. Lady will see that clause 167(5) provides for regulations
to set out requirements on an authority to monitor and report how the
levy funds have been raised, how the levy funds have been transferred
and how they have been spent. Those requirements to report publicly
should help to ensure that authorities charged with delivering planned
infrastructure—as a contribution to which they raise the
levy—are held to account and can be publicly challenged. I
appreciate that that is a different form of accountability from the
contractual accountability that the hon. Lady
seeks.
Mrs.
Lait:
Let me give the Minister a “for
instance” that might help him. Some years ago, we had bad floods
in the south-east after which it was recommended, and agreed by the
Environment Agency and the Government, that various flood alleviation
works would be carried out. We then had the debacle of the Rural
Payments Agency, and the Environment Agency was required to forgo some
of its budget so that it could bail out the RPA. That meant that the
flood defence works were politely postponed. How would that situation
play into what is, I accept, the poorly drafted spirit of the
amendment, given that the Environment Agency could not carry out its
work? It does not have to be the Environment Agency—it could be
any stream of funding—but the Environment Agency could not carry
out, for whatever reason, the commitments into which it had
entered.
John
Healey:
To put it terribly politely, the
hon. Lady totally misrepresents the scale and the impact of the
consequences of the Rural Payments Agency’s problems with the
Environment Agency and its investments and programme of flood
defences.
It is not a comparable position
because we have said consistently that the levy could be spent only on
infrastructure development, which clearly is not the case in the hon.
Lady’s contention in respect of the Rural Payments Agency and
the Environment Agency. I continue to believe that clause 167 does the
job.
3.32
pm
Sitting
suspended for a Division in the
House.
3.47
pm
On
resuming—
The
Chairman:
Mr. Healey, you were responding, I
think.
John
Healey:
I did not feel that I had anything further to
add.
Mrs.
Lait:
This is one of those clauses on which the Minister
has been relatively helpful. On that basis, I beg to ask leave to
withdraw the
amendment.
Amendment,
by leave, withdrawn.
Clause 169, as amended,
ordered to stand part of the
Bill.
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