21 May 2012 : Column 903

As my right hon. Friend the Member for Greenwich and Woolwich (Mr Raynsford) said, there is a form of “doublethink”. The Minister for Housing and Local Government told the Select Committee that people could be protected by

“getting economic activity going so there are jobs.”

The Government are prone to lecturing everybody on getting economic activity going. They lecture councils and the European Union, but the one set of people they do not seem to lecture is themselves. They have no plan for growth at all.

Many people in receipt of council tax benefit are in work or not expected to seek work because of their circumstances. For them, the cut will depend not on their individual circumstances but on where they live and, crucially, how many pensioners there are in their local authority area. That varies hugely from one area to another. Claimants of non-working age make up 34% of the total in East Dorset. In Tower Hamlets, the figure is 68%.

The benefit cut that people receive could vary between 13% and 25%. The worst thing about it is that it is entirely arbitrary, with no pretence of fairness whatever. In fact, in their recently published statements the Government have explicitly rejected the idea of taking into account the number of pensioners in a local authority area when setting the funding level. Many Government Members will have cause to regret that in future years.

As some of the Opposition amendments point out, the new system will hit not only those in work or unable to work but those seeking work. The Government have been in such a rush to bring it in that they have failed to align it with universal credit, to which the Minister referred earlier. If they are so keen to have universal credit, they should have waited to align council tax benefit with it. Their own consultation document acknowledged the problem, stating:

“There is a risk, however, that some of the advantages from the single Universal Credit taper…could be lost if there is a separate and overlapping withdrawal of council tax support through localised schemes. This would produce a marginal deduction rate higher than 76%”.

If millionaires were having to put up with that, the Government would be rushing in to rescue them. What sort of Government include those warnings in the consultation and then ignore them? They are either incompetent or vicious—one or the other. [Interruption.] Both, somebody says, and I am beginning to think so.

As we have seen with business rates, the areas in greatest need will be hit hardest. Let us take the impact on people in work as an example. In Liverpool, there are 6,570 people in work and receiving council tax benefit. In Durham, there are 5,810, in Birmingham a whopping 16,780 and in Hackney 7,910. Just down the road in the City of London, there are precisely 40. In Purbeck there are 580, in Runnymede there are 610 and in Wokingham—I could not pass up another chance to mention Wokingham —there are 780.

This change is a triple whammy for the poorest areas. First, it will mean that local authorities with more people in work and receiving council tax benefit face a much bigger risk of default in their council tax collection. Secondly, it will make it much harder for them to mitigate the effect of the cut on people of working age. Thirdly, there will be a bigger impact on their local

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economy, because money will be taken from people who would otherwise go out and spend it. It will come as no surprise to my right hon. and hon. Friends to hear that the New Policy Institute estimates that five of the 10 hardest-hit local authorities will be among the top 10 most deprived in the country—Hackney, Newham, Liverpool, Islington and Knowsley.

In the Liverpool city region, it is estimated that the Government’s proposals will result in cuts of 17.23% for those who are not pensioners. In Halton, a single person will have to find at least £179 more each year. In Sefton, which has a higher than average number of pensioners, a couple in a band A property will have to find an extra £226 a year. That is probably small change to Government Members, but to people who struggle to keep their heads above water—those who have to count every penny to get to the end of the week without getting into debt, and without being driven into the arms of the loan sharks who are on many of our estates and ready to batten on vulnerable people—it is the difference between surviving and not surviving.

I sometimes wonder what Ministers know of that world. Have they ever stood in a supermarket watching people put things back because they cannot afford to pay for everything in the basket? Do they understand the struggle that some families have if a child needs a new pair of shoes? They know nothing of it, and they have no wish to understand it.

Mr Raynsford: Is it not telling that not a single Government Back Bencher has contributed to this debate in support of the Government’s measures? Does that not indicate that they know deep down that these measures are deeply flawed, deeply unfair and deeply wrong?

Helen Jones: My right hon. Friend is entirely right. [Interruption.] The Under-Secretary says that it is because they think the measures are right. Well, if I cannot appeal to their moral sense, let me try appealing to their economic sense. The poorest areas will have the biggest hit to their local economies. The 2010-11 figures show that a 10% cut will mean £10 million being taken out of Birmingham, £6.1 million out of Liverpool, £3 million out of Newham, £2.7 million out of Newcastle and £2.9 million out of Gateshead. By contrast, the prosperous local economies lose less. Runnymede will lose £454,000; Wokingham £518,000; Melton more than £246,000; and Hart £293,000; but—as we might expect with this Government, this is a big “but”—that is not the whole story.

7 pm

The figures I gave were calculated on payments made in 2010-11, as given in a parliamentary answer by the Minister of State, Department for Work and Pensions, the hon. Member for Thornbury and Yate. The total paid to councils in Great Britain in that year in council tax benefit was £4.8 billion. In their consultation on funding, the Government promised to give 90% of the forecast council tax expenditure for 2013-14, but they expect council tax benefit to have miraculously decreased by then to a total of £4.2 billion.

How did the Government arrive at that assumption? Considering unemployment levels and what is happening to the economy, we might expect council tax claims to

21 May 2012 : Column 905

go up rather than down. Perhaps that figure was calculated on the earlier optimistic forecasts that the Government gave us, but they have had to be adjusted. Councils should be warned, however, that they might face more than the cut they are expecting. Even with the so-called minor adjustments the Government want to introduce to the distribution of funding, and the creation of ceilings and floors, we do not expect too much difference. We have heard those promises before in local government finance settlements, and the measures still ended up hitting the poorest most.

Moreover if, as the Under-Secretary appeared to suggest, vulnerable people ought to have more protection—I assume he was referring to those on passported benefits—why could the working poor be facing cuts of up to 40% in their benefits, which would wipe out any gains from the increase in personal allowances that he trumpets? In face, those gains have been wiped out already by rising VAT, the loss of tax credit, changes to housing benefits and so on.

I know the Minister is anxious for good news—if the Labour party had lost to Professor Pingu the penguin, I would be looking for some good news—but his proposal will not run, because like most Lib Dem policies it is little more than a headline for the latest hocus-pocus. Indeed, far from councils being given more freedom, they will bear all the financial risks and most of the public anger for the policy. The Government have carefully ensured that the increased bills dropping through doors will bear the imprint of the local council, not that of the Secretary of State. Councils will pay the price if it goes wrong. The Select Committee on Communities and Local Government called it

“an illusion of delegation with a minimum of real discretion”.

We know, for instance, that only between 57% and 66% of pensioners claim their benefit. The likelihood is that the number claiming the benefit will increase when it is shown as a discount on a bill rather than as a benefit. That is a good thing, but councils must bear the burden of the extra cost. Increased unemployment in a council area, especially from the closure of a large company, will mean that council tax benefit claims increase. What will happen then?

The Government want to include council tax support in their business rate retention scheme, but what is the consequence of that? According to the Government’s consultation, a local authority will come into the safety net category only if its revenues fall by between 7.5% and 10% below the baseline, which is a massive fall before getting any support.

This is the crux of the matter. The Government have said that the measure will inspire councils to create employment and get more people into jobs, but how do councils do that in a double-dip recession? The Government have an in-built belief that local authorities do not want to encourage economic growth, but I challenge the Minister to name one, as I have throughout debates on the Bill. I am willing to give way to him if he wants to name one, but he cannot do so. Local councils have not caused the double-dip recession; the Government have. It is not local authorities that are causing firms to go into administration, but the economic failure of the Chancellor, who seems to have been too busy entertaining Rebekah Brooks at Dorneywood to notice what is happening to the economy.

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The poorest areas are likely to face the greatest rise in claims and have already had their budgets cut. There is no slack in the system and no money to be transferred from elsewhere. The Opposition’s greatest fear is that some local authorities will try to manage the system by driving down claims and deterring people from claiming. I have confidence that Labour authorities will not do that—thankfully, there are many more Labour authorities than there were when debates on the Bill began—but I have little confidence in Tory and Lib Dem authorities. Equally, setting up an appeals system and dealing with what is likely to be a higher level of default will incur costs for local authorities.

New clause 5 is designed to ensure that the Government cannot ignore those impacts. It is no good the Minister telling us that there will be reviews, because those reviews do not include people in work and in poverty or those looking for work and in poverty.

Graham Jones (Hyndburn) (Lab): My hon. Friend makes excellent points, but on the confusion in the appeals process it is not yet clear whether council tax benefit staff will be employed in future by the Department for Work and Pensions under the universal credit or within local authorities. That changeover adds to the complexity and confusion.

Helen Jones: My hon. Friend is entirely right. Even if we supported the Government’s changes in the Bill, their failure to align the changes with universal credit will cause chaos throughout the system, including for staff.

Many Government amendments relate to Wales, which the Government forgot about when they drafted the Bill—to lose a county is unfortunate; to lose a whole country is rather careless—but the Welsh Government have said they are profoundly concerned by the plan. Some 327,000 people in Wales will be affected, whom the Government also seem to have forgotten about—they have developed a habit of absent-mindedly mislaying citizens, such as those in work or those who happen to live in Wales.

The Government have tabled a series of amendments on council tax reduction schemes and default schemes, which could have been discussed properly had draft regulations been brought before the House, as the Minister promised us on 31 January. Instead, we are once again being asked to grant wide powers to the Secretary of State without any idea how they will be exercised, which is extremely worrying and a poor way to make legislation.

My right hon. Friend the Member for Greenwich and Woolwich raised the rushed implementation of the proposals, an important problem we raised in Committee. Last week, we received statements of intent, but not the draft regulations we were promised. I get the feeling the Government are simply not ready to implement the proposals. It is as if someone, somewhere in the Department for Communities and Local Government—I suspect the Minister for Housing and Local Government—had a wizard wheeze and said, “I know. Let’s cut council tax benefit,” but did not work out the details. The Government, following the example set by the Prime Minister, do not seem to do detail. They just wave a languid hand and say, “Detail will follow.” But, in government, details matter. They affect the lives of the people whom we represent. The Bill will result in enormous changes for

21 May 2012 : Column 907

local authorities, which are being asked to cope with changes to non-domestic rates and with the localisation of council tax benefit, all at the same time.

By next year, local authorities will have to be ready to run their own local schemes, yet the Bill was rushed with indecent haste through the Committee—because the Government did not appear to understand the rules for carrying over a Bill—then kept hanging about like some kind of slow-cooking stew until after the Queen’s Speech. It will not have a Second Reading in the other place until, I believe, 12 June, and its first Committee sitting there is scheduled for 3 July. If, as I am told, the other place will not be sitting in September, who knows when the Bill will complete its passage?

Amendments will have to come back here, and if they are not agreed to—[ Interruption. ] The Under-Secretary of State for Communities and Local Government, the hon. Member for Bromley and Chislehurst (Robert Neill) talks about the recess, but he has perhaps forgotten that this House is sitting in September, although the other place does not appear to be doing so. That is the kind of detail that matters when we are trying to get legislation through. There could well be ping-pong between the two Houses. Regulations will also have to be set and passed by both Houses. In the meantime, councils are being expected to draw up a scheme without knowing the precise rules that they will need to follow, and with no certainty about their funding. That is not sensible government—it is pass-the-buck government.

We have also heard about the difficulty of producing the software required to implement the changes. Councils will need to be very clear about what they want from the firms that are designing that software, but they do not have the necessary information at the moment. Why are the Government so determined to meet the 2013 date that they will not listen either to local authorities or to the experts who design the system? I would call them pig-headed, but that would probably be unfair to pigs. Why are they so keen to impose cuts on the poorest people and chaos on local authorities? We know the answer: it is simply that they are out of touch.

The people who will suffer are the poorest people. Councils are in a no-win situation. If they protect vulnerable groups other than pensioners, those in work or seeking work will face even larger reductions in their income. This Government believe that the poor must pay for the poor, while tax cuts are given to the rich. They believe that the living standards of those who have very little have to be cut, while bankers in partly state-owned banks swan off for courses on executive nutrition at a spa. I am sure that many of the poorest people in this country would love to have to worry about the type of nutrition that they got; most of them have to settle for what they can afford.

The Government do not call the money given to bankers a handout, but that is what they call the money given to local councils. They do not call their tax cuts for millionaires a handout, but that is the term they use for the money they give to local councils to run essential services. This is a Government without a proper sense of direction and without a proper sense of right and wrong. We will continue to monitor the effects of the Bill. We will press our amendments to the vote, and we will ensure that the plight of the poorest people who are being hit by these provisions is not forgotten. It is for that reason that I urge my hon. Friends to vote in support of new clause 5.

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Andrew Stunell: I should like to remind the House that, contrary to some of the wild assertions from the Opposition, the Bill represents a major step towards bringing power back to local government and local communities. The business rates retention scheme, the localisation of the council tax benefit system and the return of the power to set discounts and reductions in council tax for empty homes and second homes are all measures that the previous Government failed to introduce, notwithstanding a lot of hot air about what they might have done or would not do, as the case may be—

7.15 pm

Mr Raynsford rose

Andrew Stunell: No, I am not going to give way.

Mr Raynsford: On a point of order, Mr Deputy Speaker. The Minister has made a factually incorrect statement that I would not want to remain on the record without giving him the opportunity to reconsider it. I hope that he will therefore take an intervention.

Mr Deputy Speaker (Mr Lindsay Hoyle): The right hon. Gentleman has pointed out that he believes the Minister’s statement to be incorrect. It is up to the Minister to decide whether he wishes to give way. I do not think that he is willing to do so at this stage, but I am sure that the right hon. Gentleman will try again.

Andrew Stunell: Thank you, Mr Deputy Speaker. I am sure that the opportunity to give way will arise, and I shall certainly do so in due course to those who think that there is anything to be said against our view that the Bill represents a significant localisation for local government and local communities. The return of business rates to local authorities, the capacity to set council tax without having capping limits set by the Secretary of State, and the transfer of the benefits system to local authorities are all significant measures.

I want to restate my point about the return to local authorities of the ability to set council tax discounts. If every local authority chose to exercise the changes that are being passed into their hands, that would generate for English local authorities a total of more than £400 million. There is no direct connection in the Bill, but I want to make it clear that, whatever might be said about the proposals in the Bill, that discount change will be of significant benefit to local authorities.

I shall deal with some of the points raised in the debate. The right hon. Member for Greenwich and Woolwich (Mr Raynsford) suggested that we ought to accept at least some of his amendments, simply because they were already in the Government’s plans. Well, it is because they are already in the Government’s plans that we do not need to accept them. Some of his other amendments were intended to dismantle the Bill and its provisions, but I made it clear that this is not just a localism measure but a component part of putting our finances right. At no point have we disguised the fact that localisation and deficit reduction are both involved in the proposals.

Graham Jones rose

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Andrew Stunell: I am happy to give way to the hon. Gentleman, even though he could not find the time to be present earlier.

Graham Jones: I am very grateful to the Minister for giving way. He keeps using the word “localisation”, but it is obvious that what he is doing is localising cuts. He has spoken about raising £400 million and about the empty homes premium and the council tax discounts. Why are central Government being prescriptive about such measures? Why are they stating that homes must have been empty for two years? Why will they not give local authorities the power to decide how long a home needs to have been empty in order to qualify for the empty homes premium?

Andrew Stunell: The flexibility on discounts will apply to all empty homes from day one, not just to those that have been empty for two years. The two-year condition relates to the empty homes premium, which is a separate provision that is being put in the hands of councils by the Bill.

The hon. Member for North Durham (Mr Jones) made some interesting points, but he did not seem to be aware that, whereas Wokingham has the capacity to generate £700,000 extra income, Wigan, which he mentioned specifically, has the capacity to generate £2.2 million from the discounts. If Wigan chose to implement those measures, that would completely offset the funding gap he talked about.

To be clear, much of the shroud-waving from the Opposition is completely misplaced. It was strange that the hon. Member for North Durham argued—although he tried to back out of it—for additional cuts in council tax benefit for pensioners, because he wants councils to have the flexibility to switch their spending on pensioners to others whom he thinks are more worthy of protection. That is a point of view, but it is not one that the Government share.

I have a lot of time for the right hon. Member for Wentworth and Dearne (John Healey). He served time in the Treasury, during which I believe he was party to the introduction of the 10p tax rate—[ Interruption. ] We all have skeletons we wish we could keep in the cupboard. When it comes to protecting the low-paid, it is this Government who have raised tax thresholds for low-paid people, many of whom are women, of course, and will take 2 million people out of tax over the next three years.

The right hon. Gentleman did get round to welcoming the localism measure, but—not for the first time—he wants localism, but not yet. The Opposition do not have a strong track record on localism, but they have realised just how important it is to the people we represent. They now pay lip service to it at every opportunity, but I see no sign that it goes beyond lip service to their agreeing to implement localism in practice. At every turn, they try to delay, dismantle and divert the successful attempts of the Government to localise decision making and give local communities the power to take decisions about their services.

I answered the right hon. Gentleman regarding Rotherham’s figures. He mentioned Barnsley, and its figures are an almost exactly equal balance, just slightly in favour of Barnsley, with £1.6 million in each direction. He also waxed lyrical about the new clause 2 single

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person discount. Some 29% of households are single person, and another 7% are single-parent households. I do not believe that he would want to put those people under additional pressure. The Government do not accept that new clause 2 is the way forward.

The right hon. Gentleman also made an interesting point, of the kind that only a former Secretary of State might make, about what would happen if a council tax referendum failed and the impact that would have on the scheme. The scheme that a local authority sets up by 31 January each year will have statutory force and cannot be changed for the following 12 months, so it would be required to be considered in any reduced budget. Of course, when a local council sets up its scheme, it will be with the full knowledge of its intended settlement. As I say, the right hon. Gentleman welcomes localism, but he does not want it yet.

I draw to the attention of the hon. Member for Warrington North (Helen Jones) one of the documents we published last week, “Localising Support for Council Tax: Vulnerable people—key local authority duties”, which sets out clearly the factors that a local authority needs to have in mind when it exercises its discretion and introduces a scheme. When she studies that, she will find that many of the questions that she raised are answered and her concerns are dealt with.

The hon. Lady commented on the introduction of the Welsh Assembly clauses. She will know from what the Government said previously that we took the time to consult with our colleagues in the Welsh Administration, and it is at their behest that the clauses take their present form. That is an example of the Government taking a measured approach, consulting with the relevant bodies and introducing proposals entirely in accordance with the Welsh Administration’s views.

The hon. Lady also drew attention to an amendment on consulting with those affected. There is a requirement on local authorities, when they have drawn up their scheme, to consult with those whom they believe will be affected. That clearly will involve a consultation with all the groups the hon. Lady mentioned.

Mr Clive Betts (Sheffield South East) (Lab): I apologise for not being here earlier, but I was at a Select Committee meeting.

My right hon. Friend the Member for Greenwich and Woolwich (Mr Raynsford) apparently raised the point about the time local authorities will have to propose a scheme, consult on it—as the Minister has just described—and then get their providers of services, such as Capita, to design the schemes and implement them. In January, Capita raised concerns about the time constraints that it would face and its real worry that it would have inadequate time to do that. Is the Minister convinced that local authorities will have adequate time and that there will be no problems with the delivery of services to constituents?

Andrew Stunell: That is exactly why we produced the statements of intent—to give local authorities and their providers the longest possible time to understand how they might best design and develop a scheme. That is also why we have provided a significant sum of money to assist them in doing that.

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The hon. Member for Warrington North also asked about criminal offences being created by the Bill. The Social Security Administration Act 1992 creates several criminal offences in relation to council tax benefit, including an offence of dishonestly making a false statement and one of knowingly making a false statement for the purpose of obtaining council tax benefit. There is a different standard of proof for each offence, as I suspect that the hon. Lady knows better than I do. Greater penalties apply if it can be shown that a person has acted dishonestly.

Helen Jones: Can the Minister explain what the position is when a person has not acted dishonestly? We have asked him several times. He has referred to acting knowingly and to acting dishonestly, but the proposed provisions refer to offences that can be committed other than dishonestly.

Andrew Stunell: I am surrounded by lawyers, and the Under-Secretary of State for Communities and Local Government, my hon. Friend the Member for Bromley and Chislehurst (Robert Neill), is giving me helpful advice, but let me say that there are two separate categories, which I think the hon. Lady has just restated: dishonestly making a false statement and knowingly making a false statement for the purpose of obtaining council tax benefit. To underline a point I made when introducing the debate, those provisions mirror and replicate the existing situation as far as the council tax benefit fraud prevention scheme is concerned. Another relevant point I made earlier is that we are conducting a full review to ensure that what is put into the new scheme is wholly proportionate to the new situation.

7.30 pm

These proposals are designed to localise council tax benefit and the council tax reduction scheme, are part of a much broader package of localisation to local government and are consistent with the Government’s deficit reduction plan. I commend new clause 9 and the other Government amendments and new clauses to the House.

Question put and agreed to .

New clause 9 accordingly read a Second time, and added to the Bill.


New Clause 10

Power for HMRC to supply information for purposes of council tax

‘(1) Schedule 2 to the LGFA 1992 (administration) is amended as follows.

(2) After paragraph 15 insert—

15A (1) A Revenue and Customs official may supply information which is held by the Revenue and Customs in connection with a function of the Revenue and Customs to a qualifying person for prescribed purposes relating to council tax.

(2) The following are qualifying persons for the purpose of this paragraph—

(a) a billing authority in England;

(b) a person authorised to exercise any function of such an authority relating to council tax;

(c) a person providing services to such an authority relating to council tax.

21 May 2012 : Column 912

(3) Information supplied under this paragraph may be used for another prescribed purpose relating to council tax.

(4) Information supplied under this paragraph may be supplied to another qualifying person for a prescribed purpose relating to council tax (whether or not that is a purpose for which it was supplied).

(5) In this paragraph—

(a)

“Revenue and Customs official”,

“the Revenue and Customs”, and

“function of the Revenue and Customs”,

have the same meaning as in section 18 of the Commissioners for Revenue and Customs Act 2005.

15B (1) A Revenue and Customs official may supply information which is held by the Revenue and Customs in connection with a function of the Revenue and Customs to a qualifying person for prescribed purposes relating to council tax.

(2) The following are qualifying persons for the purpose of this paragraph—

(a) a billing authority in Wales;

(b) a person authorised to exercise any function of such an authority relating to council tax;

(c) a person providing services to such an authority relating to council tax.

(3) Information supplied under this paragraph may be used for another prescribed purpose relating to council tax.

(4) Information supplied under this paragraph may be supplied to another qualifying person for a prescribed purpose relating to council tax (whether or not that is a purpose for which it was supplied).

(5) In this paragraph—

“Revenue and Customs official”, “the Revenue and Customs” and “function of the Revenue and Customs” have the same meaning as in section 18 of the Commissioners for Revenue and Customs Act 2005;

“prescribed” means prescribed by regulations made by the Welsh Ministers.

(6) Regulations under this paragraph must not be made except with the consent of the Commissioners for Her Majesty’s Revenue and Customs.

(7) A statutory instrument containing regulations under this paragraph is subject to annulment in pursuance of a resolution of the National Assembly for Wales.

15C (1) A Revenue and Customs official may supply information which is held by the Revenue and Customs in connection with a function of the Revenue and Customs to a qualifying person for prescribed purposes relating to council tax.

(2) The following are qualifying persons for the purpose of this paragraph—

(a) a local authority;

(b) a person authorised to exercise any function of such an authority relating to council tax;

(c) a person providing services to such an authority relating to council tax.

(3) Information supplied under this paragraph may be used for another prescribed purpose relating to council tax.

(4) Information supplied under this paragraph may be supplied to another qualifying person for a prescribed purpose relating to council tax (whether or not that is a purpose for which it was supplied).

(5) In this paragraph—

“Revenue and Customs official”, “the Revenue and Customs” and “function of the Revenue and Customs” have the same meaning as in section 18 of the Commissioners for Revenue and Customs Act 2005;

“prescribed” means prescribed by regulations made by the Scottish Ministers.

21 May 2012 : Column 913

(6) Regulations under this paragraph must not be made except with the consent of the Commissioners for Her Majesty’s Revenue and Customs.

(7) Regulations under this paragraph—

(a) are subject to the negative procedure; and

(b) may make—

(i) different provision for different purposes, including different provision for different areas or for different authorities, and

(ii) such incidental, consequential, transitional or supplementary provision as the Scottish Ministers think necessary or expedient.

15D (1) A person to whom sub-paragraph (2) applies is guilty of an offence if the person discloses without lawful authority any information—

(a) which comes to the person by virtue of paragraph 15A, 15B or 15C, and

(b) which relates to a particular person.

(2) This sub-paragraph applies to—

(a) a qualifying person for the purpose of paragraph 15A, 15B or 15C;

(b) a person who is or has been a director, member of the committee of management, manager, secretary or other similar officer of a person within paragraph (a);

(c) a person who is or has been an employee of such a person.

(3) A person guilty of an offence under this paragraph is liable—

(a) on conviction on indictment, to imprisonment for a term not exceeding 2 years or a fine, or both;

(b) on summary conviction, to imprisonment for a term not exceeding 12 months or a fine not exceeding the statutory maximum, or both.

(4) It is not an offence under this paragraph—

(a) to disclose information in the form of a summary or collection of information so framed as not to enable information relating to any particular person to be identified from it;

(b) to disclose information which has previously been disclosed to the public with lawful authority.

(5) It is a defence for a person (“D”) charged with an offence under this paragraph to prove that at the time of the alleged offence—

(a) D believed that D was making the disclosure in question with lawful authority and had no reasonable cause to believe otherwise, or

(b) D believed that the information in question had previously been disclosed to the public with lawful authority and had no reasonable cause to believe otherwise.

(6) For the purposes of this paragraph, “lawful authority” has the meaning given by section 123 of the Social Security Administration Act 1992.

(7) In relation to an offence under this paragraph committed in England and Wales before the commencement of section 154(1) of the Criminal Justice Act 2003 (increase in maximum term that may be imposed on summary conviction of offence triable either way) the reference in sub-paragraph (3)(b) to 12 months is to be taken as a reference to 6 months.”

(3) In paragraph 11 (supply of information to authorities: England and Wales), after sub-paragraph (1) insert—

“(1A) Information may be prescribed under sub-paragraph (1)(d) by reference to—

(a) how the person concerned came to be in possession or control of the information;

(b) the purpose for which it is requested by the authority.”

(4) In paragraph 12 (supply of information to authorities: Scotland), after sub-paragraph (1) insert—

21 May 2012 : Column 914

“(1A) Information may be prescribed under sub-paragraph (1)(d) by reference to—

(a) how the person concerned came to be in possession or control of the information;

(b) the purpose for which it is requested by the authority.”

(5) In paragraph 16 (supply of information by authorities), after sub-paragraph (2) insert—

“(3) Information may be prescribed under sub-paragraph (2)(c) by reference to—

(a) how the first-mentioned authority obtained the information;

(b) the purpose for which the first-mentioned authority believes that the information would be useful to the other authority.”

(6) This section comes into force at the end of the period of 2 months beginning with the day on which this Act is passed.’. —(Andrew Stunell.)

Brought up, read the First and Second time, and added to the Bill.

New Clause 5

Report on effects of provisions

‘At a date no later than three years from the implementation of this Act the Secretary of State shall prepare a report detailing the effects of these provisions on—

(a) the number of people receiving council tax support in each local authority including the number in employment, the number actively seeking work, and the number of pensionable age, and

(b) the costs incurred by each authority in running the scheme, including the cost of appeals.’.—(Helen Jones.)

Brought up, and read the First time.

Question put, That the clause be read a Second time.

The House divided:

Ayes 201, Noes 271.

Division No. 5]

[7.31 pm

AYES

Abbott, Ms Diane

Abrahams, Debbie

Ainsworth, rh Mr Bob

Alexander, Heidi

Anderson, Mr David

Ashworth, Jonathan

Austin, Ian

Bailey, Mr Adrian

Bain, Mr William

Banks, Gordon

Barron, rh Mr Kevin

Bayley, Hugh

Beckett, rh Margaret

Benn, rh Hilary

Benton, Mr Joe

Berger, Luciana

Betts, Mr Clive

Blears, rh Hazel

Blenkinsop, Tom

Blomfield, Paul

Blunkett, rh Mr David

Brennan, Kevin

Brown, rh Mr Nicholas

Bryant, Chris

Byrne, rh Mr Liam

Campbell, Mr Alan

Campbell, Mr Ronnie

Caton, Martin

Chapman, Mrs Jenny

Clarke, rh Mr Tom

Clwyd, rh Ann

Coffey, Ann

Connarty, Michael

Cooper, Rosie

Corbyn, Jeremy

Crausby, Mr David

Creagh, Mary

Creasy, Stella

Cruddas, Jon

Cunningham, Alex

Cunningham, Mr Jim

Cunningham, Tony

Curran, Margaret

Dakin, Nic

Danczuk, Simon

David, Mr Wayne

Davidson, Mr Ian

De Piero, Gloria

Denham, rh Mr John

Dobson, rh Frank

Docherty, Thomas

Doran, Mr Frank

Dowd, Jim

Doyle, Gemma

Dromey, Jack

Durkan, Mark

Eagle, Ms Angela

Eagle, Maria

Elliott, Julie

Ellman, Mrs Louise

Engel, Natascha

Esterson, Bill

Evans, Chris

Farrelly, Paul

Fitzpatrick, Jim

Flello, Robert

Flynn, Paul

Francis, Dr Hywel

Gardiner, Barry

Gilmore, Sheila

Glass, Pat

Glindon, Mrs Mary

Godsiff, Mr Roger

Goggins, rh Paul

Goodman, Helen

Greatrex, Tom

Green, Kate

Greenwood, Lilian

Gwynne, Andrew

Hain, rh Mr Peter

Hamilton, Mr David

Hamilton, Fabian

Hanson, rh Mr David

Harman, rh Ms Harriet

Harris, Mr Tom

Havard, Mr Dai

Healey, rh John

Hendrick, Mark

Hepburn, Mr Stephen

Hillier, Meg

Hilling, Julie

Hodge, rh Margaret

Hodgson, Mrs Sharon

Hoey, Kate

Hood, Mr Jim

Hopkins, Kelvin

Howarth, rh Mr George

Hunt, Tristram

Irranca-Davies, Huw

Jackson, Glenda

Jamieson, Cathy

Jarvis, Dan

Johnson, rh Alan

Johnson, Diana

Jones, Graham

Jones, Helen

Jones, Mr Kevan

Jones, Susan Elan

Kaufman, rh Sir Gerald

Keeley, Barbara

Khan, rh Sadiq

Lavery, Ian

Leslie, Chris

Lewis, Mr Ivan

Llwyd, rh Mr Elfyn

Long, Naomi

Love, Mr Andrew

Lucas, Ian

MacShane, rh Mr Denis

Mactaggart, Fiona

Mahmood, Shabana

Malhotra, Seema

Mann, John

Marsden, Mr Gordon

McCann, Mr Michael

McCarthy, Kerry

McClymont, Gregg

McDonagh, Siobhain

McDonnell, John

McFadden, rh Mr Pat

McGovern, Jim

McGuire, rh Mrs Anne

McKechin, Ann

McKenzie, Mr Iain

McKinnell, Catherine

Meacher, rh Mr Michael

Mearns, Ian

Michael, rh Alun

Miller, Andrew

Mitchell, Austin

Moon, Mrs Madeleine

Morden, Jessica

Morrice, Graeme

(Livingston)

Morris, Grahame M.

(Easington)

Munn, Meg

Murphy, rh Paul

Murray, Ian

Nandy, Lisa

Nash, Pamela

O'Donnell, Fiona

Onwurah, Chi

Osborne, Sandra

Owen, Albert

Pearce, Teresa

Perkins, Toby

Phillipson, Bridget

Pound, Stephen

Raynsford, rh Mr Nick

Reed, Mr Jamie

Reeves, Rachel

Reynolds, Emma

Reynolds, Jonathan

Riordan, Mrs Linda

Robinson, Mr Geoffrey

Rotheram, Steve

Roy, Mr Frank

Roy, Lindsay

Ruane, Chris

Ruddock, rh Dame Joan

Sarwar, Anas

Seabeck, Alison

Sharma, Mr Virendra

Sheridan, Jim

Shuker, Gavin

Simpson, David

Skinner, Mr Dennis

Smith, rh Mr Andrew

Smith, Angela

Smith, Nick

Smith, Owen

Spellar, rh Mr John

Straw, rh Mr Jack

Stringer, Graham

Sutcliffe, Mr Gerry

Thomas, Mr Gareth

Timms, rh Stephen

Trickett, Jon

Turner, Karl

Twigg, Derek

Twigg, Stephen

Umunna, Mr Chuka

Vaz, rh Keith

Watts, Mr Dave

Williams, Hywel

Williamson, Chris

Winnick, Mr David

Winterton, rh Ms Rosie

Wood, Mike

Woodward, rh Mr Shaun

Wright, David

Wright, Mr Iain

Tellers for the Ayes:

Phil Wilson and

Yvonne Fovargue

NOES

Adams, Nigel

Afriyie, Adam

Amess, Mr David

Bacon, Mr Richard

Baker, Norman

Baker, Steve

Baldry, Tony

Baldwin, Harriett

Barclay, Stephen

Barwell, Gavin

Benyon, Richard

Beresford, Sir Paul

Berry, Jake

Bingham, Andrew

Binley, Mr Brian

Birtwistle, Gordon

Blackman, Bob

Blackwood, Nicola

Blunt, Mr Crispin

Boles, Nick

Bone, Mr Peter

Bradley, Karen

Brady, Mr Graham

Bray, Angie

Brazier, Mr Julian

Bridgen, Andrew

Brine, Steve

Brokenshire, James

Bruce, Fiona

Bruce, rh Malcolm

Burley, Mr Aidan

Burns, Conor

Burns, rh Mr Simon

Burrowes, Mr David

Burstow, Paul

Burt, Lorely

Byles, Dan

Cable, rh Vince

Cairns, Alun

Campbell, rh Sir Menzies

Carmichael, rh Mr Alistair

Carmichael, Neil

Carswell, Mr Douglas

Cash, Mr William

Chishti, Rehman

Clappison, Mr James

Clark, rh Greg

Clarke, rh Mr Kenneth

Clifton-Brown, Geoffrey

Coffey, Dr Thérèse

Collins, Damian

Colvile, Oliver

Cox, Mr Geoffrey

Crabb, Stephen

Crockart, Mike

Crouch, Tracey

Davey, rh Mr Edward

Davies, Glyn

Davies, Philip

Dinenage, Caroline

Djanogly, Mr Jonathan

Dorrell, rh Mr Stephen

Doyle-Price, Jackie

Duddridge, James

Duncan, rh Mr Alan

Duncan Smith, rh Mr Iain

Ellis, Michael

Ellison, Jane

Eustice, George

Evans, Graham

Evans, Jonathan

Evennett, Mr David

Fabricant, Michael

Fallon, Michael

Farron, Tim

Featherstone, Lynne

Field, Mark

Foster, rh Mr Don

Fox, rh Dr Liam

Francois, rh Mr Mark

Freeman, George

Freer, Mike

Fuller, Richard

Gale, Sir Roger

Garnier, Mark

Gauke, Mr David

Gibb, Mr Nick

Gilbert, Stephen

Glen, John

Goodwill, Mr Robert

Gove, rh Michael

Graham, Richard

Grant, Mrs Helen

Grayling, rh Chris

Green, Damian

Greening, rh Justine

Griffiths, Andrew

Gummer, Ben

Gyimah, Mr Sam

Halfon, Robert

Hames, Duncan

Hammond, Stephen

Hancock, Matthew

Hands, Greg

Harper, Mr Mark

Harrington, Richard

Harris, Rebecca

Hart, Simon

Haselhurst, rh Sir Alan

Heald, Oliver

Heath, Mr David

Heaton-Harris, Chris

Hemming, John

Henderson, Gordon

Herbert, rh Nick

Hinds, Damian

Hoban, Mr Mark

Hollingbery, George

Hollobone, Mr Philip

Horwood, Martin

Howarth, Mr Gerald

Howell, John

Hughes, rh Simon

Huhne, rh Chris

Huppert, Dr Julian

Jackson, Mr Stewart

James, Margot

Javid, Sajid

Jenkin, Mr Bernard

Johnson, Gareth

Johnson, Joseph

Jones, Mr Marcus

Kelly, Chris

Kennedy, rh Mr Charles

Kirby, Simon

Knight, rh Mr Greg

Kwarteng, Kwasi

Laing, Mrs Eleanor

Lancaster, Mark

Latham, Pauline

Leadsom, Andrea

Lee, Jessica

Lee, Dr Phillip

Leech, Mr John

Lefroy, Jeremy

Leigh, Mr Edward

Leslie, Charlotte

Letwin, rh Mr Oliver

Lewis, Brandon

Liddell-Grainger, Mr Ian

Lloyd, Stephen

Lopresti, Jack

Loughton, Tim

Luff, Peter

Macleod, Mary

Main, Mrs Anne

Maude, rh Mr Francis

Maynard, Paul

McCartney, Jason

McCartney, Karl

McIntosh, Miss Anne

McLoughlin, rh Mr Patrick

McPartland, Stephen

McVey, Esther

Mensch, Louise

Menzies, Mark

Mercer, Patrick

Metcalfe, Stephen

Miller, Maria

Mills, Nigel

Milton, Anne

Mitchell, rh Mr Andrew

Moore, rh Michael

Mordaunt, Penny

Morgan, Nicky

Morris, Anne Marie

Morris, David

Morris, James

Mosley, Stephen

Mowat, David

Mulholland, Greg

Mundell, rh David

Munt, Tessa

Murrison, Dr Andrew

Neill, Robert

Norman, Jesse

Nuttall, Mr David

Offord, Mr Matthew

Ollerenshaw, Eric

Opperman, Guy

Ottaway, Richard

Parish, Neil

Patel, Priti

Pawsey, Mark

Penning, Mike

Penrose, John

Perry, Claire

Phillips, Stephen

Pickles, rh Mr Eric

Pincher, Christopher

Poulter, Dr Daniel

Prisk, Mr Mark

Pugh, John

Raab, Mr Dominic

Randall, rh Mr John

Redwood, rh Mr John

Rees-Mogg, Jacob

Reevell, Simon

Reid, Mr Alan

Robathan, rh Mr Andrew

Rogerson, Dan

Rudd, Amber

Ruffley, Mr David

Russell, Sir Bob

Rutley, David

Sanders, Mr Adrian

Sandys, Laura

Scott, Mr Lee

Shapps, rh Grant

Sharma, Alok

Shelbrooke, Alec

Shepherd, Mr Richard

Simmonds, Mark

Simpson, Mr Keith

Skidmore, Chris

Smith, Miss Chloe

Smith, Henry

Smith, Julian

Smith, Sir Robert

Soames, rh Nicholas

Soubry, Anna

Spelman, rh Mrs Caroline

Stanley, rh Sir John

Stephenson, Andrew

Stevenson, John

Stewart, Bob

Stewart, Iain

Streeter, Mr Gary

Stride, Mel

Stunell, Andrew

Sturdy, Julian

Swales, Ian

Swayne, rh Mr Desmond

Swinson, Jo

Syms, Mr Robert

Teather, Sarah

Thurso, John

Timpson, Mr Edward

Tomlinson, Justin

Truss, Elizabeth

Turner, Mr Andrew

Tyrie, Mr Andrew

Vara, Mr Shailesh

Vickers, Martin

Villiers, rh Mrs Theresa

Walker, Mr Charles

Wallace, Mr Ben

Ward, Mr David

Watkinson, Angela

Wharton, James

White, Chris

Wiggin, Bill

Willetts, rh Mr David

Williams, Stephen

Williamson, Gavin

Willott, Jenny

Wilson, Mr Rob

Wollaston, Dr Sarah

Wright, Jeremy

Yeo, Mr Tim

Young, rh Sir George

Tellers for the Noes:

Mr Philip Dunne and

Mark Hunter

Question accordingly negatived.

21 May 2012 : Column 915

21 May 2012 : Column 916

21 May 2012 : Column 917

21 May 2012 : Column 918

Clause 8

Council Tax

Amendments made: 42, page 5, line 2, at end insert—

‘(aa) in the case of a dwelling situated in the area of a billing authority in Wales, is to be reduced to the extent, if any, required by any council tax reduction scheme made under regulations under subsection (2B) which applies to that dwelling;’.

Amendment 43, page 5, line 4, after ‘paragraph (a)’ insert ‘or (aa)’.

Amendment 44, page 5, line 12, at end insert—

“(2A) Schedule 1A (which contains provisions about schemes under subsection (2)) has effect.

(2B) The Welsh Ministers may by regulations—

(a) require a person or body specified in the regulations to make a scheme specifying the reductions which are to apply to amounts of council tax payable, in respect of dwellings to which the scheme applies, by persons to whom the scheme applies,

(b) impose requirements on that person or body regarding the matters which must be included in that scheme, and

(c) make other provision for and in connection with such schemes.

(2C) Schedule 1B (which contains further provisions about regulations under subsection (2B) and about schemes under those regulations) has effect.’.

Amendment 45, page 5, leave out lines 18 and 19 and insert—

“( ) No regulations under subsection (2B) are to be made unless a draft of the statutory instrument containing them has been laid before, and approved by a resolution of, the National Assembly for Wales.’.

Amendment 46, page 5, line 21, at end insert

‘or regulations under subsection (2B)’.

Amendment 47, page 5, line 24, leave out ‘Schedule to be inserted as Schedule 1A’ and insert

‘Schedules to be inserted as Schedules 1A and 1B’.

Amendment 48, page 5, line 27, at end insert

‘under section 13A(2) of the LGFA 1992’.—

(Robert Neill.)

Schedule 4

Amendments relating to council tax reduction schemes

Amendments made: 49, page 47, line 32, after ‘schemes’ insert ‘: England’.

Amendment 50, page 47, line 35, after second ‘scheme’ insert ‘under section 13A(2)’.

Amendment 51, page 49, line 7, at end insert—

‘(10) Regulations under sub-paragraph (8) may in particular set out provision to be included in a scheme that is equivalent to—

(a) provision made by a relevant enactment, or

(b) provision that is capable of being made under a relevant enactment,

with such modifications as the Secretary of State thinks fit.

(11) Subject to compliance with regulations under sub-paragraph (8), a scheme may make provision that is equivalent to—

(a) provision made by a relevant enactment, or

(b) provision that is capable of being made under a relevant enactment,

with such modifications as the authority thinks fit.

21 May 2012 : Column 919

(12) For the purposes of sub-paragraphs (10) and (11), each of the following enactments as it had effect on the day on which the Local Government Finance Act 2012 was passed is a “relevant enactment”—

(a) sections 131 to 133 of the Social Security Contributions and Benefits Act 1992 (council tax benefit);

(b) sections 134 to 137 of that Act (general provisions about income-related benefits) so far as applying in relation to council tax benefit;

(c) section 1 of the Social Security Administration Act 1992 (entitlement to benefit dependent on claim) so far as applying in relation to council tax benefit;

(d) section 6 of that Act (regulations about council tax benefit administration).’.

Amendment 52, page 49, line 16, leave out ‘consultation under sub-paragraph (1)(a) took place’ and insert

‘any step described in sub-paragraph (1) was taken’.

Amendment 53, page 49, line 44, at end insert

‘(or such other year as is specified in section8(4) of the Local Government Finance Act 2012)’.

Amendment 54, page 50, line 2, at end insert—

‘(3A) The default scheme may in particular make provision that is equivalent to—

(a) provision made by a relevant enactment, or

(b) provision that is capable of being made under a relevant enactment,

with such modifications as the Secretary of State thinks fit.

(3B) For the purposes of sub-paragraph (3A), each of the following enactments as it had effect on the day on which the Local Government Finance Act 2012 was passed is a “relevant enactment”—

(a) sections 131 to 133 of the Social Security Contributions and Benefits Act 1992 (council tax benefit);

(b) sections 134 to 137 of that Act (general provisions about income-related benefits) so far as applying in relation to council tax benefit;

(c) section 1 of the Social Security Administration Act 1992 (entitlement to benefit dependent on claim) so far as applying in relation to council tax benefit;

(d) section 6 of that Act (regulations about council tax benefit administration).’.

Amendment 55, page 51, line 30, after ‘benefit’ insert

‘, or who makes or has made a claim for that benefit,’.

Amendment 56, page 51, line 31, at end insert—

 

‘Schedule 1B

Section 13A

Council tax reductions schemes: Wales

Interpretation

1 In this Schedule—

(a) “the regulations” means regulations under section 13A(2B);

(b) “scheme” means council tax reduction scheme under the regulations;

(c) “specified” means specified in the regulations;

(d) “specified authority” means a person or body required by the regulations to make a scheme (and, in relation to a particular scheme, means the authority which made the scheme or is under a duty to make it).

Application of schemes

2 (1) The regulations may—

(a) prescribe, for each scheme that is to be made, the dwellings to which that scheme is to apply;

(b) require each scheme to state the dwellings to which it is to apply.

(2) The regulations may prescribe—

(a) the date by which each scheme is to be made, and

21 May 2012 : Column 920

(b) the first financial year to which it must relate.

Persons entitled to reductions

3 (1) The regulations may prescribe—

(a) classes of person who are to be entitled to a reduction under schemes;

(b) classes of person who must not be entitled to a reduction under schemes.

(2) The regulations may—

(a) allow specified authorities to determine (subject to regulations under sub-paragraph (1)) classes of person who are to be entitled to a reduction under schemes, or

(b) provide that specified authorities may not determine such classes.

(3) The regulations may require each scheme to state the classes of person (prescribed under sub-paragraph (1)(a) or determined under sub-paragraph (2)(a)) who are to be entitled to a reduction under the scheme.

(4) Any class of person prescribed under sub-paragraph (1)(a) may be determined by reference to, in particular, the matters listed in sub-paragraph (7).

(5) The regulations may require any class of person determined under sub-paragraph (2)(a) to be determined by reference to specified matters (which may include those listed in sub-paragraph (7)).

(6) If the regulations do not require a class a person to be determined as mentioned in sub-paragraph (5), the specified authority may determine that class by reference to, in particular, the matters listed in sub-paragraph (7).

(7) Those matters are—

(a) whether the Welsh Ministers consider, or the specified authority considers, any person to be in financial need;

(b) the income of any person liable to pay council tax in respect of any dwelling to which a scheme is to apply;

(c) the capital of any such person;

(d) whether any such person is in receipt of any specified benefit;

(e) the income and capital of any other person who is a resident of the dwelling, or whether any such person is in receipt of any specified benefit;

(f) the number of dependants of any person within paragraph (b) or (e);

(g) whether the person has made an application for the reduction.

Reductions

4 (1) The regulations may prescribe reductions, including minimum and maximum reductions, to which persons in each class (whether prescribed under paragraph 3(1)(a) or determined under paragraph 3(2)(a)) are to be entitled under schemes.

(2) The regulations may—

(a) allow specified authorities to determine (subject to regulations under sub-paragraph (1)) reductions to which persons in each class set out in the scheme are to be entitled, or

(b) provide that specified authorities may not determine such reductions.

(3) The regulations may require each scheme to set out the reductions (whether prescribed under sub-paragraph (1) or determined under sub-paragraph (2)(a)) to which persons in each class set out in the scheme are to be entitled.

(4) Different reductions may be set out for different classes.

(5) A reduction under a scheme may be—

(a) a discount calculated as a percentage of the amount which would be payable apart from the scheme,

(b) a discount of an amount set out in the scheme or to be calculated in accordance with the scheme,

21 May 2012 : Column 921

(c) expressed as an amount of council tax to be paid (lower than the amount which would be payable apart from the scheme) which is set out in the scheme or is to be calculated in accordance with it, or

(d) the whole amount of council tax (so that the amount payable is nil).

Other matters

5 (1) The regulations may require each scheme to state—

(a) the procedure by which a person may apply for a reduction under the scheme;

(b) the procedure by which a person can make an appeal under section 16 against any decision which affects the person’s entitlement to a reduction under the scheme or the amount of any reduction to which the person is entitled;

(c) the procedure by which a person can apply to the relevant billing authority for a reduction under section 13A(1)(b).

(2) In sub-paragraph (1)(c), the relevant billing authority for any dwelling to which the scheme applies is the billing authority in whose area the dwelling is situated.

(3) The regulations may prescribe requirements which must be met by the procedure mentioned in sub-paragraph (1)(a) or (b).

6 (1) The regulations may—

(a) require other matters to be included in schemes;

(b) allow schemes to make provision that is equivalent to provision made by a relevant enactment, or provision that is capable of being made under a relevant enactment, with such modifications as specified authorities think fit;

(c) prescribe the procedure which a specified authority must follow when making a scheme (including requirements regarding consultation and other steps to be taken before and after making the scheme);

(d) require or allow functions conferred by the regulations to be exercised by specified authorities jointly with other authorities;

(e) prescribe a default scheme which is to take effect, if a specified authority fails to make a scheme in accordance with the regulations, in respect of dwellings to which that scheme would have applied;

(f) impose requirements on specified authorities relating to the review, revision or replacement of schemes;

(g) enable specified authorities to make reasonable charges for the supply of copies of documents relating to schemes;

(h) require specified authorities to provide to the Welsh Ministers information about schemes.

(2) In particular, the regulations may under sub-paragraph (1)(a) set out provision to be included in schemes, and a default scheme prescribed under sub-paragraph (1)(d) may make provision, that is equivalent to—

(a) provision made by a relevant enactment, or

(b) provision that is capable of being made under a relevant enactment,

with such modifications as the Welsh Ministers think fit.

(3) For the purposes of sub-paragraphs (1)(b) and (2), each of the following enactments as it had effect on the day on which the Local Government Finance Act 2012 was passed is a “relevant enactment”—

(a) sections 131 to 133 of the Social Security Contributions and Benefits Act 1992 (council tax benefit);

(b) sections 134 to 137 of that Act (general provisions about income-related benefits) so far as applying in relation to council tax benefit;

(c) section 1 of the Social Security Administration Act 1992 (entitlement to benefit dependent on claim) so far as applying in relation to council tax benefit;

(d) section 6 of that Act (regulations about council tax benefit administration).

21 May 2012 : Column 922

Transitional provision

7 (1) The regulations may make such transitional provision regarding the commencement of schemes as the Welsh Ministers think fit.

(2) Such provision may include, in particular, provision for and in connection with treating a person who is or was in receipt of council tax benefit, or who makes or has made a claim for that benefit, as having made an application for a reduction under a scheme.

Guidance

8 In exercising any function relating to schemes, a specified authority must have regard to any guidance issued by the Welsh Ministers.”’.

Amendment 57, page 52, line 7, after ‘scheme’ insert ‘under section 13A(2)’.

Amendment 58, page 52, line 11, leave out ‘a billing authority’.

Amendment 59, page 52, line 12, at beginning insert

‘a billing authority in England or a specified authority (within the meaning of Schedule 1B) in Wales’.

Amendment 60, page 52, line 13, at beginning insert ‘a billing authority’.—(Robert Neill.)


New Clause 1

Tax increment financing schemes

‘(1) The Secretary of State may provide in regulations under paragraphs 20, 23 or 26 of Schedule 1 (levy payments, safety net payments and safety net payments on account) for the calculated amount for an area in which a tax increment financing scheme is in place to disregard the levy and any re-set.

(2) Regulations under subsection (1) shall be made by statutory instrument and may not be made unless a draft has been laid before and approved by resolution of each House of Parliament.’.—(John Healey.)

Brought up, and read the First time.

John Healey: I beg to move, That the clause be read a Second time.

Mr Deputy Speaker (Mr Lindsay Hoyle): With this it will be convenient to discuss the following:

New clause 6—Determination of central and local shares

‘(1) In determining the central share and the local share for any relevant authority, the Secretary of State must have regard to—

(a) the level of need in that authority, and

(b) the likely capacity of the authority to benefit from business rate growth.

(2) Any assessment of the level of need shall include—

(a) the ranking of the local authority in the Index of Multiple Deprivation,

(b) the level of unemployment within the authority’s area,

(c) the proportion of adults within the authority’s area who have a limiting long-term illness,

(d) the number of adults within the area who are in receipt of social care,

(e) the number of looked-after children within the authority, and

(f) the level of child poverty within the authority’s area.

(3) The Secretary of State must lay his assessment before the House at the same time as the Local Government Finance Report.’.

21 May 2012 : Column 923

New clause 11—National business rate policy changes: consultation

‘The Secretary of State may not make any changes to national business rate policy which impact on local business rate yields without first consulting with all interested parties.’.

Government amendments 15 to 17.

Amendment 62, page 12, line 13, schedule 1, leave out ‘each year’ and insert—

‘each financial year until the end of the financial year beginning 1 April 2014’.

Government amendments 18 and 19.

Amendment 63, page 23, line 40, at end insert—

‘(ca) by reference to the volatility caused by rating appeals following a revaluation;’.

Government amendments 20 to 41.

Government new clause 8—Payments to and from authorities.

John Healey: I rise to speak to new clauses 1 and 11, and amendments 62 and 63.

My purpose with new clause 1 is to encourage the Minister to confirm, on behalf of the Government, that the necessary powers exist in legislation to make tax increment financing work in future, and also to confirm Ministers’ intent and commitment to using those powers. The case for TIFs—tax increment financing schemes—is unarguable. I myself have been arguing it for a number of years, first in the Treasury and then in the Department for Communities and Local Government. There are local government regulations in Scotland to allow six TIF pilots to go ahead. The use of TIFs is widespread in Canada and the US, particularly in areas where regeneration is required; indeed, only one state in the US—Arizona—does not have TIF legislation. TIFs build on the commitment that Labour made in government, in the Budget 2010, a commitment that was backed by a capital down payment of £120 million.

However, if the TIFs system is to work—that is, if local authorities are to borrow money for up-front infrastructure investment against the anticipated increase in business rate income as a result of the new infrastructure —there must above all be certainty for those long-term investments to be made. There needs to be certainty for a clear business plan and then an investment plan to be put in place; otherwise TIFs will not get off the ground and will not work. That certainty is required over a 20 to 30-year time scale, which is why it is needed in legislation. As the Centre for Cities said in response to the Government’s consultation:

“When the Government introduces Tax Increment Financing…it should be based on ‘Option 2’—a ringfenced TIF which is best suited for local investment finance within the proposed business rate retention system.”

That point was echoed by the British Property Federation, which said:

“Failing to ring-fence the income stream for that length of time”—

its submission referred to a 25 to 30-year period—

“would generally render the upfront investment unbankable, because the risks associated with it become too difficult to model, understand and price. TIF will only work with the sort of total ring-fencing proposed under Option 2”.

The Government made the commitment to ring-fencing, stating in the White Paper of October 2010:

21 May 2012 : Column 924

“We will introduce new borrowing powers to enable authorities to carry out Tax Increment Financing”.

In response to the consultation, the Government also made a commitment to

“allow a limited number of Tax Increment Financing Projects to be exempted from any levy and reset for 25 years.”

That is the crucial commitment that I want to test against the content of the Bill before us. I expressed my concern about the freedom of the ring-fencing from any effects of reset to the Secretary of State on Second Reading on 10 January. He had no answer: either he did not know, or he did not want to say.

Let me therefore point the Minister to the source of my concern, which relates to paragraph 37(1)(d) of schedule 1 on page 32. This deals with the regulation-making powers of the Secretary of State, referring to regulations that can

“provide for that amount or that proportion to be disregarded for the purposes of calculations under any of the following provisions”—

in other words, regulation-making powers that can lead to the disregard of a proportion of business rates in specified areas, namely TIF areas, for particular payments that would otherwise be due. The provision goes on to identify payments to the central share, payments by billing to precepting local authorities, levy payments, safety net payments, payments on account and payments that follow from changes either to the local government finance report or to an amending report of a local government financing report. There is no power, however, to make regulations to exempt payments as a result of changes through a reset.

If I am mistaken, I would like the Minister to indicate where that power lies. If no such provision exists in the legislation, will he confirm that the Government will honour the commitment they made in their response to the consultation and will amend the Bill so that any payments resulting from a reset can be disregarded—and disregarded in full—for the purpose of the TIF areas? The Minister would be welcome to accept my new clause if he needs to do so.

Mark Field (Cities of London and Westminster) (Con): The right hon. Gentleman has made admirably clear his concerns about the potential lack of commercial certainty. One of the advantages of going down the route of tax increment financing is that there would be ring fence over the 25 to 30-year period. Does he not see, however, that in very uncertain economic times, that is a very long period, so it might be unwise, where a major change required a major reset in a particular area, perhaps where new towns were being built, not to allow the Government a certain amount of leeway? Is that not more important than the exclusion of a reset from the ring fence?

John Healey: I would have thought the hon. Gentleman, who represents the Cities of London and Westminster, would recognise more than anyone else that for the sort of commercial investment required to get TIFs off the ground in circumscribed and specific areas, certainty is a premium. If the 25 or 30-year commitment required to make this work could be periodically completely set to one side in a reset process, I put it to him that the inherent risk created by that and the inherent lack of certainty entailed by it would undermine the ability to raise the finance necessary to get the TIFs off the ground.

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As to the hon. Gentleman’s point about new towns, the regulations allow the disregard in the specified areas that are designated as TIF areas only. The disregard on business rate payments, a proportion of which would otherwise become payable by the local authority, would be allowed under various headings, but this would not apply to the reset. Fundamentally, that is the biggest upset factor of all, so the case for disregarding that is probably stronger than it is for the smaller-beer measures for which regulations can be designed to protect.

Mark Field: I accept what the right hon. Gentleman says and he is absolutely right about commercial certainty, which is of great importance to any would-be investor. Instead of the notion of absolute certainty embodied in new clause 1, would the right hon. Gentleman not be satisfied, particularly in view of the important effect of building a new town or a huge new industrial estate for which the notion of a reset would apply, by reassurances from the Minister that the Government do not intend to make the changes he has in mind? Would that not be better than going down the route of absolutely certainty, which provides little flexibility either to central or local government, for an incredibly long period of 25 or 30 years? We need go back only two and a half or three decades to recognise the great changes that have taken place in many of the industrial areas that we represent and to understand that absolute certainty of the sort that he—

Mr Deputy Speaker (Mr Lindsay Hoyle): Order. [Interruption.] Order—the hon. Gentleman must not test my patience even more. Interventions are welcome, and I am prepared to give a little leeway, but the hon. Gentleman is almost making a speech.

John Healey: Thank you, Mr Deputy Speaker. I got the gist. I welcome this Bill and I want it to work. My fear is that without the certainty around potential resets—we do not know when or how often they might happen; we do not know whether they will happen every 10 years; we do not know how they will work in future—there will be huge risk and uncertainty in the system. It is not a question of whether I am satisfied by the provision; it is a question of whether the potential investors, who will determine whether the TIFs work or not, are satisfied. I am trying to convey the sentiment that I have picked up from my discussions with banks, commercial organisations, the British Property Federation and some of the City’s policy experts, who all say, “Look, we require a ring fence; it must be total”. Thus leaving out the reset, which the Government promised they would not do, does not make sense if we want the provisions to work. I hope the Minister will be able to provide the confirmation we need and be able to build it into the Bill. This issue will certainly need to be confirmed at later stages of the Bill.

Amendment 62 is designed to get to the heart of the relative share of the business rate take as between central and local government. The figures for projected resource spending on local government under the current spending review demonstrate a significant reduction for next year and the year after that—of nearly half a billion between this year and the next, and of more than £1.5 billion between next year and the year after that in

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nominal terms. Alongside that, the projected yield from business rates is set to go up by nearly £1 billion next year and by more than half a billion the year after that. That means that the gap between the projected business rates yield and central Government’s commitment to resource spending on local government is more than £2 billion for next year, and £4 billion for the year after that. There is a significant and growing gap between the business rates yield and spending on local government.

8 pm

I accept, as do my colleagues on the Opposition Front Bench, the need for the business rates retention system not to undermine the Chancellor’s announced plans for deficit reduction during the current spending review period. However, I do not want central Government to keep helping themselves to a growing yield from business rates after 2014-15, given that the system is designed to return that yield to local government as an incentive for it to support economic development.

Andrew Gwynne: It is not yet clear how local authorities’ needs will be assessed for the purpose of determining the proportion of the business rate that they will retain. We need to see the bigger picture, not least because services and needs vary widely, as does the ability to generate income locally.

John Healey: My hon. Friend, who has experience of local government, has put his finger on the button. What worries me is that the Bill gives the Secretary of State power to set the central and local shares—in other words, to determine the division of the business rates take—in each and every year, indefinitely. I am not talking just about what will happen next year and the year after that, or about what will happen until the end of the current spending review period. From year to year, local government simply will not know where it stands until the Secretary of State makes the decision. The central and local shares could vary, and central Government could decide to take a greater share.

The Government’s top-slicing of at least 50% of the business rates revenue and 50% of the business rates growth above the baseline will reduce the incentives for local authorities to support growth, which were meant to be part of the design of the system. It will also reduce the certainty that would enable authorities to plan their finances on more than a year-by-year basis, and reduce the Government’s own ability to claim that this is a localising reform. I am sure that we will hear from the Minister—and I have heard this before—that the Government have declared their intention of returning the revenues in the central share to local government; but, as has been pointed out by my hon. Friend the Member for Denton and Reddish (Andrew Gwynne), we have been given no details, and we do not know what purposes or constraints that may entail.

Mr Betts: My right hon. Friend has raised an important point about what the Government may choose to do with the extra money from the business rates that will accrue each year. The suspicion has been expressed that they will use it to ensure that local authorities must fund more and more council tax benefits. That would be a simple way of transferring responsibility for benefits to local authorities.

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John Healey: My hon. Friend may well be right, and his Select Committee will doubtless keep a close eye on the matter. I hope that the Minister will give us some answers tonight, but I am sure that, if he does not, Ministers in the other place will be pressed on the point.

The other gaping hole in the Bill is the absence of any specific measure that would tell us when and how the Government would deal with the reset in the future. The two options that they presented in their statement of intent last week could lead to fundamentally different outcomes. There could be a full reset, whereby all the business rate growth up to the point of the reset was redistributed—meaning, in effect, that the baseline of the whole system would be reset by means of the new, and total, business rates pot—or there could be a partial reset, meaning that business growth would be retained at local level, and just the initial baseline would be reset. That represents a very wide range of possibilities for local authorities. If the Minister wants authorities to be able to plan for the future on the basis of the new system, he must provide them with some of the answers to such questions, sooner rather than later.

Andrew Gwynne: Getting the reset procedure right is important not least because the initial baseline is so unfair. It locks in unfair local government settlements and in-year cuts. It is crucially important for local government to be certain that the reset procedure will work in the future, because otherwise the gaps will continue to widen.

John Healey: Indeed. I have my misgivings about whether any approach to the reset procedure can make the system fair after more than a few years. Indeed, I am still to be convinced that the system can be reset in a fair and proper way. But, Mr Deputy Speaker, I digress beyond the scope of the amendments that I tabled.

Let me now turn to amendment 63. During earlier debates on the Bill in the Chamber, I argued that this was an unsuitable system for long-term Government funding. Ultimately, business rates yield is too volatile, and it is too volatile on a year-by-year basis. Let me give three examples, a couple of which will be close to home for those on both Front Benches.

In Warrington the business rates yield has dropped by £10 million over the last 10 years, from £53 million to just £43 million. In Sunderland there was a £17 million drop between 2010 and 2011, and in the year before that there had been a £12 million rise. I can tell the Under-Secretary of State for Communities and Local Government, the hon. Member for Bromley and Chislehurst (Robert Neill), that in the middle of 2005-06, the business rates income in his borough of Bromley halved. In two of the last four years, the changes—up and down, and up and down again—have amounted to more than 10%. The funding stream is inherently volatile, and, in my view, is inherently unsuitable as a basis for the funding of essential local government services.

The main purpose of amendment 63, however, is to draw attention to concern about the volatility caused by appeals. I believe that areas in which there is a particular concentration of a single or consistent business type are particularly vulnerable to a big impact from them. The hon. Member for Cities of London and Westminster (Mark Field), who has just left the Chamber, may recall that in 2007-08 a full 20% of the business rates yield of

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the City of London was lost as a result of successful backdated appeals. So the appeals add another important, volatile element to the system of business rates.

Those appeals are made against decisions by the Valuation Office Agency, not local authorities. The system is managed by the VOA and tribunals, not the local authority, and it brings benefits to the companies that are successful, not the local authorities. We must ensure that the impacts of appeals do not affect the funding base of the local authorities; we must not expose authorities to vagaries in the system and to the impact of appeals, when they cannot predict them, control the risk of them or benefit from them. Actually, neither can they benefit from business rate increases through revaluation, at least while the Government put in place transition relief.

I tabled amendment 63 because the Government are creating a one-way bet, in which the Chancellor wins each way and the councils lose each time. If the appeals are won by the company, the local authority has to manage the volatility and has to bear the loss up to the level of the safety net threshold—which, according to the statement of intent in the Government’s publications of Thursday last week, is likely to be somewhere between 7.5% and 10%. Amendment 63 is an attempt to make sure that once the calculations and the thresholds are determined, safety net payments take full account of rating appeals. Linked to that, I hope the Government will accept the case for fully compensating local authorities from the levy pot for the impact of any successful business appeals—over which they have no control, and which they cannot predict.

New clause 11 is relatively modest, and I hope the Minister will accept it in principle, if not in practice at this stage. The power for setting and changing business rates policy—business rate reliefs, which are mandatory, as well as the payment schedules for business rates and the transition periods for business rate increases—will continue to rest with the Secretary of State and the national Government. Currently, any national business rate policy changes have no direct impact on local authority finances or local authority budgets. In future they will, however. They will not be local government decisions, but they will create consequences that local government will have to deal with. If the Government decide to change the rate or the type of mandatory rate reliefs, or to allow the deferral of part of the change in business rate bills, that will have a direct impact on that year’s yield in the area concerned, and therefore on the local authority’s funding. Local authorities will be hit by the consequences of decisions that they did not make and that they cannot control. That is unfair and unreasonable.

It may surprise some Members to learn that the Federation of Small Businesses has also made that argument. It said in response to the consultation of October 2011 that

“the FSB is concerned that the incentive system could actually deter local authorities from promoting and utilising the reliefs available to small businesses such as small business rate relief, rural rate relief and hardship relief…It would mean that a local authority would lose out on income if it increased the proportion of businesses that received rate relief or would make money if the number of businesses able to get reliefs fell.”

I am sure the Minister does not want to design into the new system perverse incentives that will hit small firms in that way.

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As currently proposed, the new system will be bad for local authorities, and could be bad for local small and medium-sized firms. My new clause requires that, at the very least, the Secretary of State must consult the parties that would be affected by changes in national business rates policy before making such decisions. Under the new system, the stakes for councils will be higher, so the guarantee to consult them before any changes are made is the minimum that Ministers should promise.

8.15 pm

Helen Jones: Once again, I am very pleased to follow an interesting, passionate and well-informed speech from my right hon. Friend the Member for Wentworth and Dearne (John Healey). I can add little to the case he made for his amendments, so, given the time constraints, I shall focus on new clause 6, which stands in my name and that of other right hon. and hon. Friends.

We make no apologies for returning to the issue of need and the different levels of need within local authorities —the elephant in the room that the Government want to ignore. This issue has been raised time and again in our debates on the Bill by hon. Friends, many of whom represent some of the most deprived communities in this country and have seen at first hand the impact of the Government’s policies on those communities.

Why are the Government so wilfully blind to the effects of their policies? They have already hit local authorities with cuts that are larger than those inflicted on any Government Department, and we have heard from Opposition Members about the real and serious impact the cuts are having on front-line services—the cuts in school food provision, increases in home care charges, library closures in the poorest communities. However, none of this has any influence on Ministers, so out of touch are they with most people’s lives, and it now appears that they are going to make things worse.

First, they entrench unfairness in the system by basing it on the current local government finance settlement, so the inequalities and unfairness of the current scheme will form the basis of the settlement for years to come. We have heard many times during our debates on this Bill about cities that are losing spending power: Manchester is losing spending power of £186 per person, Birmingham £155 and Nottingham £147. Those are the cities that the Government think will drive the economic recovery; there is no linked-up policy here. Wokingham, of course, gains, however. Basingstoke and Deane gains £6.30 per person. East Dorset gains £3 per person.

According to the Government’s statement of intent—it is one of many, so I am unsure how much weight we can place on any of their statements of intent—each authority will keep 50% of its business rates and the Government will provide a revenue support grant to make up the difference between the local share of business rates at the outset of the scheme and the spending controls for local government. However, they will, it seems, have top-sliced that for the new homes bonus first, which already benefits most those authorities with a high tax base, and it appears that many other grants will also be included, as listed in the statement of intent.

We already know how the grant system has been used to penalise the poorest authorities with communities that are most in need, and there has been a significant

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reduction in resource equalisation. Under this scheme, the gap between richer and poorer authorities will widen. First, as the Yorkshire and Humberside councils have said,

“a baseline may not reflect the actual levels of funding councils need to deliver services from April 2013.”

They were right about that. Secondly, as we have discussed during the passage of this Bill, some authorities will find it easier to grow their business rates than others. It has been estimated that even if the top-ups and tariffs increased in line with the retail prices index, the gap between the richest and the poorest authorities, and between the north and the south, will widen. Cash growth in the City of London could be 139% over four years and the figure for Westminster could be 90%, whereas the estimate for Liverpool and Knowsley is 21.9% and that for South Tyneside is 22.7%.

When we add into that this Government’s abject failure to take into account the differing tax bases of local authorities, the situation becomes even worse. That failure means that local authorities do not start on the level playing field that the Deputy Prime Minister kept telling us about—although he was the man who said he was not going to raise tuition fees, so I am not sure that anyone takes much notice of him. In the long term, fortunate local councils might reduce or even get rid of council tax, whereas others whose tax base is low and where it is harder to attract investment will be unable to do so. When we also take into account the amount that some councils will lose through changes in council tax benefit, it is clear that they could be heading for the perfect storm.

Andrew Gwynne: May I use the example of my constituency to illustrate precisely the issue that my hon. Friend is raising? My constituency covers two metropolitan boroughs that lie side by side; Tameside predominantly contains band A and band B properties, so its ability to increase its income from council tax is less than that of neighbouring Stockport, which contains a much larger amount of properties in a wider range of bands. Is that not the fundamental unfairness of all this?

Helen Jones: It is the fundamental thing that the Government fail to understand: councils are not starting from the same baseline. Those who pay the price for these inequalities, which will increase, are those most in need. Need is the thing that the Government do not want to talk about. That is why our new clause 6 seeks to require the Government to take into account both the likely capacity of an authority to benefit from business rate growth and the authority’s level of need.

When the Secretary of State issued all these statements of intent last week, he sought to dismiss the whole concept of need. He talked of grants as a

“system of Government handouts to local authorities”.

He said that this

“encourages a begging bowl mentality, with each council vying to be more deprived than its neighbour.”—[Official Report, 17 May 2012; Vol. 545, c. 39WS.]

I have never heard such an appalling slur on local councils or such an arrogant dismissal of the needs of many of the poorest people in this country, and he should apologise for that. Is he really suggesting that councils are pretending to represent areas that are poorer

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than they actually are, simply to get Government grants? That is nonsense. So why is it that under this Government the needs of people who are out of work, of people who have long-term illnesses and of people in poverty can be treated as if they do not exist? These people do not have loud voices, because most of them are just trying to get by from week to week. They do not share mulled wine and mince pies with the Prime Minister or get invited to dinner at Dorneywood. By contrast, those who pay 50% tax—millionaires, who are apparently squeezed beyond endurance—must be relieved of their burdens.

[Interruption.]

The Under-Secretary of State for Communities and Local Government, the hon. Member for Bromley and Chislehurst (Robert Neill) says that that is a cliché. It is not a cliché; it points out the moral laxity of this Government, who cannot see that treating poor people unfairly while giving handouts to rich people is exactly what most of the country finds wrong.

Andrew Gwynne: My hon. Friend is making precisely the point that needs to be made in these debates, which is that the demands on local services vary widely and that it is often the poorest communities that have the greatest demands. I am very pleased that her proposal recognises children in care, because they are a big issue for local authorities in need. That argument needs to be made in this debate.

Helen Jones: My hon. Friend is right about that, and I shall discuss the number of people in care later. It is important that we recognise that many of the things we are discussing are statutory services, which the local authority has to provide.

Let us examine some of the differences between areas. In Knowsley, whose case was put forcefully in Committee by my right hon. Friend the Member for Knowsley (Mr Howarth), 58,000 people—more than one third—live in areas that are among the top five most deprived in the country. In the north-east, 32.7% of people live in the most deprived 20% of areas. Those are the areas that will struggle as the gap between needs and resources widens. Such authorities are often the same ones that are having to cope with the biggest increases in unemployment. That both reduces the finance available to local councils, because more people are claiming benefit, and increases the demand for their services.

The Secretary of State seems to think that authorities are competing to be the most deprived, so let me ask him something—I would if he were here, but he seems to take these debates so lightly that he has not even bothered to turn up for most of this one. So let me ask this Minister: is unemployment in Birmingham, Ladywood higher or lower than in Henley? In Birmingham, Ladywood, it stands at 11.2%, whereas in Henley it is 1.1%.

Does Middlesbrough have a higher or lower unemployment rate than North East Hampshire? Middlesbrough’s rate is 9.7%, whereas that for North East Hampshire is 1.1%. Is the figure for Liverpool, Walton higher or lower than that for Wokingham? The figure for Liverpool, Walton is 8.5%, whereas that for Wokingham is 1.3%. Does he think that councils are making this up and deliberately causing unemployment to get Government grants? Not even he could get up to argue that. It is not local councils that have caused this recession, yet still we hear from Government Members that councils are “reluctant” to promote economic growth.

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Coming from this Government that is a bit like King Herod accusing someone of child cruelty. Local authorities are still having to cope with the long-term legacy of heavy industry, followed by de-industrialisation.

Stephen Pound (Ealing North) (Lab): I am loth to interrupt my hon. Friend, who is making a powerful and passionate case that I have no doubt will sway even those stern Gradgrinds on the Government Benches. Does she accept that constituencies such as mine have islands of deprivation in a sea of affluence and that we have a post-industrial working class in parts of west London? Is it coincidence that the royal borough of Kensington and Chelsea has the longest life expectancy of anywhere in the United Kingdom, whereas places such as her constituency and mine are at the other end, not through any fault, but because of industrial history? What can be done to address this cruelty?

Helen Jones: My hon. Friend is quite right. In the first place, we could ensure that we address those legacies of ill health and poverty, which create a greater demand for services and mean that fewer people are able to contribute to them. For example, why does Durham council need to spend more on older people than a similarly sized council such as Surrey? It is not because it is profligate, but because it has higher deprivation and ill health, which lead to greater demand for home care services but mean that fewer people are able to finance that care. Fifteen times as many people receive a community service in Durham as in Surrey and two and a half times more receive a home care service. That demonstrates the huge variation in need across the country.

Those levels do not bear any relation to an authority’s ability to generate income. In Surrey, for example, 75% of the properties are in band D or above. Surrey can generate more income from band D council tax than a similarly sized authority, which is a point that was made earlier. Unless those factors are taken into account in any financial settlement, there is a huge risk to services for those in need.

8.30 pm

A similar combination of need and a more difficult local economic situation can be seen in Halton, my neighbouring authority. One in five people in Halton has a limiting long-term illness, yet its ability to benefit from increased economic growth is more limited than that of other authorities for one simple reason: 22.3% of its business property already has an empty rating assessment, and even if it were all brought back into use it would generate little by way of extra income. The same is true of Liverpool and other big cities, where so much spare capacity exists that even if an extra 15,000 jobs were created, they would get no additional business rate income. When the Government insist that councils concentrate on increasing commercial floor space, the problem is that those who have surplus capacity find things increasingly difficult.

Andrew Gwynne: The question of developing local economies also does not take into account the relationship between city regions. Often the drivers for economic growth might be outside a borough’s boundaries, or in a neighbouring local authority to which people will travel for work.

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Helen Jones: My hon. Friend is quite right and that is true in many conurbations, such as Manchester and London, for example.

Let us also consider the need for children’s services. Levels of child poverty, and thus the demand for services, vary hugely between authorities. In Hartlepool, 29% of children are in poverty. In Newcastle, the figure is 27%, as it is in Liverpool. That is 91,000 children. I could not resist looking at that often mentioned authority, Wokingham, where the level of child poverty is 7%. Which area has the most need for services, yet which is benefiting most and is likely to benefit more from this Government’s plans?

Such high levels of child poverty mean a higher demand for children’s services. In Liverpool, for example, 77% of the children in poverty are in single-parent families, meaning there is an even greater need for child care and support for families to help parents go to work, as well as for other support. Children in those areas need better service, not worse, and they need more help. There is no point in the Deputy Prime Minister’s banging on about the need to address inequalities in education unless the Government recognise that to make a real difference those inequalities must be tackled before children get to school.

So, we have places such as Middlesbrough—the hon. Member for St Austell and Newquay (Stephen Gilbert) is shaking his head, but anyone in education knows that to make a real difference to educational attainment we need to tackle the inequalities before the children reach the age of five. By the time they get to school, those inequalities are entrenched and, if he does not think that that is true, I suggest he asks some teachers.

Middlesbrough is the ninth most deprived local authority in England and has seven times as many children receiving free school meals as Wokingham does. It clearly needs greater investment in children’s services. Poverty also drives the number of children being taken into care. We spoke earlier in the passage of the Bill about the huge increase in the number of referrals and children taken into care following the case of baby Peter, but the differences between authorities are stark. There was a 10% increase nationally in safeguarding referrals in the period around 2009-10, but in Liverpool the increase was 60%. Those are the differences that we are dealing with. The same applies to the numbers of looked-after children—children for whom the authority has a legal obligation to be the corporate parent and to provide. It cannot cut those services, it cannot trim them and it cannot decide how great the demand is.

Andrew Gwynne: I ought to declare an interest, as my wife, Councillor Allison Gwynne, is the cabinet member for children’s services in Tameside council. My hon. Friend’s point about children’s services and the cost of those services is absolutely correct, not least because children’s services, particularly for looked-after children, is such a resource-intensive service and cannot easily be cut, nor should it be. It is those councils that often have the least ability to raise business rates that are likely to be penalised the most.

Helen Jones: I could not have put it better than did my hon. Friend. These services are demand-led; they are not within the control of the local authority, and they are, as he said, very expensive to provide, as they

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must be. We are dealing with some extremely damaged and vulnerable children in local authority care. Surrey has 32 looked-after children per 10,000 of population, and Wokingham has 22, compared with 104 per 10,000 in Middlesbrough and 100 per 10,000 in Newcastle. That is a stark example of the differing levels of need in local authorities, and the idea that those services should be left to the vagaries of the market is breathtaking.

My right hon. Friend the Member for Wentworth and Dearne, who is no longer in his place, gave some good examples of how business rates can vary from year to year. It is entirely unpredictable, yet this Government still refuse to recognise those different levels of need within local authorities.

Mr Betts: Am I being a little cynical when I say that the Government have devised a scheme that is now so complicated—top-ups, tariffs, set-asides, then revaluations, and on top of that the fact that only 50% of business rates will be returned to local authorities, and a rate support grant element as well—that when they achieve what they are trying to do, the transfer of money from deprived communities to more affluent communities, it will be virtually impossible to explain to anybody what they have done?

Helen Jones: I do not think my hon. Friend is at all cynical. He is exactly right. The whole point of the Bill, as we have said throughout, is to centralise power and devolve the blame. We saw it earlier when we were debating council tax. We are seeing it now in the Government’s plans for business rates. I believe their aims are simple. They go about it in a complicated way, but the basic aim is very simple: to ensure that whoever gets the blame for cuts in local services, it is not them. It is also to ensure that the voices of those who are most in need are excluded from this debate.

We believe that the views of those people ought to be heard. Let us think about who they are. They are elderly men and women who have contributed all their lives and who are not getting the home care that they need in their old age, or are paying too much. It is a child in a family who may not be well-off but is dependent on local libraries for his or her education. It is the most vulnerable children in need of care and protection. These are the people to whom this Government pay no heed. We have moved the new clause because we do not intend their needs to be forgotten. I urge my hon. Friends to support it in the Lobby. It might help if I indicate that we will press it to a vote.

Pat Glass (North West Durham) (Lab): Perhaps it is a sign of the complexity of the subject and the fact that we have not exactly taken the nation with us that there are so few Members in the Chamber tonight to discuss local government funding. We ought to remember that local government funding underpins local authority services, which support our most vulnerable people—the elderly and the disabled—and that it is women who are the heaviest users of local authority services and who are hardest hit when services are cut or funding is changed. Any changes to local authority funding need to be considered carefully and time must be taken to ensure that all intended and unintended consequences are known before those changes are made, not after, but adequate time and proper consideration are precisely what the Government’s proposals are lacking.

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We heard only this morning that nine of the 10 poorest areas in the country are in the north-west, and the 10th is in the north-east. We know that Government cuts to local authority funding have already led to every person in the average north-west local authority losing £133. Every person in my local authority has lost £70, yet every person in deepest deprived Surrey has gained £2.

Because of the complexities of local government funding, even slight changes in one area often have major impacts elsewhere. We are beginning to see clear evidence that the pupil premium, although well intended, is responsible for a shift in funding from the poorest areas to the most affluent, and from schools with high concentrations of children on free school meals to schools with lower concentrations of those children. The Government have already signalled their intention to shift health funding away from need and deprivation and towards the elderly population. That will have an impact on areas such as mine that have high concentrations of people who, because of our industrial heritage, are in need of health provision and live in deprivation, because the funding will be transferred to areas in the south where the more affluent and the elderly live.

Now the Government propose changing business rates, which will simply carry on their work of siphoning funding from the poorest areas to the most affluent. Those policies on business rates are not new or untried; they were used in the USA in the 1990s and resulted in cities such as Detroit and New Orleans becoming derelict, because everyone who could move out did so and left the cities to the poorest and most vulnerable. The Government’s proposals on business rates take absolutely no account of the ability of individual local authorities to raise rates without the support of the Government.

The Government’s proposals also take no account of geography. Any area that is not within the golden triangle of south-east England, northern France and Germany needs the support of Government infrastructure to attract businesses and business rates. We have heard tonight how, as a result of these proposals, the City of London will see cash growth of almost 140% over four years, yet places such as Liverpool, Knowsley, Bury, Wirral and south Tyneside will see cash growth over the same period of about 20%.

The Government’s proposals take no account of the number of children living in poverty in a local authority or the number in need of local authority care and protection. They take no account of the number of elderly poor, the quality of housing or the number of people living in substandard housing or with chronic ill health. They do not take account of what local authorities need to spend; only of what they can raise.

I am asking the Government to agree to carry out and publish an independent assessment of the needs of different local authorities before deciding how much of their business rate they can keep. Local authority funding formulae are complex and any review must be properly handled and carefully considered. I know that the Government do not do detail, but that is what local authority funding formulae are all about. If they get the detail wrong, they will cause chaos for our most vulnerable people.

I remember that some years ago the previous Government were levering additional funding for schools, but the schools were saying that they were not getting it.

21 May 2012 : Column 936

Treasury civil servants initially pointed the finger at local authorities and said that they were creaming off the money. There was naming and shaming of local authorities, which came out very firmly and screamed that they were not creaming off the money. The civil servants looked again and then pointed the finger at special educational needs, saying that the growth in the SEN sector and its increasing cost was draining money that had been meant for the schools. A proper review found that it was not special educational needs, but a Treasury anorak—

[

Interruption.

]

I am sorry, but Ministers should listen to this, because it is important. It was a Treasury anorak who tweaked the system in one area and caused a Mexican wave in another. Local authority funding is complex. If the Government do not take the time to consider it properly, the most vulnerable people in our society will be the most affected.

8.45 pm

The Parliamentary Under-Secretary of State for Communities and Local Government (Robert Neill): I agree with the point that the hon. Member for North West Durham (Pat Glass) makes: local authority funding is complex. I spent 16 years in a local authority and another eight on the Greater London authority dealing with funding issues, so I say to her gently, because I recognise the sincerity of her point, that the instance to which she refers occurred on the previous Government’s watch. Despite her indication that it was a risk in the system, it was a risk because of the opacity and complication of the funding system and the operation of the formula grant, which this Government inherited and are changing. I understand that there is a problem, but this Government are fixing it.

Mr Betts: Will the Minister give way?

Robert Neill: I am going to make some progress if the hon. Gentleman will forgive me—[ Interruption. ] Very well, I will give way on that point, but I may not again.

Mr Betts: The Minister says that the system is being reformed because of the complications of the current system. The Secretary of State, in his initial statement to the House, said that the Government’s objective was to create a new and simpler system. Does the Minister think that the Government have achieved that objective?

Robert Neill: Compared with formula grant that the Labour Government left behind, yes I do. That view was shared by the Lyons inquiry, which the previous Government very conveniently buried because it did not suit their purposes.

Might I now turn, Mr Deputy Speaker, specifically to the two sets of amendments and new clauses before us? I am sorry that the right hon. Member for Wentworth and Dearne (John Healey) is not in his place, because he made a thoughtful and well considered speech. I had the pleasure of shadowing him for a time and I respect his concern about the matter, so in fairness to his arguments, I will deal with the points he made.

New clause 1 relates to the operation of set-aside and the position of tax increment financing schemes—TIFs. The Government are committed to making TIFs option 2, which is what we are talking about, successful. I am glad to learn that when he was in government the right

21 May 2012 : Column 937

hon. Gentleman was an advocate of TIFs. He was not, unfortunately, able to persuade those further up the governmental pay scale to introduce them, but I do not doubt that he tried hard. This Government are doing what everybody asked and succeeding in introducing them. He is quite right that for TIFs to operate properly there has to be a degree of certainty, but the change he proposes is not necessary because the provisions in the Bill already enable that to happen.

The Government’s intention, as indicated in the White Paper, is that a ring fence exempts TIFs from the calculations of the levy, the set-aside and any reset, and the Bill already permits that. We also intend that, under the system, the additional uplift in rates retained be disregarded when setting tariffs and top-ups, not only in relation to the option 2 TIF scheme, but in respect of enterprise zones. That is why “proportion” is used in the regulations about which the right hon. Gentleman is concerned. The intention for TIFs is 100% ring-fencing, but in relation to enterprise zones, as hon. Members will know, the uplift in rates is retained from a starting point, so there is a proportion. The wording is used simply to cover both types of scheme and to enable both to be ring-fenced.

Mr Raynsford: Given the Minister’s response to the Chair of the Communities and Local Government Committee, my hon. Friend the Member for Sheffield South East (Mr Betts), insisting that the new system is simpler, will he now explain how that mechanism, involving not only the set-aside and the levy but the reset and the differential arrangements in enterprise zones, will work in practice to achieve the objective, which my right hon. Friend the Member for Wentworth and Dearne (John Healey) rightly stressed, of giving investors the certainty that there will be a ring fence?

Robert Neill: I think that the right hon. Gentleman will have to make do with a potted version, given that I have only 10 minutes left and want to deal with other points as well. Suffice it to say that if he casts his eye over paragraph 37(1)(d)(iv) and (vi) of part 10 of new schedule 7B to the Local Government Finance Act 1988 —I know that he will want to do detail as we wish to do detail—he will see that the regulations permit those uplifts to be disregarded.

Those provisions have the same effect as the new clause tabled by the right hon. Member for Wentworth and Dearne would have. The Government have said that it is not our intention to reset the system until 2020, save in exceptional circumstances. I accept that for option 2 TIFs it may well be desirable to have a longer period than that, and the regulations will permit that. Enterprise zones and option 2 TIFs will be disregarded at the reset and could be disregarded for subsequent periods. It will therefore be convenient to align future resets with the revaluation period from 2015 onwards. The system will work perfectly well in practice.

In amendments 62 and 63, the right hon. Member for Wentworth and Dearne fairly recognises that central Government have, and always will have, an interest in public spending. It is unrealistic to think that central Government would not have a macro-economic view on the overall level of control over local government, and

21 May 2012 : Column 938

that is why we could not accept his amendment and constrain ourselves in the way that is intended. However, we have always made it clear that, over time and particularly once we have the public finances back on track, we hope to increase the proportion of business rates that are part of the rates retention scheme. We are starting at 50%, which is a considerable step forward in giving local authorities greater financial autonomy, and the provisions in the Bill allow the figure to be increased if circumstances permit. Equally, however, one has to be realistic and recognise that in an economically difficult world it would be imprudent to presuppose that the central share could be removed altogether. I do not think that any Government would envisage that. It is conceivable that in dire circumstances the share could be increased, but that is certainly not the Government’s intention; we intend to reduce it as soon as economic circumstances permit. It is therefore appropriate to maintain the existing provisions, which enable the alterations in shares between local and central Government to be considered alongside the need to maintain affordability and to protect the interests of the taxpayer and the wider economy. Whatever the proportion, be it 50% or higher, I repeat the assurance that, as is consistent with the 1988 Act, it remains the case that business rates paid to central Government through the central share will be returned to local government through other grants.

On amendment 63, we are alive to the point that the right hon. Member for Wentworth and Dearne makes, and we will take it on board when drafting final regulations. We are conscious of the potential interaction of the incentive with loss of revenue at appeals, and we have said that we will consult further on that during the summer. We have already scheduled meetings between officials and local authority officials. Against that background, I hope that the he will feel able, albeit in absentia, to withdraw his amendment.

Let me turn to new clause 6 and the related proposals from Opposition Front Benchers. I could not help but note a slightly different tone in the debate when we discussed them. I think that earlier the hon. Member for North Durham (Mr Jones) alluded to one-tune records. With respect to the hon. Member for Warrington North (Helen Jones), a one-tune record is still a one-tune record however long you play it, and I am afraid that that is what we heard from the Opposition Front Bench. It is also, I am sorry to say, a rather inaccurate one-tune record, because when one analyses the hon. Lady’s argument, one sees that it is not only a serious indictment of the system that we inherited from the Labour Government but it does not accurately portray what we are seeking to do. It is a serious indictment of the Labour Government’s record because the list of undoubted differences and inequalities between regions in the UK that she set out is in some measure, if she will forgive my saying so, the legacy of the failed, highly centralist policies of the Labour Government. It is pretty scandalous that after 13 years of regional policy and of a highly centralised local government finance system, the inequalities to which she referred exist. That is what Labour left behind.

The coalition has sought to address that legacy, even within the existing system. First, we have increased the weighting given to the needs element of the formula grant, which precisely reflects those issues, from 73% to

21 May 2012 : Column 939

83%—something that no previous Government have done. Secondly, we have introduced transitional grant to deal with authorities in the greatest difficulty.

It is worth bearing in mind that need is built into the calculations in the business rate retention system. Need is part of the calculation of the baseline because the needs element is part of the formula grant, and we have indicated that we will take the 2012-13 formula grant as the baseline. The hon. Lady’s examples of the undoubted cost pressures in social services, child care and so on are, therefore, reflected in the social services element of the formula grant that we have maintained, as well as in the uplift of the needs element that we have maintained. We have placed such authorities in a better position for the starting line.

There are undoubtedly significant and sensitive services that are under pressure. Reference has been made to some of the child care cases that we know about. Those are really tough areas with real cost pressures, but under our system top-tier authorities in two-tier areas, which make up the majority of the authorities that are responsible for adult social care and children’s services, will be designated as top-up authorities. That means that they will be protected from volatility more than any other authorities in the system. They know that their top-up will be fixed for the reset period and index-linked thereafter to the retail prices index. There is particular protection in our system for authorities with the greatest need. The thrust of the Opposition proposals therefore falls at the first point.

We have said that we will share the proceeds and the risks through the 50:50 split between local and central Government. We have said that the baseline will take into account the issues that we have taken on board. We have said that baseline funding will remain fixed and that growth in budgets will be linked to local business rates growth thereafter, but with protections in place. Opposition Front Benchers have shown a schizophrenic attitude to the Bill from start to finish. They have paid lip service to a degree of localism, and they have given examples of over-centralisation that, on analysis, turn out to be the legacy of their own system. They have been in denial throughout about the need to link reform of the local government system with a realistic appraisal of the need to reduce the deficit. They have produced a set of arguments about as dysfunctional as one could find, making them the Simpson family of British politics. We have heard no credible alternatives. They have played the same record time and time again, and they do not have much credibility. I hope that the House will resist the Opposition proposals if they are pressed.

John Healey: Members of another place will study the Minister’s remarks this evening very carefully and return to a number of points. I am grateful to him for his comments about TIF funding, and I was pleased by most, if not all of them. I, too, will study the Hansard record of his comments very carefully indeed. I beg to ask leave to withdraw the clause.

Clause, by leave, withdrawn.

9 pm

Proceedings interrupted (Programme Orders, 10 January and this day ).

The Deputy Speaker put forthwith the Questions necessary for the disposal of the business to be concluded at that time (Standing Order No. 83E).

21 May 2012 : Column 940

New Clause 6

Determination of central and local shares

‘(1) In determining the central share and the local share for any relevant authority, the Secretary of State must have regard to—

(a) the level of need in that authority, and

(b) the likely capacity of the authority to benefit from business rate growth.

(2) Any assessment of the level of need shall include—

(a) the ranking of the local authority in the Index of Multiple Deprivation,

(b) the level of unemployment within the authority’s area,

(c) the proportion of adults within the authority’s area who have a limiting long-term illness,

(d) the number of adults within the area who are in receipt of social care,

(e) the number of looked-after children within the authority, and

(f) the level of child poverty within the authority’s area.

(3) The Secretary of State must lay his assessment before the House at the same time as the Local Government Finance Report.’.—(Helen Jones.)

Brought up, and read the First time.

Question put, That the clause be added to the Bill.

The House divided:

Ayes 202, Noes 275.

Division No. 6]

[9 pm

AYES

Abbott, Ms Diane

Abrahams, Debbie

Ainsworth, rh Mr Bob

Alexander, Heidi

Anderson, Mr David

Ashworth, Jonathan

Austin, Ian

Bailey, Mr Adrian

Bain, Mr William

Banks, Gordon

Barron, rh Mr Kevin

Bayley, Hugh

Beckett, rh Margaret

Benn, rh Hilary

Benton, Mr Joe

Berger, Luciana

Betts, Mr Clive

Blears, rh Hazel

Blenkinsop, Tom

Blomfield, Paul

Blunkett, rh Mr David

Brennan, Kevin

Brown, rh Mr Nicholas

Bryant, Chris

Burnham, rh Andy

Byrne, rh Mr Liam

Campbell, Mr Alan

Campbell, Mr Ronnie

Caton, Martin

Chapman, Mrs Jenny

Clarke, rh Mr Tom

Clwyd, rh Ann

Coffey, Ann

Connarty, Michael

Cooper, Rosie

Corbyn, Jeremy

Crausby, Mr David

Creagh, Mary

Creasy, Stella

Cruddas, Jon

Cunningham, Alex

Cunningham, Mr Jim

Cunningham, Tony

Curran, Margaret

Dakin, Nic

Danczuk, Simon

David, Mr Wayne

Davidson, Mr Ian

De Piero, Gloria

Denham, rh Mr John

Dobson, rh Frank

Docherty, Thomas

Doran, Mr Frank

Dowd, Jim

Doyle, Gemma

Dromey, Jack

Durkan, Mark

Eagle, Ms Angela

Eagle, Maria

Elliott, Julie

Ellman, Mrs Louise

Engel, Natascha

Esterson, Bill

Evans, Chris

Farrelly, Paul

Fitzpatrick, Jim

Flello, Robert

Flynn, Paul

Fovargue, Yvonne

Francis, Dr Hywel

Gardiner, Barry

Gilmore, Sheila

Glass, Pat

Glindon, Mrs Mary

Godsiff, Mr Roger

Goggins, rh Paul

Goodman, Helen

Greatrex, Tom

Green, Kate

Greenwood, Lilian

Griffith, Nia

Gwynne, Andrew

Hain, rh Mr Peter

Hamilton, Fabian

Hanson, rh Mr David

Harman, rh Ms Harriet

Harris, Mr Tom

Havard, Mr Dai

Healey, rh John

Hendrick, Mark

Hepburn, Mr Stephen

Hillier, Meg

Hilling, Julie

Hodge, rh Margaret

Hodgson, Mrs Sharon

Hoey, Kate

Hood, Mr Jim

Hopkins, Kelvin

Howarth, rh Mr George

Hunt, Tristram

Irranca-Davies, Huw

Jackson, Glenda

Jamieson, Cathy

Jarvis, Dan

Johnson, rh Alan

Johnson, Diana

Jones, Graham

Jones, Helen

Jones, Mr Kevan

Kaufman, rh Sir Gerald

Khan, rh Sadiq

Lavery, Ian

Leslie, Chris

Lewis, Mr Ivan

Llwyd, rh Mr Elfyn

Long, Naomi

Love, Mr Andrew

Lucas, Ian

Mactaggart, Fiona

Mahmood, Shabana

Malhotra, Seema

Mann, John

Marsden, Mr Gordon

McCann, Mr Michael

McCarthy, Kerry

McClymont, Gregg

McCrea, Dr William

McDonagh, Siobhain

McDonnell, John

McFadden, rh Mr Pat

McGovern, Jim

McGuire, rh Mrs Anne

McKechin, Ann

McKenzie, Mr Iain

McKinnell, Catherine

Meacher, rh Mr Michael

Mearns, Ian

Michael, rh Alun

Miller, Andrew

Mitchell, Austin

Moon, Mrs Madeleine

Morden, Jessica

Morrice, Graeme

(Livingston)

Morris, Grahame M.

(Easington)

Mudie, Mr George

Munn, Meg

Murphy, rh Paul

Murray, Ian

Nandy, Lisa

Nash, Pamela

O'Donnell, Fiona

Onwurah, Chi

Osborne, Sandra

Owen, Albert

Pearce, Teresa

Perkins, Toby

Phillipson, Bridget

Pound, Stephen

Raynsford, rh Mr Nick

Reed, Mr Jamie

Reynolds, Emma

Reynolds, Jonathan

Riordan, Mrs Linda

Robertson, John

Robinson, Mr Geoffrey

Rotheram, Steve

Roy, Mr Frank

Roy, Lindsay

Ruane, Chris

Ruddock, rh Dame Joan

Sarwar, Anas

Seabeck, Alison

Sharma, Mr Virendra

Sheridan, Jim

Shuker, Gavin

Simpson, David

Skinner, Mr Dennis

Smith, rh Mr Andrew

Smith, Angela

Smith, Nick

Smith, Owen

Spellar, rh Mr John

Straw, rh Mr Jack

Stringer, Graham

Sutcliffe, Mr Gerry

Thomas, Mr Gareth

Timms, rh Stephen

Trickett, Jon

Turner, Karl

Twigg, Derek

Twigg, Stephen

Vaz, rh Keith

Watts, Mr Dave

Williams, Hywel

Williamson, Chris

Wilson, Phil

Winnick, Mr David

Winterton, rh Ms Rosie

Wood, Mike

Woodward, rh Mr Shaun

Wright, David

Wright, Mr Iain

Tellers for the Ayes:

Mr David Hamilton and

Susan Elan Jones

NOES

Adams, Nigel

Afriyie, Adam

Amess, Mr David

Bacon, Mr Richard

Baker, Norman

Baker, Steve

Baldry, Tony

Baldwin, Harriett

Barclay, Stephen

Barwell, Gavin

Beith, rh Sir Alan

Benyon, Richard

Beresford, Sir Paul

Berry, Jake

Bingham, Andrew

Binley, Mr Brian

Birtwistle, Gordon

Blackman, Bob

Blackwood, Nicola

Blunt, Mr Crispin

Boles, Nick

Bone, Mr Peter

Bradley, Karen

Brady, Mr Graham

Bray, Angie

Bridgen, Andrew

Brine, Steve

Brokenshire, James

Bruce, Fiona

Bruce, rh Malcolm

Burley, Mr Aidan

Burns, Conor

Burns, rh Mr Simon

Burrowes, Mr David

Burstow, Paul

Burt, Lorely

Byles, Dan

Campbell, rh Sir Menzies

Carmichael, rh Mr Alistair

Carmichael, Neil

Carswell, Mr Douglas

Cash, Mr William

Chishti, Rehman

Clappison, Mr James

Clark, rh Greg

Clarke, rh Mr Kenneth

Clifton-Brown, Geoffrey

Coffey, Dr Thérèse

Collins, Damian

Colvile, Oliver

Cox, Mr Geoffrey

Crabb, Stephen

Crockart, Mike

Crouch, Tracey

Davey, rh Mr Edward

Davies, David T. C.

(Monmouth)

Davies, Glyn

Davies, Philip

Dinenage, Caroline

Djanogly, Mr Jonathan

Dorrell, rh Mr Stephen

Doyle-Price, Jackie

Duddridge, James

Duncan, rh Mr Alan

Dunne, Mr Philip

Ellis, Michael

Ellison, Jane

Eustice, George

Evans, Graham

Evans, Jonathan

Evennett, Mr David

Fabricant, Michael

Fallon, Michael

Farron, Tim

Featherstone, Lynne

Field, Mark

Foster, rh Mr Don

Fox, rh Dr Liam

Francois, rh Mr Mark

Freeman, George

Freer, Mike

Fuller, Richard

Gale, Sir Roger

Garnier, Mr Edward

Garnier, Mark

Gauke, Mr David

George, Andrew

Gibb, Mr Nick

Gilbert, Stephen

Gillan, rh Mrs Cheryl

Glen, John

Goodwill, Mr Robert

Graham, Richard

Grant, Mrs Helen

Grayling, rh Chris

Greening, rh Justine

Grieve, rh Mr Dominic

Griffiths, Andrew

Gummer, Ben

Gyimah, Mr Sam

Halfon, Robert

Hames, Duncan

Hammond, Stephen

Hancock, Matthew

Harper, Mr Mark

Harrington, Richard

Harris, Rebecca

Hart, Simon

Haselhurst, rh Sir Alan

Heald, Oliver

Heaton-Harris, Chris

Hemming, John

Henderson, Gordon

Herbert, rh Nick

Hinds, Damian

Hoban, Mr Mark

Hollingbery, George

Hollobone, Mr Philip

Horwood, Martin

Howarth, Mr Gerald

Howell, John

Hughes, rh Simon

Huhne, rh Chris

Huppert, Dr Julian

Jackson, Mr Stewart

James, Margot

Javid, Sajid

Jenkin, Mr Bernard

Johnson, Gareth

Johnson, Joseph

Jones, Andrew

Jones, Mr Marcus

Kelly, Chris

Kennedy, rh Mr Charles

Kirby, Simon

Knight, rh Mr Greg

Kwarteng, Kwasi

Laing, Mrs Eleanor

Lamb, Norman

Lancaster, Mark

Latham, Pauline

Leadsom, Andrea

Lee, Jessica

Lee, Dr Phillip

Leech, Mr John

Lefroy, Jeremy

Leigh, Mr Edward

Leslie, Charlotte

Letwin, rh Mr Oliver

Lewis, Brandon

Liddell-Grainger, Mr Ian

Lloyd, Stephen

Lopresti, Jack

Loughton, Tim

Luff, Peter

Macleod, Mary

Main, Mrs Anne

Maude, rh Mr Francis

Maynard, Paul

McCartney, Jason

McCartney, Karl

McIntosh, Miss Anne

McLoughlin, rh Mr Patrick

McPartland, Stephen

Mensch, Louise

Menzies, Mark

Mercer, Patrick

Metcalfe, Stephen

Miller, Maria

Mills, Nigel

Milton, Anne

Mitchell, rh Mr Andrew

Moore, rh Michael

Mordaunt, Penny

Morgan, Nicky

Morris, Anne Marie

Morris, David

Morris, James

Mosley, Stephen

Mowat, David

Mulholland, Greg

Mundell, rh David

Munt, Tessa

Murray, Sheryll

Murrison, Dr Andrew

Neill, Robert

Nokes, Caroline

Norman, Jesse

Nuttall, Mr David

Offord, Mr Matthew

Ollerenshaw, Eric

Opperman, Guy

Ottaway, Richard

Parish, Neil

Patel, Priti

Pawsey, Mark

Penning, Mike

Penrose, John

Perry, Claire

Phillips, Stephen

Pickles, rh Mr Eric

Pincher, Christopher

Poulter, Dr Daniel

Prisk, Mr Mark

Pugh, John

Raab, Mr Dominic

Randall, rh Mr John

Redwood, rh Mr John

Rees-Mogg, Jacob

Reevell, Simon

Reid, Mr Alan

Robathan, rh Mr Andrew

Rogerson, Dan

Rudd, Amber

Russell, Sir Bob

Rutley, David

Sanders, Mr Adrian

Sandys, Laura

Scott, Mr Lee

Shapps, rh Grant

Sharma, Alok

Shelbrooke, Alec

Shepherd, Mr Richard

Simmonds, Mark

Simpson, Mr Keith

Skidmore, Chris

Smith, Miss Chloe

Smith, Henry

Smith, Julian

Smith, Sir Robert

Soames, rh Nicholas

Soubry, Anna

Spelman, rh Mrs Caroline

Spencer, Mr Mark

Stanley, rh Sir John

Stephenson, Andrew

Stevenson, John

Stewart, Bob

Stewart, Iain

Streeter, Mr Gary

Stride, Mel

Stunell, Andrew

Sturdy, Julian

Swales, Ian

Swayne, rh Mr Desmond

Swinson, Jo

Syms, Mr Robert

Teather, Sarah

Thurso, John

Timpson, Mr Edward

Tomlinson, Justin

Truss, Elizabeth

Turner, Mr Andrew

Tyrie, Mr Andrew

Uppal, Paul

Vara, Mr Shailesh

Vickers, Martin

Villiers, rh Mrs Theresa

Walker, Mr Charles

Wallace, Mr Ben

Walter, Mr Robert

Ward, Mr David

Watkinson, Angela

Wharton, James

White, Chris

Wiggin, Bill

Willetts, rh Mr David

Williams, Stephen

Williamson, Gavin

Willott, Jenny

Wilson, Mr Rob

Wollaston, Dr Sarah

Wright, Jeremy

Yeo, Mr Tim

Young, rh Sir George

Tellers for the Noes:

Greg Hands and

Mark Hunter

Question accordingly negatived.