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The noble Baroness said: My Lords, I shall speak also to Amendments Nos. 19, 20, 21 and 28.

Amendment No. 17 would add a test of reasonableness into the provisions that would empower local authorities to impose extra charges on licensed businesses that fall within an alcohol disorder zone. The drafting in Clause 12 regarding alcohol disorder zones contains a fundamental flaw, as there is nothing in the scheme in its current form to prevent a local authority imposing blanket charges on licensed premises and clubs in an alcohol disorder zone regardless of the degree to which the premises contribute to the disorder. In our view, that is far too arbitrary, and is potentially extremely unfair to those businesses that, for example, close well before the usual times when alcohol-fuelled disorder may take place. The amendment we propose would impose a requirement on the local authority that it must be satisfied it is reasonable to impose charges on particular clubs or people. This provides a safeguard for individual businesses that are entirely innocent of contributing to or causing alcohol-related crime.

4.15 pm

In Committee the Minister objected to this on the basis that we would be placing an undue burden on the local authority. We disagree. Although of course we acknowledge that establishing a causative link between individuals misbehaving due to excessive drink and specific licensed premises might not be straightforward, it is not unduly problematic, and we have sought to reduce the burden on the local authority by setting the test as one of reasonableness. A test is entirely straightforward and sensible.

The issue is essentially one of fairness. Why should a corner shop or convenience store that closes at six o’clock in the evening pay for the late-night problems caused by a few irresponsible licence holders? We on these Benches acknowledge that some licensed premises encourage irresponsible drinking; for example, by free-drink promotions and so-called happy hours, and by serving individuals who are already drunk. There are a few—not many, one hopes, and reducing in numbers. It is entirely reasonable that such irresponsible establishments should be penalised. The main concern of the bodies

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representing the licensed trade is that there should be a link between paying any charge and being responsible for the alcohol-fuelled trouble, and that is what my amendment seeks to address.

The Minister’s response to the debate in Committee gave more cause for concern. He stated that he thought it would be,

We simply cannot agree to that broad assumption. It means that even those premises that conduct themselves impeccably could be caught by the penalty of a charge, and that would be a disproportionate way for the Government to behave.

I noticed that later, on a different day in Committee, the Minister appeared to take a different tack. I tabled an amendment to probe how the Government would expect the boundaries of ADZs to be drawn and clearly identified. In response, the Minister gave an example that looked similar to the one he had given on 26 April, but which could lead to a significant and far more helpful interpretation of the way charges would be imposed. He said:

If that second reply is the correct interpretation of the Government’s intention in bringing forward these measures, we would certainly be on the same wavelength. The problem is that the Bill does not make that causal link clear in its terminology.

I shall move on to what is effectively the second set of amendments in the group; I proposed that I should take this large group together, because, as I said in opening this afternoon, it is one of the areas where significant progress has been made in discussions with the Government over the summer. It was therefore very much the wish of the British Retail Consortium and the Wine and Spirit Trade Association that I should put on record in full our concerns, and then enable the Government to give what we hope may be a satisfactory response.

The effect of the remainder of the amendments in this group would be to ensure that the two types of licensed premises set out in Clause 15(6)(a) and (b) would be exempt from any charges imposed by virtue of the clause. The first type would be those premises whose principal use did not involve the sale of alcohol, and the second would be those premises where the availability of alcohol is not the main purpose for which individuals enter them. The Minister gave an assurance in Committee, at col. 236 on 26 April, that the exemptions in Clause 15(6) would be included in regulations. I said that I would consult the British Retail Consortium and the Wine and Spirit Trade Association to see whether that was sufficient to satisfy them. I met them during the Summer Recess. They reported that they remained concerned that the Government had not put clearly on record their intentions regarding, first, exemptions; secondly, how the charges would be applied to businesses of different sizes, hours of

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opening and management practice; and thirdly, discounts, and whether in any circumstances a business might receive a 100 per cent discount where it had behaved appropriately.

Since we debated this matter in Committee, I have also been contacted by the public affairs manager of Boots plc. He states that Boots is very concerned that the decision on ADZs will be left to regulation. He makes the understandable point that companies such as Boots need clarification that they will be exempt. Will the Minister say today whether the Government’s view is that Boots, and companies that operate in a like manner, will be exempt from charges?

Like me, noble Lords may be a little surprised that Boots considered that it might come within the rules governing ADZs. But it was pointed out to me that there is some sale of alcoholic beverages as part of gift sets, particularly in the five months running up to Christmas. We are in that period now and I saw such sets on the shelves in my local Boots last week. For the rest of the year Boots does not sell alcohol. Alcohol sales equate to just 0.1 per cent of Boots’s turnover per annum, but it already pays more for licences than purely alcohol-based retailers, such as small off-licences, due to the fact that the cost of the licence is based not on how much alcohol you sell but on the size of the licensed area. As Mr Sheppard, representing Boots, points out, that is taken to be the whole of the Boots store. I understand that Boots has about 400 stores with licences. Obviously, it is important to know whether the Government intend that businesses such as Boots should be caught up in the ADZ charging system.

I have covered the matter in detail as I hope that the Minister’s response will be such that we may not need to return to the matter at Third Reading. I await that response with anticipation. I beg to move.

Lord Graham of Edmonton: My Lords, I am pleased at the length and depth with which the noble Baroness put forward her case and at her account of the history of the matter. I declare an interest as the president of the all-party group on the retail trade. No doubt I have received the same brief as the noble Baroness from the BRC.

It is not just a question of a burden on industry but the unfairness of being tarred with the same brush. On all sides of the House there is general acceptance that something must be done about the matter. Whether this weapon, which is to be used by local and national government, is the appropriate one remains to be seen. However, the briefing that I received indicates that the relevant people are smarting at the unfairness of legislation not differentiating clearly between responsible and irresponsible retailers.

I discussed the subject of this debate with some people over lunch and we mentioned Enfield. The situation that this Bill is meant to deal with occurs from time to time in Enfield. But how do you demarcate the area within which premises will be subject to charges? It is not easy. The Minister referred to the difficulty of placing the burden on local authorities to define those areas more precisely,

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but that is a burden on local authorities. The retail trade has an honourable place in the economy. It is entitled to try to ensure that imposts placed on it are proper and reasonable.

The noble Baroness referred to the discussions that have taken place. I took particular note that a lot of the trouble was caused by the Minister’s remarks on 26 April:

That is a questionable assumption. How can that be? This is the stage when better counsels and experience prevail. The people who have pleaded their case with the Minister are sensible, responsible retailers, who obviously want the best that they can get, but they are not shirking their problems. There are a number of ways in which the Government rely on retailers to police actions that the Government bring forward and which they commend. It will not help relationships between the retail industry and the Government if what is manifestly unfair treatment is let to go ahead without alteration. I am very grateful indeed that the noble Baroness has set the scene.

Lord Thomas of Gresford: My Lords, I follow the noble Lord, Lord Graham of Edmonton, in referring to unfairness. That is, critically, at the base of the problem that the noble Baroness, Lady Anelay, has outlined. The purpose of the alcohol disorder zones is to spread any increased charge for policing a particular area among the licensed premises in that area. That is not right. It may be that a particular set of premises does not contribute in any way to the disorder that is taking place. As the noble Lord, Lord Graham, said, very responsible retailers may be called on to pay for the sins of others. That is fundamentally unjust and contrary to the spirit of the common law of this country. We on these Benches will wholly support the noble Baroness in whatever decision she makes on the amendment.

Lord Bassam of Brighton: My Lords, I am, as ever, grateful to the noble Baroness, Lady Anelay, for giving me an opportunity to clarify some of my comments from an earlier stage in the Bill, which have been interpreted in a way that suggests that we want to put in place a scheme that would operate unfairly; clearly we do not. We want something that is workable and which everyone feels comfortable and confident in supporting. I hope that what I say on the amendments can offer some reassurance, and I am sure that it will.

Amendment No. 17 would oblige local authorities to determine whether individual pubs and clubs had directly contributed to alcohol-related crime and disorder before including them in the scope of the alcohol disorder zone charge. That would, in effect, mean that the local authority would have to establish a clear link to the particular pubs, clubs and off-licences that inebriated offenders had patronised. When the amendment was debated in Committee, I said that I believed that it was, in general terms, unworkable, and I remain of that view.

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As we recognised in Committee, there is a tension with alcohol disorder zones. They will inevitably include some responsible operators. That has been the theme of much of our discussion with the trade associations representing both the off-licence and on-licence operators. I concede willingly that their concern is understandable, particularly at a time when the trade is taking big steps to raise operating standards, which we welcome. We welcome the expressions of concern by the trade associations, which have helpfully been given full voice on all sides of the Chamber this afternoon.

I offer the House assurances about the way in which the provision will be used. First, as I made clear, ADZs will be there as a last resort, to secure collective responsibility for alcohol-related crime and disorder in a locality when all other measures have failed. That action must include using the full force of the provisions in the Licensing Act 2003. Where evidence reveals a few clearly identifiable problem premises, local authorities and the police should not reach for an ADZ; the Licensing Act should be used. Alcohol disorder zones become an option where this and other interventions have been tried and there is still a more general problem. ADZs cannot and will not become a routine intervention. I believe that our work on alcohol disorder zones with representatives from local authorities and the police bears this out. As ADZs will not become a routine intervention, I can inform the House that we will review their operation two years following their implementation. The review will be undertaken earlier, if necessary—for example, if we find that their use escalates out of control, which we will take action to rectify.

4.30 pm

In relation to charging premises, we recognise that not all premises should pay the same. We propose a national charging framework that will be structured and calibrated so that account will be taken of the risk that individual premises pose. This will be linked to the level of service that they receive and the amount that they pay. For example, a small pub on the corner closing at 11 pm will pay much less than a large bar closing at 3 am. I accept that that does not precisely address what the noble Lords are seeking in their amendment, but constructing the charge in this way will allow us to gear both the charge and the service received to reflect the different nature of licensed premises. There will not be a flat-rate charge for all.

Opposition Amendments Nos. 19, 20, 21 and 28 deal with exemptions. Clause 15(6) provides for the only exemptions from the ADZ charge that can be granted. Premises must pass both a principal use test and a patronage test to qualify for an exemption. The amendments would provide for more exemptions through regulations, and premises might not necessarily have to pass more than one test to claim the exemption. Alcohol disorder zones are intended to encourage licensees within the designated locality to work together to reduce alcohol-related crimeand disorder. We recognise that there should be

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exemptions from the charge. The intention ofClause 15(6) is to provide a sensible basis for decisions to be made around both use of the premises and their patronage. We need to go no further than that.

Perhaps I may give an illustration of how we expect the exemptions to work in practice. We have made it clear that our policy intention is for restaurants and hotels to be exempt from the charge and we have assured the British Hospitality Association on that count. The Bill also provides for discounts to be granted on the charge. I can inform the House that when we ask Parliament toconsider regulations, we will propose discounts of up to 100 per cent of the charge in certain circumstances. Local authorities will have to establish a time for ADZ services to commence, which would need to be evidence-based in relation to when crime and disorder occurred. Premises that closed before that would receive a 100 per cent discount. I believe that that addresses the points raised by stakeholders, including the Wine and Spirit Trade Association, which was concerned that premises might pay for services that were delivered after they closed and for which no direct benefit was received.

That also addresses some of the points made by the noble Lord, Lord Thomas of Gresford, in Committee and by the noble Lord, Lord Graham of Edmonton. No doubt there could be an interesting debate on whether a 100 per cent discount is an exemption, but I am sure that noble Lords will not be too disappointed if I fail to enter that semantic discussion.

Through the discounting arrangements, we will be seeking to deliver on some of the issues that lie behind the amendments. I am sure that the noble Baroness will recognise much of what I have said from discussions that she has had with Tony McNulty, the Minister of State at the Home Office. He also wrote to her on 11 October detailing these and other matters. I have placed a copy of that letter in the Library of the House so that all noble Lords can have sight of it.

The noble Baroness also raised a point about Boots the chemist, which I understand perfectly well. In fact, I have a horrible feeling that at some stage some years ago I may even have purchased one of those glorious packs to which she referred. I probably bought it as a present that no one wanted to receive.

In the context of exemptions, it was mentioned that the noble Baroness had been approached by Boots the chemist, which was concerned that it might be subject to charging in an ADZ. As she explained, Boots sells alcoholic gifts at Christmas. As the correspondence points out, the noble Baroness can be assured that local authorities will make decisions on exemptions on a case-by-case basis. I place on record our view that it is extremely unlikely that Boots will be caught by the charge simply because it sells seasonal gifts. On the basis of its business model, I cannot see that the sale of alcohol is the principal use to which its premises are put or that its patronage is focused mostly on the sale of alcohol. That assurance is given in correspondence and it is one that I am

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happy to repeat from the Dispatch Box because I think that it might help our deliberations and assist noble Lords who may be contemplating pushing the amendment to a vote. I hope that the amendment will be withdrawn.

Lord Waddington: My Lords, if I heard the Minister aright, I think that he said that the Government would take action if use of the power escalated out of control. But should we be granting a power that the Government think might escalate out of control?

Lord Bassam of Brighton: My Lords, I suppose that that question could be posed in relation to any new power that any Government ever took at any time. The commitment makes very clear, and I have put it clearly on the record this afternoon, that we would be very surprised if we thought that local authorities and the police working together werenot using the ADZ regime appropriately and proportionately in the circumstances and not using it as an instrument of last resort, all else having failed. In those circumstances, not only would a review be brought forward but it would have to be conducted at some speed. That is not the intention of the legislation and I want to make that absolutely clear. I hope that that reassures the noble Lord, Lord Waddington.

Baroness Anelay of St Johns: My Lords, my noble friend Lord Waddington went to the heart of my concerns when I first tabled these amendments. As the Minister knows, I was worried that we were coming forward with a package of provisions that local authorities in some areas might be tempted to see as a way of obtaining extra income and that therefore they might go through this procedure. The British Retail Consortium and the licensed trade had similar concerns.

I appreciate that over the past months the Government have been trying to say that the process by which an ADZ may be designated and maintained is so carefully drawn and convoluted that it would not be an easy option for a local authority to take. The Government are trying to get the balance right and to assure me that the review will take place after two years. The fact that they have recognised that it may have to take place before two years shows that, even in government, it is recognised that some areas might adopt ADZs too easily. I hope that that is not the case, because we all want some kind of provision that assists local authorities to obtain better policing for their communities on these matters, particularly in the middle of the night. Although I accept the Minister's assurances today, overall I still have niggling concerns about whether ADZs will be used more frequently than they should be, and I am grateful to my noble friend Lord Waddington for raising that issue.

I am grateful for the support from the noble Lords, Lord Graham of Edmonton and Lord Thomas of Gresford, who again spoke on the core issue of

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fairness. We were all trying to address that. As the noble Lord, Lord Graham of Edmonton, said, the retail trade has an honourable place in our economy—I thought that that was a very appropriate quotation from him.

After I received the letter from the Government last Thursday, I ensured that the licensed traders were able to see that letter—the Government forwarded it to them by e-mail. They were able to consider it and their view was that, if the Minister fairly put on the record those assurances, that would be sufficient for them. The Minister says that the letter is in the Library, and it is always helpful for the public to know that, but an assurance at the Dispatch Box gives the retail trade that added assurance and provides a guarantee that things may happen in the way it hopes.

On whether there is an exemption or a discount, I do not believe that the retail trade is concerned under which head it falls, as long as responsible traders are not caned by having extra taxes for events to which they have made no contribution. The commitments given by the Minister today make it possible for me not to press this group of amendments and I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Thomas of Gresford moved AmendmentNo. 18:

“(c) must require a local authority to ensure that the level of charges which they impose acts as an encouragement to local action and not as a hindrance to the viability of local businesses.”
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