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Lord Jenkin of Roding: That has somewhat taken me by surprise. I hope that the noble Baroness will not take it amiss if I say that we have had, as it were, a mini-Second Reading speech at the beginning of this Committee stage. The noble Baroness raised several points of considerable importance. We shall need to bear that in mind. We must deal with the amendments before us at Committee stage now, but at later stages of the Bill, we shall need to see to what extent we can take account of those important points.

The noble Baroness, on advice, seems to have arrived at a clear position on whether the charges made by a BID company are taxation and whether the expenditure is to be regarded as public expenditure. That has wide ramifications. There are

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many forms of partnership arrangement. If that doctrine is to be extended more widely, there may be some anxiety about the future of other schemes.

I read the consultation paper with some interest. No doubt in due course we shall have an opportunity to discuss that and other local government consultation papers foreshadowed in it. One point struck me. The published paper, Local Democracy and Community Leadership, gives notice that,

    "the Government intend to replace section 111 of the Local Government Act 1972 due to concern over 'ultra vires' which may inhibit partnership activities including participation in companies".

It seems to me that we are in danger of getting two messages: one that the Government actually want to give encouragement--indeed, I welcome the opening remarks of the noble Baroness--while at the same time there appear to be new restrictions, or at least a clarification, that contrary to the view I expressed at Second Reading, to which the noble Baroness made reference, such activity may become more difficult as it will have to come firmly within the system of public expenditure control and charges amounting to taxation. We shall need to examine the noble Baroness's remarks with some care.

The question of auditing and so on can be dealt with effectively by further amendments at a later stage although, once again, it would have been helpful to have heard comments at an earlier stage of the Bill. One could have taken account of them and there would have been more than one opportunity to get the drafting right.

The general tenor of the noble Baroness's remarks was one of welcome. She indicated that she is looking forward to the discussion; we can all approach it in that sense.

As for this amendment, we will examine the drafting in regard to this matter. However, I hope that the House will be able to accept Amendment No. 1 now, and, when we come to it, Amendment No. 28. Then, if necessary, we can examine the matter again between now and Report to make sure we get the drafting right.

On Question, amendment agreed to.

Clause 1, as amended, agreed to.

Clause 2 [Application for election order]:

Lord Jenkin of Roding moved Amendment No. 2:

Page 2, line 14, at end insert--
("( ) state whether a financial contribution or other assistance is anticipated from the local authority and if so, the extent of that contribution or the nature of the assistance;").

The noble Lord said: It would be helpful to discuss Amendment No. 9 with this amendment. Their purpose is to make absolutely clear that a BID scheme can include a partnership with a local authority. When the Bill was originally drafted we had assumed that that would be possible. However, this pair of amendments puts the matter beyond doubt. The reasons for wanting to make it clear are that a number of local authorities would very much like to feel that they are part of a BID scheme and, secondly, that although it would be possible under the Bill for a business improvement district to be initiated from scratch it is much more probable that a BID will develop from existing collaborative

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arrangements. At Second Reading I gave a number of examples. Since then, I have heard of a good many others which are currently operating and where those working them would welcome the provision which is the central purpose of this Bill to avoid the problem of free riders.

Many of these arrangements involve local authorities. It is not the Bill's intention that the process of partnership between the public and private sectors should be in any way discouraged. I have always been very strongly in favour of that partnership and the Bill is intended to reflect that. These two amendments put the point beyond doubt. I beg to move.

Baroness Hamwee: The noble Lord introduces these two amendments with a reference to partnership with local authorities. The obverse of that coin is the question of additionality, referred to by a number of noble Lords at Second Reading. In other words, BID schemes should not replace the projects that are properly a matter for the local authority. As I read these amendments, that point does not seem to be affected either way. However, if the noble Lord could confirm that, I should be grateful.

12.15 p.m.

Lord Jenkin of Roding: Perhaps I may respond to the noble Baroness. The amendment is certainly in no way intended to change the intention of the Bill that the expenditure by a BID should be additional to that which a local authority is undertaking. It may well be that local authorities would welcome sub-contracting some of their services to a BID company. We shall come to that provision in a later amendment. One can imagine, for instance, that it would be very awkward if one had two different groups of street cleaners, one working for the local authority and the other topping up the work, as it were, by the BID. The sensible course would be for the BID to contract with the local authority and then contract under the contracting out procedures for its share of that to be done by the BID, and of course paying for it.

The additionality point is important. I am aware of anxieties expressed by some ratepayers. I wish to state clearly that it is the intention of the Bill that the expenditure by a BID should be additional.

Baroness Farrington of Ribbleton: The Bill requires applicants to prepare a detailed package of information to be submitted to the local authority. That will be of great assistance to the authority in deciding whether it would be appropriate to issue an election order. The purpose of Amendments Nos. 2 and 9 is to ensure that as part of that process a local authority can take account of the role that it might want, or be expected, to play. We recognise that a local authority may wish to assist a BID company. I am pleased that these amendments make any contribution that is anticipated from a local authority explicit from the outset, so that local taxpayers' money is accountable.

On Question, amendment agreed to.

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Clause 2, as amended, agreed to.

Clause 3 [Consideration of application]:

Lord Jenkin of Roding moved Amendment No. 3:

Page 2, line 33, leave out subsection (1) and insert--
("(1) In considering a draft scheme a local authority shall have regard to such representations as may be made by--
(a) any ratepayer in respect of a hereditament within the area specified in the draft scheme;
(b) any other person in respect of such a hereditament, being a person having an interest in that hereditament in any capacity;
(c) any person who is either resident within the area specified in the draft scheme, or is not so resident but is affected by the improvements which are proposed by it.").

The noble Lord said: It will be within the recollection of noble Lords that at Second Reading a good deal was said about the need for wide consultation on a proposed BID and that the local authority which has to make the decision as to whether to make an order for an election must take account of a wide measure of representations. I gave an indication on that occasion that ordinary residential council tax payers would clearly have an interest in the establishment of a BID if it was to cover the area where they lived or even where they were accustomed to doing their shopping and so on. I quoted the example of the Fitzrovia proposals for the area between Oxford Street and Euston Road in London. Others have said that their views should be taken into account. One such group is obviously the owners of buildings. The charges, indeed the whole provision, are based on occupiers, who in many cases will be tenants. But the owners of buildings may well have views which they want to put. Amendment No. 3 therefore includes the reference in paragraph (b):

    "being a person having an interest in that hereditament in any capacity".

There may well also be ratepayers, paying the national non-domestic rate or whatever may take its place, who, though not liable to pay under the scheme because it may be proposed that they be exempted or excluded under the provisions of the Bill, may nevertheless have a view. All those people are entitled to be heard. This amendment ensures that the local authority shall have regard to such representation. It will have to listen to them and take them into account. The amendment therefore meets the anxieties expressed from all parts of the House at Second Reading. I beg to move.

Baroness Farrington of Ribbleton: Amendment No. 3 recognises that the establishment of the BID may impact upon parties other than those listed on the draft bid charge list. I fully support the principle of ensuring that consideration is given to representations received in response to a draft scheme.

However, it is important that in making representations interested parties have access to the relevant information. It is not clear from the Bill what information would be made available to those parties. At present Clause 2(5)(a) requires that the application is advertised in a local newspaper in the area to which the application applies. However, there is no indication given to the applicant as to what information should be incorporated within the advertisement. I am sure that the

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noble Lord, Lord Jenkin of Roding, will wish to consider whether further provision could be included to address this issue.

The amendment to Clause 3 will extend the scope of representations to enable persons from outside the area but with an interest in it--for example, those working in shops or offices--to submit their views on the scheme. In view of this, the Committee may wish to consider whether there is a need to advertise the BID application outside the area to which the application relates.

Finally, as representations will be taken into account in the local authority's consideration of the application, Members of the Committee may wish to give thought to whether such representations should be made available to the BID applicant.

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