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Lord Redesdale: My Lords, I shall speak extremely briefly. Many points have been raised, especially regarding the issues of which I am well aware in Camden. I shall ask the Minister one question about fees. The fees are now to be set by regulation. We have already discussed the joys of centrally set fees in regard to regulations for public entertainment licences, which will make the system a good deal easier. If fees are to be set by regulation, which groups will be consulted on

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a change in the fee bands at a later date? Does the Minister have a set procedure on groups which should be consulted to discuss whether the fee structure is working?

5 p.m.

Lord Cobbold: My Lords, I speak to Amendment No. 237A which stands in my name and which is grouped with the amendment. It is concerned with the question of fees. It seeks to give an applicant a specific right of appeal against an unreasonable fee. First, I apologise for not being present in Committee, which was due to my being absent from the country. I thank the noble Baroness, Lady Buscombe, for raising the issue on my behalf in Committee. The noble Baroness, Lady Blackstone, said that,

    "fees will be set centrally by the Secretary of State, following consultation. There will be no scope for variation by the licensing authority and, as a result, no need for appeal against them.—[Official Report, 20/1/03; col. 464.]

Clauses 54 and 90 of the Bill state that,

    "regulations may"—

I stress the word "may"—

    "prescribe the amount of the fee".

Amendment No. 122 raises the question whether the provision will be a prescription or guidance as to the fee. It would be difficult, as the noble Baroness, Lady Thornton, said, to set fees centrally for the wide diversity of, in particular perhaps, public entertainment licences.

My questions for the Minister are: is the matter a question of prescription or is it guidance? What is to stop the local authority/licensing authority in any event adding to the fee? In the event of an additional or unacceptable fee, will the applicant be able to appeal?

Lord Brooke of Sutton Mandeville: My Lords, I too am grateful to the noble Baroness, Lady Thornton, for having moved the amendment. She provided some examples in the context of Camden. I shall take the liberty of providing some information in the context of Westminster. I shall do that in particular because—and it is not a secret to the Department for Culture, Media and Sport—Westminster City Council has both this morning and this afternoon been conducting a seminar for local authority officers from all over the country to discuss the Bill and its implications. I say that it is not a secret because the department was invited to be present and to take part in the panel. It is no surprise and no discourtesy on the part of the department that, because of its preoccupation with the business in the Chamber today, it was not able to attend. I mention it in order to demonstrate that the seminar was in no way being conducted behind the Government's back.

I cite the seminar because a local authority officer from Southampton said that he received a telephone call from the department last week, which was the first contact that Southampton City Council had had on the matter, to ask what fees it currently charged. That gave the impression that perhaps the amount of data

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available to the department at this stage in the proceedings is not as far advanced as it might be. I had the privilege of commenting on the parliamentary progress of the Bill. I went out of my way to praise the courtesy with which the Minister and indeed her two colleagues on the Front Bench had treated the House.

I have some figures of a similar nature to those for Camden. They are somewhat larger because of the greater number of premises in Westminster. It is projected that Westminster will have 3,241 liquor licences transferring in the first year and that on average there will be 54 new licences per year during the next 10 years. The base for those figures was supplied by the magistrates' court. They were then applied to a logarithmic equation to project the figures over 10 years from 2004 to 2014.

Based on fees in the DCMS regulatory impact assessment, Westminster's income is estimated to be £7.285 million on a best case basis and £2.293 million on a worse case basis. The anticipated cost to the council of providing the service over 10 years is £27.4 million. The best case scenario therefore envisages a net loss to the council over 10 years of just over £20 million. On a worst case scenario the net loss to the council over 10 years is £25 million. The cost per licence of the council was based on the cost per licence for a public entertainment licence and a night café licence. The logarithmic equation was based on the growth of public entertainment licences and night cafés since 1992. It has been assumed that the rate of growth of liquor licences follows the same trends and timescales.

On personal licences, where the figures are much more modest, it is projected that there will be 454 personal licences created for Westminster in the first year, and that on average there will be seven new licences per year during the following nine years. The percentage of people in Westminster who will require a personal licence is based on the number of street traders living in Westminster applied to the number of new premises that will have a liquor licence.

Based on the figures in the DCMS regulatory impact assessment, Westminster's income is anticipated to be £15,000. The anticipated cost to the council over 10 years will be approaching £60,000. The cost of a personal licence is based on the cost of a door supervisor's licence. Therefore, the net loss to the council over 10 years would be £43,000. The figures in the first category of premises licences—where the best case scenario is of a net loss to the council over 10 years of £20 million and the worse case scenario a net loss to the council over 10 years of £25 million—underlie the anxieties of local authorities up and down the country as to the economic consequences of this new licensing arrangement as regards both their costs and their income. I hope those details may be of some service to your Lordships' House.

Baroness Blackstone: My Lords, we had a constructive debate on the issue of the central setting of fees in Committee when my noble friend was ill. I emphasised then that fees will be set at a level which will allow all licensing authorities to recover the costs

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of administration, enforcement and inspection. Fee levels will be decided following extensive consultation with local authorities and local authority bodies, as well as other stakeholders, and will be set in regulations made by the Secretary of State and made subject to the negative procedure. I hope that that answers the question of the noble Lord, Lord Redesdale. So there will be extensive consultation with everyone involved.

The Government will of course consider whether the fact that some geographical areas have significantly higher overheads relating to labour and accommodation should be reflected in the levels of the fees. Our intention is that fee levels will take into account the size of premises because the costs relating to a large night club could differ from those of a small pub or bar. But fees will allow all licensing authorities to recover their costs and will be structured in such a way to ensure that that is the case.

One answer to my noble friend's question of why the Government want to set fees is the current large variation in both the level of fees and the way they are calculated. Fees differ significantly across the country. Furthermore, some places, on top of a flat fee for public entertainment licences, charge per person above a certain number. Others do not. Some areas increase the fees to premises in town centres and some do not. Some charge a higher fee if the licence is to operate at later hours. All this inconsistency leads to uncertainty and confusion for businesses and others seeking to apply for public entertainment licences.

The Bill seeks to make the licensing process simple, straightforward and transparent. An important means to achieve that is by setting appropriate and fair fees centrally. The principle that fees will be fair and proportionate would be undermined by Amendment No. 237A. I should perhaps add, in response to the noble Lord, Lord Cobbold, that the licensing authority will have no legal powers to impose additional fees.

The House should also appreciate that there is nothing radical in our proposal to set fees centrally. The 155,000 holders of alcohol licences pay fees to the licensing justices that are set centrally by the Lord Chancellor's Department. Similarly, the fees for the 40,000 occasional permissions are set centrally for the 22,000 organisations seeking them each year. The fees for cinema licences are set centrally by statutory instrument. The businesses paying local authority-set fees for public entertainment, theatre and late night refreshment are very much the minority under the existing regimes.

I should tell my noble friend Lady Thornton that, under the new regime, premises licences will not have to be renewed. It is important to avoid drawing direct comparisons between the old system and the new one—they will be very different.

To respond to the noble Lord, Lord Brooke, one must wonder why the figures that he cited have not been passed to my department, despite promises that were made. I certainly do not accept those estimates of the cost of the new system. However, no doubt when

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they are presented for challenge, we shall be able to have a more constructive debate about fair and reasonable fee levels. Given my assurances that fees will be set at a level that will allow all licensing authorities to recover costs, I hope that the amendment will be withdrawn.

I should perhaps add a word about the CIPFA figures. The department's interpretation of the CIPFA figures was incorrect, for which I apologise. That of course means that my assertion that local authorities make a net gain from entertainment licensing was incorrect. That was a genuine mistake. We are updating the regulatory impact assessment but, even taking account of that, our estimate of a premises licence fee in bands between £100 and £500 is still correct.

I do not accept what my noble friend Lady Thornton said: that that requires a complete reinterpretation. The CIPFA figures were not the only justification for setting licensing fees centrally—far from it. We want to institute a national system that does not contain all the awful inconsistencies of the current one, but I reassure my noble friend and others who have spoken that we shall continue to discuss the issues with the Local Government Association as we work on setting precise fee levels.

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