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Baroness Thornton: My Lords, I thank my noble friend for those remarks and her explanation. I am not sure that I am reassured, or that local government will be, but I am pleased to know that discussions are continuing and will continue. I thank noble Lords for their support.

This is not a London conspiracy or just a London concern; there is great concern across the country. It essentially concerns the quality of the scheme. There is no point in having a brand-new scheme if it is under-funded and therefore ineffective. I urge further discussion, but I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Baroness Thornton moved Amendment No. 123:

"(4) If the annual fee is not paid by the prescribed time, the relevant premises licence will lapse on that date.
(5) If a licence lapses under the provisions of subsection (4), the former holder of that licence may for a period of three months, commencing on the date the licence lapsed, seek reinstatement of the licence.
(6) The applicant for reinstatement shall pay to the relevant licensing authority the annual fee together with such reasonable reinstatement fee fixed in advance by that licensing authority.
(7) The premises licence shall be deemed to have been reinstated as soon as the requisite fees have been received by the licensing authority."

The noble Baroness said: My Lords, I shall speak also to Amendment No. 163, which addresses the same issues as Amendment No. 123. They concern the problem of defaulting. My noble friend addressed the issue in Committee, but on reading the Official Report of our debates, I felt that the issue and its

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implications—which are important for how the whole system will operate—were not fully explored and explained.

Currently, the law states that if people do not pay the performance entertainment licence fee before the expiry date of the licence—usually after one year—their entertainment licence lapses until the operator pays the fee. The Government propose that local authorities will effectively be able to chase up the fee—which will be for all licensable activities, not just entertainment licences. That will cause significant problems, which is why new subsections (4), (5) and (6) have been tabled.

First, under the new legislation, the majority of premises licences will run continually until surrendered or revoked. What possible incentive is there, therefore, for operators to pay their ongoing annual fee? The Bill appears to contain no redress or active action that local authorities can take. It is a bit like people saying that they want to defer their car tax for a month or so, because they cannot afford it this month. The principle is exactly the same.

Secondly, there is the issue of the unnecessary time and resource burden on local authorities who will have to chase up the fee. The Bill assumes that local authorities will have the time and resources to chase up fees—a concern to local authorities across England and Wales. In the real world of local authorities' priorities, they will have to choose whether to spend council tax payers' money on subsidising a debt collection service for the licence fee or whether to spend the same money on teachers, books or other things that they may think more important.

The potential impact of a reduction in the cash flow necessary to keep the licensing system running should not be underestimated. Local authority budgets cannot sustain year-on-year under-achievement of income because licensees have no incentive to pay. The result could be an under-funded, inefficient service of benefit to no one—especially not to responsible licensees who pay on time.

In essence, that is the heart of the issue. If 5 per cent of the 1,500 licensed premises in Camden council's area—to cite that example again—do not pay up on time, that amounts to 75 premises. First, they must be identified. Then letters need to be sent to them—which is, perhaps, two full days' work. Then further chasing will be needed. Then the matter will have to be passed on to the finance section for further chasing. If, say, 20 of the 75 still do not pay up, legal fees, bailiffs, debt collectors and possibly court proceedings will be involved. That cannot be a sensible use of our council tax payers' money.

In fact, it is highly likely that the cost to the council of recovering the annual fee from licensees who are slow in paying will be equal to, if not significantly more, than the value of fee. That will be in addition to the extra costs and resources that local authorities will have to find to process the initial increase in applications. I beg to move.

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5.15 p.m.

Lord Skelmersdale: My Lords, I have sympathy with the amendment moved by the noble Baroness, Lady Thornton, but I observe that paragraph 8 of the draft guidance to local authorities includes a large section—which does not spring immediately to mind—regarding conditions attached to premises licences. As the noble Baroness said, the payment of fees is vital to the proper administration of the scheme by local authorities. I cannot see any reason why a condition should not be attached to the licence specifying that fees must be paid annually on whatever date is necessary—presumably, the anniversary of the application for the licence, but that may not be so. I ask the Minister: is such a provision in mind under the conditions that attach to premises licences?

Lord Redesdale: My Lords, we also support the amendment. I had assumed that a premises licence included a public entertainment licence, so that the two would not be divorced. However, if regulations are to be set, will the provisions be added to them, or do they need to be in the Bill?

Baroness Blackstone: My Lords, the conditions in these amendments would make the penalty for late or non-payment of the annual fee a suspension of the premises licence or club premises certificate. As I said when the amendments were discussed in Committee, the approach is disproportionate. I cannot agree with my noble friend.

She is being unduly pessimistic in her assumption about non-payment also. So far as I understand it, there is not a serious problem of non-payment of fees for entertainment licences, for which local authorities are currently responsible. I see no reason why there should be problems with fee payment for alcohol licences either. Any unpaid fees will be recoverable as debts. Local authorities already have powers to recover debts. But the actions proposed by these amendments in cases of non-payment or late payment of fees could threaten the livelihoods of many people, not just premises licence-holders. I agree entirely that fees should be paid, and that that should happen on time. I am sure that local authorities will encourage licence-holders to do just that. But late or non-payment of fees could be the result of something as simple as administrative oversight, and one reminder could produce the fee. In such cases, suspending a licence is not an appropriate or proportionate sanction.

The noble Lord, Lord Skelmersdale, asked whether a condition about the payment of the fee would be attached to the licence. Such a condition does not relate to the licensing objectives, so it would not be appropriate to attach it to the licence. Payment of the fee is a matter of law and is legally enforceable. I suppose that it would be perfectly feasible to include a provision about fee payment in the regulations, but I do not think that the Government intend to do so at present.

Lord Brooke of Sutton Mandeville: My Lords, before the Minister sits down, my understanding is

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that, at present, a public entertainment licence lapses if the fee is not paid. Without a penalty, there is no incentive to pay. Is the Minister saying that the Government regard past practice as totally unsatisfactory and unfair, when it has worked perfectly satisfactorily? Because there is a penalty, licence-holders have made sure that they pay the fee on time.

Baroness Blackstone: My Lords, I am extremely sorry; if the noble Lord is right, I stand corrected. I was not aware that the present system of entertainment licensing involved the immediate suspension of a licence if the fee was paid late, or if there was a delay in passing the fee to the local authority. If I am wrong, I shall let the noble Lord know and place a letter in the Library.

Baroness Thornton: My Lords, I thank the Minister for her answer and other noble Lords for their support. The point made by the noble Lord, Lord Brooke of Sutton-Mandeville, was my precise reason for moving this amendment. I understand that the licence lapses if the fee is not paid. It is a jolly good way of making sure that people pay their fees on time. The approach works well, so it seems sensible to extend it to the whole licensing system.

I shall withdraw the amendment. But I ask the Minister to look again at the matter, which we can perhaps discuss at some other time. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Baroness Buscombe moved Amendment No. 124:

    Page 32, line 19, at end insert—

"( ) In regulations made under this section, the Secretary of State shall prescribe a nil fee to certain categories of premises which shall include—
(a) church halls,
(b) village halls,
(c) parish halls,
(d) community centres, and
(e) similar community buildings."

The noble Baroness said: My Lords, this important amendment would result in nil fees for certain categories of premises. We considered it following an extensive and fruitful debate in Committee. The amendment is straightforward and self-explanatory. We moved a similar amendment in Committee in respect of which we argued that the financial burden of a full premises licence on community and parish halls would be potentially crippling and stifle the use of such buildings for local events.

The Bill has raised a multitude of fears among non-profit-making organisations. Notwithstanding full debate and full responses by Ministers at previous stages, particularly in Committee, we are still receiving a significant amount of lobbying from all kinds of organisations—particularly non-profit-making bodies—that remain deeply concerned about several aspects of the Bill.

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I am pleased to say that Amendment No. 124 is tabled in response to encouraging noises made by the noble Baroness, Lady Blackstone, in Committee. She set out to clarify the position on the setting of fees in regulations, saying:

    "The Bill provides for the Secretary of State to set a reduced or, indeed, nil fee for categories of premises in the regulations. We are looking at the position of all the premises types covered by the amendment, with a view to trying to minimise the financial burden so far as we can. That may well involve waiving the fee altogether, although various issues obviously need to be considered".—[Official Report, 16/1/03; col. 357.]

In the light of that positive response, I hope that we may be assured on the issue by the inclusion of details in the Bill. The Government clearly agree with our point in principle. Although the rest of the fees may be decided by regulation, such exemptions for premises hosting a range of community events would allay the fears of many small-scale, non-profit-making venues. We are clear in our amendment. We are looking simply at church halls, village halls, parish halls, community centres and similar community buildings. This is an occasion where something should be set in stone in the Bill rather than in regulations. We all know what happens with regulations in practice. They can be changed, but obviously there can be debate.

This issue affects so many people, particularly volunteers, who are not out to make a profit but simply to do all that they can to support their local community. Over the years we know that that will become increasingly difficult for communities. In that case, we believe that it would serve the Government well if they accepted this amendment and made clear in the Bill that there should be no fee for activities in those premises. I beg to move.

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