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Baroness Hanham: Can the Minister confirm what David Miliband said in the other place: that, with the postponement of revaluation, it was extremely unlikely that any valuation would take place before the next election?

Baroness Andrews: We think it very unlikely that there will be a revaluation in the lifetime of this Parliament.

A specific question raised on the back of the amendment was why the Secretary of State has this power. The options for the Secretary of State having this power are limited, if not non-existent. He is, after all, the person who must take a decision beyond politics which is in the interests of the country. But he would not do so with an in any sense unfettered power. The House of Commons will be able to scrutinise the decision. An instrument will be laid under the affirmative resolution procedure which, as with any other instrument, can be challenged in the House of Commons.

Lord Hanningfield: Why was that not done before? In the last piece of legislation, a date was named, which was obviously cancelled in the end. We support this part of legislation cancelling the revaluation because it is obviously necessary.

Why do these pieces of legislation have to be in the Bill now? Why can we not all wait for Sir Michael Lyons's report before we continue? There will probably have to be legislation to implement the recommendations of Sir Michael's report, so why can we not have a short Bill cancelling the current revaluation and leave the rest until we are ready for it? We do not understand that. There are few amendments on the Bill but they all question why the Government are doing this now rather than waiting for Sir Michael Lyons's report.

Baroness Andrews: It is important that I make myself clear. Because of the timetable of revaluation—the way in which dates are set and brought forward—it was important to ensure that it was stopped at the point at which we would not only be saving money but also introducing clarity and certainty into the process. Making clear that we will wait for Sir Michael, with an extended remit running to the end of this year, is common sense—and administrative common sense at that.

Both the 1992 and 1999 Acts have always provided for changes to be made by affirmative powers. Not being completely familiar with the history of that legislation, if I have missed another point I am sure my officials will put me right and I will write to the noble
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Lord about that. It would certainly be misleading to suggest that the Secretary of State was beyond the scrutiny of the House of Commons. On the powers that we are providing, he is certainly not.

The noble Lord, Lord Hanningfield, asked me how soon after Sir Michael Lyons's report we could expect a revaluation. The answer is that we do not know. Sir Michael may come forward with radical proposals, but we do not know that either. It would be absurd for us to fix a timetable at this point without knowing exactly what the scope of the changes might be.

The noble Baroness, Lady Hanham, asked me a related question about whether any changes in the structure of local government would affect plans for valuation. We have taken absolutely no decisions on restructuring local government. There is an active debate, as the noble Baroness will know, and clearly our decision on revaluation will be affected by a number of different factors which are not predictable at the moment. The important thing is that we must be clear about what we are doing. That is why we are sharing the information that we have, making the Lyons committee as open as possible and being clear in the Bill that revaluation is postponed and not cancelled. But predicting how and when we can do this is very difficult for us to do at the moment.

The questions that the noble Baroness, Lady Scott, raised—the noble Baroness, Lady Hanham, picked up on this point as well—were to do with timetables for valuation and the impact on the valuation office itself. I now know a little more about how the valuation office works and I am extremely impressed by just what has been achieved in the timetable to date, both in the digitisation process—which has been a massive undertaking—and in the work that was done for the revaluation. We have had discussions at Second Reading and parliamentary Questions about the costs of that process, and the savings in stopping where we did, but the point is what the VOA has experienced in gearing up for revaluation. The fact that the database is now in place will make it easier to restart a revaluation when a decision is taken because digitisation gives us more flexibility to move at speed and to draw the information down.

So we cannot say exactly what notice would be appropriate. Again, it would obviously depend on circumstance. For example, the extent of any reforms would bring us back to the question of when, how and what the reform would actually reflect. All work on revaluation has indeed stopped at the moment, but the point about the valuation office is that it is not there simply for revaluation on a cyclical basis; it has a continuing role to play. It has been very much taken up in the past year or two with the digitisation process and its implications. So valuation continues and the valuation office has a duty to maintain the current list as best it can. Again, I am very impressed with what I have heard about how the office goes about that.

I think that I have answered most of the questions that were raised. If I have not, I am sure that noble Lords will tell me and we can do something about it. But, on the basis of the amendment, I urge that it is
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very important to engage with the review process and not to add in unnecessary uncertainties just at the point when we are trying to work towards stability and predictability in the process. Of course we do not want to narrow down the options or jump to conclusions; we want the debate to be conducted with the greatest confidence in the interests of the people who are most affected.

Lord Smith of Leigh: Could my noble friend confirm that when we get beyond the Lyons report and the need radically to review the valuations of council tax, which has been long overdue since 1991—and I am pleased to see that Members of the Committee on the Benches opposite support that—and the implications that that has for redistribution of grants across the country, if we are going to keep the council tax as a creditable property tax, there is no reason why in this day and age we cannot use that to arrive at an annual review of values? If you have such a review only periodically, you get big radical shifts, whereas, if you have it on an annual basis, the shifts are small and it reflects movements in property values. It also has the benefit of adding buoyancy to the level of council tax. When whatever local authorities those of us here represent need to raise money, it all comes on the bottom line of council tax, but if there is buoyancy in the system, reflecting the rise in the value of property, that could taken care of.

Everyone seems to know what happens to house prices. Halifax has produced indices about the movement of house prices by region and area and so on. Surely we can build that into the system, which would allow us to have a much more sensible debate about whether council tax will be a real benefit as a tax for local councils in future.

Baroness Andrews: I recognise the experience that my noble friend brings to this debate and the reality of what he has described. I cannot comment on the possibility of an annual review. It may be one of the options to emerge in the debate. However, it would be a huge burden for the Valuation Office Agency to carry despite digitalisation. There would be implications for the amount of work done, the costs and a lot else besides and I would be interested in the view of the VOA on that. I take note of what my noble friend said and I am grateful for his contribution to the debate.

Lord Hanningfield: What has just been said is part of the proposal that I put forward. If you look at what other countries do each year—the United States, for example—they do not use revaluation, but a basket of indicators. If you buy a house in a particular street, the building society can value it straight away. There are plenty of indicators around that could be put in a basket to make an indication without having a mammoth, expensive revaluation. You could then start the process this year. With a ceiling and floor system, nobody would go up or down too much and everyone would accept revaluation just like that. It would happen every year. No government could politically do a full-scale revaluation. What I have
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suggested gets out of that. I have suggested that to Michael Lyons. Other countries do it like that without the fuss that we have.

That is why parts of this legislation are premature. We need to cancel the revaluation now, because that is the law, but we need to look at more innovative ways of doing it in the future. That is why two or three parts of the Bill should wait. Let us have a full-scale debate and the Lyons review—which I am sure will suggest things like this because I have talked in some detail to Sir Michael Lyons about it. Those of us who are involved on a day-to-day basis know how unpopular a mammoth rise would be, and that is not politically on for any government at the moment.

I have suggested my alternative, which is why we tabled this amendment. I am sure that we will return to this matter on Report because some parts of the Bill are premature. With that, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

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