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We will obviously want to look at the issue that the noble Lord raises within the pilots. Clearly, those will have to be brought forward with a business plan and with a communication plan to residents taking full account of the extreme cases that the noble Lord raises. However, it is essential that local authorities have powers sufficient to recover debts in the small proportion of cases where residents fail to pay. Enforcement options would be as for a civil debt, and have broadly similar sanctions as with non-payment of council tax—but, we envisage, without the draconian measures of imprisonment and bankruptcy. I wanted to get that out of the way before we start any other questions.
Amendment No. 183U would mean that local authorities could refuse to collect waste from a household which has not paid its charge. We do not think this an appropriate response to non-payment and think that the general duty to collect should still apply. That would avoid the situation, as raised by the noble Duke, of residual waste being left to pile up outside as a public health hazard. As I have explained, there are other courses of action for the authority to deal with non-payment, which it is well accustomed to using for, say, some cases of parking fines or for council tax—although not in the extreme position.
Amendment No. 183V looks to change the wording of the provisions to say that a failure by any person to pay charges that they owe does not affect the authority’s general duty to arrange for collection of household waste. Given what I have already said, we do not consider that Amendment No. 183V adds anything to the provisions as they stand and therefore does not add to the Bill one way or the other.
I have not been asked this, but I shall answer it anyway: how much will it cost an authority to collect debts? We do not hold data centrally on the costs to local authorities of enforcing fixed penalties. In any case, costs will vary according to the nature of the scheme. As a rough comparison, we know that council tax collection costs are about 1.8 per cent of the total yield. That squares as probably the most efficient tax to be collected. I recall that many years ago I was responsible in the other place for organising the opposition to the infamous poll tax and I had to defend the rates. One of the great defences of the rates was that they were so cheap to collect—a penny in the pound. They were cheaper than all the other taxes such as VAT and corporation. But the poll tax not only cost a fortune to collect; it cost the Government power in office.
9.15 pm
Lord Greaves: I will defend myself briefly in a minute. I think that if any local authorities are daft enough to bring in some of these measures, it will cost them their power in office; who knows—we will see. I am grateful for the response, and again I shall read it carefully, especially that on the first amendment.
There is a difference between using amendments in order to probe how the Government think something
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Having said that in self-defence against the shocking attack on me by the Minister—I point out, for the record, that that is said with irony—I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 183V not moved.]
Lord Greaves moved Amendment No. 183VA:
“( ) In making the calculations under sub-paragraph (1) the waste collection authority shall take into account the administrative and other costs that are attributable to the scheme, including any costs that are offset by any contributions made by the waste disposal authority and the government.”
The noble Lord said: I shall speak also to Amendment No. 183W. This goes back to the question of revenue neutrality. We have covered a lot of this so I shall not go over the same ground again. Can the Minister tell us how he thinks this is going to be financed if it comes to a rollout affecting 62 per cent of the households in the country? How on earth can the costs of setting up and administering it, at least in the early days which perhaps will be informed by the pilots, be met? Does he have any views about that?
The second amendment seeks to scrutinise a bit of the Bill that seems to contradict what the Minister has been saying about how this will always be revenue neutral on the basis of charges made against people being used to provide rebates or bonuses for those who do well. On page 57, new paragraph 7(2) and (3) seems to imply that the Secretary of State may, by order, amend this and change it so that it would not be revenue neutral in the future. Is my interpretation correct and, if it is, would the Minister comment on it? I beg to move.
The Duke of Montrose: Amendment No. 183VA refers to new sub-paragraph (1) and the waste collection authority. It is slightly hard to follow because new sub-paragraph (1) states:
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- “the aggregate amount of charges ... must not exceed the aggregate amount of the rebates or other payments”.
It sounds like a closed loop system in which the moneys that are collected from the public will all be recycled, so how the local authority will cover the costs which are bound to aggregate over and above that is an interesting question. I think that is partly what the noble Lord, Lord Greaves, is probing for.
The amendment appears to offer the local authority the possibility of making money by collecting,
We would like to know what the Government consider will be the outcome on that matter.
We agree with Amendment No. 183W and that the Secretary of State should not have the power to upset the balance of charges and rebates without first bringing the details and reasoning for it to Parliament.
Lord Rooker: I, too, was worried about that last point. I try to keep ahead of things but I should have asked about Amendment No. 183W this morning. There is a protection in the fact that the affirmative resolution procedure will provide powers to Parliament, and the Delegated Powers and Regulatory Reform Committee would have to be satisfied with the process.
On revenue neutrality, it is a closed loop, as the noble Duke said. But, as I said in an earlier debate, local authorities could save a lot of money by such a scheme. Leaving aside the incentives and the charges, they could save a fortune in landfill costs, for example, which they can keep or use to reduce the council tax overall for everyone in the authority. That is part of the infrastructure. So there are potential savings. The closed loop comes in with the direct charges and the rebates.
If as a result of getting a change in behaviour of residents the local authorities end up with their costs of disposal being a lot less overall—which we think will be the case—those will be savings to the country at large and would not be counted for or against the individual participants of the scheme. So there is an opportunity there. I am not saying but implying that when local authorities come forward with their proposals for pilots, part of the business case will include the overall savings—in other words, the cost of running the scheme. As I have implied, it is a very small amount of money. I still live in the real world and £4.5 million is a lot of money to me, but in the scale of local government it is only a couple of decimal points when adding up the figures. So the money is there but no decisions have yet been taken on that.
The revenue neutrality simply means that the local authority does not make a profit out of the residents taking part in the scheme. That is the bottom line so far as the residents are concerned. But if they can see that the local authority is going to save money overall and keep costs down, that has got to be a good thing for those both in and out of the scheme.
As I have said, the amendment requires the revenue schemes to be neutral so that no profit is made, which is a key element of the pilot schemes that we wish to organise. It is part of the definition of piloting that we
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We want the flexibility to amend the revenue-neutrality condition. In the unforeseen event that we need to make an amendment, as I have said, it would come back to Parliament. The Minister would be given a pretty rough ride if they did not have a good reason for amending it, because it is a key part of the scheme that we want in the pilots.
Amendment No. 183VA seeks to allow the authorities to use the money raised from waste charges to cover the costs, but that could create an additional burden on local residents who could end up paying more overall to the authority. It could also reduce the amount of money available to reward the householders who were benefiting from the scheme. It would hinder efficient administration if they had less incentive to keep the costs down, and that would not be fair; it would look like a rip-off. On the other hand, if the offsets were greater than the costs incurred, that could result in the savings achieved being passed directly back to the local residents covered by the scheme via the rebate. That might appear to be a good deal for the residents but it would limit the authority’s freedom to invest the savings where it chose; for example, in other priority services.
I have not been misleading. Earlier I said, in answer to the noble Lord, Lord Dearing, that local authorities could potentially save a lot of money from running such a scheme. Even though the incentives and charges to residents are ring-fenced, there could still be other pots of money for local authorities to save. That money is for the greater good of all ratepayers in that authority.
Lord Greaves: I want to ask the Minister a specific question, so perhaps I can ask that straightaway and he can answer it. How is it going to work in two-tier areas, where the county council pays the waste disposal charges and the district council as the waste collection authority—if there are additional expenses in running the scheme, which there clearly will be—will have to pay?
Lord Rooker: That is a good, specific question to which I have a specific answer, although it is not written down here. That will be in the business plan of the pilot programme put to the Government. It is self-evident that if five areas are going to implement a scheme and one of them is a two-tier area, that will require the two-tier authority to come forward with a plan that delineates between the ratepayers for the district and for the county, which is what the noble Lord is referring to. It will be up to local government to come forward with a plan, and I look forward to noting that. That is a legitimate question that would have to be covered in any business plan put forward to central government.
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Baroness Byford: I am grateful to the Minister for clarification on that. It is quite likely, or at least I hope it is, that one of the trials will involve that combination of authorities. What happens if two authorities—two counties, for want of a better expression—decide to form a pilot scheme together? Is that possible, or does the Bill as it stands limit pilots to a single authority? I am not quite clear on this. To give a bad example, if Leicestershire decided to do a deal with Nottinghamshire to see if they could achieve better savings by doing it together, would that be possible?
Lord Rooker: That is a brilliant question for which I need some additional advice, and I am not certain whether I will get it. I know there are facilities for this in local government. Three district councils combined their environmental services for food safety—I will not say which ones I think they were, but they were in the south Midlands area—to run a joint service for checking restaurants, pubs and so on. They had a plan—
Baroness Morgan of Drefelin: A single waste collection authority.
Lord Rooker: It is a single waste collection authority that would come forward with the plan. That will be a single unit of local government, even if the waste collection authority happens to cover two local authorities. That is probably not an adequate answer. If I get any better particulars, I will write.
9.30 pm
Lord Greaves: Waste partnerships were made possible by the Local Government and Public Involvement in Health Act, but that is perhaps a little premature. Some £4.5 million for an ordinary shire district is still a lot of money. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 183W and 183X not moved.]
Lord Greaves moved Amendment No. 183Y:
The noble Lord said: The amendment would remove a new paragraph on “Separate account to be kept”, which instructs waste collection authorities to keep a separate account for the money that they take in from the extra charges for people who throw away too much and hand out to people who throw away less. I do not want to take the provision out of the Bill—it is merely a probing amendment—but wish to ask one or two questions in relation to it. It states that a waste collection authority is to keep a separate account of any rebates, other payments or any charges received. It then states:
“Any person interested may at any reasonable time and without payment inspect the account and make copies of it or any part of it”.
If they are obstructed, a penalty is incurred. I am not clear about how much detail about individuals such an account would contain. Is it a general account, relating to the amount of money collected and paid out over a period, or would it go down to the level of showing who has had to pay extra charges and who has been given rebates? I do not want to ask any
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Baroness Morgan of Drefelin: As we discussed earlier, the requirement for waste reduction schemes to be revenue-neutral is a key element of the proposals. We want to make sure that schemes are transparent for residents. It is essential that they can easily access information about total amounts of charges and rebates. This allows them to feel assured that any revenue collected by authorities is being paid back in full through rebates, thereby fulfilling the revenue-neutrality condition. This is why new paragraph 10 of the schedule requires authorities to keep a separate account of charges and rebates under a waste incentive scheme. It requires that the account is made available for inspection by members of the public. The new paragraph is not about placing extra burdens on local authorities, nor is it about making transparent information about residents that one would not normally expect to be made public. It is about giving residents confidence in the scheme, keeping them motivated to reduce their waste and allowing them access to information that they have every right to see.
In practice, there is unlikely to be much extra effort involved for authorities in collecting the information. They will need to have the information in place in any event. I do not wish to labour the point, but residents will want to be able to see revenue-neutrality. They will not expect to have their behaviour publicised. The noble Lord has raised an interesting point, but I hope that, following that reassurance, he will consider withdrawing his amendment.
Lord Greaves: I think I have the reassurance I wanted that it will be summary accounts and not detailed individual accounts that could be accessed. Although we are all entitled to see the details of our own accounts, that is a different matter altogether. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Taylor of Holbeach moved Amendment No. 183YA:
The noble Lord said: The purpose of this amendment is to probe what sort of modifications to enactments relating to council tax the Government have in mind. Will they simply make room for two lines on the council tax form, one levying a charge for domestic residual waste collection and the other applying a rebate from the tax as a whole, or will they impose new conditions on the calculation of council tax, its formulation or the way it is levied? I beg to move.
Lord Rooker: This is a legitimate and practical question but unfortunately, at this stage, one to which I do not have an answer. What would a combined council tax and waste bill look like? I have not taken advice on this. I do not know how such a bill is envisaged. There are some possible variants but we want to work further with local authorities on this. I
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As I said earlier, this flexibility is there only because local government raised this issue during the formal and informal consultation process. A waste disposal authority may well suggest a system that has no connection whatever with the council tax. The system has inbuilt flexibility, which is why I cannot give any indication of what a bill would look like. However, residents must be able to understand it and it must be credible in terms of being no different from what they see in the rest of their bill.
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