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However, the issue remains: the word “unlikely” has caused a good deal of unhappiness in the House. It is good that the Minister has said that the issue will be pursued and examined further. I wonder whether, in the course of that examination, he or whoever it would be might receive a deputation from the City of London—accompanied, perhaps, by some companies that have been asked to make and have considered making voluntary contributions to Crossrail—so that this could be discussed not only with Ministers in the DCLG but, perhaps, with officials from the Revenue. That would be a helpful way forward, and it might help the Minister to achieve the objective that I think he is anxious to achieve, without prejudicing the generality of the fiscal treatment of companies in these circumstances. I am happy to give way if the Minister says that he would be prepared to do that.

Lord Davies of Oldham: My Lords, as ever, the noble Lord puts these issues in persuasive terms. He will appreciate that, given the particular position that I occupy today in coming late to the Bill, I am reluctant to engage in a response that puts obligations on others rather than on myself. I recognise the strengths of the points that have been made today, though, and there is no doubt that further discussions would be valuable. I will do what I can to facilitate those.

Lord Jenkin of Roding: My Lords, I realise the constraints that the Minister feels himself under, and no doubt if I were in his boots I would have said much the same. I have some sympathy for him, being confronted immediately by three former Treasury Ministers arguing this point. He has been good enough to say that this matter will be pursued, and I am sure that if a request is made, a delegation will be received and these good things can be discussed with those who are directly concerned. Given that, I beg leave to withdraw the amendment.

Amendment 16 withdrawn.

Amendment 16A

Moved by Lord Bates

16A: Schedule 1, page 21, line 27, at end insert—

“( ) A description of the arrangements for—

(a) the proposed project management,

(b) the governance and management arrangements (if any dedicated arrangements) for the project when completed,

(c) the mechanisms by which those paying BRS shall be kept informed of what monies have been raised in pursuance of the BRS and how they have been expended, and

(d) those paying BRS to be represented upon the governing body of any organisation set up for the purposes of delivering the objectives of the BRS, or, if such an organisation is not to be set up, how such persons are to be involved in the oversight of the delivery of such objectives.”

Lord Bates: My Lords, I beg to move the amendment to which I have already spoken, and I wish to test the opinion of the House.

8 Jun 2009 : Column 507

9.06 pm

Division on Amendment 16A

Contents 41; Not-Contents 69.

Amendment 16A disagreed.

Division No. 3


Anelay of St Johns, B. [Teller]
Attlee, E.
Bates, L.
Blackwell, L.
Bridgeman, V.
Brooke of Sutton Mandeville, L.
Brougham and Vaux, L.
Cathcart, E.
Colwyn, L.
Craigavon, V.
De Mauley, L.
Fookes, B.
Forsyth of Drumlean, L.
Gardner of Parkes, B.
Geddes, L.
Hooper, B.
Howell of Guildford, L.
Hunt of Wirral, L.
Jenkin of Roding, L.
Kingsland, L.
Knight of Collingtree, B.
Lindsay, E.
Luke, L.
Lyell, L.
Mancroft, L.
Marlesford, L.
Montrose, D.
Morris of Bolton, B.
Northbrook, L.
Norton of Louth, L.
O'Cathain, B.
Rogan, L.
Seccombe, B. [Teller]
Sheikh, L.
Strathclyde, L.
Taylor of Holbeach, L.
Tebbit, L.
Trenchard, V.
Ullswater, V.
Waddington, L.
Williamson of Horton, L.


Acton, L.
Adams of Craigielea, B.
Amos, B.
Anderson of Swansea, L.
Archer of Sandwell, L.
Bach, L.
Bassam of Brighton, L. [Teller]
Bilston, L.
Blood, B.
Borrie, L.
Brett, L.
Brookman, L.
Campbell-Savours, L.
Carter of Coles, L.
Chandos, V.
Crawley, B.
Davies of Oldham, L.
Dubs, L.
Elder, L.
Elystan-Morgan, L.
Evans of Parkside, L.
Foster of Bishop Auckland, L.
Foulkes of Cumnock, L.
Gale, B.
Gilbert, L.
Golding, B.
Gordon of Strathblane, L.
Greaves, L.
Grocott, L.
Haskel, L.
Haskins, L.
Haworth, L.
Henig, B.
Hollis of Heigham, B.
Hoyle, L.
Hughes of Woodside, L.
Hunt of Kings Heath, L.
Jones, L.
Jones of Whitchurch, B.
Jordan, L.
Layard, L.
Lea of Crondall, L.
Macdonald of Tradeston, L.
Mackenzie of Framwellgate, L.
McKenzie of Luton, L.
Maxton, L.
Meacher, B.
Morgan, L.
Morgan of Drefelin, B.
Morris of Handsworth, L.
Morris of Yardley, B.
O'Neill of Clackmannan, L.
Paisley of St George's, B.
Quin, B.
Radice, L.
Richard, L.
Robertson of Port Ellen, L.
Rosser, L.
Sawyer, L.
Sewel, L.
Simon, V.
Soley, L.
Taylor of Bolton, B.
Thornton, B.
Tunnicliffe, L. [Teller]
Warwick of Undercliffe, B.
Watson of Invergowrie, L.
Whitty, L.
Young of Norwood Green, L.
9.16 pm

Amendments 17 and 18 not moved.

Amendment 19 withdrawn.

8 Jun 2009 : Column 508

Amendments 20 and 21

Moved by Baroness Hamwee

20: Schedule 1, page 22, line 35, leave out from “to” to end of line 37 and insert “the requirement under section 7 to hold a ballot”

21: Schedule 1, page 22, line 38, leave out from “to” to end of line 41 and insert “the result of the ballot held under section 7”

Amendments 20 and 21 agreed.

Clause 6 : Consultation

Amendment 22

Moved by Baroness Hamwee

22: Clause 6, page 4, leave out lines 24 to 26 and insert “consult those persons who the authority thinks might become liable to pay a chargeable amount before the end of the chargeable period of the BRS and whom it would be appropriate to consult”

Baroness Hamwee: My Lords, I shall also speak to Amendments 23 and 24. Amendment 22 revisits Clause 6(5), because I believe consultation is important and Clause 6(5) does not in my reading actually require it. It says that,

in other words, it must think whether consultation would be appropriate. At Grand Committee, the debate turned on the difficulty of identifying those who may be above or below the threshold—in other words, who might become liable—which was not the point of the amendment. Thinking whether it is appropriate to consult is not the same as thinking who might become liable. Our amendment—this is the crucial point—applies the term “appropriate” to ratepayers, whom it would be appropriate to consult, not to consultation. The consultation itself would be required. I hope that that explanation is clearer than we managed to achieve at the last stage.

Amendment 23 would require the levying authority to publish the result of the consultation, once it had been conducted. Oddly, this is where even the best local authorities slip up too often. My noble friend Lord Tope, who has had to go back to Sutton, as he says, to be a councillor, has volunteered that this is too often a problem. The best consultation can be carried out to really high standards, but the authority forgets to feed back the outcome of that consultation—the results of it.

Amendment 24 would flesh out Clause 6(6). The Minister may tell me that this is a detail too far but I think that it is important that when a revised version of the prospectus is published, the revisions are clearly indicated. I am thinking here of the mechanisms so readily available to us in computer programs that indicate the alterations which have been made. It will not be helpful with a complicated document to issue a revision without pointing ratepayers to where those revisions have been made. I beg to move.

Lord Bates: My Lords, I support this group of amendments as they seem to make an awful lot of sense. We had a very good debate on this issue in Committee. Clause 6 currently provides that the authority has only to think whether it might be appropriate to

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consult. That seems an odd thing to include in a Bill. The consequence is essentially that the levying authority must consult those whom it thinks might be liable for the BRS before the end of the chargeable period of the business rate supplement., This amendment is almost consequential on our acceptance of Amendment 1, as there will be a mandatory ballot and they will be consulted at some stage. However, that is a wider consultation than the one being aimed at here.

Amendment 23 is consequential on that. It states:

“The levying authority shall publish the result of the consultation”.

An additional point here is the timely publication of the results of consultations with busy business people. In Committee we discussed whether there were more immediate, real-time ways of engaging in consultation so that members of the business community could track what people said. We also discussed such exciting activities as blogging which could be used to give the business community a more immediate sense of what other members of the business community were thinking about an issue, rather than having an extensive written consultation and then finding that businesses do not have the time to read or digest results stretching to several hundred pages.

Amendment 24 currently provides that the levying authority has only to publish a revised version of the initial prospectus if changes are made after the consultation and it believes that it would be necessary and appropriate to do so. We therefore strongly support this amendment which provides that the authorities must publish a revised version of the initial prospectus. It is almost unthinkable that there could be circumstances in which consultation took place on complex schemes aimed at economic regeneration and feedback was received but then not one change at all was made to the prospectus. Therefore there ought to be an updated prospectus. The concept of a Green Paper moving to a White Paper is sound and ought to apply to the way in which these prospectuses are issued. The prospectus should perhaps be issued in draft Green Paper form and then in a final document to be published when the results have been collated and sorted. Our view is that the amendments would be nice to have in ordinary circumstances, but, given the decision of the House on Amendment 1, they are now essential. I very much support the amendments.

Lord Davies of Oldham: My Lords, I am grateful to both noble Lords for their constructive approach to these issues. Of course local businesses should have confidence that they will be consulted if they are likely to have to pay the supplement. That is why Clause 6 requires levying authorities to consider whether they should consult those persons that they think will become liable for the BRS in future.

The discretion allowed for in Clause 6 is not a get-out-of-jail-free card when it comes to consulting those who might become liable for the supplement. The levying authority will have to be able to justify any decision it takes not to consult those who might become liable for the supplement. For example, where properties with a rateable value of £50,000 are liable, it would be very difficult for the authority not to consult ratepayers whose properties had a rateable value of £49,999.

8 Jun 2009 : Column 510

The Bill as drafted gives flexibility for dealing with marginal situations—for example, determining whether it is necessary to consult those with a rateable value of £30,000 in an area where the BRS might be relatively short-term, and therefore it would be highly unlikely that such businesses would move into the category in such a short time. It enables the levying authority to take a reasonable and proportionate approach to consulting those who might become liable for the supplement. However, the amendment, by requiring authorities to consult those who might become liable for the supplement in future, runs the risk that they will have to consult absolutely anyone who has the remotest possibility of becoming liable for the supplement, lest they open themselves to a potential legal challenge. I am sure that that is not the intent of the amendment, but that is what the local authority is likely to feel obliged to do if the amendment is carried and we do not have the flexibility that we envisage in the Bill as it is presented.

Amendment 23 requires levying authorities to publish the results of consultation on their initial prospectuses. Amendment 24 would require levying authorities to publish a revised initial prospectus following the consultation but before the publication of the final prospectus. Of course any consultation process on the BRS needs to be transparent, and businesses need to have confidence that their concerns and comments will be taken seriously and will be reflected in the final plans for the project. For these reasons, levying authorities will be required to publish a final prospectus. This will set out how the BRS will work and the details of the project, taking account of the comments and views expressed during the consultation. In line with best practice, the authority should also consider publishing a summary of the consultation responses, setting out how the project has changed as a result.

I emphasise best practice. We are certainly prepared to emphasise in guidance what we expect to see in best practice and levying authorities should follow that. However, to require a revised initial prospectus in all cases surely goes further than what will be needed in many cases, resulting in unnecessary delay and excessive bureaucracy. Instead of taking a standardised approach, which in many cases may not be appropriate, we should give levying authorities the flexibility to decide what is right for their area and for their proposal. That is the basis of the Bill as it stands.

I am grateful to the noble Baroness for having identified issues that need serious consideration. I know that they reflect discussions held in Committee. I merely wish to emphasise that we considered these matters in drafting the Bill. We are seeking to avoid being overly prescriptive where we do not need to be, but we certainly agree—as has been emphasised this evening—that best practice on consultation needs to be followed. We are happy to signal in guidance that levying authorities should indeed refer to existing best practice. I hope that on that basis the noble Baroness will feel sufficiently reassured to withdraw the amendment.

9.30 pm

Baroness Hamwee: My Lords, I am not sure whether the Minister answered Amendment 23. Perhaps it was wrapped up with Amendment 22. As regards

8 Jun 2009 : Column 511

Amendment 24, publication is really very easy. The prospectus will have to be revised if there are changes. That follows; otherwise people will not know what they are talking about. Publication is really not difficult. I am so tempted to divide the House but I shall not do so despite a noble Lord saying “Go on”.

My Amendment 22 preserves flexibility as regards the consultees. It requires consultation but retains the term “appropriate” as applied to the consultees. The clause does not say what Ministers say that it says. I completely disagree with the Minister on that. However, I shall probably do better to rely on guidance than by polarising the position and having Ministers decide not to explain in guidance that the clause means something slightly different. On that basis I surrender and beg leave to withdraw the amendment.

Amendment 22 withdrawn.

Amendments 23 and 24 not moved.

Clause 7 : Holding of ballot

Amendment 25

Moved by Baroness Hamwee

25: Clause 7, page 4, line 35, leave out from “BRS” to end of line 3 on page 5

Amendment 25 agreed.

Clause 8 : Approval by ballot

Amendment 26

Moved by Baroness Hamwee

26: Clause 8, page 5, line 14, leave out from beginning to second “the”

Amendment 26 agreed.

Clause 10 : Variations

Amendments 27 and 28

Moved by Baroness Hamwee

27: Clause 10, page 6, line 18, leave out from beginning to second “a” in line 19

28: Clause 10, page 7, line 5, leave out from “BRS” to end of line 18

Amendments 27 and 28 agreed.

Clause 14 : Chargeable amount: supplementary

Amendment 29 not moved.

Clause 15 : BRS relief

Amendment 30

Moved by Baroness Hamwee

30: Clause 15, page 11, line 19, leave out from “BRS” to end of line 20 and insert “shall apply in relation to BRS reliefs that are no less favourable to ratepayers than the most favourable reliefs applied by the relevant billing or levying authorities”

Baroness Hamwee: This brief speech on my part might require a rather longer answer. On reading Hansard, I realised that I am very unclear—I may be alone in that—about the position regarding empty

8 Jun 2009 : Column 512

properties. I agreed with the noble Baroness, Lady Andrews, that I would table this amendment in order to give the Government an opportunity to explain what the position is. I beg to move.

Lord Bates: My Lords, I support the amendment. It concerns reliefs, which can apply widely. They can apply to sports clubs and other such organisations. However, the noble Baroness is seeking clarification regarding empty property rates. This issue is a sore point for business. The concept of empty property rates was introduced when businesses and the economy were doing well but has been implemented when businesses are doing badly. The idea was originally conceived to dissuade property owners from sitting on properties that should be redeveloped. Now many businesses and landlords are certainly not sitting on properties waiting to be redeveloped as their tenants are going out of business at an alarming rate. As a result, business premises are empty when their owners would wish for anything other than that, and they still have to pay this iniquitous tax of empty property rates. We will listen carefully to the Minister’s response on how he will deal with reliefs.

Lord Davies of Oldham: My Lords, I am grateful to noble Lords for keeping their contributions brief because my response is somewhat lengthy, given the complexity of the issue and the importance of getting on the record exactly how the provisions on reliefs are intended to operate. I hope that the House will be tolerant of me. There are different strands to this issue and I will deal with them under three main headings. First, there is how Clause 13 is intended to work. Secondly, there is the intention behind Clause 15, entitled “BRS relief”. Thirdly, I will deal with the issue of empty properties, which both noble Lords raised and the noble Lord, Lord Bates, emphasised.

Clause 13 sets out the method for calculating the BRS liability for a ratepayer. The method varies depending on whether the ratepayer already receives one of the existing mandatory or discretionary reliefs from national non-domestic rates. In framing our proposals for BRS, we want to apply the same approach as currently operates in the non-domestic rating system. The effect of Clause 13 is that if a ratepayer receives relief on their rates bill, the same level of relief will be applied when assessing liability for BRS. I emphasise how Clause 13 works. For instance, charities that receive just the 80 per cent mandatory relief will therefore have an 80 per cent reduction in their BRS liability. Where a charity receives 80 per cent mandatory relief and a further 20 per cent top-up relief on its rates bill, it will be entitled to the full 100 per cent relief and will pay nothing.

I realise that Clause 15 on BRS relief may have given rise to some confusion and I will attempt to explain how this clause differs from Clause 13. Clause 13 deals with reliefs under the existing non-domestic rating system. By contrast, Clause 15 covers reliefs specific to BRS. It enables levying authorities to reduce the impact of BRS, not by reference to any reliefs payable under the non-domestic rates system, but by setting out its rules for levying BRS. We make clear that those properties with a rateable value below £50,000

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will not be liable for BRS. Clause 15 enables levying authorities to set the threshold for liability above £50,000—say at £65,000—so that properties with a rateable value below this would not be liable for BRS. It would be up to the discretion of the levying authority. Alternatively, levying authorities may wish to use Clause 15 to set a differential rate for properties with different rateable values. An example would be a levy of 0.5p for properties with a rateable value of between £50,001 and £70,000, a 1p levy for properties with a rateable value of between £70,001 and £85,000, and a 2p levy for properties with rateable values above that. That is the import of Clause 15.

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