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EnactedBusiness Rate Supplements Act 2009

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3rd reading in the Lords

16 Jun 200924 speechesView in Hansard ↗
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    The Chancellor of the Duchy of Lancaster (Baroness Royall of Blaisdon)The Chancellor of the Duchy of Lancaster (Baroness Royall of Blaisdon)Labour
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    My Lords, I have it in command from Her Majesty the Queen to acquaint the House that, having been informed of the purport of the Bill, she has consented to place her prerogative and interest, as far as they are affected by the Bill, at the disposal of Parliament for the purposes of the Bill. Clause 4 : Conditions for imposing a BRS Amendment 1
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    The Parliamentary Under-Secretary of State, Department for Communities and Local Government & Department for Work and Pensions (Lord McKenzie of Luton)The Parliamentary Under-Secretary of State, Department for Communities and Local Government & Department for Work and Pensions (Lord McKenzie of Luton)Labour
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    My Lords, I shall speak to the other amendment in the group as well. These are minor, technical amendments to those approved by this House on Report last week requiring a ballot on all proposed business rate supplements. The amendments to Clauses 4 and 10 inadvertently created contradictions with existing provisions in the Bill, which are resolved by the amendments today. It remains the case that the Government do not agree with the principle behind the amendments made—we do not think a ballot in all cases is the right approach—but I assure noble Lords that these amendments do not change the intended effect of the amendments approved by the House on Report and simply ensure that there can be no scope for confusion or uncertainty. I beg to move.
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    Baroness HamweeBaroness HamweeLiberal Democrat
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    My Lords, I am glad that I read the amendments correctly as bringing the Bill into line with the mandatory ballot arrangements that I put to the House last week, supported by the noble Lord, Lord Bates. I am extremely grateful to those responsible for the drafting of the Bill for dealing with parts of it that, honestly, had passed me by and should not have done. I therefore support the amendments. As this is the first occasion on which I have spoken on this stage of the Bill, I should declare an interest as joint president of London Councils and a charity, the Rose Theatre in Kingston, which is a ratepayer.
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    Lord BatesLord BatesConservative
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    My Lords, I welcome the noble Lord to his position. It is Third Reading and we are on to our third Minister. It is good to see him in his place and I am grateful for the introduction that he gave. These are obviously consequential amendments. I was a little puzzled as to what was happening here. The original Clause 4(c) was 30 words and the amended wording is 18, and the original wording related to Clause 8, “Approval by ballot”, which sets out that the majority is absolutely necessary. But if this is the advice of officials, certainly we are happy with it. Unlike the noble Lord, we fully support the protection afforded to businesses by giving them a ballot in all cases as a result of the amendment put forward last week on Report. Therefore, we welcome these amendments as far as they go.
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    Lord McKenzie of LutonLord McKenzie of LutonLabour
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    My Lords, I thank the noble Lord, Lord Bates, for his kind words. I reassure him and other noble Lords that these are just consequential amendments; they are not intended to change the effect of the amendments moved successfully at our last sitting on the Bill.
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    Baroness HamweeBaroness HamweeLiberal Democrat
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    My Lords, the amendment provides for expenses incurred in preparation for the collection or recovery of a business rate. The words “collection or recovery”, defined as “administrative expenses”, are those that appear in the Bill. My concern, particularly on behalf of London boroughs, which will be in the forefront of billing for the new supplement, is whether their set-up costs will be covered. There may be IT costs, for instance. A great deal of expense is certain to be incurred. I am not looking to officer time that will be spent on the matter, although that will be a drain on resources as well. They will be incurring those costs on behalf of all billing authorities, which will profit from the work carried out if and when the BRS is levied outside London.
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    Lord BatesLord BatesConservative
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    My Lords, it seems that Third Reading is the third time that this issue has been raised. Some Members of the House were privy to an e-mail that came down from the Clerk of Public Bill and Private Bills, which pointed out that the amendment is identical to that moved in Committee by the noble Baroness, Lady Hamwee, and to Amendment 36 moved on Report by the noble Lord, Lord Tope. At that time we indicated that we shared the concern that the funding should be carried out efficiently to allow maximum funds to be diverted to the project for which they were being raised. That has been placed on the record before. I should have declared earlier my interest as a business-rate taxpayer, if that is relevant in these circumstances. I refer noble Lords to my entry in the register.
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    Lord McKenzie of LutonLord McKenzie of LutonLabour
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    My Lords, as the noble Lord, Lord Bates, said, this is a repeat amendment, but I am happy to use the opportunity provided by the noble Baroness to place the matter clearly on the record. The amendment is about the cost of setting up the business rate supplement, with particular reference to London, although it has a wider application. In developing our proposal for business rate supplements, we have been mindful of the fact that certain costs could initially fall on billing authorities. We fully appreciate that those authorities do not want to be out of pocket as a result. We have addressed the issue in Clause 22, which gives the Secretary of State the power to authorise billing authorities to use a prescribed proportion of BRS revenues to meet their collection and enforcement expenses where the levying authority levies its BRS from the beginning of the financial year. This is what we expect to happen in most cases where the BRS is levied, but we recognise that that might not always be the case and it is possible that a levying authority may not be ready to levy the BRS from the start of the financial year and it might not want to wait for nearly a whole year to elapse before being able to start collecting the supplement. Therefore, the Bill enables BRS to be levied part way through a financial year. Where that happens, those costs can not be recovered from BRS revenues. Instead, they must be met by the levying authority. Clause 22 gives the Secretary of State a power to make regulations prescribing the proportion of BRS revenues that may be retained by billing authorities when the supplement is collected as part of the normal billing round. Where costs have to be met by the levying authority, the Secretary of State may cap the amount that the levying authority is required to reimburse the billing authority. I am conscious that this is a probing amendment seeking clarification on a point that will be of the utmost importance to local billing authorities. The noble Baroness, Lady Hamwee, is seeking clarification that Clause 22 will enable billing authorities to recover the costs that they will incur in preparing for BRS, as distinct from the costs they will incur in collecting BRS when it is up and running. I am happy to put it on record that it is, indeed, our intention that billing authorities should be able to recover their set-up costs. Let me take a moment to explain how we are addressing this specific issue. Much of the detailed arrangements for BRS will be dealt with in secondary legislation. We recently published a consultation paper with our proposals for secondary legislation. It covers the arrangements for ballots as well as for the collection and enforcement of BRS. The consultation paper also includes a section on the costs of collection and recovery of BRS, referred to in the Bill as “administrative expenses”. The consultation paper acknowledges that these expenses will cover set-up costs. There are a number of different approaches to calculating costs of collection and the consultation paper discusses three possible options. It invites views from stakeholders on these options, but billing authorities should not be constrained by them. If billing authorities or others with an interest in this issue think that there is a better way of dealing with costs of collection, the consultation gives them the opportunity to let us have their views. Views are invited on whether administrative expenses should be a fixed percentage of the annual total amount of BRS to be collected by the billing authority or whether this should be a fixed amount. A third possible approach is that costs should be agreed locally between the levying authority and the billing authority, subject to an upper limit to provide reassurance for business. We are inviting views on what is an important issue for billing authorities. We will need to decide on the best way forward in the light of the responses to the consultation paper. However, subject to that consultation, it is our intention that billing authorities should be able to recover their reasonable costs incurred in preparing for collecting and enforcing BRS. I hope that this response clarifies the issue for noble Baroness, Lady Hamwee, and that she will feel able to withdraw her amendment.
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    Baroness HamweeBaroness HamweeLiberal Democrat
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    My Lords, I am extremely grateful. In answer to the point made by the noble Lord, Lord Bates, this is not the first time I have tabled this amendment because I was hoping to get the clear answer that we have just received. I was certainly not seeking to pre-empt the consultation, but merely to get the assurance that we now have on the record that the primary legislation does not exclude the issue that I have explained. Regulations cannot change what will become an Act quite soon, so it is helpful to have that clarification of interpretation. I beg leave to withdraw the amendment.
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    Lord Jenkin of RodingLord Jenkin of RodingConservative
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    My Lords, this amendment deals with a wider issue than that which we have just dealt with on the amendment tabled by the noble Baroness, Lady Hamwee. Here, we are concerned with the administration by the billing authorities of the combination of the business rate supplement and the business improvement districts levy, which can be accepted by a local authority as an addition to the BRS that it will raise. This has a long history, and I do not want to detain the House, except to say that the issue raised is the addition of owners of property to occupiers who would be liable for a business improvement district levy. This goes right back to the time when I introduced a Private Member’s Bill in this House to introduce BIDs. We took it right through this House back in the previous century, but it was killed in the end when the Bill reached another place, notwithstanding that it had the support of all sides of this House. That was a matter of great disappointment to me. The Local Government Bill 2003 was introduced by the Government, and the noble Lord, Lord Rooker, who I am delighted to see in his place this afternoon, introduced Part 4 of that Bill. Lo and behold, what did it include?—my Bill on BIDs, in effect. It was all there. So BIDs are incorporated in that 2003 Act. We are now concerned with those areas where the BRS is or may be levied where there are BID levies. This is a complex matter but it must be dealt with. At a late stage—between Committee and Report—the Government tabled a substantial new schedule, which is now Schedule 2 to the Bill before us. That was tabled towards the end of the week before Report and the weekend came in between when notably it is quite difficult to get hold of people to brief one. It had to be dealt with on Report on the immediate following Monday. Accordingly, the noble Lord, Lord Tope, then speaking on behalf of the Liberal Democrats, supported by my noble friend Lord Bates and myself, asked the then Minister, the noble Lord, Lord Davies of Oldham, if he might withdraw it so that we could have a proper briefing and then a discussion. The noble Lord said that he was not prepared to withdraw the amendment. As I warned the House at the time, we had no alternative but to table amendments to bring it back at Third Reading. I had a little difficulty in persuading the Public Bill Office that my amendment fell within the rules of amendments that could be tabled at Third Reading. However, when the Clerk in the Public Bill Office heard the full story of how we had reached that stage, he had no hesitation in allowing my amendment. All I can say is that the noble Baroness, Lady Hamwee, seems to have had to appeal to the usual channels before she managed to table her amendment. I did not have to do that. The Public Bill Office recognised the case that I was making. The previous amendment raised the question of the costs of billing authorities in collecting the levy where there was just the BRS. This amendment concerns both BRS and BIDs. The central purpose of the Bill is to provide an industrial and commercial addition to other funds to help to fund the Crossrail project in London. Of course, the powers go beyond London although we have been assured and reassured that there are no immediate intentions of any local authorities outside London to introduce BRS. In effect, we are discussing BRS and its relationship with the BIDs in London, of which there are quite a number. The question of adding the owners, for which there has been pressure since right back into the previous century, and to which the Government to their credit have now agreed, has been supported by a large number of influential interest groups, including the British Property Federation, the British Retail Consortium, British BIDs—the association of BID authorities—the Greater London Authority, London First and the New West End Company, which is a prominent BID in London. They have had legal advice on that. None of those bodies is a billing authority. In London, the billing authorities will be London councils. Like the noble Baroness, Lady Hamwee, I am a joint president of London Councils, and I declare that interest.
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    Baroness HamweeBaroness HamweeLiberal Democrat
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    My Lords, I support the amendment. The noble Lord, Lord Jenkin of Roding, explained the position and the concerns very thoroughly. He emphasised the potential burden. The old Department for Business, Enterprise and Regulatory Reform was certainly very hot on that, although one sometimes got the impression that there could be a burden if that department approved of it. We now have a Minister who is in the CLG and the new department so there should be some more joining up, and one hopes that the burden issue can be addressed very thoroughly. I have a particular question for the Minister, which I do not think will come as any surprise. In 2003, and no doubt before, the reason given for the exclusion of property owners was the difficulty of tracking them down. What has changed to enable property owners to be included as potential BID contributors in a formal rather than informal capacity with, one hopes, confidence on the part of the Government that there will not be this mechanical difficulty?
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    Lord BatesLord BatesConservative
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    My Lords, I, too, support the amendment of my noble friend Lord Jenkin of Roding. He played an invaluable role in Committee and on Report when he introduced amendments at timely instances that went to the heart of the issue. They improved the debate and the Bill as a result. This is another example of that. My noble friend has highlighted a real problem in the way in which the Bill was presented to the House, certainly in Committee. In response to a two-line amendment put forward in Committee for a ballot allowing BRS-BIDs offsetting to take place for properties, the Government then came up with a six-page Schedule 2 setting out the details about how that will work. That was not done in a sensitive way by giving the House time to consider it; it was rushed through at the last minute. The only option open to those who had concerns and simply wanted to put statements on the record was to table amendments at Third Reading. The only point I would like to make in addition to those made by my noble friend Lord Jenkin and the noble Baroness, Lady Hamwee, would be to impress upon the Minister the impact that the rating evaluation will have. We were talking about the difficulties and burdens already on the collecting bodies—the councils—that are administrating the business rate supplement as it comes forward, but the rating revaluation is under way next year and that will be an additional burden on those authorities. It will not only be a burden on the authorities: it will be a burden on the businesses that have to pay it. The rating revaluation that has been pushed through is testing the rateable value of properties between the years of 2005 and 2008. I am sure that every Member of the House will recognise that those were the years of boom under this Government and the current year is certainly one of bust, yet the strike point by which the revaluation thresholds will be put forward for next year, 2010, will be the high point of inflated property values and inflated rents. That is pertinent to the amendment because of the £50,000 threshold in rateable value. Due to that rate, we could potentially see the cohort of businesses that is caught within the group this year significantly expanding next year. There is an easy way for the Minister to ease at a stroke the burdens and costs on the councils, and on the businesses that are going under at an alarming rate. Some figures were mentioned in the other place showing that 120 small businesses are closing down every day, according to the Federation of Small Businesses, and that a principal cause of that is the rise in business rates—as they are now, that is, before the revaluation is even in place. This year, two-thirds of businesses are saying that they face a rise of 6 per cent or more, while 10 per cent say that they face a rise of over 20 per cent. These are huge burdens on business, and they place additional burdens at a difficult time upon the administering authorities. The result is that there will be fewer businesses around to pay the business rate supplement and the business improvement district levy, and there will be more administrative burdens on the councils that have to collect them. Surely that does not make sense. The most sensible thing to do would be to abandon the plans for the revaluation for the present or to give an undertaking to this House—would the Minister be prepared to do this?—that if the revaluation went through next year, taking account of the thresholds that have been mentioned, the £50,000 threshold that the Government have put in place for the Bill would be reviewed and increased. Will the Minister comment specifically on that question and take note of the concerns mentioned by me, my noble friend and the noble Baroness, Lady Hamwee?
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    Lord McKenzie of LutonLord McKenzie of LutonLabour
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    My Lords, I acknowledge that the stage at which Schedule 2 was introduced during the process of the Bill produces challenges, and there has not been a lot of time. I would plead before I respond that I have had even less time to grapple with its complexities. The noble Lord, Lord Jenkin of Roding, was right in his description of what the schedule seeks to do: effectively, it is to introduce a third levy—a BRS-BID levy—that would operate when a BRS or a BID was in place or approved. The focus would be on owners of properties rather than on occupiers.
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    Lord Jenkin of RodingLord Jenkin of RodingConservative
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    My Lords, it says that it is occupiers as well.
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    Lord McKenzie of LutonLord McKenzie of LutonLabour
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    My Lords, the structure of the arrangements is that the BID would apply to occupiers and, under the terms of the Bill, a BRS-BID would apply to those who have a relevant property interest, which will be prescribed. However, regulations may prescribe only freehold, leasehold or commonhold interests. In terms of collections, when one is dealing with owners of property rather than people who occupy property and are routinely subject to the non-domestic rate, there are challenges associated with that. We need to be mindful of costs on local authorities, although we also need to be mindful of the benefits that these arrangements could bring to a local authority. With regard to the timing of this, it has been pressed on the Government; it is not a government-conceived policy that has been visited on the Bill at a late stage. I will endeavour to deal with some of the specific questions that have, quite reasonably, been raised, although the generality of my answers on process may not fully satisfy noble Lords. This amendment would require that before commencing the provisions for BRS-BIDs the Secretary of State consults those bodies representing billing authorities. It also requires the Secretary of State to carry out an assessment of the likely costs to the billing authorities of any BRS-BID. I agree with the noble Lord that there must be a full consultation prior to the implementation of BRS-BIDs and a review of the possible impact on interested parties. Indeed, the Government intend to go further than the noble Lord’s amendment. I can assure the House that the Government will consult a wide range of stakeholders on the detailed arrangements for BRS-BIDs. That will include businesses, the BID lobby and property owners, and, importantly, billing authorities, giving them the opportunity to influence how BRS-BIDs will work. An impact assessment on BRS-BIDs will be published alongside the consultation document. The assessment will look at the impact of all affected groups, including billing authorities. Respondees will have an opportunity to comment on the impact assessment, alongside the proposed arrangements for BRS-BIDs. As noble Lords will recall, before any BRS-BID can be levied, secondary legislation will need to be put in place and Schedule 2 enables the Secretary of State to make the necessary provision before BRS-BIDs can come into being. It may be more appropriate to consult prior to making that secondary legislation than prior to bringing Schedule 2 into force, but I can reassure noble Lords that consultation will take place before any BRS-BIDs are established. I believe that that is the fundamental thrust of the noble Lord’s amendment. The noble Lord, Lord Jenkin, asked whether the billing authority’s costs of establishing the BRS-BIDs will be met. As I indicated, there will be an impact assessment when the Government implement the schedule, which will include an assessment of billing authority costs. As to whether the billing authorities will be given time to establish systems for BRS-BIDs, the consultation will be 12 weeks, following which the Government will consider responses and will announce the outcome well before regulations come into force. Without regulations, no BRS-BIDs can be established. There will be a lead time for BRS-BIDs and billing authorities will in practice be given plenty of time to establish systems. I acknowledge the importance of that, particularly with everything else that is going on with revaluation, transitional relief and other matters. The noble Lord, Lord Jenkin, asked whether billing authorities will be covered for transitional costs. That issue will be covered in the consultation paper. The noble Baroness, Lady Hamwee, and the two other noble Lords who spoke made reference to the potential burden on billing authorities. Any potential problem will be considered through the impact assessment which will accompany the consultation document on the draft regulations. Specifically, I can say to the noble Baroness, Lady Hamwee, in relation to new burdens generally that it is CLG policy that all new burdens on local authorities from duties or powers are assessed and, depending on the outcome of the assessment, are funded by the relevant department. The noble Lord, Lord Bates, touched on the rating revaluation. Revaluation happens every five years based on market rents at an earlier date—typically, two years earlier. Therefore, the 1 April 2010 revaluation will be based on market rates at 1 April 2008. That system has been in place since 1990. He pressed me on whether the revaluation should be scrapped. We certainly have no plans that I am aware of to do so. The noble Lord also asked whether there should be a raising of the threshold. I think that that was a threshold in relation to BRS, rather than to BRS-BIDs in particular. The threshold is not mandatory and there is scope within the proposals that will come forward for a higher threshold that is introduced in particular arrangements. The threshold does not have to stick at £50,000. As I understand it, there is scope within the provisions of the Bill to have higher thresholds. I hope that that has dealt with the questions raised. I am conscious that much of the answer is about how we are going to consult and much of the detail that noble Lords seek will be dependent on that consultation. We will have an impact assessment, which is very important. But until that has been constructed and the consultation has been undertaken, it will not be possible to flesh out some of the more detailed questions that have been raised. I hope that that will at least satisfy the noble Lord of our intent in how we will move forward and that he will feel able to withdraw his amendment.
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    Lord Jenkin of RodingLord Jenkin of RodingConservative
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    My Lords, I am grateful to noble Lords who joined in supporting the amendment. I am grateful also to the Minister, because it is clear that he has done his best to try to reassure us that everything will be all right on the night. We shall have to wait and see. There is no doubt that there is a lot of anxiety on the part of the billing authorities in London. They will want to study carefully what the Minister said. They are of course mindful of the benefits, as he said. They all support the Crossrail project and recognise that part of the finance for it was going to be found through contributions from business, hence this Bill. An impact statement will be welcome—I am grateful for that. I am not quite certain that the Minister recognises that the commitment under the new burden doctrine is that those new burdens should be “fully funded”. If he would like to intervene and say, “Yes, that is quite right. That is what I meant”, I should happily give way.
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    Lord McKenzie of LutonLord McKenzie of LutonLabour
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    My Lords, I hope that that is what I said in answer to the noble Baroness, Lady Hamwee; that is, that it is CLG policy that all new burdens on local authorities from duties or powers are assessed and, depending on the outcome of the assessment, are funded by the relevant department.
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    Lord Jenkin of RodingLord Jenkin of RodingConservative
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    My Lords, I heard that and I am grateful. The Minister has, I think, confirmed that that sentence, which he has read out again, is intended to represent that they will be fully funded. I am particularly grateful that the Minister recognised that the late tabling of this substantial and complex amendment has raised serious challenges for everybody. I would like to think that we have perhaps dealt with it effectively in this House, but it is my guess that when the Government’s amendment goes back to another place, notwithstanding what the noble Lord, Lord McKenzie, has said, my honourable friends will wish to pursue it further. However, that is for them. It would not be right to spend any more time on it here; there is other business to follow. I beg leave to withdraw the amendment.
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    Baroness HamweeBaroness HamweeLiberal Democrat
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    My Lords, I apologise to the House for the error both in this amendment and in the reference in Amendment 6. Amendment 5 should read “page 23, line 38” and Amendment 6 should read “page 24, line 8”. I shall speak to Amendments 6 to 12 as well as to Amendment 5. I am grateful to the Bill team, who telephoned me this morning having identified which paragraphs should have been referred to from the questions which I had emailed to them and which I intend to raise under this group of amendments. I apologise to the House for the confusion that the errors may have caused. I apologise also for being somewhat telegraphic in my speaking to the amendments. I have given notice of my questions, as I have said, and I am not sure, given the Statement which is to follow, that the House would want me to spell things out in greater detail than I intend.
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    Lord McKenzie of LutonLord McKenzie of LutonLabour
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    My Lords, I am grateful to the noble Baroness for giving us notice of the intent behind the amendments, as that makes it easier for us to be, I hope, very specific in our responses. This is a large group of amendments that deal with points of detail. If I am not able today to answer them simply, clearly and fully, I will certainly follow up in correspondence, but I hope to meet the noble Baroness’s expectations. As I said when we dealt with the amendment tabled by the noble Lord, Lord Jenkin of Roding, the Government will consult fully before implementing Schedule 2 to the Bill. Schedule 2 gives a valuable degree of flexibility, which many stakeholders have asked for. Of course, with flexibility comes the possibility of implementing the schedule in different ways. In due course, all stakeholders will be given the chance to comment in full on the Government’s proposals for implementation, as will Parliament when the necessary regulations come here for debate. I hope that that puts in a useful context the answers to the noble Baroness’s detailed questions. On Amendment 5, the noble Baroness wishes to know how paragraph 2(2) of Schedule 2 applies where a BID is being renewed. The short answer is that it does not. It may be useful if I take a step back to explain why. Schedule 2 will apply where there is both a BRS and a BID in an area, but it need not be the case that either is already in force. All that is necessary for steps to be taken to establish a BRS BID is that a BID has been approved in a ballot for an area and that the final prospectus for a BRS for the area has been published. As a minimum, both the BID and the BRS must have been approved to come into force on some future date, but they need not actually have come into force. That is the combined effect of paragraphs 1 and 2(2) of Schedule 2. Where a BID is already in force and up for renewal, paragraph 2(2) will have no direct application. The BID will be in force and steps can be taken to establish a BRS BID, provided that there is a BRS for the area. If BID renewal proposals are ultimately unsuccessful, the BRS BID will have to come to an end, because there cannot be a BRS BID without a BID being in existence. However, if the BID is renewed, the BRS BID will be able to continue. The BRS BID proposals will have to allow for both these prospects. The maximum lifespan of a BRS BID will be five years, as is the case for BIDs, and the expiry date for a BID and BRS BID in an area will be the same only if they come into effect on the same day, which will not necessarily be the case. The noble Baroness asked whether paragraph 2(5) of Schedule 2 affects local discretion to offset BID liabilities against BRS liabilities. It does not. While BRS BIDs can be introduced only in those areas where a BRS is in place, a BRS BID will not affect owners’ or occupiers’ BRS liability. A BRS BID might be established so that the BID liability of occupiers can be offset by a contribution from property owners through the BRS BID, but the BRS BID provision is separate and distinct from the flexibility that levying authorities have to offset BID liabilities against BRS liability that is provided for in Clause 16. Subsections (1) to (4) of Clause 16 provide the BRS-levying authority with powers to offset BID levies against BRS liability, which can be done irrespective of whether a BRS BID is in place. Where a BRS BID is in place, the levying authority has the discretion to offset that liability against BRS liability for anyone who is liable for both levies. That is dealt with in Clause 16(5). The levying authority will need to set out in its prospectus its policy on offsetting BID liability and BRS BID liability against BRS. This policy will have to cover BIDs in existence when the BRS is established, as well as future BIDs and BRS BIDs. Once the authority has done that, BID companies will be able to consider whether a BRS BID for their area might be appropriate and whether property owner contributions might take the place of some or all of the contributions from occupiers who are also liable to BRS. The noble Baroness, Lady Hamwee, queried whether a rateable value is doubled if both occupiers and owners vote. This contemplates ballots for a BID as well as a BRS BID. The answer will depend on how the ballots for the BID and BRS BID in an area are run. Schedule 2 to the Bill gives the Secretary of State the power to deal with this in regulations, on which we will be consulting, but the Bill contemplates that ballots might be conjoined, held simultaneously but separately, or held at different times. The Bill also gives the Secretary of State the power, in paragraph 5 of Schedule 2, to deal with how rateable value is attributed to a property owner for the purposes of BRS BIDs. That reflects the practical reality that property owners may own property that does not individually have a rateable value ascribed to it. Office blocks, for example, might comprise several rateable properties and, therefore, several rateable values, but the whole building might not have a rateable value. In those circumstances, one answer might be to aggregate the individual rateable values and ascribe those to the owner for the purposes of BRS BID ballots. On the specific question, depending on the approach taken, it might be the case that, in a combined ballot where both the occupier and owner of a property vote, the rateable value of that property is effectively doubled, but that will reflect the fact that there are two persons voting in respect of that property. In separate ballots on a BID and BRS BID, that will not happen; when it is conjoined, that will not be the case. The noble Baroness doubted whether it was proper for BRS BID proposers to be able to cherry pick between provisions that might be made under paragraphs 6(2)(a) and 6(2)(b) of Schedule 2. Paragraph 6(2) flows from discussions between the Government and stakeholders in advance of Schedule 2 to the Bill being tabled. We were told that it would be valuable for those proposing a BRS to be able to consider how the results of combined ballots on a BID and a BRS BID might be assessed based on the proposals that they are making. I can understand that the idea of those proposing a BRS BID cherry picking the counting mechanism could give cause for alarm; it potentially looks like carte blanche for those proposing the ballot to rig the result. But I can assure noble Lords that that is not what we are providing for. Paragraph 6 simply acknowledges that, in combined ballots, there might be cases where a degree of interdependence is appropriate between the votes of occupiers and the votes of owners before a BRS BID can be established; in others, even though the ballot is combined, it should be enough that the BRS BID vote is successful on its own. The Government recognise that there will be different views on this and that the issue has the potential to be complicated. That is why we have taken the power to make provision of the type contemplated in paragraph 6 of Schedule 2 in regulations, subject to the affirmative resolution procedure and why, as I mentioned, we will be consulting fully. Amendment 9 relates to the possibility of weighting occupiers’ and owners’ votes in a combined BID and BRS BID ballot. Paragraph 6(4) is in addition to the double-lock ballot arrangements and follows on from the Government’s discussions with BID stakeholders and the British Property Federation at earlier stages of the Bill. As I mentioned, in some cases a BRS BID will be set up so that the contributions from property owners to a BID-funded project can offset the contributions to that project from occupiers who are also paying a BRS. In other cases, occupiers and property owners will fund the same project for their area, through a BID and BRS BID respectively, although the BRS BID will not provide any offset as such. In both these cases, occupiers and property owners will be contributing a proportion of the funding to the same project. Those proportions may be equal—50:50—or they may not and owners will contribute, say, 25 per cent of the project costs. In those cases, stakeholders have told us that there should be flexibility for the ballots on the BID and BRS BID to be conjoined and for the votes of occupiers and property owners to be weighted. Therefore, where they are funding equal proportions of the project, their votes would carry equal weight and, where they are not, their votes could be weighted by reference to the proportion of the project that their cohort is funding. Potentially, this would be for the person proposing the BRS BID to set out in their BRS BID proposal document. Clearly, however, different stakeholders will have different views on whether such a weighting should be possible and, if so, whether it should be for the BRS BID proposer to decide that weighting is appropriate for their proposals. This is one of the issues on which we will be consulting.
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  • Speaker
    Baroness HamweeBaroness HamweeLiberal Democrat
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    My Lords, on that last point, I am sure that I speak for all noble Lords in adding my thanks to the noble Baroness, Lady Andrews. I am glad to see that she is here to wave the Bill on its way. It was a more enjoyable Bill than I expected when we started work on it. I congratulate the noble Lord on that tour de force in answering my amendments. The whole House has been absolutely riveted and completely enthralled. I found the answers useful; they will be even more so when I read them. I hope that they will be more useful still to those who will be concerned with the Bill after it leaves this House. I beg leave to withdraw the amendment.
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  • Speaker
    Lord McKenzie of LutonLord McKenzie of LutonLabour
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    That the Bill do now pass
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  • Speaker
    Lord BatesLord BatesConservative
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    My Lords, given that the House has other business, I shall only briefly echo the sentiments expressed by the Minister and the noble Baroness, Lady Hamwee. This Bill departs this place in better shape than when it arrived, which is a testament to cross-party co-operation and the great knowledge and expertise that have been brought to bear on it. I particularly pay tribute to the benefit that the House has had of the support and experience of the noble Lords, Lord Jenkin of Roding and Lord Brooke of Sutton Mandeville. I also pay tribute to the sterling work of the Bill team in the support that it has offered not only to successive Ministers at the Dispatch Box but also to us. It is good to see two predecessors in their place. The noble Baroness, Lady Andrews, who was terrific in the way in which she consulted on, led on and initiated this Bill, is standing at the Bar of the House, waiting keenly, I am sure, to embark on that mammoth tour of English Heritage sites around the country. Finally, on behalf of the noble Earl, Lord Cathcart, and myself, I thank Miss Clemmie Grant for the assistance that she gave these Benches in Committee, Report and Third Reading.
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  • Speaker
    Lord Jenkin of RodingLord Jenkin of RodingConservative
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    My Lords, on behalf of the Back-Benchers, not very many of whom took part in this Bill, I, too, thank the succession of Ministers—a sort of relay race of Ministers—that we have had, one after the other, for the very full answers that they have given. I hope that I am not disclosing any secrets but, at one point this morning, I was informed by the Government Whips’ Office that it would not be the noble Lord, Lord McKenzie of Luton, who would be handling the Bill this afternoon but the noble Lord, Lord Young of Norwood Green. I then had an urgent telephone call from the government Whips, who said, “No, no, no, it won’t be Lord Young, it will be Lord McKenzie”. So I said, “I know Lord McKenzie, so that’s all right”. That is, if I may say so, a pretty strange way to conduct a Government. I am most grateful to my noble friend for his kind remarks and, as I say, I am grateful for the very full answers, which, I know, have gone a long way towards satisfying those outside who have been anxious about this.
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