Local Government Finance (England) Special Grant Report No. 80 and Draft Non-Domestic Rating (Public Houses and Petrol Filling Stations) (England) Order 2001

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Mr. Clifton-Brown: I do not want to make a party political point, but if Parliament is not sitting in the near future, difficult cases will still be brought to us as candidates. Can the Minister confirm that there will be a dedicated hotline so that problems can be brought to the taskforce's attention and action can be rapidly taken to deal with them?

Ms Armstrong: The hon. Gentleman knows as well as I do that government continues during election periods. Parliament may not sit, but the Government carry on. The Government can take decisions that are agreed—co-operation is necessary—between the Opposition and the Government. A hotline is already running and the Government are committed to taking any necessary further action.

Mr. Green: My hon. Friend is making a rather different point. Members of Parliament have individual representational rights, which will disappear on dissolution. When this Committee finishes, I am going to talk to a Ministry of Agriculture, Fisheries and Food regional office about a farm in my constituency facing serious welfare problems with its ewes. Because that sort of representational role will disappear during an election, my hon. Friend was asking the Government for a commitment to treat us as Members of Parliament, even when we are not. That should apply to all candidates because the individual representational role is vital and must continue.

Ms Armstrong: I thought that I had already made it clear that hotlines will continue and that councillors, for example, will continue to be able to make representations. Councillors continue to be councillors during a general election. Of course candidates can continue to ask questions and to represent people. The world does not change in that sense. The world will go on, as it has in previous elections.

What I do know is that we have pulled down the agri-money for farmers as no previous Government have done and quickly paid compensation. However, we are anxious to do what we can to reassure other businesses, so that they believe that they can continue. How we talk about the disease is most important to the public perception of what is happening in the countryside. Life goes on. We must get the balance right or we will frighten people away unnecessarily, but the public can continue to enjoy the countryside.

In my constituency, the foot and mouth outbreak is confined largely to the foothills of the north Pennines. At the top end of the dale, there is no sign of foot and mouth; there are good visitor and craft centres in the small market town of Stanhope. I hope that people will continue to go there and buy things in the Co-op and in other shops and then go further up the dale to other visitor attractions that will open up at Easter, if plans continue.

As I said, there are significant outbreaks in my constituency but we want to ensure that businesses can continue. It is a difficult time for them, whatever the Government say or do, but we want to give them confidence that we are listening to them and know the problems that they face. It is precisely for that reason that we set up the taskforce to consider a wide range of matters, and why my right hon. Friend the Minister for the Environment announced interim measures. We are working consistently on other aspects of the issue—the guaranteed loan scheme, for example—many of which have been raised today. Those matters are under active consideration by the taskforce; any proposals that it makes will be implemented as soon as those decisions are taken.

As hon. Members know, my right hon. Friend is anxious to reassure the banks. He is holding meetings with them, and the taskforce has involved them in the most effective way to give short-term support to farming and other businesses with cash-flow problems.

Mr. Clifton-Brown: It may help the hon. Lady to know that Andrew MacThomas, the public affairs adviser to Barclays bank, has written to me and, I presume, to every other Member of Parliament, saying that the bank's farming customers who are affected by foot and mouth disease can apply for a repayment holiday, which is welcome news. I hope that the Minister will press other banks to do the same and to consider including all businesses that are affected by the foot and mouth crisis in the repayment holiday.

Ms Armstrong: I have not yet seen the letter to which the hon. Gentleman refers, but I shall take note of it when I do so.

The hon. Member for Ashford asked for an estimate of the number of businesses that would take up relief. That will be difficult to do, as we have not cash-limited the money that we are giving to help them. More generous relief is being given in Wales, but it is cash-limited on the basis that their outbreak is not as great as that in this country. Wales also has a devolved Administration, and it is up to them to take such decisions. We estimate that about 50,000 businesses in this country may benefit from rate relief. The total cost will depend on how many businesses finally receive relief, their size and how long they receive it. If 50,000 businesses received 100 per cent. relief for three months, the total cost would be about £22 million. That would include £4.5 million funded through the special grant and £16.5 million centrally funded through the national rate pool in the normal way. Authorities granting relief would fund the remaining £1 million.

The hon. Gentleman also asked why there was a limit of £12,000. During the work done in preparation for the local government finance Green Paper, it became clear that rates represented a much larger proportion of the outgoings of small businesses than of large ones. Therefore, rate relief is a more effective way of assisting small businesses, which are also less able to absorb temporary reductions in income. The £12,000 rateable value limit is used in defining the limit of discretionary rate relief available under the village shop rate relief scheme. We felt that that was appropriate.

Larger properties, with rateable values above £12,000, and those in areas outside the 151 areas specified in the order, will also be eligible for the relief if their business is adversely affected by the foot and mouth outbreak, provided that the council funds the usual 25 per cent. of the cost of providing that relief. It is not true to say that either businesses outside the 151 areas or those with a rateable value of more than £12,000 will not be eligible for the rate relief. They will be eligible for it, but it will be funded in the traditional way.

Several Members raised the subject of the three-month limit, which is simply the limit for this special grant. We will, of course, monitor the situation carefully. Should it prove necessary, we would present another report to Parliament to extend the scheme for a further three months.

Mr. Clifton-Brown: If it is sitting.

Ms Armstrong: We always face that issue and will take it into consideration in any action that the Government take. We are confident that we can fulfil that commitment and would keep that in mind if Parliament were prorogued.

Mr. Green: Dissolved.

Ms Armstrong: Yes. I am sorry. That would also be the case if anything else happened.

Mr. Ian Cawsey (Brigg and Goole): This is a revelation.

Ms Armstrong: Well, Parliament might not be dissolved, but just go on holiday.

Mr. Clifton-Brown: Prorogued.

Ms Armstrong: Yes.

The hon. Member for Ashford asked further questions, but perhaps I should deal with other hon. Members' questions on this subject before I deal with pubs and clubs.

The hon. Member for Cotswold (Mr. Clifton-Brown) talked about the trauma and psychological strain for farmers. Given my constituency experience, I am probably more aware of that than most people in the Room. The Government are totally sympathetic to that. That is why we have been so prompt with the compensation and why we have drawn down the agri-money.

The hon. Gentleman asked whether the measures we were taking would fall foul of state aids. We have formally applied for state aid clearance, but we are confident about them as they are building on existing schemes. The increase from 75 to 95 per cent. is seen as perfectly acceptable because it deals with a crisis that the European Union knows about. We are confident that the measure for pubs, other shops and garages will not fall foul of anything, because it is building on a current rate relief that has been accepted for shops.

The hon. Gentleman also talked about issues that had been raised by his district council last week. I said that councils can already defer rate payments to help businesses in the short term and to make it easier for them to do so we will defer part of the payments due to be made by these 151 rural authorities into the national rate pool. I hope that that answers his questions. He also said that it was important that councils had clarity and could be clear with their electorates. We issued guidance about that on Tuesday and his authority ought to have received it and so should be relatively clear about what it can and cannot do. These measures must be put in the hands of councils. They have a better idea of what is going on locally and who is suffering and who may be doing fine and simply looking for a bit more assistance. We have to be careful with public money to ensure that it is being spent properly.

The hon. Gentleman also spoke about post office closures and garages. Of course such businesses always have to be innovative and careful about their local business. The latest figures show that post office closures have begun to slow down; there are fewer now than there were under the previous Administration. That does not mean to say that I do not recognise that life is difficult for them and that is precisely why we have been working so hard with them to provide alternative means of trade and to open up other avenues of trade. That work continues. I know that garages buying petrol through the spot market is a big issue in rural areas. It is one that I have previously brought to the attention of colleagues in my Department who deal with transport and I know that they are continuing to look at it.

The hon. Member for Ashford asked how many pubs and petrol stations would be affected. We estimate that around 8,200 pubs and 1,700 petrol stations will be eligible and that the cost will be in the region of £2 million, and that will all be funded from the centre. Considerable additional public expenditure is involved here. That is because the Government have been able to handle the economic situation so that we can continue to invest. Opposition Members need to work out what they want to do. Do they want to cut the amount of money going into public expenditure, which would mean cuts in those areas, or are they prepared to recognise that there has to be sufficient public expenditure to deal with crises like this? It is not easy for any Government because they have to balance pressures.

I believe that these measures will help. They will not sort out the problems that rural businesses are facing at the moment but they will help. We will continue to keep an eye on things and to be closely involved with all the organisations involved to ensure that we get the right proposals and the right balance of support so that we can see a thriving rural economy growing out of the crisis.

Question put and agreed to.


    That the Committee has considered the Local Government Finance (England) Special Grant Report No. 80.

Draft Non-Domestic Rating (Public Houses and Petrol Filling Stations) (England) Order 2001


    That the Committee has considered the draft Non-domestic Rating (Public Houses and Petrol Filling Stations) (England) Order 2001.—[Ms Armstrong.]

        Committee rose at five minutes past Eleven o'clock.

The following Members attended the Committee:
Michie, Mrs. Ray (Chairman)
Armstrong, Ms
Breed, Mr.
Browne, Mr.
Cawsey, Mr.
Clifton-Brown, Mr.
Green, Mr.
Heppell, Mr.
Hughes, Mr. Kevin
Watts, Mr.
Winterton, Ms Rosie

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