Local Government Finance (England) Special Grant Report (No. 100) (HC 869), On 2001-02 Special Grant for Rate Relief in Respect of Hardship Caused by Foot and Mouth Disease

[back to previous text]

Mr. Leslie: I welcome this useful airing of the issues and, in particular, the recognition of my own respectable role in these proceedings. I am aware that, like other hon. Members, the hon. Member for Brentwood and Ongar has encountered the traumatic impact of foot and mouth disease in his constituency. Thankfully, it appears that the worst has passed and we can move on.

Column Number: 011

The Government recognise that foot and mouth disease was a pernicious problem. We have initiated many measures to try to ameliorate the impact on businesses and others, and the grant is another. We have examined deferral of various tax payments, including VAT and national insurance. Our initiatives include the £80 million business recovery fund channelled through the regional development agencies, match donations for those raised by charities for cleansing and disinfection and the livestock welfare disposal scheme. The grant is only one element.

The hon. Member for Brentwood and Ongar and my hon. Friend the Member for Hyndburn (Mr. Pope) mentioned the authorities outside the 151 rural authorities as defined. I shall write to the Committee to explain in more detail how we decided which authorities to put on the list. However, it is not true that the authorities that are not on the list will receive not a single penny piece from central Government funding. All authorities may apply for rate relief if they choose and get 75 per cent. of that support paid by central Government. The grant that we are debating refers to the 95 per cent. central Government support, which can rise to 98 per cent. if the relief has a particular impact on a certain local authority's budget.

It is up to the local authorities to decide how to apply the relief, which should answer questions asked by the hon. Member for Brentwood and Ongar about how calculations are applied and whether particular shops will get particular relief—food shops, for example. It is up to individual local authorities to decide how to take and assess applications from businesses on their patch. I was asked how the calculation is to be applied—whether it will be made on the reduction or rateable values—and I understand that it will be made on the rateable value at the time that the relief is awarded.

Mr. Pickles: So, that will be the temporary figure. My understanding was that the temporary reduction will operate for a fixed period of three months. When the award is made, will it take into consideration those three months or will it be decided after?

Mr. Leslie: My understanding is that the rate relief in question applies to the whole financial year, so the sums will be relatively similar throughout. There will be no crossing over into another financial year. As such, the calculation as to which quarter may apply will not differ throughout that financial year. If an award is made, even retrospectively, it will apply to the sums relevant in that year at the time that it is made. It will be calculated in respect of the financial year 2001–02.

Mr. Pickles: This is not an important point, but I want to be clear in my mind. For example, if there were an agreement within a financial year temporarily to reduce rateable value by 30 per cent., would the

Column Number: 012

figure for the year be 100 per cent. for three quarters and 70 per cent. for one?

Mr. Leslie: I understand that that is a matter for the local authority in question, but if I am wrong I shall write to the hon. Gentleman. I am not sure about the precise arrangements applied by local authorities—they are in the driving seat on a lot of those of matters. While the Government calculate what support we should offer local authorities when giving that rate relief, often those questions can be left to them.

I hear what my hon. Friend the Member for Hyndburn and others said about authorities not being included in the list of those receiving up to 95 per cent., but I ask them to bear it in mind that the 75 per cent. social funding support is available for authorities outside the 151 should they choose to apply such rate relief schemes. I am not aware of any representations on or applications for that higher level of support from Brentwood, Epping Forest, Rossendale, Hyndburn or even Oldham. If I am wrong, I shall certainly inform hon. Members.

I shall write to my hon. Friend about the definition of rurality, and as the hon. Member for South-East Cornwall (Mr. Breed) said, the inclusion of north Cornwall and west Somerset is welcome. I am glad that the Government have been able to consider that matter. On deferral, I understand that how local authorities defer or reschedule the payments of individual ratepayers is a matter for their discretion. The LGA apparently reported in December that about 6,000 businesses were allowed to defer payments as a result of the foot and mouth outbreak. Obviously, the Government will monitor those closely.

Mr. Pickles: On another small point, given that the Government will monitor those schemes, do they now know the split between those that are part of the scheme and those outside it?

Mr. Leslie: I have no figures to hand on which authorities are deciding to apply rate relief under the normal arrangements. Certainly, we must monitor things closely. Given that we are discussing such a recent financial year, it is understandable that many of those matters have yet to be settled. Obviously, we want to keep a close watch on all those questions. I believe that special grant report No. 100 is a considerable benefit to many authorities that have suffered from particularly severe outbreaks of foot and mouth disease. I strongly urge the Committee to take note of it.

Question put and agreed to.


    That the Committee has considered the Local Government Finance (England) Special Grant Report (No. 100)(HC 869), on 2001–02 Special Grant for Rate Relief in Respect of Hardship Caused by Foot and Mouth Disease.

Committee rose at twenty-three minutes past Five o'clock.

Column Number: 013

The following Members attended the Committee:
O'Hara, Mr. Edward (Chairman)
Bayley, Hugh
Breed, Mr.
Gilroy, Linda
Havard, Mr.
Hayes, Mr.

Column Number: 014

Jackson, Helen
Leslie, Mr.
Pickles, Mr.
Pope, Mr.
Smith, Geraldine
Woolas, Mr.

Previous Contents

House of Commons home page Parliament home page House of Lords home page search page enquiries ordering index

©Parliamentary copyright 2002
Prepared 17 June 2002