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Earl Ferrers moved Amendments Nos. 101 and 102:

Page 34, line 30, after ("therms") insert ("or kilowatt hours").
Page 35, line 19, after ("therms") insert ("or kilowatt hours").

The noble Earl said: In moving these amendments I should also like to speak to Amendments Nos. 105 and 150. These are all technical amendments, bringing the Bill into line with our metrication obligations in Europe. I beg to move.

On Question, amendments agreed to.

Earl Ferrers moved Amendments Nos. 103 and 104:

Page 35, line 43, at beginning insert ("Subject to subsection (6) below,").
Page 35, line 49, at end insert:
("(6) A public gas transporter shall not be required under subsection (5) above to give any information which he could not be required to give in evidence in civil proceedings before the court; and in this subsection 'the court' means—
(a) in relation to England and Wales, the High Court;
(b) in relation to Scotland, the Court of Session."").

The noble Earl said: In moving these amendments I should also like to speak to Amendment No. 137. These amendments refine an information gathering power that was inserted rather hastily on Report in another place. I beg to move.

On Question, amendments agreed to.

Earl Ferrers moved Amendment No. 105:

Page 36, line 12, after ("therms") insert ("or kilowatt hours").

The noble Earl said: I spoke to this amendment with Amendment No. 101. I beg to move.

On Question, amendment agreed to.

28 Jun 1995 : Column 821

Lord Inglewood: I beg to move that the House do now resume. I suggest that the Committee stage begin again at 7.50 p.m.

Moved accordingly, and, on Question, Motion agreed to.

House resumed.

Non-Domestic Rating (Chargeable Amounts) (Amendment No. 2) Regulations 1995

7.19 p.m.

The Earl of Lindsay rose to move, That the draft regulations laid before the House on 19th June be approved [23rd Report from the Joint Committee].

The noble Earl said: My Lords, these regulations contain three technical amendments to the non-domestic rating transition scheme which phases in the effects of the 1995 revaluation. There is also a minor change to correct an erroneous cross-reference in the principal regulations. These regulations were passed in another place earlier this afternoon.

The transitional phasing scheme, which we debated in this House last December, operates by limiting year on year rate increases to 7½ per cent. in real terms for small properties—those with a rateable value for 1st April 1995 of under £15,000 in London or £10,000 elsewhere—and 10 per cent. for larger ones. For small mixed-use property, the limit is 5 per cent. For those who gained from the revaluation, rate reductions are also limited.

Perhaps the most important amendment we wish to make concerns the rating of police property following the creation of the new police authorities on 1st April. In case law dating back to the last century, hereditaments which are provided or maintained for purposes connected with the administration of justice, police purposes or other Crown purposes are treated as Crown properties, and so are exempt from rates and other taxes unless the legislation includes express provision to the contrary. Section 64 of the Local Government Finance Act 1988 included just such a provision to remove the Crown exemption from hereditaments provided or maintained by local authorities and the old police authorities for such purposes. However, this provision was not amended by the Police and Magistrates' Courts Act 1994 to reflect the creation of the new police authorities. As a result, police hereditaments became Crown exempt from rates from 1st April.

Although rates are not payable on Crown property, voluntary contributions in lieu of rates are payable in certain cases. However, there would be a number of practical difficulties in setting up arrangements to collect contributions from police authorities even if they had the power to pay them, which is by no means clear. For that reason, we have decided to bring police authority property back into rating as soon as possible. We have the power to do this by overriding the Crown exemption by order under Section 64.

However, there is a problem with bringing police property back into rating at this time. In our transitional scheme, property qualifies for phasing of its rate bill only

28 Jun 1995 : Column 822

if it was subject to rating on 31st March 1995 and has remained in rating since. That does not, as I have explained, apply to police property. However, we do not believe it would be fair to deny police authorities the benefits of phasing once their properties come back into rating: we want to put them on the same footing as other ratepayers. That is what the first amendment made by these regulations does. It has the effect that periods during which police hereditaments are subject to Crown exemption will be treated as though they were periods during which they were subject to rating. The amendment will also allow phasing to apply, from the date these regulations come into force, to any former police properties which may have been acquired by a non-police body since 1st April 1995.

One effect of the Crown exemption from 1st April is that local authorities will not be able to collect all the rates that they expected to be able to pay into the non-domestic rating pool this year. My department has written to local authorities to remind them that they can re-calculate their contributions to the non-domestic rating pool if those losses are significant.

The second amendment deals with the transitional phasing arrangement for certain properties which are shown in central rating lists. The central lists for England and Wales include those industries whose rateable values are set by the Secretary of State—gas, electricity distribution, water and so on—together with other extensive properties, such as the national telecommunications networks and long-distance pipelines. The main regulations governing the transitional arrangements were intended to apply phasing to those industries in a similar way as for other ratepayers. However, we have found that certain long-distance pipelines fall outside the arrangements because they have been switched into the central rating list from 1st April 1995, having previously been shown in local rating lists. That possibility was not envisaged when the regulations were drafted. As a result, the companies to whom the pipelines belong are being treated less favourably than other ratepayers.

The amendment deals with the problem by changing the qualifying conditions for phasing. Hereditaments will now be able to qualify if they were shown for 31st March 1995 in either a central list or a local list. If they were shown in a local list for 31st March, their transition bill will be calculated by reference to the rateable value shown in the list for that day.

The third change that we wish to make concerns the calculation of transitional bills for property which has been divided into two or more separate rating assessments, or where separate assessments have been merged into one, since 1st April. As currently worded, the rules require the phased bill in the year after the year in which the split or merger takes place to be calculated by reference to the amount payable on the day of the split or merger. But we now realise that this would give the wrong result if the newly created hereditament is eligible for certain rate reliefs on that day. These are taken into account later in the calculation and so would be double-counted. The amendment has the effect that reliefs are ignored when carrying out the calculation. No harm

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has been done by the current wording since the provision only affects the calculation of bills from next year. I beg to move.

Moved, That the draft regulations laid before the House on 19th June be approved [23rd Report from the Joint Committee].—(The Earl of Lindsay.)

Lord Graham of Edmonton: My Lords, we on these Benches certainly do not oppose the measure that is before us. There are only one or two points on which I should like clarification. Quite clearly, from what the Minister said, a great deal of thought has been given to this matter in some quarters. I had the impression from what the Minister said that the regulations were important to certain groups of people.

As always in these matters, we hear the argument for the case in the abstract. Can the Minister give us some idea of the size of the problem? In other words, arising from these regulations, what amounts of money are concerned? What sum would now be paid which would not have been available if the measure had not been before us? Are we talking about large or small sums of money? Any moneys that will be put into or back into the coffers of local authorities to enable them to carry out their functions are welcomed from these Benches.

Can the Minister say whether there is an esoteric element involved in the sense that someone in Marsham Street, civil servants or officers reviewing or revising the formula, have simply said, "Perhaps we have got it wrong"? Or was there pressure from either police authorities or local authorities? Was the matter raised as a burden? I should like to know whether there was a problem which has been examined and to which this measure is the solution. Or has there merely been a second look at the manner in which the Acts have applied and, on mature reflection, what we now have is the product of how things could be done better?

I can well imagine that the Minister does not have to hand the precise answers to those questions. I should be happy to hear from him later. In the meantime, I recognise that I am dealing with the fine print of much greater issues. I am sure that the Minister feels that this measure is the better way.

Perhaps the Minister can tell me whether these matters have been the subject of previous consultation. Were the local authorities consulted? Were the police authorities consulted? Were requests received from those bodies? Did they have no objection to the measure? If those bodies are consulted on proposals which they consider sensible and benign rather than malignant, I can well imagine that there would be no objection. The AMA body is meeting downstairs at this moment and there are many people in the building tonight who understand local government. On their behalf, I should like to make sure that they have been party, by consultation or agreement, to what the Minister has put before us. Otherwise, I am very happy indeed to see progress made.

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