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Lord Williams of Mostyn: As always, I am most grateful for the care and courtesy which the Minister devotes to answering my questions. However, I regret to say—and I am sure that the fault is mine—that I am neither enlightened nor satisfied by the explanation put forward. It is, of course, a cause of great contentment to us all to hear the noble Earl speak with commendation of a retrospective tax on a windfall. I am obliged to hear that that is now to be government policy. However, I must not intrude unnecessarily on private grief, and I shall turn to one or two specific points.

The noble Earl says that this measure imposes no new burden on any local authority. Can that be so? Subsection (13) requires that sums paid to a local authority over a considerable number of years should be repaid. Most persons dealing with economic matters would regard that as the imposition of a new burden.

I wish to put a specific question which is of some importance. I indicated that the longest period of financial attack against local authorities could be as much as 27 years because of the specific designation in Clause 2(1)(a)(i) of the Town and Country Planning Act 1968. The Minister said that my fears were unfounded because there would be a six-year limitation period. I should be grateful for confirmation that that suggestion arises from Clause 2(2). I respectfully suggest that what the Minister has indicated as his understanding of subsection (2) is not correct. Clause 2(2) provides that:

these are the important words,

    "any amount so required by him to be paid by a local planning authority shall be, and shall be taken at all times after the making of the requirement to have been, recoverable from that authority as a civil debt".

The construction of that subsection which I humbly offer is that the six-year limitation period will run from the date of the requirement being made, not from 1989 as in the Minister's example. In other words, if I am right, and I think I may be, the civil debt recovery period will be a period of six years from the date of the requirement. Of course, the requirement can itself relate to sums expended, or not expended as the case may be, going back to 1968. This remains a serious problem when, after all, one is dealing with fairly limited sums.

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Earl Ferrers: I am sorry that I did not make my position clear to the noble Lord. If I did not, that was my fault. It is not his comprehension which is adrift but merely my explanation.

Perhaps I may try to help the noble Lord a little further. I am always hesitant to get into legal tangles with the noble Lord, who is an expert in these matters. He said that his understanding of the Town and Country Planning Act was that claims could go back for 27 years. The clause validates all charges which have been levied as far back as 1968. But, by virtue of Clause 2(2) it is provided that such sums are recoverable as a civil debt from the date of the making of the requirement to pay. Therefore, if a charge has been levied and an authority has not paid it can only go back six years by virtue of Section 9 of the Limitation Act 1980.

The noble Lord, Lord Williams, will be far more familiar with the niceties of these criteria and legal positions than I. However, what I am trying to tell the noble Lord, and the Committee, is that the sole purpose of the clause is to close an unsuspected loophole, one which everyone thought did not exist. For the past 20 years everyone had been quite content to pay.

Perhaps it is not the noble Lord's intention, but if he were to remove Clause 2 that would cause terrible problems, because all payments made by local authorities over the past six years could have to be refunded by the Government. However, the Government had included in standard spending assessments and the revenue support grant figures which included moneys which local authorities would have to pay for those services. That is why I say that if local authorities received a windfall because your Lordships deemed it necessary to remove Clause 2, as a result of which windfall the Government had to pay back all that the local authorities had spent, then the Government would have to recover from the local authorities that amount of money that they had given to local authorities to meet that expenditure. I think that that is unreasonable and would cause problems all over the place. All we are trying to do is to restore the position to what everyone thought it was.

I hope that with that simple explanation the noble Lord will find it easier to understand the position than he did before.

Baroness Hamwee: Perhaps I may pursue that point before the noble Lord responds. The words:

    "shall be taken at all times to have had"

appear on the first line of subsection (2). The Minister has told us that those words go back to the first of the Acts referred to. There is a similarity between those words and the words introduced by the Limitation Act:

    "and shall be taken at all times after the making of the requirement to have been".

Does the Minister agree that the use of similar terminology meaning different things is bound to lead to confusion? I apologise to the Committee, but that is why I am prolonging this short debate.

Earl Ferrers: One could describe this as an important drafting matter. We are dealing with an Act which states that this provision shall apply to all those cases and that is limited by the six-year limitation in Section 9 of the

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Limitation Act 1980. We are dealing with both the town and country planning Acts which refer back a long time and it is the Limitation Act which prevents it going further than the six years.

4.30 p.m.

Lord Williams of Mostyn: I simply wish to be helpful as will doubtless be recognised by all. Subsection (2) introduces the six-year period of limitation in the Limitation Act to which the noble Earl rightly refers to the date of the making of requirement—in other words, not from the date of the original liability.

My essential purpose was to raise the question of principle, which I maintain to be important. My subsidiary purpose is to ask the Minister to consider whether some of the words and phraseologies might have been rather more felicitously drafted. Some thought at least should be given to the questions raised.

Earl Ferrers: I apologise to the noble Lord. He is quite right. He referred to the matter and I did not reply to it.

The noble Lord thinks that the six year application goes back to when there is a requirement to pay. I believe that he will find that the six year period goes back from the Royal Assent, when the Bill becomes an Act, which is then curtailed by the six years. That is the time when the provision will come into effect.

The noble Lord asked a number of quite technical, legal points. Rather than to have a possibly wrong explanation from me I should like to write to him so that he knows the exact position.

Lord Williams of Elvel: Will the noble Earl be good enough to look at the drafting to which my noble friend referred? The Report and Third Reading stages are to come. In the light of the remarks made by my noble friend, if the Government feel that there is a point we are happy to accept whatever amendment the Government may put forward to clear up the matter.

Earl Ferrers: Of course I shall take account of what Members of the Committee have said. I accept the kind offer of the noble Lord, Lord Williams of Elvel, that he would be happy to accept any amendment that the Government put forward. I assume that the noble Lord, Lord Williams of Elvel, having asked the question, wishes me to respond to the noble Lord, Lord Williams of Mostyn. It is a complicated way of doing things, but if that is the way in which the noble Lord, Lord Williams, wishes me to deal with it I am content to do so.

Of course I shall consider these matters. The noble Lord, Lord Williams of Elvel, said that if we put down an amendment, it would go down quite happily. By that I assume he also meant that if we did not put down an amendment that would go down quite happily too. On that assumption and generosity of understanding—it is always there if nothing interrupts it—I shall certainly consider the points made. I shall also let either of the noble Lords, Lord Williams, know the result of our considerations before the next stage.

Lord Williams of Mostyn: I am much obliged to the Minister for that response.

Clause 2 agreed to.

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The Deputy Chairman of Committees (Lord Murton of Lindisfarne): Before we proceed, there is a correction to be made. The result of the Division on Amendment No. 1 was announced incorrectly. The correct figures are: Contents, 90; Not-Contents, 140. The figures given earlier—namely, Contents, 93; Not-Contents, 137—should be disregarded.

Clause 3 agreed to.

Clause 4 [Retrospective validation of payments etc. in connection with certain past Scottish inquiries and hearings]:

On Question, Whether Clause 4 shall stand part of the Bill?

Lord Ewing of Kirkford: It may seem to the Committee that the debate that we are about to have is similar to the debate on whether Clause 2 shall stand part of the Bill. Perhaps I may take a few moments of the Committee's time to explain that there is a significant and major difference between the contents and needs of Clauses 2 and 4 of the Bill. Clause 4 has the same effect in Scotland as Clause 2 has in England and Wales.

Perhaps I may explain the background to the legislation. As the noble Earl has been at pains to explain throughout our short discussion, the legislation has arisen because the Government were challenged in the English courts by Birmingham City Council, which questioned the Government's legal right to charge them for such inquiries. The court upheld Birmingham City Council's approach that the Government had no legal basis on which they could charge for those inquiries. As time passed, it was necessary for the Government to introduce this legislation and, in the case of England and Wales, to make it retrospective in order to validate what had been understood to have been the position over the years.

If that had been the position in Scotland, and against the background of the debate on Clause 2, I would not oppose the Question that the clause stand part. However, that is not the position in Scotland. The retrospective application of the legislation to Scotland is both unnecessary and, for that reason, highly undesirable. There never has been a problem in Scotland. No local authority has ever challenged the Government's right to charge those payments. No local authority has any intention of challenging the Government's rights to charge those payments because the local authorities referred to go out of existence in six months' time with the whole local government scene in Scotland changing and new authorities coming into being on 1st April 1996.

The extent of the problem in England has been defined by the noble Earl, involving amounts of £2 million to £3 million, possibly rising to £11 million.

I tabled a Written Question before the House adjourned for the Summer Recess. I asked the total amount of payments by Scottish local authorities to the Scottish Office for such inquiries. I asked for the figures over a 10-year period. I was given the most recent up-to-date figure for the five-year period. The total figure for five years is only £220,000. I am reliably informed—I shall not reveal my source—that I was not given the figures for

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the 10-year period because they would have been extremely embarrassing to the Government's case and that the whole issue would have been made to look ridiculous. Therefore, there is no need for retrospective legislation in the case of Scottish local authorities. There never has been a problem. There never will be a problem. Therefore, there is no need for retrospection. Both Houses guard with jealous care the principle of not having retrospective legislation if at all possible. In my 25 years in both Houses I can count on one hand the number of times that retrospective legislation has been introduced.

I simply say this to the Minister who will reply to the debate. In all seriousness, I ask him sincerely to accept that the clause does not stand part of the Bill. There is simply no reason for the provision in Scotland and therefore no need for it.

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