HL Deb 28 April 2004 vol 660 cc857-60

7.52 p.m.

Lord Bassam of Brighton

rose to move, That the draft regulations laid before the House on 22 March be approved [13th Report from the Joint Committee].

The noble Lord said: My Lords, the draft Non-Domestic Rating (Chargeable Amounts) (Amendment) (England) Regulations 2004 amend certain rules governing the operation of the transition schemes established to phase in the effects of the 1995 and 2000 revaluations.

Under the Local Government Finance Act 1988, revaluations must be carried out every live years, with the rateable values of all properties being updated in line with changes in their market rental values. The purpose of a revaluation is not to increase the amount of rates paid nationally. In fact, the legislation expressly prevents this from being done. The purpose of a revaluation is to adjust individual bills in line with relative movements in the property market. That means that at a revaluation many ratepayers benefit, with their rate bills being reduced. However, others see their bills increase.

The transition scheme phasing in the effects of the last revaluation, that of 2000, is estimated to have benefited more than 600,000 properties in England; that is, 40 per cent of the total. To pay for the phasing in of increases, other rate bills that were decreasing as a result of the revaluation had to have their decreases phased in to avoid a loss in rate income for local government.

The regulations governing the 1995 and 2000 schemes are lengthy, nearly four dozen pages each. They therefore need to be kept under review to ensure that they continue to work fairly. It is as a result of both discussions with representatives of the rating professionals and the impact of new rating legislation that we have decided on amendments to some provisions in the regulations. The Explanatory Memorandum provided with these draft regulations explains their purpose and effect.

First, there is a move to a standard one year in which ratepayers can appeal against the value of a certificate issued by a valuation officer for the calculation of a transition bill. As mentioned in the memorandum, when a new property, such as a suite of offices, is created from merging adjoining offices on the first day of a new rating list, to calculate the transition bill for the new office suite it is necessary to have values for the old offices on the assumption that they have survived until the first day of the new list. These values are certified by the valuation officer.

All ratepayers will now be guaranteed a minimum time in which to lodge an appeal against the certified values. If, following the making of an appeal the ratepayer and valuation officer cannot agree on the value, the matter is transferred to an independent valuation tribunal for decision. This move to standardisation in the time allowed to make an appeal will not adversely affect any ratepayer: all those on whom it will impact will benefit from more time in which to appeal.

Secondly, and happily, under Section 64 of the Local Government Act 2003, community amateur sports clubs which are registered under the Finance Act 2002 are now entitled to 80 per cent mandatory rate relief—that is, rate relief on a par with the relief that charities receive. This reflects the fact that these clubs play a valuable and influential role in promoting the health, welfare and cohesion of their local communities.

These amending regulations will ensure that the transition scheme will interact with this new rate relief for sports clubs in the same way in which it interacts with charity relief. First, the effects of transition on the rate bill will be taken account of, and then the resulting bill will be reduced by 80 per cent.

Finally, we will be holding a public consultation exercise later this year on the transition scheme to accompany the 2005 revaluation. The new scheme will of course take full account of the experience gained in the working of the current and past schemes, experience reflected in these new regulations. For those reasons, I commend the regulations to the House.

Moved, That the draft regulations laid before the House on 22 March be approved [13th Report from the Joint Committee].—(Lord Bassam of Brighton.)

Baroness Hanham

My Lords, I thank the Minister for that explanation. Anything to do with raising appeals is something most of us would avoid like the plague if we possibly could, but because of their complexity, not their desirability.

The regulations are now greatly overdue; they were originally promised in 2002. Indeed, some of the sister regulations which were promised in March were introduced in April. Can the Minister say at the outset why two years have passed before the regulations have come to light? They are not very controversial. Indeed, they are extremely desirable because anything that lengthens the time, first for the certification and then for the appeal, from six months to a year is bound to be welcome.

The Minister also mentioned that there will be consultation on the 2005 regulations; presumably they will cover the new rating system for 2005–10. We are, of course, almost at the end of the 2000–05 period. Are there any proposals for consolidation of the regulations? This was suggested in the Green Paper, Modernising Local Government Finance, in 2002 but so far there has been complete silence on the subject. Perhaps the Minister will give me a clear view on that as well. We do not oppose the regulations. They are entirely sensible but require a little explanation on the matters I have raised.

Finally, we welcome the appearance of the mandatory relief for amateur sports clubs. The matter was introduced into the House by my noble friend Lord Moynihan. Unfortunately, he cannot be in his place today, but I know that he will be dancing up and down with glee because his initiative has seen the light of day.

Baroness Hamwee

My Lords, we, too, welcome the regulations, although it has taken a little while for me to work out that I do. The noble Baroness referred to their complexity. When I looked at the regulations I thought, "This is a surveyor's heaven really". I was not surprised, nor did I castigate myself too much, when I discovered that this is the thousandth regulation since the Local Government Finance Act 1988. Perhaps it is no wonder that we are running out of things to say on this subject.

I shall not repeat the questions asked by the noble Baroness. I was very relieved to see paragraph 14 of the Explanatory Note, which states, These regulations will ensure that the 1995 and 2000 schemes will apply relief as intended". That is extremely reassuring.

I welcome the provisions for community amateur sports clubs. The noble Lords, Lord Moynihan and Lord Phillips of Sudbury, and another noble Lord whose name I am ashamed I cannot remember, formed a very active group of Peers which pushed the matter during primary legislation. I am sure that the clubs will be delighted that their pressure is now bearing fruit.

Lord Bassam of Brighton

My Lords, I thank both noble Baronesses for their praise for the regulations. I hope that by saying a few further words I may have sufficient time to read the note that has been presented to me on some of the questions that were raised.

The noble Baroness, Lady Hanham, asked about delay. I understand that we have been consulting on the regulations with various rating professional bodies. As the noble Baroness said, these are complex matters—it is the 1000th regulation—and that consultation took somewhat longer than expected. However, most of the substance of the changes was embodied in negative regulations many months ago. We have now put those aspects together, one of which is fairly recent following the Local Government Finance Act 2003. In a sense, we have used the opportunity created by the delay usefully to bring in that aspect via this regulation.

I hope that there will be a degree of consolidation. I cannot be certain on that point, but it seems to be highly desirable. We are all grateful and glad that my noble friend Lord Woolmer and the noble Lords, Lord Moynihan and Lord Phillips of Sudbury, were so active and persuasive on mandatory rate relief. It would be remiss of me if I did not thank also my noble friend Lord Pendry, who reminded us of the Northern Ireland example. He showed us that if it could be done there, it could be done here too.

On Question, Motion agreed to.