Business Rate Supplements Bill

Public Bill Committee, 29 January 2009.

Clause 16

Janet Dean (Labour, Burton)

I remind the Committee that with this we are taking the following: amendment 31, in clause 16, page 11, line 43, leave out—

‘to the extent specified in the rules’.

Amendment 32, in clause 16, page 12, line 4, leave out ‘subsection (4).

Amendment 17, in clause 16, page 12, line 8, leave out paragraphs (b) and (c).

Amendment 33, in clause 16, page 12, line 9, at end add—

‘(5) This section does not apply to the Crossrail project.’.

Clause stand part.

New clause 1—BIDs: supplementary provisions—

‘(1) The 2003 Act is amended as follows.

(2) After section 41 insert—

“41A Additional arrangements where business rate supplement imposed

(1) In any business improvement district where a business rate supplement under the Business Rate Supplements Act 2009 has been imposed, a property owner BID levy may be imposed on the owners of non-domestic property, or a class of such owners, in the district.

(2) A non-domestic ratepayer who is liable to pay the BID levy on a hereditament is not liable for a property owner BID levy on that hereditament, and may not take part in a property owner ballot in respect of that hereditament.”

(3) In section 46(1) (description of non-domestic ratepayers liable for BID levy to be specified) insert at end “, and, where applicable, the description of property owners who are to be liable.

(4) In section 49 (BID proposals) after subsection (2) insert—

“(3) A levy on property owners may come into force only where it is approved by a ballot of the property owners in the proposed business improvement district who are liable for the proposed property owner BID levy.”

(5) In section 50 (approval in ballot) after subsection (6) insert—

“(7) A property owner BID levy is not to be regarded as approved by a ballot held for the purposes of section 49(3) unless the two conditions set out in subsections (2) to (6) are satisfied.”

(6) In section 55(2) (regulations about ballots)—

(a) in paragraph (b) after “ ratepayers” insert “and property owners”, and

(b) after paragraph (h) insert—

“(i) enabling the billing authority to construct a list of all property owners in the BID area for the purposes of holding a property owner ballot and billing.”’.

Amendment 45, in title, line 3, after ‘development;’, insert

‘to make provision about business improvement districts in consequence of the imposition of a business rate supplement;’.

Nick Raynsford (Labour, Greenwich and Woolwich)

At the end of our sitting on Tuesday, I was near the end of my speech outlining the case for new clause 1 and amendment 45. I have a few additional points, which I will cover briefly now to complete the case.

The advantage of the proposal for a landowner levy to be an option in areas where there is a BID and where there might be an adverse impact from the introduction of the BRS, is that it would be permissive. There would be no obligation on local authorities to produce a register of landowners, which could be an onerous and expensive operation and could involve abortive expenditure. It would apply only in those cases where BIDs were up and running, where there would probably be a greater understanding of the ownership structure in the area. There would be an incentive to ensure that the BID, if it was working successfully, had the prospect of continued viability should it be threatened, as we heard from witnesses who gave evidence last week, by the arrival of the BRS. I therefore believe that there would be considerable advantages.

I accept, however, that more work might be needed if this particular option is to be progressed. There would almost certainly be a need for further guidance on the processes involved in compiling a register. If I can persuade my right hon. Friend the Minister for Local Government consider the proposition, I would be happy to offer any further thoughts outside the Committee on how that process might be undertaken.

It will be important to conduct some further research. A research study was commissioned precisely because of the anxieties about the non-contribution of landowners towards BIDs. I believe that that study, commissioned by the Department and undertaken by the university of York, has completed two stages. Stage 3 has been postponed because of the expected arrival of the BRS; that is an entirely proper approach by the Department, as it avoids anticipating conclusions to a research study that could be influenced by the impact of the BRS.

It would be sensible to have a specific element in the research study looking at the experience of introducing, on a voluntary or a permissive basis, a landowner levy in one or more BIDs districts, where the imposition of a BRS can be anticipated and where there might be an impact. One might suggest the possibility of a control study, using one or two BIDs districts without the landowner levy and one or two with the landowner levy, to compare and contrast the experience of those two.

There are very strong grounds for considering the option. The issue has been with us right from the origin of BIDs. We heard evidence that the success of BIDs might be undermined following the introduction of the BRS if progress is not made on the funding package to keep BIDs viable, and we know that the contribution of landowners could be critical.

I hope that I have said enough to persuade my right. hon. Friend that the idea is worthy of further consideration. I accept entirely that my new clause and amendment are unlikely to be accepted today. I shall be happy not to press them if my right hon. Friend indicates that he is not happy to accept them, but I hope that he will be willing to give further thought to the concept.

Dan Rogerson (Liberal Democrat, North Cornwall)

Welcome to the Chair, Mrs. Dean.

I will speak briefly to the amendments proposed by the hon. Member for Bromley and Chislehurst, but also to amendment 17, which stands in my name and that of my hon. Friend the Member for Solihull. First, on amendment 30 and the consequent amendments, an automatic offset—which I believe is the underlying principle—is problematic. In many areas BIDs and business rate supplements will be doing entirely different things. With reference to our previous debate, had there been a ballot in both cases, it would have been easier to reconcile the two, because that would have demonstrated that the business community had opted for both. However, an automatic offset is potentially problematic.

The new clause, to which the right hon. Member for Greenwich and Woolwich spoke, is attractive and absolutely right. During evidence sessions, he consistently drew attention to the lack of a mechanism to enable a more formal role for property owners, as opposed to tenants, to participate in BIDs and a BRS. I am therefore attracted to his proposals. As he said, this is an exploratory process and he does not intend to press them to a vote. We are all the better for his having done that and I congratulate him on raising those points.

Amendment 17 takes a different approach to that proposed by the hon. Member for Bromley and Chislehurst in his amendment, in that it seeks to give flexibility to local authorities. Our colleagues at the Local Government Association may not be happy with some of my remarks about ballots, but perhaps they will be slightly happier with these ones. Under amendment 17, a local authority that wished to put in place a BRS across its entire area, where there might be one or two BIDs, could take a different approach to BIDs within that area, depending on local circumstances—for example, how advanced the BID was or how close it was to concluding. Of course, that would be done in consultation with the business community in the area, because there might be specific reasons why an offset would be preferable in that area. In conclusion, amendment 17 would give flexibility to a local authority, in consultation with its local business community, to achieve a local solution.

John Healey (Labour, Wentworth)

It is a pleasure to serve under your chairmanship this morning, Mrs. Dean. I hope that the Committee will make as much progress as it did on Tuesday.

We have had a full debate on this group of amendments, which is right because of the number of concerns voiced in last week’s evidence sessions. The concern to protect the future success of BIDs was clearly part of our thinking when framing the legislation. Interesting and important points have been raised about the interaction between BIDs and a business rate supplement, and our debate has been well informed by and drawn from the evidence that we took last week. That underlines the value of the new Public Bills system, which allows evidence taking before the start of the scrutiny sittings. To help the Committee to consider the proposals in two stages, I shall deal first with the amendments that suggest an automatic offset for a business improvement district levy from the business rate supplement; and, secondly, with the new clause tabled by my right hon. Friend the Member for Greenwich and Woolwich.

Like other members of the Committee, I listened carefully to the evidence last week and to this debate. I am conscious of the arguments and recognise the concerns about BIDs within any new system. It is encouraging that there is—unlike in 2003—a very clear view on all sides of the House about the importance of the success and future value of BIDs. We want them to continue to thrive alongside a business rate supplement. The fact that we are so conscious of BIDs’ value is a real tribute to the work that my right hon. Friend the Member for Greenwich and Woolwich put in as the Minister responsible for that policy and legislation five years ago.

Let me explain why in many ways the amendments cut across the ethos that we have tried to enshrine in the Bill. We aimed to establish the principle that local authorities will work together with businesses in their area to develop proposals for major investment and projects that will strengthen the long-term economic development and success of their area. In other words, the responsibility and decision making will be devolved to the local level. The Bill, therefore, essentially gives a decentralised but circumscribed power to local authorities to play that future role in the economic development of their area.

In keeping with the desire to decentralise such decisions so that they can be made appropriate to the areas to which they apply, authorities will also have flexibility—again, within certain limits—to design the levy, as well as to determine whether to introduce a BRS and decide to which projects they should contribute funding. Local authorities can therefore decide whether to offer more generous safeguards to business; to set the threshold for the liability to pay the BRS above the £50,000 that we propose; and even to decide to exclude empty properties from liability. With that general approach, it is only right that we should leave to the local level the decision on whether there should be an offset for those paying BID levies. The Bill offers local authorities the power and scope to make that decision. If Members pause to think about this, they will see that it is self-evident that circumstances will vary considerably in different local areas with different BIDs. The Government have therefore framed the legislation to make provision for the arrangements of BIDs to vary.

I turn now to amendment 17, which stands in the name of the hon. Member for North Cornwall. Clause 16 in general requires the levying authorities to set rules on the extent to which BID levies can be offset against a BRS liability. However, the clause also requires those authorities to apply the same rules to all BID levies throughout their area. I am not sure whether it is what the hon. Gentleman intends, but treating BID areas differently could allow levying authorities to draw up different rules for different BID areas. That could contravene some of the state aids legislation and competition rules and therefore favour certain types of undertaking in certain areas. The hon. Gentleman quite rightly described the proposition in amendment 30 as problematic, but the proposition in amendment 17 is equally so.

Amendment 30 would require an offset for BIDs in all circumstances except, of course, Crossrail and London. The evidence that we heard from the chief executive of British BIDs, Dr. Julie Grail, was particularly impressive and informed, as well as extremely helpful to the Committee. I took on board and understood her concerns about BIDs, particularly in areas where there may be a BRS and there is a desire to introduce new BIDs or perhaps to refresh the mandate to continue a BID. I will give further thought to her views, because they were echoed by my right hon. Friend the Member for Greenwich and Woolwich, who said that he had a genuine concern that reflected Dr. Grail’s.

Beyond the concern about the risk and therefore about the protection of BIDs within a BRS system, it is important that this morning we subject the case in principle on whether there should be an automatic exemption to careful scrutiny. Doing so will lead to a judgment, which has to be made, on whether that is the right approach. BIDs and the BRS are different policy measures designed to deal with different types of project and activity. In deciding whether to have an offset, levying authorities will need to consider the benefits from a BID to those paying for it and the benefits from a BRS-funded project to those paying the supplement.

Although we followed the approach to BIDs to a great extent in framing the legislation for the BRS, the two are different. That is one reason why the power to levy for a BID lies with lower-tier local councils, while the power to levy a BRS is restricted to the upper-tier or unitary authorities in an area.

There are several other differences between the two. First, they are different in purpose: a BID is essentially short term, and the levy generally funds immediate activity, such as community wardens, street cleaning, pedestrianisation projects and CCTV cameras; a BRS, in contrast, is longer term and more suited to large-scale investments and capital projects. BIDs also tend to reflect directly and immediately on the bottom line for individual businesses. A BRS, on the other hand, brings longer-term, much wider and perhaps less specific and less easily quantifiable benefits for an area, including the businesses in it. BIDs typically run for a term of three to five years—their mandate must be re-established every five years. In contrast, the BRS is for longer-term investments—there is no fixed time limit. For instance, for Crossrail, the Mayor proposes to use a BRS for a 24-year term.

The uses of the funds are also different. Generally, funds raised from BIDs support revenue spending, and they often raise the lion’s share of the funding for a particular project in an area. On the other hand, the BRS—certainly for Crossrail—supports the capital required for a long-term project. The geography, too, is generally different. BIDs are specifically designed and set up in a highly localised area—often, but not exclusively, a town centre—so they are small in scale. The BRS, in contrast, is designed to benefit a much wider area, and the liability is therefore applied in a wider area. It may often apply to more than one local authority area, as in the case of London, and perhaps others in the future.

Finally, in many cases, the businesses that are liable and paying for a BID will be different from the businesses that will be paying a BRS, particularly given the threshold that we propose to set. In other words, the majority of businesses paying for a BID are unlikely to fall into the category that will be liable to pay a BRS.

We heard from the Confederation of British Industry, British BIDs, the Royal Institution of Chartered Surveyors and the Mayor in his written evidence, and it is quite telling that their view is that BIDs are different from the BRS. The argument that the hon. Member for Bromley and Chislehurst advances in his amendment—that there should be an automatic offset—does not, therefore, have a strong, principled basis, and I hope that he will not press it to a vote.

In fact, the hon. Gentleman did, in many ways, help me make my arguments. In our earlier sittings, he accepted that there are clear differences between BIDs and the BRS. He acknowledged that there may be some overlap, but that is precisely why the Bill gives the levying authority the power to consider whether there should be an offset when a case can be made that there is an overlap in a local project. That is why there is flexibility in the Bill.

Dan Rogerson (Liberal Democrat, North Cornwall)

Although I entirely take the Minister’s point that amendment 17 might be leading us into the dangerous territory of competition, my intention was to reflect the point he has just made on specific local circumstances. It would increase flexibility for local authorities because those circumstances might apply to one BID area and not to others in a large rural area.

John Healey (Labour, Wentworth)

I understood why the hon. Gentleman felt that this proposal should be looked at, but I have already explained the problems with it and why I cannot accept it. I hope that he will treat this discussion as a useful airing of the issues and not press amendment 17 to a vote.

The hon. Member for Bromley and Chislehurst suggested that another way of offering an offset might be to have a reduction in the business rate multiplier. He mentioned in passing the point he made on Second Reading that the Government have not provided in the Bill the option for a levying authority to reduce the business rates and give a reduction rather than a supplement. We raised that question in the White Paper in October 2007, but decided not to pursue the idea in the Bill because detailed discussions with business, local government and other interested parties revealed no real appetite for it and, in fact, a number of problems were foreseen.

Bob Neill (Conservative, Bromley and Chislehurst)

Will the Minister give way—at a convenient point, of course?

John Healey (Labour, Wentworth)

If I continue for a minute before giving way, I may answer the hon. Gentleman’s question.

In the end, the principal problem was that people found it hard to see how the proposal could work in practice without having an impact on mainstream local authority services, as it would take funding from them. It could also have an impact on council tax payers, who would have to meet any shortfall caused by a reduction in the business rate. For those reasons, we did not pursue that proposal in the Bill.

Bob Neill (Conservative, Bromley and Chislehurst)

I am grateful to the Minister for that explanation and for his earlier explanation of the Government’s thinking on the automatic offset. He will not be surprised to hear that I am not entirely convinced. The issues of local flexibility, resolving potential conflicts with mainstream revenue and the impact on council tax payers could have been addressed had the Government provided for an automatic ballot in all cases. Had they done so, those issues would then be part of the local debate and it would be for local people to decide whether to go ahead with the BRS.

John Healey (Labour, Wentworth)

I am interested in the hon. Gentleman’s point. Does he mean a ballot of council tax payers, as they would pick up the tab, or is he returning to his argument for a ballot of business? The logic of his proposal for a ballot was that all businesses that would have to pay more through business rate supplements should be balloted. With a reduced business rate, the extra burden would fall on the council tax payers. Logic demands that he is now proposing a ballot of council tax payers rather than businesses.

Bob Neill (Conservative, Bromley and Chislehurst)

That is a good try by the Minister. He knows that our point is that a ballot of those who pay under the BRS scheme would inevitably be informed by the views of the council and the council tax payers who are the customers of the businesses. Such a ballot would naturally generate a public debate in the area. A ballot of council tax payers is not required, as they will get their own vote in the council elections. At that point, they can judge the wisdom of the local authority in embarking on such a scheme.

I understand and accept the Minister’s point about the difference between the BRS and BIDs, particularly from the point of view of Government and local authorities. Does he concede that from the point of view of the businesses that will have to pay, the BRS and BID levies will come out of the same pot? From their point of view, both affect their bottom line and their cash flow. That is why the automatic ballot might have resolved the questions we are discussing.

John Healey (Labour, Wentworth)

I do not want to re-rerun the arguments on the compulsory ballot that the hon. Gentleman has lost for now. He is right that a business may have to find a BID levy and a business rate supplement. However, to return to my general argument, if in an area there is a case for both, the benefits likely to be derived and the purposes for which the two charges might be introduced are different, so one cannot automatically and fully offset the other.

I shall now move on to the new clause proposed by my right hon. Friend the Member for Greenwich and Woolwich. I am grateful, as are other members of the Committee, for the opportunity to debate the issues that arise from his proposal. On Tuesday, he was right to hope that I would be sympathetic to the new clause but also to suspect that I would be unlikely to accept it. I want to give further careful consideration to what he described as a fundamental problem with BIDs, which is that the levy cannot be applied to the owners of business properties. I know that he has regarded this as unfinished business since the Local Government Act 2003.

My right hon. Friend mentioned the research that we undertook. He correctly stated that we did two stages of research on property owners and BIDs. Both sets of research were inconclusive—in other words, they demonstrated that BIDs could go ahead successfully without contributions from property owners and that some went ahead successfully with voluntary contributions from business owners. He is also right to say that we pulled or perhaps postponed the third phase of the scheduled work, not least because the prospect of the BRS suggested that that was sensible, which is the stage we are at now.

As I understand it, my right hon. Friend’s proposal is that where a BID is in place in an area that is likely to be subject to a BRS, the BID body would be able to decide whether the owners of the properties in the BID should be liable for the BID levy. A register of the BID owners in that area would therefore have to be prepared. By enabling property owners to pay towards the BID, extra revenue would be available to offer occupiers a reduction on their BID payment. I think that that is the logic behind what he has in mind and how it would operate. In effect, it would be an offset for the occupiers, or a cushion against a BRS, where local judgment suggested that it would otherwise place a BID in jeopardy.

I agree with my right hon. Friend that his proposal is elegant—in many ways, it is. If he wants to intervene, I will be interested to know the extent to which he has discussed his proposition and approach with some of the obvious interested organisations, such as British BIDs. I am interested in that because clearly the proposal would break new ground.

Nick Raynsford (Labour, Greenwich and Woolwich)

I am most grateful to my right hon. Friend for inviting me to intervene. I shall try to answer his question as quickly as I can because interventions should be brief. I have held discussions with the British Property Federation about the concept of a power being available to allow a levy to be raised following a ballot of property owners—that ballot would be essential. The proposal is the result of those discussions. I have consulted interested people, but I have not specifically discussed it with Dr. Grail, although I would be more than happy to do so.

John Healey (Labour, Wentworth)

That is helpful. It indicates both the serious intent and the how early the stage of examining and developing the idea is. I shall respond to my right hon. Friend on that basis.

Philip Dunne (Conservative, Ludlow)

May I help the Minister?

John Healey (Labour, Wentworth)

I would be delighted if the hon. Gentleman wishes to help.

Philip Dunne (Conservative, Ludlow)

I am always helpful. I am sure that the Minister has seen the note prepared by the British Property Federation in connection with the new clause. It claims that the new clause has the “explicit support” of not only the British Property Federation, with which the right hon. Member for Greenwich and Woolwich held discussions, but the British Retail Consortium, British BIDs and London First. If the Minister has not received a copy of that note, I will be happy to provide him with one after the Committee.

John Healey (Labour, Wentworth)

As the hon. Gentleman promised, that was a helpful and useful contribution to the Committee’s debate on this approach.

As my right hon. Friend the Member for Greenwich and Woolwich has acknowledged, should we be able to make a response to the concerns raised by Dr. Julie Grail, one of the things we will need to deal with is the principal problem of 2003: bringing property owners into the BIDs framework. The problem at the time was that BIDs were based on the ratings system, in which liability for rates falls on the occupier rather than the owner in most cases. The view at that time was that including them would have amounted to a new tax on property owners. That is why at that stage, the provision was made elegantly for property owners to make a voluntary contribution towards the BIDs. That is the approach that we have followed with the Bill. I referred to that last week in my evidence to the Committee.

The other principal argument for taking that approach in 2003 and in the current Bill is provided by Cambridge Econometrics, which has looked at evidence for the feed through of business rate rises from property owners to occupiers. It found that the majority of the change in business rates is passed on through reduced rents. While the formal burden of taxation for business rates falls on occupiers, the economic incidence—the actual costs—passes on to the landlords in large part, if not in whole, in the medium term. That raises a question about the extent to which property owners should be required to contribute, particularly for a medium or long-term project facing levies such as the business rate supplement.

There are other questions about the proposition in the clause that come to mind. There are practical questions about the suitability of a double-lot ballot and the prospect of property owners voting to reject a levy, and the question of not guaranteeing that any additional contribution by property owners to the BID would be passed on to the occupiers. Finally, there is the question of the administrative burden on billing authorities to set up a register.

I say to my right hon. Friend that I will consider this further and consider the scope for property owners to be bought more fully into the BIDs system. I would be very pleased to meet him to discuss that further, if he wants me to, when he is ready. I hope that, on that basis, he will not press the new clause to a vote—I think he has indicated as much to the Committee.

Finally, I return to the question of the automatic offset, which has been raised by a number of outside organisations and is on the agenda as amendment 30. There are voices calling for that, but others are arguing the opposite case. Let me finish, therefore, with a couple of quotes from important and informed sources. The first is from the South Bank Employers Group—an association of major organisations on the south bank in the Waterloo and Blackfriars areas—which helps to deliver a BID-type benefit for their local area through an alternative but voluntary BID levy. Members of the group, comprising a high proportion of the largest business rate payers in the area, decided not to propose a BID. Their view was that the present voluntary arrangements worked extremely well in their area and that a BID would not bring greater benefits. They have also looked at an automatic offset and their view is that having an offset for BID payers would be unfair. The group said:

“The fact that business have chosen to contribute to this fund of local additionality...should not in any way relieve them of the obligation to contribute to a major pan-London project like Crossrail. This would be seriously unfair on major businesses which are not in BID areas, whether because they have voted against the BID proposals or because a BID proposal has not come forward, or because the area is not seen as suitable for a BID.”

If Opposition Members are going to press the case for an automatic offset to the business rate supplement for BIDs levy payers, they have to deal with the argument of the association that represents the BIDs themselves, which we heard in evidence last week from Dr. Julie Grail:

“a full offset in London would be a ridiculous and dangerous move and would give an open door to every business community in London to go and get itself a cheaper business rate supplement”.——[Official Report, Business Rate Supplements Public Bill Committee, 20 January 2009; c.47, Q200.]

Bob Neill (Conservative, Bromley and Chislehurst)

I hear what the Minister says. Sometimes when there is conflicting evidence, people come to different conclusions, and I think that that is where we are at. The South Bank Employers Group’s argument would have been met in the event of a ballot—I am not going to repeat the point again after this—because that would have involved an informed choice. On the second piece of evidence, the exemption for Crossrail would have dealt with that issue.

So, grateful though I am to the Minister for his detailed and helpful response, and alive as I am to the very valid points raised by the right hon. Member for Greenwich and Woolwich, I hope that I do not damage the chances of his proposal going forward if I commend it to the Minister for further consideration, as well. None the less, my hon. Friends and I will seek to press our amendment 30 to a vote.

Clause 17

John Healey (Labour, Wentworth)

This is a fairly straightforward clause. It enables us as a Government to set some practical arrangements on how levying authorities should deal with a business rate supplement in relation to properties jointly owned or occupied. It also allows them to make arrangements in cases where the person who is liable for the business rate supplement has died. The provisions will be technical in nature; they will mirror powers that already exist in relation to non-domestic rates; they are designed to ensure that it is clear where the liability for BRS falls in very specific circumstances. I think it therefore appropriate to deal with this in secondary legislation. The clause gives us the power to make those regulations, and I can reassure the Committee that no provisions made under them will affect the level of the liability due in respect of a property.

Clause 18

Dan Rogerson (Liberal Democrat, North Cornwall)

I beg to move amendment 18, in clause 18, page 12, line 41, leave out ‘March’ and insert ‘January’.

The amendment seeks to examine the question of when the billing authority gets formal notice of the intention to charge a levy. My understanding of the Bill is that the levying authority has until the end of February in the calendar year in which the BRS will come into force, which is in the April. That is a concern because when people are given late deadlines, things can creep towards it; my thought is to bring that deadline back to the start of the calendar year so that the billing authorities have more notice. I say that because, for example, where a ballot is to be held, and it is not clear whether the BRS will go ahead, it may take the billing authority a considerable amount of work to put things in place in order to enact it. It is a straightforward amendment that allows the billing authorities a little more leeway in getting prepared for things to run smoothly when the BRS comes in at the beginning of the financial year.

Bob Neill (Conservative, Bromley and Chislehurst)

I apologise for not having welcomed you to the Chair earlier, Mrs. Dean, on behalf of myself and my hon. Friends. We are delighted to see you, as are all the other members of the Committee.

I have much sympathy with the amendment. It may be that March is used because it is a standard date in local government legislation. I served on a London borough council, which is a billing authority, for a number of years and talked to many others who are on billing authorities. I remember, therefore, the frustrations one often had when there was a precepting authority that went right up to the deadline in fixing its precept. That caused difficulty for the second-tier authorities in working out their budgets. The circumstance here is similar; putting back the deadline would make it easier for people to plan and get things in order.

Sadiq Khan (Labour, Tooting)

I, too, welcome you to the Chair, Mrs. Dean. It is a pleasure to serve under your chairmanship.

I thank the hon. Member for North Cornwall for explaining the reasons for tabling the amendment, and I acknowledge the points made by the hon. Member for Bromley and Chislehurst.

Amendment 18 would mean that levying authorities in two-tier authorities, and the Greater London authority, would have to serve notice on the billing authorities in their area, regarding the arrangements that are to apply for their BRS for the forthcoming financial year, before 1 January. In practice, we would expect levying authorities to give notice earlier than this to ensure that a BRS goes out with the rates bill.

A date of before 1 January would be three months earlier than the date in the Bill of 1 March. That March deadline was chosen for consistency with the timetable for upper-tier authorities in the GLA to issue council tax precepts for the forthcoming year, and with the budget setting process. We are trying, therefore, to ensure that the arrangements for BRS dovetail as far as possible with the existing administrative arrangements, hence minimising the burden on both the levying and billing authorities.

If agreed to, the amendment would cause inconsistency because the BRS and budget-setting/precept processes would be running to different timetables. Also, levying authorities—including the GLA—that intend to levy a BRS from 1 April 2010 could face difficulties in the short to medium term in meeting the timetable proposed by the amendment. The timetable is particularly tight considering that, before the levying authority can notify the billing authority, it will need to have prepared a prospectus, completed the mandatory consultation and revised the proposals in response to the consultation. I therefore respectfully ask the hon. Member for North Cornwall to withdraw his amendment.

Dan Rogerson (Liberal Democrat, North Cornwall)

I was interested to hear what the Under-Secretary said about what would be expected of levying authorities. However, the concern is that what is expected and what is delivered may be two different things. The real reason lies in what he said about Crossrail in his closing remarks. Once again we have hit on an issue where the Bill has been drafted to meet the Crossrail timetable but will have effects elsewhere across the country, which is a grave concern.

The hon. Member for Bromley and Chislehurst referred to issues with precepting authorities. In my constituency there is a five-member parish council where there was a dispute between two members and the other three. The three resigned, making the parish council inquorate and no other people could be found to serve with the two who remained. There was a problem in setting a precept for that year, and this was quite a controversial time in the parish. In the end, we managed by public meeting to find some people willing to stand and resolved the situation. I make that as an aside about the frustrations that billing authorities can experience when dealing with other authorities.

I have not heard a persuasive argument from the Under-Secretary as to why we could not push the deadline back a bit further; we are talking about potential applications of this Bill much wider than Crossrail. I am concerned that, for example, where a ballot is to be held, if the deadline for having all the regulations in place is the beginning of March, that could allow extra leeway for the ballot to take place later. If a deadline is pushed later there is sometimes less impetus—less momentum to get things tied up and dealt with earlier.

I am not going to press this amendment to the vote because I think we have made the point, but I hope that the Government will clearly signal their intention in any reflections and advice they offer to local authorities as to how a prospectus should be put together. Every effort must be made to give as early an indication as possible to the billing authority as to what is proposed and what is likely to occur, so that we do not get the situation where a billing authority has to struggle to deliver things on time for the BRS to be imposed in the financial year.

Sadiq Khan (Labour, Tooting)

As we have discussed, in two-tier areas the lower-tier authorities will act as the billing authority for the purposes of BRS. Clause 18 sets out the requirements on levying authorities in terms of notifying the lower-tier authorities in their area of their intention to levy a BRS, so that billing arrangements can be made in good time—and I hear the points made by the hon. Member for North Cornwall.

The key provisions in this clause are: subsection (1) requires levying authorities intending to impose a supplement to give written notice to each billing authority in their area; subsection (2) sets out the information that must be contained in the notice; subsection (3) specifies when the notice must be given and subsection (4) explains the scope and content of notices where the levying authority intends to impose more than one supplement in the year.

Clause 19

Sadiq Khan (Labour, Tooting)

Clause 19 sets out the arrangements that apply where a supplement is not to be levied and collected as part of the annual non-domestic rating cycle and where a supplement is varied in accordance with clause 10, with the result that new bills have to be issued during the financial year. The clause requires levying authorities to give notice to each billing authority in their area of their BRS arrangements or the variation to their arrangements. This notice must be in writing and, if it is the first notice for the year, must contain the same information as a notice under clause 18, which we have discussed, would. If the notice is being issued as a result of a variation in an existing BRS, the levying authority must also set out the variation and the day on which the variation is to take effect.

The key distinction between notices under clause 18 and clause 19 is that notices under clause 19 will result in billing authorities incurring extra costs because of billing outside the usual cycle. Accordingly, clause 22, which we will come to, provides that levying authorities must meet costs incurred by billing authorities in dealing with notices under clause 19.

Bob Neill (Conservative, Bromley and Chislehurst)

I understand what the Under-Secretary is saying and I am grateful for the explanation. Perhaps, he can also undertake that the guidance on these issues will take on board the point, raised by the hon. Member for North Cornwall, about timely notice for such notices, as well as for others.

Sadiq Khan (Labour, Tooting)

I can give the hon. Gentleman that reassurance. The points have been made very well—loud and clear.

Clause 20

Sadiq Khan (Labour, Tooting)

The clause sets out which authority is responsible for calculating the amount to be paid by each person liable to pay the supplement. Subsection (1) requires billing authorities that are also levying authorities to calculate the chargeable amount. Subsection (2) applies the section to lower-tier billing authorities that have been given notice by a levying authority under clause 18 or 19. Subsection (3) requires lower-tier billing authorities to calculate the chargeable amount payable by each liable person where they have been given notice by a levying authority under clause 18 or 19. Subsection (4) disapplies the requirement under subsection (3) on billing authorities to calculate the chargeable amount in the case of a variation of a supplement, unless the variation requires new calculations to be made. Subsection (5) explains how calculations under this clause are to be made.

In developing these proposals, the Government have ensured that the arrangements are as consistent as possible with the current procedures for business rates. That will minimise any additional burden on local authorities.

Clause 21

Sadiq Khan (Labour, Tooting)

The clause makes provisions for regulations to be made setting out the collection and enforcement arrangements for BRS. My right hon. Friend the Minister for Local Government has set out how the Government intend to make use of these provisions in the statement of intent. Subsection (1) enables regulations to be made for the collection and enforcement of supplements. Subsection (2) provides for the preparation of stand-alone regulations relating specifically to the collection and enforcement of supplements, and also for the existing regulations governing the collection and enforcement of non-domestic rates to be amended so that they apply to supplements. Subsection (4) confers a power to make regulations to address the collection and enforcement of supplements where projects are abandoned. Subsection (3) is not a regulation-making power; it gives the billing authorities a power to collect and enforce payment of supplements once they have come to an end. That is required to ensure that billing authorities can collect the supplement from those ratepayers who have outstanding liability.

Clause 22

Sadiq Khan (Labour, Tooting)

I would like take this opportunity to explain the clause. It allows the Secretary of State and Welsh Ministers to make regulations that make provision for billing authorities to retain a proportion of the BRS revenue they collect to meet the expenses they incur in collection or recovery—referred to in the Bill as “administrative expenses”.

Where BRS is collected as part of the annual billing round, the costs will be met from the BRS revenue. Where billing authorities decide to levy the supplement outside the normal non-domestic collection round, the costs of collection will not come from the BRS revenue and will instead be met by the levying authority. Options for how administrative expenses should be calculated will be set out in the consultation paper that we propose to issue shortly on our proposals for secondary legislation.

Brian Binley (Conservative, Northampton South)

It is a pleasure to serve under your chairmanship, Mrs Dean. I have some concerns about the clause. I preface my remarks by saying that I am very worried about giving opportunity to any Government body to grab more money than they need to have for a given project. I have already mentioned that parking charges are now being used to supplement local government revenue incomes, rather than to provide a service to local communities. I am concerned that the same sort of thinking, in the less scrupulous of our councils, might take place in this respect, too.

I have two concerns on which I seek clarification, the first of which is about the difference in billing. Subsection (1) makes it clear that the billing authority has the ability to recover moneys for administrative costs from the moneys collected through the BRS project. However, the clause then states that the authority can do that only if the information is given prior to the beginning of the financial year, and it seems from the impact assessment that when billing is undertaken as a separate exercise, the cost of collection will be met from the upper-tier authority’s own resources. So, if there is good notice for collection to be made as part of the normal collection of rates, it is the billing authority’s right to take those costs out before it hands the money back to the levying authority. If, however, the levying authority does not ask for a rate until after the beginning of the financial year, it seems that that cost falls on the upper-tier authority’s own revenue budget. Therein lie the sort of caveats that concern me—such as the ability to raise money that is not properly controlled and not transparently projected, but which adds to local authorities’ income streams.

First, will the Minister clear up the issue of those two ways of charging for the collection process? Secondly, how will we be assured, bearing it in mind that money might be coming from the general revenue budget of a given levying authority, that that money will be properly and transparently accounted for, so that people can have faith that money is not being leaked out into other budget areas for purposes not directly ascribed by the Bill?

Sadiq Khan (Labour, Tooting)

I thank the hon. Gentleman for his well-articulated concerns. I agree that we need to keep costs to a minimum. We do not want wastage, and we need to ensure that there is a disincentive in respect of it. One reason for trying to synchronise the collection, with the BRS collected as part of the annual billing round, is to minimise cost duplication. On his point about reassurance, in the consultation for the secondary legislation we will set out the details of the administrative costs incurred in collection or recovery. That consultation is important. He may be reassured because he will be able to respond to the consultation and see the other responses. He is right that we cannot have a situation in which the upper-tier authority’s general revenue account is incurring an additional cost because of the failure to synchronise the collections. I hope that he will become involved in the consultation and that we can assure him that there is no additional wastage.

None

Bob Neill (Conservative, Bromley and Chislehurst)

Perhaps the Minister can help us with an issue regarding paragraph 3(2), and in particular 3(2)(a), on refunds and credits. I understand the concept behind the regulations, but this measure gives a permissive power for the regulations to provide, in effect, for a refund to the billing authorities. I do not have a problem with that, but I notice that the refund is referred to as being

“in equal proportions to each billing authority”.

I take it that that means exactly what it says, but is that always the fairest means of carrying out the refund?

Might it not be appropriate to consider a refund that does not involve equal shares across the board, but which is in proportion to the contribution that has been made by each billing authority? Let us say that there are five billing authorities in a BRS scheme. Depending on how the BID is constructed, some of the billing authorities may have put more into the pot than others. However, as I read the regulations, the refund would be split to give them each a fifth of any refund. However, one of those five authorities might have contributed 30 per cent. and another 40 per cent. of the revenue from businesses in their area, with the others contributing rather less. Should not provision for that be reflected in the regulations? Perhaps the same consideration ought to be given where a BRS covers more than one top-tier authority area. The aim is to have the extra flexibility needed to provide the just result in such cases.

Dan Rogerson (Liberal Democrat, North Cornwall)

The hon. Gentleman makes a good point. I can think of a number of counties where district or borough authorities are different sizes and have different concentrations of businesses communities that might be affected. I look forward to hearing the Minister’s response.

Philip Dunne (Conservative, Ludlow)

I seek your guidance, Mrs. Dean, on whether now is the appropriate point to raise an issue, because I could not find what seemed an appropriate moment anywhere else in the Bill. Please guide me properly if I stray out of order.

It is quite proper that the potentially large sums being raised for substantial projects over a prolonged period should be accounted for. The schedule sets the rules under which the accounting would work, but I see nothing in the Bill that identifies where the accounting information goes or the extent to which that is made public to either the levy payers or the citizens in the area who are subject to the scheme. In particular, there is nothing to show the progress relating to the expenditure of these sums or whether the project is on budget, according to the estimate made at the outset.

A lot of clauses refer to the preparatory phase and to setting up a levy, but there is little about monitoring the levy during the period of its operation until such time as a refund may apply—at the end of it. There seems to be a lacuna in the middle. Will the Minister say how that will be dealt with?

Brian Binley (Conservative, Northampton South)

I seek your guidance, too, Mrs. Dean, because the schedule deals with refunds and credits and I am concerned about the total lack of any comment about refunds to the taxpayer, should the estimate for a given project be over-generous and there is a surplus at the end of it. I see that refunds may be returned, but the schedule does not specify to whom they should be returned, other than mentioning the billing authority. Is this the correct time to mention that or should I mention it in the debate on clause 24, which also deals partly with this matter?

Janet Dean (Labour, Burton)

It would be satisfactory to deal with it under this schedule.

Brian Binley (Conservative, Northampton South)

Thank you, Mrs Dean.

The calculation of the cost of a given project sets the rate thereafter, irrespective of how long the project lasts. The whole thing will be framed, in terms of collection, and laid out in the initial prospectus. I understand that. However, I am concerned that Government projections are sometimes not as accurate as we would like them to be. I have heard that concern echoed even more loudly at local government level over the 12 years that I have been a county councillor. Will the Minister help us by explaining how we will have some control, other than by the measures set out in the schedules, over the efficacy of the accounting processes for the initial prospectus; and if the prospectus is totally wrong, how that money might be returned to the taxpayer, bearing in mind that some of the projects will carry on for some time?

Sadiq Khan (Labour, Tooting)

I thank all hon. Members who have spoken and will deal with each of their comments in turn by contextualising schedule 2.

The White Paper emphasised the importance of security and accountability to the business community to maximise the benefits of BRS. It will therefore be essential to have in place a robust set of accounting arrangements, and the Bill places certain requirements on the levying and billing authorities. As I said earlier, we will soon publish a consultation paper setting out our proposals for secondary legislation, including those for the accounting arrangements, and those will complement the Bill’s main provisions.

The hon. Member for Bromley and Chislehurst made a good point, as he often does—it pains me to say that—and clearly the example he gave applies not only to proportions in cities that we know about, such as London, but to different proportions outside London, which the hon. Member for North Cornwall also mentioned. That is one of the options that should and will be looked at during the consultation. The anal answer I can give him is that paragraph 3(1) gives us the general power and paragraph 3(2) is just a list of examples, but he makes a good point that we need to come back to along with other matters.

Levying authorities that impose a BRS must keep a BRS account for each one they operate. That will be similar to the BID revenue accounts that authorities are required to have for BIDs that are established in their areas. When the Greater London authority enters into an arrangement with one of its functional bodies, as set out in paragraph 3, that body will similarly be required to keep a BRS revenue account. If two or more levying authorities act jointly, each authority must have its own BRS revenue account to ensure appropriate transparency and accountability.

The hon. Member for Ludlow made an important point about transparency during the process and how people will be made aware of what is happening, and as I mentioned, we will shortly set out our proposals in a consultation paper. Local authority accounts, as he is aware, are open to the public. Although the prospectus sets out what to do in case of variations, I take his point about the need to see the work in progress and how things are going. That is one of the things that we hope to clarify during the consultation and receive comments about the best way of doing so. He is right to say that that is particularly relevant to BRS schemes, which by definition are long. As we know from long-term projects, there could be a rollercoaster ride and we need to ensure that key stakeholders are kept on side. One way of doing so is through transparency.

Philip Dunne (Conservative, Ludlow)

The Under-Secretary will recall from his time on the Public Accounts Committee, on which we have both served, that the primary scrutiny body for Parliament took the view that it would be appropriate, as with major projects, to review the performance of the Olympic Delivery Authority annually during construction for the Olympics. Perhaps an annual review should also be considered for projects such as Crossrail or other substantial projects subject to BRS.

Sadiq Khan (Labour, Tooting)

The hon. Gentleman knows, as I do, that the current Mayor is keen to have transparency, with all his laundry out in the open, so I have no doubt that the GLA, the Mayor, London MPs, the Government and businesses, whether corporations or those in Canary Wharf, will want to ensure transparency throughout the process. The example he gave from the PAC is a really good analogy, and he will be aware that the National Audit Office is identifying lessons to be learnt during the process, rather than just at the end. As we lead up to the Olympics, the NAO is looking at how money has been spent and whether it represents value for money. We would expect that sort of rigour to be applied to such a project because it involves money not only from BRS, but from general taxation, including money from Transport for London and voluntary contributions. His point is well made and needs to be addressed during consultation on the secondary legislation.

The Bill also provides for billing authorities, in the first instance, to pay BRS revenues into their collection fund, in the same way as they do council tax and non-domestic rate revenues. However, an important difference between NDR and BRS is that BRS revenue will not be paid into the central Government NDR pool, but will instead be retained locally and transferred to the levying authority. I know that the hon. Member for Northampton, South is concerned that central Government will somehow gobble up this locally raised money. That is unfair because the clause confirms that the money is retained locally, to be spent locally.

Brian Binley (Conservative, Northampton South)

The Under-Secretary of State misunderstands me. I have no concerns about central Government leeching some of this money away—he might be pleased to know that— and I am sure that is not the intention under the Bill. I am concerned first about accountability, particularly with long-term projects. Secondly, I am worried that money may be leeched away either at the billing level or at the levying authority level, used for other purposes and rather cleverly accounted for as part of the administrative cost. The final point was about refunds—to the taxpayer, not the billing authority—where an overestimation had been made in the initial prospectus.

Sadiq Khan (Labour, Tooting)

For the record, it was the hon. Gentleman who first used “leeching”, not me, but I will use “leeching” as a response to his introduction of the word. God forbid that central Government ever leeches from local councils or taxpayers.

I understand the hon. Gentleman’s concerns. The proposed secondary legislation governs accounting arrangements. It needs to cover, and will cover the following key areas: refunds to ratepayers of, for example, unspent BRS revenue; credits and debits to the BRS revenue account; handling of voluntary contributions; transfer of BRS revenue from the collection fund to the BRS revenue account; and surpluses and deficits of BRS. I take his point that we cannot have imaginative accounting processes, whereby items other than those that the Bill defines as administrative expenses are brought under that cover.

Clause 24

Dan Rogerson (Liberal Democrat, North Cornwall)

I beg to move amendment 20, in clause 24, page 15, line 20, at end insert

‘, and where it does so it—

(i) must direct the levying authority to refund the sums received by it in respect of the BRS or, where the levying authority is not a billing authority, direct it to return to a billing authority that is a lower-tier authority in relation to sums transferred to it by the billing authority,

(ii) must direct a billing authority that is a lower-tier authority in relation to the levying authority to refund the sums collected by it in respect of the BRS but not transferred to the levying authority, and

(iii) must direct a functional body to transfer to the levying authority sums received by the body in respect of the BRS but not used by it, and’.

Janet Dean (Labour, Burton)

With this it will be convenient to discuss amendment 21, in clause 24, page 15, line 21, leave out paragraphs (b) to (d).

Dan Rogerson (Liberal Democrat, North Cornwall)

Much earlier today, reference was rightly made to the elegance of the solution proposed by the right hon. Member for Greenwich and Woolwich. I am sure the amendments that stand in my name are not as elegant and perhaps do not do exactly what I intend them to. However, I am grateful for the opportunity to have this debate and I am sure the Minister will clarify what the intention is. I am very much building on what the hon. Member for Northampton, South said about reassuring people that if a project does not go ahead, the money will be refunded.

I have been looking at my own amendment, wondering whether it is actually about money going back to the bill payers; it is certainly about money going back to the billing authority and that is the intention. Earlier, a circumstance was described relating to an underspend on a project. Previously, it was suggested that overspends are far more likely, but there is the possibility of an underspend, which everybody would welcome. In that event, there is an opportunity for that money to be passed back to its source and for it to be refunded to the bill payers. Similarly, my amendment refers to a situation where the Secretary of State or the relevant authority in Wales needs, for some reason, to intervene to cancel the imposition of a BRS, the scheme does not go ahead, and the money has to be refunded.

There is a provision in the Bill to allow that at present, but my amendment would strengthen it to ensure that the money does go back. I am not quite sure what would happen to the money if it was not returned. I assume that there are restrictions on its being used for any other purpose, so I suppose it would sit in an account. Whether interest on that account could be used for other reasons is another question, but the amendment aims to clarify and strengthen the principle that if, for whatever reason, the scheme needs to be cancelled and the money is not used for the purpose for which it was originally intended, it will find its way back to those who paid it in the first place.

Bob Neill (Conservative, Bromley and Chislehurst)

Again, I have much sympathy with the hon. Gentleman’s argument. I hope that the circumstances where the provision needs to be used will not arise. It is needed as a long-stop, but I am sure that local authorities will seek to act in a way which does not give rise to the need to use it.

I do not have a problem with the concept, although I note that the Local Government Association expressed reservations about the clause. I apologise to you, Mrs. Dean, for breaking my word—I said that I was not going to mention ballots again—but in the absence of a ballot, it seems that there is a need for that sort of long-stop for that eventuality. The LGA makes a fair point. I hope that the association is right. It has repeatedly stated that it cannot envisage a BRS-funded project going through without the full agreement of the business community. There is, dare I say it, one simple way to ensure that. As such a provision is not there, the clause is necessary; equally, however, it is important to have that reassurance that in the event of its being terminated, there will be a guaranteed refund to those who have contributed.

Brian Binley (Conservative, Northampton South)

I shall seek a little leeway here and simply ask whether my hon. Friend feels that this is a particularly good reason for at least allowing the ratepayers in areas affected by such projects to be involved every year to do some of the scrutiny that we are talking about.

Bob Neill (Conservative, Bromley and Chislehurst)

My hon. Friend makes a characteristically well judged and helpful point. He is right. We discussed the need for ongoing involvement in the rolling out of the project and its implementation in an earlier sitting, and Ministers were sympathetic to our argument. I am sure that they will take it on board. My hon. Friend reinforces the point that he made forcefully in our earlier debate. For all those reasons, I believe the amendment has merit. I agree with the hon. Member for North Cornwall that there may be different approaches to the wording, but the most important point is that Ministers should take away the idea and give us a commitment.

Nick Raynsford (Labour, Greenwich and Woolwich)

I understand the reason for having the safeguard in the Bill, but I am a little concerned about the risk of its being used by a dissident group who, let us say, lost a ballot on a BRS and wanted to scupper the whole venture by maliciously appealing to central Government to stop it. The terms of subsection (2) —which deal with cases in which there might have been a breach of undertakings, or, at least, the levying authority is alleged to have acted inconsistently with the information provided—include more than the prospectus, which is mentioned in paragraph (a) and which one would expect to be entirely accurate, and formal variations to the prospectus, mentioned in paragraph (b). Subsection (c) refers to information provided

“in the course of consultation on the proposal”.

I have been to many consultations undertaken by local authorities on various matters, and one hears things said by council officers or by councillors in the heat of debate which might not be an entirely accurate description of what the process will deliver. I am nervous that someone who maliciously wanted to scupper a BRS could use an inconsistency between something said

“in the course of consultation”

by a relevant council officer and the implementation of the BRS proposition in an attempt to invoke the power to cancel. That, of course, would mean that my right hon. Friend the Minister for Local Government would have to deal with people pestering him to use the power to stop the whole thing going ahead. I can see a potential risk.

Dan Rogerson (Liberal Democrat, North Cornwall)

I am not entirely clear whether the right hon. Gentleman is addressing his remarks to the amendment or to the wider provisions of the clause. He may recall a previous debate about the power to cancel being given to the Secretary of State or, in Wales, the relevant authority. An amendment in my name sought to ensure that a person would have to demonstrate, rather than merely have to think, that there are significant problems, because there may be a change in Government or different local issues, and if there were any coincidence between the views of those who had opposed the ballot or imposition locally and the views of the new Government, the Secretary of State might on occasion use the power unfairly or precipitously. My earlier amendment sought to strengthen the provision in that earlier clause but, sadly, it was not accepted.

Nick Raynsford (Labour, Greenwich and Woolwich)

I understand the purpose of the amendments. We debated “can demonstrate” and “thinks” on an earlier occasion, but I note that the hon. Gentleman’s amendments would not remove not subsection (2)(c) from the clause, but a series of paragraphs from subsection (3). It seems to me, however, that subsection (2)(c) is the nub of the problem, because it provides people who seek maliciously to frustrate a BRS with considerable scope to use it to demonstrate that there is an inconsistency between how the BRS is being implemented and its prospectus or presentation.

I am not entirely convinced by the amendments, but there is a problem, and I hope that my right hon. Friend the Minister for Local Government will give some thought to it, because I should hate him and his colleagues to spend a disproportionate amount of time having to fend off malicious grumbles from disaffected parties who are on the losing side of a BRS ballot.

John Healey (Labour, Wentworth)

I have to say to the hon. Member for North Cornwall that we are not legislating with any change of Government in mind, and, frankly, looking across the Committee Room, I must say that it remains quite hard to envisage the prospect. With the clause, we are trying to establish a principle and a significant power ultimately to cancel a BRS, without being too rigid by prescribing in legislation how we require—rather than empower—the Secretary of State to respond in particular circumstances. Judgments will in the end require tests of fact and tests of degree if they are to be made appropriately in the circumstances.

I do follow the hon. Gentleman’s general line of argument. He wants to provide additional protection for business tax payers, but my right hon. Friend the Member for Greenwich and Woolwich, from a different point of view, which demonstrates the value of the debate, is concerned about creating too great a scope for certain groups of taxpayers to use the provisions either to put pressure on the Secretary of State or to frustrate the progress and the implementation of a business rate supplement.

Brian Binley (Conservative, Northampton South)

The point that the right hon. Member for Greenwich and Woolwich makes is easily met by the Government simply saying that the provision places on the creators and proposers of a project a greater need for rigour, which is no bad thing in these circumstances.