The Parliamentary Under-Secretary of State for Justice (Mr Shailesh Vara)
I congratulate the hon. Member for Stoke-on-Trent South (Robert Flello) on securing this debate, and I put on record his diligence and conscientiousness in championing this worthwhile cause on behalf of his constituents. We have corresponded with oral and written questions, by letter, and we had a meeting earlier today with some of his constituents. I also pay tribute to the 498 brave people who paid the ultimate price so that the hon. Gentleman and I, and the rest of us, could have the privilege and pleasure of being able to discuss matters in the democracy that we enjoy.
As the hon. Gentleman is aware, the closure of Stoke-on Trent magistrates court was announced in December 2010 as part of the court estate reform programme. Any decision to close a court is not taken lightly and is never easy, but the hon. Gentleman will recall the consultation that preceded the closure, which found that the court offered poor facilities and was non-compliant with the Disability Discrimination Act 2005. It had inadequate facilities for victims and witnesses, and there were also security issues. As he knows, the court subsequently closed in December 2012.
The court site incorporates the former town hall which, as the hon. Gentleman said, was built and funded in the late 1880s by William Meath Baker, a benefactor. According to English Heritage, Mr William Meath Baker sold the town hall to the local health board, which was superseded by Fenton urban district council in 1897. It has been in the hands of the public sector ever since. More recently, the freehold of the building was transferred under the Courts Act 2003 to the local magistrates court committee, and then to the Government in 2005. Those are legal provisions, and I like to think that all such transfers have been done according to the law—I say that with reference to the comments made by the hon. Gentleman about legality of ownership.
I note the hon. Gentleman’s view that the Government have never paid any sums of money to Stoke-on-Trent to buy or rent the building but, as he rightly said, we should remember that for more than 100 years maintenance, upkeep and so on has been paid for by the taxpayer. That is not an inconsiderable sum over the years.
The building is operationally surplus to requirements. We have to work within the rules concerning the disposal of surplus property assets. Guidance to Departments is clear: surplus property assets need to be disposed of as expeditiously as possible, within six months of being declared surplus for housing and within three years for all other properties, while achieving overall value for money for the taxpayer. It is certainly the case that overall value for money for the taxpayer does not necessarily equate to the highest offer. However, I trust that the hon. Gentleman will appreciate that I cannot simply gift a building that has considerable value.
It is not just the capital receipt that we need to consider. There are temporary costs associated with ensuring unused courts are kept secure and protecting the fabric of each building. By disposing of surplus property assets speedily, we remove the ongoing liability of holding costs. In the case of this particular building, bearing in mind that the level of security, utilities and maintenance has been reduced to a level that is appropriate for a site that has been closed, the holding costs do not come cheaply—more than £108,000 in the past financial year alone. Put simply: we cannot hold on to it indefinitely.
The hon. Gentleman is of course correct to raise the future of the four memorials inside the building. Memorials to those who made the ultimate sacrifice are hugely important and must be protected. We have received advice that a Minton great war memorial cannot be moved without risk of damage. Therefore, the Minton world war one memorial will remain in situ and be preserved in perpetuity with an appropriate legally binding restrictive covenant in the sale contract that states that the memorial is to be preserved.
The hon. Gentleman wanted a bit more clarification about a covenant. A covenant is a contractual promise incorporated in a property contract. It provides for an obligation—in this instance that the memorial will be preserved and looked after not only by whoever ends up owning the property, but by the successors in title as well. A covenant also has consequences for what happens when there is a breach. There can be damages paid or there can be specific performance that can be ordered by a court. It is also important how the property is held: whether it is held freehold or leasehold. In the case of leasehold, it may be possible that forfeiture will follow. That effectively means that the property reverts back to the freeholder. This is a legally binding set of words in a contract.
Robert Flello
That will not reassure the community. If a developer damages the building or gets sued and it reverts back to the Ministry of Justice, the memorial will still be gone.
Mr Vara
The hon. Gentleman makes a very valid point, but he will accept that this is property law. It is the way that thousands of property transactions are conducted on a daily basis for a whole variety of properties, whether they be commercial, residential, industrial or whatever. This is the process of the law of the land under which we operate. We would very much hope that, in parting company with the premises, we would have carried out our due diligence to make sure that any obligations in the contract will be honoured and that we will not get a rogue developer or rogue occupier who would do the damage that the hon. Gentleman fears may happen. I hope he will take on board the point that we will do our utmost to make sure the owner is credible, whether it is a person, corporation or charity.
The three other memorials, depending on who we sell the building to, be they in the public or private sector, will either be removed to the local church or remain in situ. That is something we can look into. If they are removed to a neighbouring church, the work will be carried out at the expense of the Ministry of Justice.
The sale of former court buildings is affected by several factors, including the state of the market, potential future use of the property, including its development potential, and the location. As of 29 October 2014, some 66 former court buildings had been closed under the court estate reform programme and sold, attracting disposable receipts of just under £43 million. Those funds have been used for further investment in the justice system. Stoke-on-Trent magistrates court has been on the market since 2013, and local campaigners have persuaded the council to list it as an asset community value, giving campaigners six months from August last year to raise funds and bid for the building at market value. Further time was set aside to allow the local community association to formulate its bid, culminating in the proposal being put forward for consideration, alongside several commercial bids.
The Department has received several commercial bids for the building, and the hon. Gentleman will appreciate that I cannot say their size for reasons of commercial confidentiality. The bidders view the building as having development potential, but we have also received a bid from Urban Vision on behalf of Fenton community association for a community asset transfer. We are also mindful of the resolution passed by Stoke-on-Trent city council requesting the return of the building. We held discussions with the council, and in early October the council was invited to come up with a viable proposal for returning the building to community use, but none was received.
We cannot afford to continue to leave the building as it is, eating away more than £9,000 every month, including almost £4,500 in rates. As is usual when disposing of surplus property assets with historic significance, there is also a qualitative element in the consideration of bids. We consider not only the purchase offer, but its potential reuse, the financial status of bidders, their ability to maintain the building in the face of significant holding cost and the extent of the estimated continued liability to the taxpayer of the Department holding the property.
In recognition of the hon. Gentleman’s advocacy for the future of the former court building and the views made so eloquently clear to me in our earlier meeting and with an eye to ensuring that we do not close down options too early, I have asked my officials to continue engagement with his constituents. I hope that that engagement, having started at today’s meeting, will continue from tomorrow onwards, but he will be aware that any possible disposal that is novel and contentious will require Treasury approval. Whatever happens, however, let me assure him that the world war one memorial will be preserved, although the future use of the building will be a matter for the preferred purchaser and the council, as the local planning authority.
Robert Flello
On the dialogue with the MOJ, which the Minister says will continue tomorrow, I must stress the point about providing a little protected time—ideally, three or four months—to give the community the opportunity to work up a bid to the satisfaction of the Department.
Mr Vara
I understand where the hon. Gentleman is coming from, but I hope he will appreciate that, in the spirit of openness and transparency, we have to ensure that other bidders are not penalised by our being seen to give preferential treatment to one of them. Much time has been spent on this. There has been a dialogue. We have asked for bids. A business case was requested. It is also possible for community groups to seek assistance from local authorities and other voluntary bodies that help these groups when they approach the Government for such measures. There is a limit to how much assistance we can provide and we are constrained by the law in terms of time limits. We are also mindful of the time that has passed, which we must also take into account. There are also other bidders whom we must take into account so we are not accused of preferential treatment.
Robert Flello
Part of the problem is that letters between the community and the Ministry of Justice were not answered and there was a breakdown in communications. I take on board what the Minister says about getting on with things and about not giving an advantage to anyone, but the community group has been disadvantaged because of the lack of communication.
Mr Vara
The hon. Gentleman and his constituents raised that with me at the meeting. I have not been able to make intensive research into the issue but I have found out that there were telephone conversations in the period where it was said there was no communication. I hope he will appreciate that at the time of the bidding there was limited information that we could impart to the other parties because that would be seen as being unfair to everyone else. This has been going on for two years and we are not talking about a bidding process covering only the last few months. There is a limit to what the Government can do.
I congratulate the hon. Gentleman on securing the debate and my officials will be in conversation with his constituents from tomorrow. I pay tribute to the 498 people who paid the ultimate price so that we could engage in this free debate.
Question put and agreed to.