Tower Blocks: Cladding

Baroness Pinnock Excerpts

Wednesday 12th May 2021 Lords Chamber

[Lord Greenhalgh (Con)]

My Lords, I start by pointing out that on 95% of the buildings that were identified at the start of last year as having the same cladding as Grenfell Tower either the cladding has been removed or work has started to remove it. We have made great progress in the past year, with some 159 starts on site. The building safety fund is open and continues to approve a number of works that will ensure that other forms of unsafe cladding are removed.

[Baroness Pinnock (LD) [V]]

[Inaudible]—the management companies for their blocks are refusing to sign up to a grant from the building safety fund unless leaseholders also sign an agreement that commits them to pay for all other remediation works. As a consequence, essential and urgent fire safety work is not being done. Leaseholders cannot commit to pay when they have no means to do so. How do the Government intend to break this impasse in the interests of fire safety?

[Lord Greenhalgh (Con)]

My Lords, we have to be clear that the agreement is with the building owner and not with individual leaseholders. No leaseholder will be required to fund additional works as a condition of government funding for cladding remediation. Of course, where building owners voluntarily decide to carry out works at the same time, we need assurances from them that this can be covered.

Fire Safety Bill

Baroness Pinnock Excerpts

Consideration of Commons amendments
Wednesday 28th April 2021 Lords Chamber

[The Deputy Speaker (Lord Lexden) (Con)]

If Motion A1 is agreed to, I cannot call Motion A2. I call the noble Baroness, Lady Pinnock, to speak to Motion A2.

[Baroness Pinnock (LD) [V]]

My Lords, I remind the House of my interests as a vice-president of the Local Government Association and a member of Kirklees Council.

Throughout the course of this Bill, I have said that I support its contents and purpose. I cannot support the unintended consequences that will have a devastating impact on individual leaseholders and a very damaging effect on the housing market. Those are the reasons for my asking again for the Government to take responsibility for the consequences of this Bill, which despite the Minister’s best efforts has been totally underwhelming so far. Promises have been made by the Government and not kept.

The Government’s response to date is to provide grant funding of £5 billion while knowing that the total cost is estimated at £16 billion. The grant includes only blocks over 18 metres and only removes the flammable cladding. For those in lower blocks, there is the prospect of paying up to £50 per month for years to come.

Conveniently, the Government fail to take into account the non-cladding issues that are a result of construction failure of immense proportions. These non-cladding issues are the ones that will finally push individuals over the edge. Meanwhile, those who have literally built this catastrophe walk away with their billions of profit. The Government have a duty to protect their citizens—it is their prime duty—yet here we are today with perhaps a million of our fellow citizens being thrown to the ravages of financial bankruptcy, and the Government wash their hands and look the other way.

The Government will argue that the Bill is a vital response to the Grenfell tragedy. It is so vital that it has taken four years to get to the statute book. The Bill’s purpose is to include external walls, doors and balconies in the fire safety order of 2005, so that action is taken to protect people from another Grenfell tragedy. However, a Bill is not now needed to force action to remove cladding; that is happening. It is not needed to get fire alarms put in; that is happening. Those who own the buildings, and those who are leaseholders and tenants, already know that action has to be taken to make their buildings safe. It is no longer urgently necessary to get legislation to force the issue and it is no longer possible to force construction firms to take the necessary action; there is not capacity to do so. If, though, the Bill does fall, this provides a breathing space for the Government to develop a package of further measures that will protect the interests of leaseholders and save them from penury.

The amendment in my name seeks to achieve that breathing space. It is based on the original one in the name of the right reverend Prelate the Bishop of St Albans and has been adjusted to include the various very valid points that have been made during the passage of the Bill. We must all recognise that passing this Bill will not magic away the crisis that individual leaseholders are facing. It will not remedy the construction scandal. It will not provide stability for a foundering housing market. It will be the beginning of a scandal of individual bankruptcies, homelessness, intense stress and mental illness. It will become a public scandal and I for one will at least have on my conscience that I have done all in my power to prevent it. Leaseholders have done everything right and nothing wrong. Liberal Democrats will stand by them. I give notice that I wish to test the opinion of the House on the amendment in my name.

[The Earl of Lytton (CB) [V]]

My Lords, as we seem to be in the last chance saloon, I will try not to repeat myself too much, but declare my interests as both a property professional and a vice-president of the LGA. As I said yesterday, the House seems to be presented by the Government with a choice. On the one hand is the evident desirability of implementing fire safety measures in pursuance of the valuable recommendations in the report by Dame Judith Hackitt into the Grenfell tragedy, plus a partial solution to some of the effects of cladding replacement on a limited class of taller buildings, as we have heard. On the other is what I am afraid I must describe as the effective hanging out to dry of hundreds of thousands, if not millions, of other home owners. It should not be a question of either/or in dealing with a growing and pressing social and economic disaster. I too support improved fire safety, but not on the basis of creating further untold, and probably unquantified, problems.

Yesterday, the Minister endeavoured to persuade us by saying that this brief and simple Bill merely clarified the Regulatory Reform (Fire Safety) Order 2005. I am afraid to say that, on my own rereading of that, he is plainly mistaken. This Bill amends the scope of the fire safety order by inserting an exception to paragraph 1a, referring in turn to two newly inserted paragraphs, 1A and 1B, that substantially expand the scope of the order. The fact that anything was attached to the named elements means the Bill has far wider implications than might be supposed. So I am afraid to say that the Minister’s assertion really did it for me. I felt it was misleading and what my late father would have described as an exercise in intellectual sharp practice. My distinct impression is that I am being taken for some sort of fool. The indisputable fact that must be regarded as plain is that this Bill makes the changes that by direct chain of causation have created the issues and caused the results that the noble Baroness, Lady Pinnock, and the noble Lord, Lord Kennedy, seek to resolve.

Another issue appears to be one of definition. The Government are concerned that any scheme that might be put in place could be used to avoid regular maintenance and routine upgrades. The amendment of the noble Baroness, Lady Pinnock, in particular, seeks to address that. In my experience there may be grey areas, but I do not have any difficulty in my work in distinguishing repairs and the like, or like-for-like replacements, from those items that are improvements. Nor do most leaseholders and property owners.

Let us be clear—and here I take a cue from the noble Lord, Lord Kennedy, for a bit of historical background—that it was on the watch of a Conservative Government that the 1984 Building Act brought in the approved inspector regime and the effective privatisation of the regulatory oversight of construction quality, previously exercised by local authority building control. Despite indicators of shortcomings and shortcutting, this process continued, without adequate checks on who was doing the inspection of the works, or how good the oversight was in practice. It is on the basis of the subsequent 37 years of construction and its legacy of known and unknown deficiencies, scattered randomly about the nation’s housing stock, that modern housebuilding, construction warranties, lending and home ownership have been founded.

If the Government consider that they need to take steps to protect the valiant and much-abused postmasters from system failure, how can they, with it any cogency or conscience, make a distinction concerning a far greater number of home owners who are affected at least as severely? So, while I note that the Minister in the other place this afternoon sought to point the finger at the unelected Lords blocking the democratic decision of the Commons, I simply say that the exercise of raw political power vis-à-vis the party whip to procure a majority in the Lobby does not endow the Government with a moral superiority, or indeed the social advancement of justice and ethical treatment of citizens. I note the reasons for rejecting our amendments, which simply translate as “too difficult”. I suspect not half as difficult as picking up the bits after this has rolled itself out.

At one point I believed the Government had it hand to corral all the potential damage, but I believe they have not done so. It would not concern me if this Bill fell, so unreasonable do I believe its true effects to be, and so lacking is the willingness of the Government to deal with it. What it has proposed will roll out far too slowly: eight months to do the highest-risk buildings, and how much longer to deal with the far greater number in future stages? What about capacity in terms of manpower, training and so on?

I took note of the comments from the noble Lord, Lord Cormack, but I find that sitting on my hands, signifying my acceptance of the Government’s position here, does not sit comfortably with my conscience—knowing, as I do from professional experience, just what harm the Bill is likely to do, alongside its undoubted good.

I suspect that the Bill will ultimately pass into law, even if the Parliament Act has to be invoked—but I am afraid I cannot agree to it as it stands. I fear that Lobby fatigue may mean that this is the end of the matter for now. Either way, I shall return to this subject in the new Session—as, doubtless, will the noble Lord, Lord Kennedy, and the noble Baroness, Lady Pinnock. Meanwhile, I have absolutely no hesitation in supporting the thrust of the amendments—any one of them, whichever might gain approval. And I hope I will sleep with my conscience clear as a result.

--- Later in debate ---

Moved by

[Baroness Pinnock]

At end insert “but do propose Amendment 4N in lieu—

4N: After Clause 2, insert the following new Clause—
“Prohibition on passing remediation costs on to leaseholders and tenants pending operation of a statutory scheme
(1) The owner of a building may not pass the costs of any remedial work attributable to the provisions of this Act on to leaseholders or tenants of that building.
(2) This section has effect only until a statutory scheme is in operation which ensures that leaseholders and tenants of dwellings are not required to pay more than £50 per month during the course of the lease in respect of remedial work attributable to the provisions of this Act.
(3) Subsection (1) does not apply to a cost that—
(a) is permitted under a lease or tenancy agreement that was made before this Act is passed, and
(b) does not exceed £500, whether as a one-off cost, or in total across a 12-month period.
(4) Subsection (1) does not apply to a leaseholder who is also the owner or part owner of the freehold of the building.””

[Baroness Pinnock (LD) [V]]

I thank all noble Lords for another excellent debate—the fourth in the series—and their contributions tonight.

Again, the tune from the noble Lord, Lord Greenhalgh, the Minister, has not changed—it is the same old record: “This is not the right Bill”. Well, if it is not the right Bill, where is the Government’s Bill to address the horrendous problems that are going to be faced by leaseholders? Where is the Bill that will keep the Government’s pledge that leaseholders would not have to face the unaffordable consequences of fire safety defects? Where is it? Its absence tells us more than anything else about the Government’s commitment to help leaseholders.

To pledge, as the Minister has done, that the building safety Bill will pave the way, forgets the fact that bills are landing on doormats as we speak. Time is of the essence, and still the Government refuse to move. It is a thoroughly depressing moment when people can be thrown to the wolves in order to save the Treasury from paying what it ought to pay and extracting what it ought to extract from those who have caused the problem. The construction scandal—the cladding crisis—is the Government’s, and the Government’s alone.

I thank the Minister for his criticisms, once again, of the amendment I have proposed today. I just wish he would do something about it rather than saying that he cannot do this and cannot do that. What is he going to do?

I have taken heart from the impassioned speech by the noble Earl, Lord Lytton. He is an expert in the housing field and has frequently shared his expertise in this House. The fact that he too cannot in all conscience vote for the Fire Safety Bill as it stands, unamended, gives me heart that we have got this in the right place from the point of view of those of us who want to protect people from exorbitant costs of putting right fire safety defects.

I will say one last word. Let us remind ourselves that leaseholders are those that have done everything right. They have saved up for their house, put down the deposit and budgeted for the expenses they anticipate. They have done everything right and nothing wrong, yet the Government—and, it seems, others in this House—are willing to make them pay the price. That is not acceptable, and the Liberal Democrat Benches will not stand by and let it happen if we can help it. It is a depressing moment, as I believe the noble Lord, Lord Kennedy, has indicated that he is not prepared to vote for the amendment to try to get safeguards for leaseholders. He has thrown in the towel, and I find that disappointing and utterly depressing.

However, with those words, I am prepared to have one more go to try to protect leaseholders and, indeed, tenants from the awful, if unintended, consequences of this Fire Safety Bill. I wish to seek the opinion of the House and I beg to move.

Fire Safety Bill

Baroness Pinnock Excerpts

Consideration of Commons amendments
Tuesday 27th April 2021 Lords Chamber

[Lord Kennedy of Southwark (Lab Co-op)]

My Lords, I join noble Lord in paying tribute to the fire and rescue services, and the bravery they have shown recently and every day. But these heroes—they are heroes—are FBU members. They have not always been shown the respect they deserve from many people, particularly the Prime Minister when he was Mayor of London. He did not always show the FBU members the respect they deserved, and these are the same people. I make that one point.

I draw the House’s attention to my relevant interest as a vice-president of the Local Government Association, a non-executive director of MHS Homes Ltd and chair of the Heart of Medway Housing Association. It is most disappointing that we are back here again, and I accept that it is very unusual for us to push this again, but I will test the opinion of the House.

My amendment is based on the amendment from the right reverend Prelate the Bishop of St Albans, and it would ensure that no costs are passed on to the leaseholders or tenants. That the subsection would remain in force until such time that we get the Government’s statutory scheme. Further, it would place a requirement on the Secretary of State to come back within 90 days to publish draft legislation to ensure that leaseholders and tenants do not have to pay, and to publish a timetable for the implementation of that legislation. Finally, we would also require a progress report from the Secretary of State within 120 days of the passing of this amendment.

Now, why are we back here again? It is because the Government have been quick to promise and slow to act. We are here because they are not listening to the innocent victims of the cladding scandal, who should be at the forefront of the levelling-up agenda, if it is anything but a slogan that the Government have no intention of delivering. These people are families whose homes are blighted. They need their Government to come to their aid but, instead, the Government made promises that they have spectacularly failed to deliver. That is no way for a Government to behave. As I said, I intend to divide the House when the time comes.

“We will do whatever it takes” is a statement that the Government regularly put about, whether from the Chancellor announcing new measures or the Culture Secretary regarding the European Super League. Sadly, it is never said by the Government when it comes to dealing with the innocent victims of the cladding scandal. Perhaps, in replying to the debate, the noble Lord, Lord Greenhalgh, the Minister for Fire Safety, can explain that failure to the House, because we have never heard from the Government what the plan is, which is part of the problem. If we are informed of a clear, well thought-out pathway and route map to help the victims we could make progress, but for some reason the Government will not do that. Perhaps the noble Lord can tell the House about this road map when he responds to the debate.

I want to see this Bill on the statute book, but I do not accept for one minute that this puts it at risk. We still have days before the end of the Session. I do not want to hold the Bill up. It is good in what it does, which is to implement the first recommendation of the Grenfell Tower inquiry—the first bit of legislation since the fire, now nearly four years ago. No one can accuse the Government of acting in haste. On a separate matter, we still have six families in temporary accommodation following the fire at Grenfell Tower.

It is vital that our dwellings are safe and that people can sleep safely at night, without fear. The Government have committed £5 billion—I accept that that is a significant amount of money—but the situation is far from satisfactory and it is in the Government’s gift to do something about it. Only the Government can do something about it, but they are not willing to at present. As the right reverend Prelate the Bishop of St Albans told us when we last debated this—I pay tribute to him for his leadership and for seeking a solution to this scandal—the result can be bankruptcies, enormous mental health strains and possibly worse. Part of the problem is that there have been no assurances to prevent the remediation costs being passed on to leaseholders until the Government’s scheme is operational. This is what my amendment seeks: to prevent the costs of this scandal being passed on to tenants and leaseholders, the innocent victims.

We have all seen in the media the heartbreaking reports of the crippling costs that leaseholders are having to bear, such as interim fire safety costs and high insurance premiums. Surely the developers that built these defective flats, the insurance companies that provided the guarantees but no longer want to honour their commitments and the professionals who signed off the buildings as safe should be paying through their professional indemnity insurance. Instead, innocent victims are left bearing the costs of this scandal, despite the promises made to them.

This leaves them with a dilemma: sell their lease and take on the debt resulting from negative equity, or stay in their leases and face huge debts in the form of remediation bills. They might possibly declare bankruptcy. Surely that is wrong. The leaseholders are playing by the rules and paying their taxes. They are buying a home and doing the right thing, but are not being supported. They had no indication that this was coming. This is a dreadful tragedy. In the absence of an adequate plan and scheme to deal with these issues properly and fairly, there is no other way forward. I hope that the House will support me. We need to find a solution to pay these costs. I beg to move.

[Baroness Pinnock (LD) [V]]

My Lords, I start by drawing the attention of the House to my interests, as recorded in the register, as a vice-president of the Local Government Association and a member of Kirklees Council.

On three separate occasions, this House has confirmed its view that the Government should urgently address the plight of leaseholders and tenants who will be significantly and adversely affected by the consequences of the Fire Safety Bill. The provisions in the Bill are not the issue; they are a welcome small step to address the failings exposed by the dreadful Grenfell tragedy. The Government and, no doubt, the Minister will state how important it is that this Bill is passed, as we heard the Minister say a few moments ago. Both omit to say that the Government have been tardy in regard to the passage of the Bill; the Report stage in this House took place in November 2019. If the Government had made the Bill a priority, we would not be here, in the final throes of this Session, seeking to find a just solution for those directly impacted by it.

Non-Domestic Rating (Public Lavatories) Bill

Baroness Pinnock Excerpts

3rd reading
Tuesday 20th April 2021 Lords Chamber

[Lord Kennedy of Southwark (Lab Co-op)]

My Lords, I start by thanking the noble Lord, Lord Greenhalgh, for his engagement in this small but important Bill. I am pleased that it is finally now going to pass; this is the second time I have worked on this Bill—because it was lost before the general election—so it is something I am very well aware of. I thank the noble Lord; he has been very helpful, as always. I join him in thanking all the organisations he mentioned—the LGA, the National Association of Local Councils, the British Toilet Association and others—for their helpful advice, guidance and support. I also thank Ben Wood from the Labour group office for his help and support on the Bill.

I thank all noble Lords who engaged in the Bill, particularly Lord Greaves, whose last speech in this House was on this Bill, as noble Lords may remember, some weeks ago, before he sadly passed away. Although Tony was in a different party from me, he was well respected in the House and was a very good man. He worked as a local councillor and as a Member of this House and he will be missed by us all. I am delighted that the Bill is going to pass.

[Baroness Pinnock (LD) [V]]

My Lords, I point to my interests as a vice-president of the Local Government Association and a member of Kirklees Council. Liberal Democrats support the measures in this Bill, and during the debate we have sought to improve accessibility and to extend the reach of the Bill to include other public buildings. I thank the Minister for his positive responses during the passage of the Bill, and for the meetings he held to enable an exchange of ideas. I also extend my thanks to those associations that have helped in the progress of the Bill, so that we all understood exactly what we were trying to achieve.

The Bill was the last time my noble friend Lord Greaves spoke in the House before his sudden and untimely death. It was typical Tony: promoting the value of parish and town councils, making a strong case for the very basic and essential public services provided for communities by local government, and exploring the meaning of the word “mainly”, used throughout the Bill. Tony will be greatly missed on these Benches for his humanity and commitment to communities. I rest my case there and thank the noble Lord, Lord Greenhalgh, for his help in getting this Bill passed.

Fire Safety Bill

Baroness Pinnock Excerpts

Tuesday 20th April 2021 Lords Chamber

However, the Bill, having raised the bar, now needs to be accompanied by safety nets, back-stops and proportionality in what follows. They must be put in place forthwith or parliamentarians will be faced with questions as to how the danger from fire has become a factor that puts families at serious peril, if not actually out of their homes. These are hard decisions that cannot be avoided, and they are ones that any Government must address.

[Baroness Pinnock (LD) [V]]

My Lords, I draw the attention of the House to my relevant interests as a vice-president of the Local Government Association and a member of Kirklees Council.

This has so far been a very good debate, with the noble Earl, Lord Lytton, using his expertise to detail the problems and suggest solutions to them since, as he says, they have yet to be resolved and need to be resolved, and the right reverend Prelate the Bishop of St Albans with his passionate exposé of the real difficulties facing individuals in this position.

We know that a property purchase is the largest single financial commitment that the majority of us ever make, yet the guarantees, the warranties and even buildings insurance for leaseholders fail to provide anything approaching adequate provision for those who find themselves living in a home where building regulations have been openly and plainly breached. Those living through this construction crisis and cladding scandal exposed by the awful tragedy of Grenfell are left with nowhere to find redress for the inexcusable failings of the construction companies.

That is in stark contrast to manufacturers of, for example, cars and white goods; where faults are discovered, even where the goods are out of warranty, the manufacturers call them in and make the repairs at their expense. What a difference with the construction industry, where only some of those involved have made any provision for remediation works—the bare minimum that they feel they can get away with. The total estimated cost of remediation so far is £16 billion. The Government are expecting construction companies to pay £200 million a year towards the remediation costs. With the government-funded scheme, that leaves a full £9 billion to fall on those who, throughout, are the innocent victims.

The purpose of the amendments in my name and that of the right reverend Prelate the Bishop of St Albans is to extend the principle already agreed by the Government: that this serious problem can be successfully fixed only with up-front funding from the Government that can then be recouped from developers, construction firms and manufacturers.

Throughout this debate I have sought to draw the attention of the House to the real and serious consequences for the individual leaseholders and tenants. Take Alison, who has recently had a bill for £28,000. That is just her share of the costs of putting right the construction errors in her block. It is not for cladding removal; the other construction failings are not covered by the scheme that the Government have introduced, but they still have to be remedied. How is that bill to be paid? She carefully budgeted for the costs of her mortgage and the service charges but has no means of raising the finance needed. Where on earth can she turn to save her home?

Another flat owner has written to me, as they apparently have to the right reverend Prelate the Bishop of St Albans, about the further consequences of the scandal. They told me about their buildings insurance premium, and it is so shocking that it is worth sharing again. The insurance premium for their block was just £11,963 last year but that has rocketed to £242,400. How on earth can people living in that block of flats have budgeted for that sort of exponential rise in their insurance premiums? Further, how on earth can they have budgeted or indeed find any finance to pay the bill, which they expect within a week, of £6,000 for each and every one of them without the Government doing what Governments can and should do, which is to protect individuals from situations where they are the innocent victims?

As a consequence of the complete lack of effective government action, bankruptcy has been the only route out of this scandal for many already, while others are on the brink of choosing that as the only option left. Yet these are the very people who have done everything right and nothing wrong. Some are even those who have been supported by the Government through the Help to Buy offer. What are the options after bankruptcy, when everything that you have worked for has been taken away? For those without dependants, the situation is very difficult. They become homeless through no fault of their own. It cannot be right that the Government are allowing this to happen.

I do not envy the Minister his task today as he seeks to defend the indefensible. I feel sure that he will point to the building safety Bill as the cure-all for the failings of the construction sector, but that Bill has yet to start its deliberations so its potential remedies will come far too late for those caught up in this crisis.

The Minister has argued that the Fire Safety Bill will fall if agreement is not reached. He argues for the need to act, but he fails to say at what cost and indeed at whose cost. I thank him for reminding me of my words at Second Reading but he has been a bit selective. I have always said throughout the passage of the Bill that leaseholders must not be asked to pay. Yes, across the House we support the Bill, but equally its consequences need to be thought through as well. The Government constantly state that they are helping leaseholders; indeed the Minister has repeated that today, but he failed then to say that that is unfortunately at a minimal level and the extent of the help is not adequate.

I have asked the cladding groups whether they would suffer if the Bill fell. Their view was unanimous. They concluded that they would be no worse off if it fell and they say that if it does not pass, to some extent it provides them with precious time to get the issue properly addressed.

Yesterday, the Government announced that they would change the law to refund investors in the London Capital & Finance mini-bond scheme. The Government have accepted that the FCA failed to regulate the firm properly. The similarities with this construction scandal are many. Innocent victims are set to lose out due to the failure of regulatory control. However, in the case of the cladding scandal, innocent victims are set to lose everything they own and have worked hard for. That is not right.

The amendment in my name seeks to put right this awful wrong and to establish the rollcall of statistics of bankruptcy, homelessness, mental ill-health and worse, of relationships broken and careers lost. Hundreds of thousands of individuals and families are watching and waiting for the decision of this House. They are willing us on to help find a fair and just solution to a problem that is not in any way of their making. Yet they are the ones who are being asked to pay the price.

If the right reverend Prelate the Bishop of St Albans wishes to divide the House, the Liberal Democrat Benches will fully support him. If, however, he chooses not to do so, then I will wish to test the opinion of the House.

[The Deputy Speaker (Baroness Fookes) (Con)]

My Lords, the following Members in the Chamber have indicated that they wish to speak: the noble Baroness, Lady Fox of Buckley, the noble Lord, Lord Newby, the noble Baroness, Lady Warwick of Undercliffe, and the noble Lords, Lord Adonis and Lord Cormack. I will call them in that order. First, I call the noble Baroness, Lady Fox of Buckley.

Levelling Up

Baroness Pinnock Excerpts

Thursday 18th March 2021 Lords Chamber

[Baroness Wilcox of Newport (Lab) [V]]

My Lords, I draw attention to my entry in the register of interests as a vice-president of the Local Government Association.

The levelling-up fund is a UK-wide £4.8 billion fund announced at the spending review, with a view to investing in local infrastructure that has a visible impact on people and their communities. It should drive regeneration in places in need: those facing particular challenges, and areas that have received less government investment in recent years. Some £600 million will be available this year for projects that have the support of their local community, and up to £4.8 billion will be available by May 2024.

All local authorities across Britain can bid for the fund, but they were placed in three categories of need, with the first more likely to get funding, including help to construct their bids. Areas were selected through a deeply flawed methodology that ignores most measures of deprivation, including the Government’s own index of multiple deprivation, which takes into account income, levels of crime and health, and instead favours areas with low productivity and where people have long commutes to work—typical characteristics of rural areas.

Covid-19 has had a catastrophic effect on the finances of local government. The LGA estimates that because of the pandemic up to a further £2.6 billion of support will be needed to cover the cost pressures and non-tax income losses of 2020-21 in full. The Government’s long-term neglect of the UK’s high streets and local businesses, with footfall down 10% since 2012, had left around one in 10 high street shops standing empty even before the coronavirus hit. Councils in England have seen their core funding from central government reduce by £15 billion in the last decade, and 773 libraries, 750 youth centres, 1,300 children’s centres and 835 public toilets in England have closed.

Not a single one of the 200,000 starter homes that the Conservatives promised in 2015 has been built, despite nearly £200 million being spent. The Government have now been forced to concede that they will not keep their promise to deliver nationwide gigabit broadband rollout by 2025, and now look highly likely to miss even their reduced target of 85% coverage. Unlike the Welsh Government’s highly successful 21st-century schools building programme, the UK Government have refurbished less than half of the schools that they had promised by this year; the programme has been delayed by four years and is running £300 million over budget.

A list of local authority areas grouped and prioritised according to economic need has been published, but with no real detail as to how that was calculated. In November the House of Commons Public Accounts Committee published its report into the towns fund, announced by MHCLG in the summer of 2019, and which invited 101 English towns—out of 541 assessed—to apply for money from the fund. The committee found that the process by which towns were selected was “not impartial” and that the department

“has a weak and unconvincing justification for not publishing any information on the process it followed.”

The Government’s treatment of the levelling-up fund is symbolic of their divide-and-rule approach: Richmondshire is in the top level, while Sheffield and Barnsley, both of which have notably higher deprivation levels, are in tier 2. The funding metric must be published. The list as it currently appears is proof that this Government’s actions are levelling areas down, pushing regions and nations and some of the poorest places in the UK to the back of the queue for investment. It appears to be about this Government using the money to level up the Conservative Party’s electoral prospects rather than the economic realities of left-behind communities. I call again on the Government to publish the methodology behind the allocation and then revise how Whitehall makes these spending decisions.

Out of 45 areas allocated money from a pre-existing £3.6 billion towns fund by the Chancellor, 40 have Conservative MPs, and five of them are Cabinet Ministers. Can the Minister explain why the Government’s bizarre formula for determining priority areas appears to use car-journey distance over levels of poverty? The Chancellor has said that the metric was based on an index of economic need that is transparently published, but the fund’s official prospectus says that the information is coming “shortly”. Again I ask: when will this metric be published? Last year the National Audit Office said that the choices in 2019 of which towns could access the towns fund were based on “sweeping assumptions” and may have been politically motivated, as a number were marginal constituencies.

The actual amount of money being distributed by the levelling-up fund is just a drop in the ocean compared with what the Conservatives have taken away from the public realm over the last 10 years. I am afraid it looks weighted towards the interests of the Conservative Party rather than the interests of the British people, who have suffered over a decade of austerity. The past year has shown us how woefully unprepared public services in the UK were to deal with the onslaught of the pandemic. If you keep taking and not putting back, eventually the edifice will crumble. This time last year, when Covid hit us with such force, it found a weakened UK in every corner of its public services.

So what would Labour do in order to bring about fairness in distributing public funding? We support funding for every region and nation, but it is crucial that it is done transparently, fairly and with a say for local communities. This fund fails on all those counts. All regions and nations should get their fair share of investment. This fund pits regions and nations against each other for crucial funding, and hands money to wealthy areas held by Cabinet Ministers ahead of those in greater need. We need to be pushing power down to spread prosperity, but the fund puts control in the hands of Ministers in Whitehall instead of local communities.

This piecemeal funding does not make up for failure over the past decade, which has seen services decimated as £15 billion of cuts have been made to local government. Under the fund our regions will be getting less than they did before the crisis and, unlike before, they will have to fight against each other for every penny of investment. We should have transparent funding metrics in place and leave every part of this country a good place to grow up and grow old in.

The Government’s failure to invest for the past decade has meant that the UK has had the worst crisis of any major economy. The Government now need to secure our jobs, support our high streets and strengthen our communities through investment that truly delivers the aspirations of people in every region. If the Government care about levelling up, why have they not come forward with a plan to fix social care, which in some areas of the country is close to collapse?

Does the Chancellor’s approach to prioritising funding for the levelling-up fund not show that, if you vote Conservative, your money will go to wealthy areas? How can this Government claim to fix regional imbalances when the fund pits regions and nations against each other? What assessment have they made of reports that Cornwall Council will take the Government to court over the decision not to prioritise its area? Does the Minister expect further court cases?

What about the positions in the nations? The fund bypasses the devolution settlement by directly allocating funding for regional and local development in Wales, directly counter to the expressed position of the Senedd and directly contrary to what was announced at the 25 November spending review, when the Chancellor said the £4 billion commitment in England

“will attract up to £0.8 billion”

in funding

“for Scotland, Wales and Northern Ireland in the usual way.”

This is the UK Government taking funding that would previously have been allocated to Wales to spend in line with the priorities that the Senedd—elected by the people of Wales—has identified. Decisions are to be made by Whitehall departments with no history of delivering projects in Wales, no record of working with communities in Wales and no understanding of the priorities of those communities. In practice, this means that the UK Government will be taking decisions on devolved matters in Wales without being answerable to the Senedd.

The Governments in Wales, Scotland and Northern Ireland now face the prospect of a centralised, Whitehall-led approach instead of a regional and nation-focused approach. The UK Government are going out of their way to take money away from the nations and pick a needless constitutional battle to weaken devolved powers in the middle of a global pandemic. Their fixation with undermining democratic devolution is driving a cynical attempt at rebranding existing spending as new and rolling back progress on a model of national and regional development by democratically elected Governments and councils across the United Kingdom. They are indeed levelling down.

[Baroness Pinnock (LD) [V]]

My Lords, I draw the attention of the House to my relevant interests as a vice-president of the Local Government Association and a member of Kirklees Council. I read the Statement on levelling up with great interest. My own area of West Yorkshire includes towns and cities that, by any fair measure, will qualify for focused help to support their residents. I am therefore particularly keen to understand what it is all about.

“Levelling up” is a rather nebulous phrase. I want to understand precisely what it means and, more importantly, what is hoped to be achieved by it. Perhaps the Minister can help, as I have not been able to find anywhere either a definition or an explanation of how improvements will be measured. Can the Minister please provide a definition of levelling up and the metrics that will be used to determine whether the funding allocated has been a success? I appreciate that sharing metrics data orally is not easy, so will the Minister provide that information and make it available to all colleagues through the House of Lords Library?

The tools that the Government are proposing and which are outlined in this Statement are resonant of previous attempts to improve the lives of parts of our country that do not enjoy the same level of well-being as the more affluent one. Previous Governments have used similar funding packages. There was City Challenge, the Single Regeneration Budget and then SRB2. This was followed by investments through the regional development agencies. The common feature was infra-structure investment, although some aspects of SRB had elements of support for jobs and skills. Will the Minister provide the data that demonstrates that the areas that benefited from the funding packages I just listed have prospered as a result—or, better still, data that explains the reasons why some of the same places are still suffering from multiple deprivations? I can name them if the Minister is not sure which places they are. I ask these questions because the Government are in danger of repeating some of the less successful aspects of past attempts at regeneration. They need to explain whether providing shiny new roads and revamped town centres is the way to improve lives and level up.

The Covid pandemic has shone a bright light on the areas of our country that suffer from considerable deprivation. There is a strong link between deaths from Covid and living in deprived parts of our country. Can the Minister explain why some of these areas will not benefit from any of the funding packages outlined in the Statement? Are these places just going to be ignored? What plans do the Government have for providing support for them? Does the Minister agree that reviving local government by enabling local authorities to provide self-help may well be the best way forward? Of course, that depends on adequately funding local government and devolving to councils the right to bring in local knowledge and talent to take responsibility for making the towns that they represent proud places once again. Does the Minister agree?

What we do know is that people who live in areas of multiple deprivation have lives that are literally limited. They die younger; they live in poor-quality housing; their access to healthcare, training and well-paid jobs is limited. Does the Minister, with his wealth of local government experience, agree with this? If he does, can he also explain the reason for these measures not being the main ones used to determine which places will benefit from the funding packages outlined in the Statement?

This brings me to the selection of the places that are due to benefit from those funding packages. Of course, metrics can be carefully selected to ensure that the towns that the Government wish to benefit from additional funding come out top of the pile. That is clearly what has happened in these instances. Using the metric of distance to travel to work will target those places that are of a more rural nature. If that is the aim, the Government should be honest about it and focus on improving public transport in rural areas. If the heart of so-called levelling up is providing focused support to places suffering from multiple deprivations, the Government should use the metrics that enable that to happen. If they do not, they are being hypocritical and make those of us looking on regard what they are doing with some cynicism.

Much of the content of this Statement is of packages that are being announced as new yet again. The miserable levels of funding to mayoral combined authorities of £30 million or so a year in areas that serve, say, 2 million people, is just another example of re-announcing old packages of funding. The support for the well-to-do areas that can raise £250,000 as matched funding to buy and run a community asset has been re-announced. These packages are not new and not aimed at poorer parts of our country.

I want those post-industrial towns that have experienced considerable decline—economically and socially—to benefit from long-term and sustained support that will revive their communities, improve the health and well-being of their residents, enable training and skills that lead to well-paid jobs, and bring hope for the future. Unfortunately, the package of funding announced does none of that. I look forward to answers to my questions when the Minister replies.

[The Deputy Speaker (Baroness Garden of Frognal) (LD)]

My Lords, the Front-Bench speakers have taken most of the 20 minutes allowable, but I can confirm that the Minister has plenty of time to reply and that the Bank-Benchers will still get their 20 minutes.

Fire Safety Bill

Baroness Pinnock Excerpts

Consideration of Commons amendments & Lords Hansard
Wednesday 17th March 2021 Lords Chamber

[The Deputy Speaker (Baroness Garden of Frognal) (LD)]

My Lords, I now call the noble Baroness, Lady Pinnock, to speak to but not, at this point, to move Motion C2.

[Baroness Pinnock (LD) [V]]

My Lords, I draw the attention of the House to my relevant interests as a vice-president of the Local Government Association and a member of Kirklees Council.

Much has happened since the Bill was last debated in this House in November. It is already clear from the contributions to this debate today that this is an unresolved crisis of major proportions. I thank the Minister for the opportunities that he has provided to discuss the issues raised. The Government’s response has been to regard this as largely an issue for lease- holders and freeholders to resolve. Gradually, however, they have acceded to the principle that, without government intervention and funding, the problem will not be resolved.

The purpose of all the amendments in my name and that of the right reverend Prelate the Bishop of St Albans is to extend the principle already agreed by the Government. Amendment 4F in my name would extend the contribution that the Government make to cover not just the remediation but the extortionate service charges and higher insurance costs that are currently being levied on these leaseholders. This serious problem can be successfully fixed only with up-front funding from the Government, which can then be recouped from developers, construction firms and manufacturers.

The Government’s own estimate is that the total cost of remediation will be in the region of £16 billion. The buildings involved are not just in London but all across the country. Following the Grenfell tragedy, we now know that ACM cladding was affixed to blocks when it was known to be inflammable. As the cladding is peeled away, further serious building defects are revealed. The Government recognise this, as they have issued a directive to local authorities requiring an inspection of various features, including fire breaks, insulation and spandrel panels, as well as cladding. This is now much more than a cladding scandal; it has become a construction crisis.

Worse still is that some of the defects that are being exposed were in breach of building regulations even at the time of construction. The big question then is: who is going to pay? Currently, the Government are providing grants for the removal of cladding only and are restricting those grants to buildings of 18 metres or more in height. Yet cladding has to be removed from all blocks, irrespective of height. The Government have chosen 18 metres partly because they simply have no idea how many blocks there are that are lower than 18 metres. I have asked the ministry for the analysis of those risks to which the Minister will refer but have received no reply to date. Good decision-making is dependent on well-researched data, which is then shared for all decision-makers.

At the heart of this crisis are people who have done everything right and nothing wrong. They are innocent victims and have suffered enough. Imagine living in a flat with your family, knowing for three years or more that the home you saved hard to buy is a significant fire risk. That fact alone has left emotional scars on those leaseholders. Then imagine, having carefully budgeted, being faced with an additional service charge of several hundreds of pounds each month to cover the extras: waking watch, insurance and more. For some, the final straw is that you are then billed for the costs of total remediation. For individuals faced with these enormous bills, the choices are very limited.

Bankruptcy has already been the solution for too many. George is one such. He describes himself as a frightened leaseholder and says, “I have been informed that it will cost £2 million to replace the cladding and remedy the defects. That is £50,000 per flat. I’ll be bankrupt by the end of the year at the age of 28. The building has one grant, covering 10% of the costs.” Everything that he and others have worked and saved for is lost through no fault of theirs. It can lead to homelessness. Sarah lives in a flat in the Royal Quay in Liverpool. The normal year service charges for that block were £270,000; this year, the service charges are nearly £1 million. Sarah says that the defects are so numerous that the fire service may have to escalate from a compliance to a prohibition notice, which will shut down the complex. If that occurs, 400 residents will be made homeless.

Not surprisingly, given those examples, for some the stress is such that very serious mental illness, or worse, has followed. Hundreds of thousands of individuals and families are watching and waiting for the decision of this House today. They are willing us on to help to find a fair and just solution to a problem that is not in any way of their making, yet they are the ones who are being asked to pay the price. If the right reverend Prelate the Bishop of St Albans wishes to divide the House, as he has indicated, the Liberal Democrat Benches will support him. If, however, he chooses not to do so, then I will wish to test the opinion of the House.

[The Earl of Lytton (CB) [V]]

My Lords, I declare my interests as a vice-president of the LGA and as a practising chartered surveyor. I have very considerable sympathy with all these amendments but, the matter having now been decided by this House, gone to the other place and now come back, it behoves us to consider all these matters with a degree of objectivity, despite the clear emotions that are involved.

With regard to Motion moved by the noble Lord, Lord Kennedy, I agree that it has taken far too long to deal with this matter, which has allowed the issue to grow in a way that should have been nipped in the bud at an earlier stage, but I realise the complexities of the issues, which I will address in a moment. On all these amendments, I must say at this juncture that I do not know which way I would vote; it will become apparent why as I proceed.

It goes without saying that I have the greatest possible respect for the right reverend Prelate the Bishop of St Albans and the powerful case that he makes for Motion C1 and, for that matter, the case made by the noble Baroness, Lady Pinnock, on the allied Motion C2. Indeed, every fibre of my being tells me that a great injustice has been visited on many innocent people as leaseholders and tenants in buildings affected by this Bill who have faced the burdens of past failings, delays and inaction, which they themselves may be powerless to deal with. It must be as if the whole system of property law and ownership has conspired against them. As a property professional, I feel that most acutely. It has been made worse, as I say, by the length of time that these problems have been gestating.

However, whatever my heart tells me on the grounds of ethics and justice, my professional experience tells me that these amendments would, almost inevitably, not achieve their aims or address the present or future fundamental issues. This Bill potentially affects a very wide category of property and tenure, not just high-rise blocks. The provisions of Clause 1 extend the regulations to any property comprising two or more separate units of accommodation. I ask noble Lords to contemplate just what that means in practice.

Non-Domestic Rating (Public Lavatories) Bill

Baroness Pinnock Excerpts

Report stage & Lords Hansard
Wednesday 17th March 2021 Lords Chamber

[Lord Greaves (LD)]

My Lords, I shall speak also to Amendment 2, which is in the same group. This follows what I thought was an interesting and useful discussion in Committee on the meaning of the words “wholly or mainly” when it came to defining whether a hereditament qualified for the zero rating under business rates as a public lavatory. In Committee I probed whether “mainly” was about the area it covered, perhaps the floor area, the value or the use. The Minister made it very clear that it was about the use; I have been reading what he said in Committee and that is very clear indeed. I will come back to that because Amendment 1 is the more important of these two amendments.

Amendment 2 is about the percentage use of the hereditament that qualifies for non-payment of any business rates. In Committee the Minister made it clear that the words “wholly or mainly” were put in because, he said, they are commonly used words in this kind of legislation, particularly in relation to charities. He referred to case law and to local authorities having some flexibility in whether they decide it is a public hereditament. He said:

“The use of ‘mainly’ means that an authority may, for example, look at the floor area of a building and see that less than 50% is being used directly as a public lavatory, but it may still feel that it meets the criteria … because the remaining area is used as storage or for other matters of little consequence.”—[Official Report, 24/2/21; col. 852.]


The useful discussion that we had there again put the emphasis upon the use of the hereditament. The Minister went on to refer to the Local Government Finance Act 1988 and its reference to charities.

The interesting thing is that it is not entirely clear that 50% is absolutely clear and written into the legislation. The Minister kept saying that he did not want greater burdens to be put on local authorities and did not want them to spend more time on this, yet there seems to be some disagreement, in the context of business rates relating to use for charitable purposes, about whether the proportion of the use that is taking place has to be 50% or more. The Charity Tax Group says in its briefing:

“In order to benefit from the mandatory exemption from business rates it is important to understand the meaning of ‘wholly or mainly used for charitable purposes’. Case law suggests that ‘mainly’ probably means ‘more than half’; but there is a certain amount of ambiguity about this and the interpretation may vary from local authority to local authority”


which is unsatisfactory.

“It is sometimes argued that ‘mainly’ in fact means more than 75 per cent. Charities may have to try to negotiate this with their local authority.”


I am no expert on this area and I do not know how much of that goes on, but it seems sensible that if “mainly” means 50% or more that ought to be written into the Bill.

Amendment 1 would put into the legislation the exact words in the charitable legislation and the exact words that the Minister said in Committee referred to this legislation. I looked it up. Section 45A(2)(b) of the Local Government Finance Act 1988 reads, for charitable relief,

“it appears that when next in use the hereditament will be wholly or mainly used for charitable purposes.”

There is then another paragraph that refers to community amateur sports clubs that has the same wording.

I am therefore trying, in an attempt to be really helpful to the Government, which I always attempt to do in legislation because if we get good legislation it is clear what it means and it is workable, to put into the Bill the wording in the Local Government Finance Act, which in Committee the Minister said applied to this Bill, which is to say that it is not, as this Bill states at the moment

“consists wholly or mainly of”,

but

“is used wholly or mainly”

for public lavatory purposes.

This is a very sensible little amendment. The Government ought to say, “Yes, of course. It’s sensible. Let’s put it in.” I beg to move.

[Baroness Pinnock (LD) [V]]

My Lords, I draw the House’s attention to my interests in the register as a member of Kirklees Council and as a vice-president of the Local Government Association. I must say that I enjoyed the forensic probing that my noble friend Lord Greaves has undertaken. The words in the Bill that he is keen to clarify are ones that legislators frequently use. One wonders whether this is for the precise purpose of storing up business for lawyers when a challenge is made and the words then have to be to defined. My noble friend has done his research and quoted case law. The Minister’s response will be of interest to many of us because it will relate not only to this Bill but to others where charitable institutions are involved.

My noble friend also drew our attention to the difference in the use of “consists” and “used”. As he rightly pointed out, a “well used” facility may not get relief, whereas one that consists “wholly or mainly” may well do. Perhaps the Minister will be able to explain the reasoning behind the use of the words in the Bill that my noble friend is questioning. I look forward to what I am sure will be a most informative response.

[Lord Kennedy of Southwark (Lab Co-op)]

My Lords, I declare my interest as a vice-president of the Local Government Association. I thank the noble Lord, Lord Greaves, for tabling the amendment. We debated issues around similar words in Committee. I thank him for raising these important matters again because we have to be clear. I was very struck by the points he made towards the end of his remarks about how important it is to get legislation right and to have good legislation. If we are not clear what we mean and mean what we say we will have all sorts of problems.

This gives the noble Lord, Lord Greenhalgh, the opportunity to be very clear about what the Government mean. We need to be clear when we have words such as “mainly” and whether it is “more” or “less”. If we do not get these things clear then we get confusion. That leads to bad law and might potentially involve the courts. It potentially involves wasting more time in this House clarifying what we should have clarified in the first place.

The noble Lord, Lord Greaves, is very good at picking these things up. I remember the debate that we had on rogue landlords, when he tabled an amendment on what was meant by the word “rogue”. It is important that we get these things right because then we will not need to clarify them. I thank the noble Lord for that. I look forward to the Minister’s response on the amendment.

--- Later in debate ---

[The Deputy Speaker (Lord Russell of Liverpool) (CB)]

The noble Baroness, Lady Jones of Moulsecoomb, has withdrawn from this group, so I call Baroness Pinnock.

[Baroness Pinnock (LD) [V]]

My Lords, my noble friend Lady Randerson has a wealth of knowledge of the value and importance to our communities, large and small, of the provision of clean, well-maintained public toilets. Her argument is a powerful one. We learned from the meeting that we had with the representatives of the British Toilet Association and the Minister that, in fact, there is no longer accurate mapping of open public toilets around the country. During these 12 months of Covid closures, public toilets have been shut out of concern that their use might enable virus transmission. As the country seeks to return to a more normal way of life, what is vital is that public toilets are available in every community. All noble Lords who have spoken so far have made that point. That is why I totally agree with my noble friend that this Bill lacks ambition and what is needed is a strategy for public toilets from a public health perspective.

I have a suggestion for the Minister. The Government are allocating funding via a Towns Fund to help regeneration. Perhaps he can urge his department to attach a requirement to successful grant applications that towns ensure, as a minimum, that they have a well-maintained and accessible public toilet for the disabled.

My noble friend Lord Greaves pointed out how important parish and town councils are in maintaining existing public toilets. He also pointed out the difficulty that those councils have in accessing capital money in order to restore or build new facilities. That, too, is something to which I hope the Minister will respond.

The noble Baroness, Lady Andrews, urges us, as a society, to recognise the essential need for decent public loos, and that their provision is in crisis. I agree wholeheartedly when she says, “If Wales can do it, so can England.” It was well said.

My noble friend Lady Thomas speaks with long experience of the barriers that are unwittingly created for disabled people by the rest of the community. There has been a failure to provide public toilets that are both available and accessible. If we all had to plan our days out shopping or visiting on the basis of the availability of an accessible toilet, my hunch is that many more would soon be provided.

I thank the noble Baroness, Lady Greengross, for pursuing a similar amendment and for supporting the purpose the amendments in the names of my noble friends. Of course, we on this side totally support this Bill. It will have some limited impact that might well ensure that some public toilets remain open. Unfortunately, it fails to address the wider issues of comprehensive provision and the role of government in encouraging and supporting the funding of such facilities. Hence, I fully support all the amendments in this group. Perhaps the Minister can provide some hope that the Government will return to the lack of provision of public toilets in future legislation. Better still, they could use the current funding regime to make their provision a priority for grants. I hope that the Minister will be able to offer some evidence that the Government take the matter seriously, and I look forward to his response.

[Lord Kennedy of Southwark (Lab Co-op)]

My Lords, Amendment 3 in the name of the noble Baroness, Lady Randerson, is a good amendment and I support it. I look forward to the Minister’s response. The noble Baroness is absolutely right to highlight these issues. An ageing population needs more facilities; parents need facilities for their children. The point the noble Baroness made about changing facilities for fathers and male guardians is very well made. We also need to ensure that proper facilities are provided for disabled people, so I very much agree with the noble Baroness on that.

The noble Lord, Lord Greaves, spoke to an amendment to the lead amendment. He was absolutely right in talking about people visiting town centres, beaches and so on. We are all looking forward to the lifting of lockdown over the next few months. The Government are going to say, “Get out there. Go out there and spend some money, visit some places and meet your family and friends”. I want to do that.

--- Later in debate ---

[The Deputy Speaker (Lord Alderdice) (LD)]

The noble Earl, Lord Lytton, has withdrawn, so I call the noble Baroness, Lady Pinnock.

[Baroness Pinnock (LD) [V]]

My Lords, I shall follow the previous two speakers in keeping my comments brief. That is not because the amendment does not have merit—on the contrary, it does—but because a lot of the issues it raises have been discussed in full earlier. The noble Lord, Lord Kennedy is right to pursue the extent of rate relief provision. There is an anomaly in restricting relief to standalone public toilets. We heard from the Minister during the debate in Committee that it would be difficult to achieve rate relief for public toilets in public buildings for reasons of complexity for the Valuation Office.

I appreciate those challenges in the administration of such a change, but where there is a will, there is a way. If rate relief were granted for public toilets within public buildings, it might just be the sort of relatively minor additional support that kept the toilets, the building and the facility provided there open. That would be a triple benefit.

What concerns me is that the Government are less than willing to find a way to enable more public toilets to remain open by extending rate relief. I understand that that is difficult—but let us hope that the Minister will be able to have a good think about it and come up with an answer. Maybe the report provision in the amendment offers a way forward; perhaps he will be able to agree to accept that part of it. Whatever happens, we have had a good debate on an important issue concerning public health and public facilities that is of concern to many people. I thank all noble Lords for their contributions, and I hope the Government are listening. I know the Minister has been listening.

[Lord Greenhalgh (Con)]

My Lords, I am conscious that everybody has kept their remarks relatively brief, so I am busily trying to pare down my speech in response to the noble Lord, Lord Kennedy.

I appreciated the point made by the noble Lord, Lord Greaves, about the importance of town and parish councils in providing public toilets, and the fact that they have facilities that would benefit from, for instance, the Changing Places scheme. Because of the points that he has raised this evening, it is important for me to say that we will be looking at including in the guidance and the prospectus a call for councils at all levels to work together to think about provision, which I hope will help to ensure that town and parish councils are more involved than they otherwise would be. I thank the noble Lord for raising that point.

I also thank the noble Lord, Lord Kennedy, for tabling the amendment, which is similar to those previously discussed. I realise that his intention is to understand the difference this legislation has made, and I assure him that the Government keep under review the effectiveness of all business rates reliefs.

Nevertheless, as I set out earlier, the ability to keep a public lavatory open depends on a number of factors, and I do not think it would be possible to separate out the impact that this relief has had from the other aspects which determine local toilet provision. In addition, the amendment would require a report to consider whether the scope of the relief should be extended. I recognise that this is an issue in which many noble Lords are interested, so I am grateful to the noble Lord, Lord Kennedy, for the opportunity to set out why the Government have designed the scope of the Bill as we have.

Subject to Royal Assent, this Bill will deliver a 100% business rates relief for properties that consist wholly or mainly of public toilets in England and Wales. The relief has been deliberately designed to benefit those toilets for which removing the cost of business rates will make the greatest difference to the operators’ ability to keep the facilities open, and stem the decline that we have seen over many decades in public toilet provision.

Officials from my department regularly engage with the Valuation Office Agency and the Local Government Association ahead of the introduction of any business rates measures. Depending on the way in which the scope of the relief was extended, it might be necessary for an additional valuation exercise to be carried out by the VOA. I understand that the VOA has advised that such an exercise could require the assessment of hundreds of thousands of properties, at an estimated cost of around £90 to £120 per property. The total cost of carrying out an additional valuation exercise would therefore be significant, and would be disproportionate to the potential benefits to ratepayers of expanding the scope of the relief.

A different approach to extending the scope of the relief could reduce the burden on the Valuation Office Agency but instead require local authorities to identify qualifying hereditaments. On the basis of conversations with the LGA, my department considers that this would be likely to create additional administrative burdens and costs for councils, which would have to go beyond simply using the existing “public conveniences” category on rating lists, and would have to make decisions on a case-by-case basis.

The noble Lord, Lord Kennedy, suggested in Committee that most qualifying ratepayers would self-identify, therefore reducing the burden on local authorities. I agree that this could be the case, but some element of scrutiny would still be likely to be required on the part of each council to identify fraudulent or spurious claims, so the creation of administration and oversight would remain unavoidable.

While the Government set the legislation which informs the structure of the business rates system, the burden of implementing a relief of this sort and the process of ensuring that it is operationally sound fall to local councils and the Valuation Office Agency.

In the case of this relief, the Government consider that this balance has been met in the Bill as currently drafted. By ensuring that the criteria for the relief reflect a pre-existing category on rating lists, we have found a happy medium between ensuring that the measure delivers value for money and is straightforward for local authorities to implement, while providing targeted support for those facilities for which removing business rates costs will make the greatest difference.

It would be extremely difficult to isolate the changes this measure has had on increasing the number of toilets and changing places facilities from wider factors. Nor do I agree that it would be a good measure of the impact of the relief. However, I can assure the House that we will continue to keep all reliefs under review and, together with my colleagues in the Treasury, to listen to representations on how to improve the business rates system. I hope that, on this basis—and on the basis of the points made earlier this evening—the noble Lord, Lord Kennedy, will agree to withdraw his amendment.

Non-Domestic Rating (Lists) (No. 2) Bill

Baroness Pinnock Excerpts

3rd reading
Tuesday 9th March 2021 Lords Chamber

[The Deputy Speaker (Lord Duncan of Springbank) (Con)]

I call the noble Baroness, Lady Pinnock. I am back on form now.

[Baroness Pinnock (LD) [V]]

My Lords, I give my thanks also to the Minister and his officials for the time that was offered for helpful briefings at each stage of the Bill. As the noble Lord, Lord Kennedy, said, it is a very simple Bill just to change the date of revaluations, which start in April this year but come into effect in 2023.

One issue raised during the Bill which we need to keep a watchful brief on is that, because the revaluation is starting this April, with the huge upheaval in market rents due to the pandemic it will be difficult to make assessments of rental value, which could affect the outcome of when businesses start paying in 2023. I hope the Minister can confirm that he will inform the House of any difficulties that arise from the timings of the revaluation.

The other issue discussed during the passage of the Bill, on which there was broad agreement on all sides of the House, was the strategic one about the future of the business rates system. Evidence was provided during all stages of the Bill demonstrating that retailers on the high street were at a huge disadvantage in business rates charged compared to those retailers which were online only. The differential is very large; a small shop in a small town may have a rental value at least five times that of a large online retailer in an out-of-town warehouse.

There is wide concern about the future of our high streets. The vast majority of people want to see the high street retained as a community focus, as the noble Lord, Lord Kennedy, has just described. One policy lever available to the Government to provide stimulus to the high street is a fundamental reform of the business rates system. It cannot for ever be put on the “too difficult” pile that the Government must have. Can the Minister provide the House with any timetable for the long-awaited reform of business rates? That would provide some hope to retailers on our high streets that change will come.

With those questions and comments, I look forward very much to hearing what the Minister has to say.

[Lord Thurlow (CB) [V]]

My Lords, it is a privilege to be asked to make the concluding remarks from the Cross Benches as we complete the passage of this Bill. I congratulate the Minister on steering it through, notwithstanding unsuccessful attempts—certainly from me—to divert the debate down other routes and related avenues. However, it is fair to say that we have been debating this in something of a straitjacket; those of us interested in non-domestic rates had nowhere to turn, try as we might—indeed, try as we did—to draw the failings of the NDR system to the Minister’s attention. He was perfectly within his rights to wear his benign smile throughout—and a tremendous smile it is. Why a straitjacket? Because it is a two-clause Bill, strictly focused on timing alone, to which there were only two amendments; I am aware of the frustrations of at least one other Peer who wished to table one and was unable to do so within the scope of the straitjacket. I congratulate the noble Lords, Lord Kennedy and Lord Moynihan, on successfully navigating these restrictions and tabling their well-founded amendments, both of which I was happy to support.

There are important implications in changing the dates for compiling the lists to two years’ time; I do not disagree with the principle, but I am concerned that the valuation date for determining rateable value, as we have just heard from the noble Baroness, Lady Pinnock, is within weeks. Without rehearsing the valuable and revealing contributions at earlier stages, it would be unwise to ignore the fact that retail and office markets are in crisis. Retail values are in freefall and office values are in pandemic-related confusion as businesses reassess their space occupancy needs. How on earth can the Valuation Office Agency determine rental value in these conditions? I wish it well.

There will inevitably be dramatic reductions in rateable values and a corresponding fall in local authority revenues. Unless the rate poundage is increased, when rates paid could exceed rent, that would be a lightning rod to disaster and a knife to the heart of the small business retail sector in that retail economy. Will the Chancellor continue to support the sector, or could we expect those who do not pay enough to compensate for those who pay too much? I am afraid that, regrettably, the Amazons of this world that do not pay enough will not make up the shortfall.

To conclude, I say to the Minister that I see some light in this dark place I describe. At every stage of the debate in this House, we have had reference to the fundamental review already mentioned. This is the real opportunity to introduce fairness across the landscape of NDR—sadly delayed but vital and urgent. I very much look forward to its publication and the chance for us all to consider it in the shape of a new Bill, no doubt steered by the Minister and his generous smile. I hope, for the sake of the smaller business sector, that it does not arrive too late.

Non-Domestic Rating (Lists) (No. 2) Bill

Baroness Pinnock Excerpts

Report stage & Lords Hansard
Monday 1st March 2021 Lords Chamber

The Minister will have heard these arguments many times, so he and his colleagues in Government have had plenty of time to come up with an answer. What are the Government going to do to ensure that online businesses are treated in the same way as those on the high street, in shopping centres and in business parks around the country? The ACS recommends introducing an online sales levy or an alternative rating methodology for online distribution warehouses and using the revenue raised to reduce bills for retail stores to support the viability of high streets and local services. Have the Government considered this? It is essential this element is addressed for the sake of all businesses concerned and for the funding of local authorities. I fully support the amendment in the name of the noble Lord, Lord Kennedy, and look forward to what I hope will be a positive response from the Minister.

[Baroness Pinnock (LD) [V]]

My Lords, I draw the House’s attention to my relevant interests as vice-president of the Local Government Association and a member of Kirklees Council. The noble Lord, Lord Kennedy, has tabled a comprehensive amendment, which addresses issues of concern that were raised and debated in Committee. The Minister was unable to provide sufficient reassurances at that stage, hence today’s amendment, which has the support of the Liberal Democrats, as already clearly stated by my noble friends Lord Stunell and Lady Bakewell.

The Bill as it stands simply changes the date of the assessment of the revaluation to 1 April of this year and to delay the publication of the rateable values until 31 December in the year prior to its implementation. As was debated in Committee, these simple changes may have a profound effect on businesses, the prosperity of our high streets, local government finances and on the appeals waiting lists.

First, I will take the effect on local government finance. During Committee, the Minister sought to provide assurances about the financial impact on council income, and I thank him for that. However, there is a wider point of the double whammy on town centre businesses of the impact of Covid lockdowns and the competitive advantages enjoyed by online business. This is likely to mean that town centres will have several empty shops, which will undoubtedly have a knock-on effect on the remaining businesses.

The Government have some support for town centres, but much is limited and scattered around the country. It does not provide sustained help. Part of the answer lies with the radical reform of the whole business rate system. Will the Minister provide the House with a draft timetable for the introduction of a reformed approach, which, as several noble Lords have stated, has been promised for several years.

My noble friend Lady Bakewell has spoken from her experience of the impact of long appeal waiting lists on businesses and council services. As the Minister will know, councils have to set aside considerable sums for the refund of any possible successful appeal. Will he tell the House the total amount set aside by local authorities for this purpose? If he is not able to do so today, will he agree to set out the information in a letter to those taking part in today’s debate? Is the Minister able to consider an alternative to setting aside large sums for potential refunds that clearly make an impact on the day to day services—as described by my noble friend Lady Bakewell—that a council is able to provide?

The current system of business rating is failing, in that it considerably disadvantages those who have a physical presence as opposed to those purely providing an online retail offer. I am not opposed to online shopping but urge the Government to appreciate the value to communities of physical shopping. As the various lockdowns have shown us, there is an intrinsic value to individuals of physical shopping. One simple benefit is that of meeting another person, in the shop or serving at the till. For too many people living on their own, this may be the one chance in the day that they have to speak to someone.

There is also the benefit to communities as a whole. Local high streets provide a sense of belonging to a place. The importance of place-based services has shone through during the pandemic. Local shops and services are part of that sense of place and play a significant role in supporting well-being. We lose it at our peril.

That leads me to repeat the example I gave in Committee of a small shop in the town centre of Cleckheaton, which pays at the rate of £250 per square metre on its 30 square metres of shopping space. In contrast, a large online-only retailer, with an out-of-town warehouse occupying 40,000 square metres, also in Yorkshire, pays just £45 per square metre. If that online retailer were to pay at the same rate as the small town-centre shop, it would be paying a rates bill of £5 million. That would solve a lot of local government finance issues. The retail playing field is hugely skewed to the benefit of online retailers. The Government must act with urgency to address this imbalance and demonstrate that they really do support prosperous local high streets.

The further problem for the Government and Valuation Office Agency is the timing of the valuation assessment. My noble friend Lord Stunell said today that the changes that the Bill will bring may be too late to save more retailers from closing their high street shops. He suggested bringing forward the implementation date to put it in line with the proposals of Non-Domestic Rating (Public Lavatories) Bill, which was discussed last week.

The noble Lord, Lord Thurlow, drew attention in Committee and today to the timing of valuations, when so much of the high street has been closed for several months. Equally, it is not of benefit to town-centre retailers that the current valuation will be that on which their rates bills will be based for the next two challenging years. The Government should address this issue with urgency, but there is no evidence that they are doing so. I look forward to the Minister’s responses on a number of these issues and hope that they are more positive than those we received in Committee.

[The Minister of State, Home Office and Ministry of Housing, Communities and Local Government (Lord Greenhalgh) (Con)]

My Lords, I am grateful to the noble Lord, Lord Kennedy, for tabling this amendment, which allows us to return to the important matter of how the revaluation will impact on various parts of our economy. I entirely understand that the House wants to consider the impact of the next revaluation on sectors such as the high street and small business. I point out to the noble Lord that the £1 billion future high streets fund is not insubstantial and forms part of the £3.6 billion towns fund. It is an important part of helping our high streets to bounce back. Also, as has been mentioned by noble Lords, there has been the business rates relief scheme throughout the Covid pandemic, which has cost in the region of £10 billion. It is for the Chancellor to signal how that will continue in his Budget later this week.

A number of noble Lords, including the noble Baroness, Lady Pinnock, referenced the shift over many years, even before the pandemic, towards online and away from place-based shopping on our high streets. It is a matter for the Chancellor, who is carrying out a fundamental review of business rates, to consider how to address that. The interim report is due on 23 March and the review will conclude in the autumn.

Businesses have been calling for frequent revaluations and we had planned for the next one to take effect this year. It would have been based on rental values as at 1 April 2019. In the difficult circumstances in which we now find ourselves, this was clearly unsatisfactory, as those new rateable values would not have shown the impact of the pandemic. Instead, the Bill will move the date on which the next revaluation takes effect back to 2023. This will allow us to use rental values as of 1 April 2021, which will better reflect the impact of the pandemic.

--- Later in debate ---

This is such a small request for such a substantial and impressive Minister. It is hardly a great deal to ask. This is the time for the Minister to tear up his speaking notes and communicate with this House from his heart, because he knows this is correct. He knows that the motive behind it is accurate and with his great intellect he can simply stand up and say, “I accept this new clause”.

[Baroness Pinnock (LD) [V]]

[Inaudible.]—follow that clarion call to the Minister, but I will try. My noble friend Lord Addington and the noble Lord, Lord Moynihan, have again made a very powerful case again for specific action in respect of amateur and community sports facilities. As my noble friend Lord Addington has reminded us, the Government already provide some support to community sports clubs but it is unlikely to be sufficient to help them balance their books after such a long period of closure due to the various lockdown measures.

I recall that in Committee, the noble Lord, Lord Moynihan, shared the result of an academic investigation by Sheffield Hallam University which valued the impact of community sport at £85.5 billion per annum to the country. The noble Lords have today made a further strong argument for change.

It is not just the impact on the finances of the country that we need to think about in the amendment, but the strong argument made in the discussion on Amendment 1 about the impact on the nation’s health and well-being. That is invaluable in itself. Covid has demonstrated the real importance of daily activity for health and community well-being to us all.

In Committee the Minister agreed with the case made by both noble Lords and said

“I will be a strong advocate” —[Official Report, 4/2/21; col. GC 382.]

of it to the Treasury. We are aware of the benefit of community sports provision. It needs to be valued by the Government for the wider community effect of providing a focus for activity and friendship. Given that the Minister has said how strongly he supports the case, I look forward to his positive response today.