Grenfell Tower Inquiry: Phase 1 Report

Viscount Younger of Leckie Excerpts

Thursday 31st October 2019 Lords Chamber

[The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Viscount Younger of Leckie) (Con)]

My Lords, I am grateful to my predecessor in my role, my noble friend Lord Bourne, for initiating this debate on the Grenfell Tower inquiry phase 1 report. I, and the whole House, know that he understands these matters so well, and I am now honoured to respond.

It is fitting that my noble friend Lady Sanderson of Welton made her heartfelt maiden speech in this House today. I pay tribute to her for her tireless work in the aftermath of the tragedy, building a strong relationship with the Grenfell community on behalf of the previous Prime Minister and ensuring that those impacted received the critical support that they needed. I also thank the noble Lord, Lord Woolley of Woodford, a tireless campaigner for social and racial equality, and the noble Lord, Lord Hendy, a renowned QC in the field of industrial relations and employment law, for their maiden speeches in this House, which were both excellent and had some serious messages. We will no doubt hear much more from them in future, and from my noble friend, as they make their mark in this Chamber.

Over two years have passed since the tragedy that shook the nation, but the 72 people who died following those horrific events will for ever remain in our thoughts and prayers. All those who lost loved ones and their homes deserve to know why the Grenfell Tower fire happened. Yesterday’s publication of the report was an important step in this regard. I take this opportunity to thank Sir Martin Moore-Bick and the inquiry team for their work, both in producing this report and in preparing for the next phase of hearings. It provides some comfort that, as we have heard today, the report is widely regarded as thorough, informative and, as the noble Lord, Lord Stunell, said, forensic.

It was important for the Government to establish this as a full independent public inquiry. It has been able to establish, first, what happened on the night of the fire; secondly, how emergency services responded; and, thirdly, how the building was so dangerously exposed to the risk of fire. We were clear that the inquiry should leave no stone unturned, no matter how uncomfortable the facts. The people of the Grenfell community must be allowed to learn the truth behind that appalling loss of life and how it was allowed to happen. They deserve nothing less.

My noble friend Lord Bourne and the noble Lord, Lord Stunell, asked about criminal charges and how many people have been interviewed under caution. It is not for the Government to comment on an ongoing criminal investigation, but I can say that the Metropolitan Police continues to investigate the causes of this terrible tragedy, needing to take into account the work of the inquiry, including this report and the next.

I take a moment to commend the bereaved, the survivors and everyone affected by this tragedy. We will never truly understand all that the victims of this tragedy went through. My noble friend Lady Sanderson mentioned the essential need for change. She is right. Let there be no doubt: our commitment to ensure change is unwavering.

Noble Lords will know that the phase 1 report is focused on what happened that fateful night, and particularly on the response of the emergency services. Let me be clear in my message today, particularly to the noble Lord, Lord Kennedy, and my noble friend Lord Porter. I also pay tribute to the heroism and bravery of those who responded to the fire: running towards danger, some more than once, entering a burning building and saving lives that night.

Sadly, heroism alone could not counter a fire of this nature, and Sir Martin outlines several significant shortcomings in the London Fire Brigade’s response. Clearly, there are lessons for our fire services from this tragedy and from this report. Crucially, he identifies the failure to change the “stay put” advice once it became clear that it was no longer the correct strategy. However, as Sir Martin said in the report:

“Effective compartmentation is likely to remain at the heart of fire safety strategy and will probably continue to provide a safe basis for responding to the vast majority of fires in high-rise buildings.”


The Government already took action on this issue following the Lakanal House fire, in particular by working with the sector to review national guidance on high-rise firefighting, including the “stay put” policy and evacuation. This was carried out both before and after the coroner’s findings in 2013.

As my right honourable friend the Secretary of State highlighted in the other place, the Government, along with the National Fire Chiefs Council and others, will continue to review the “stay put” advice to ensure that lessons are learned. We have already completed a call for evidence and published a summary of the responses, which showed consensus that “stay put” was the right approach but for buildings correctly designed, built and maintained.

The noble Lord, Lord Harris, and the noble Baroness, Lady Pinnock, raised some important points about communications—the noble Lord particularly asked about mobile telephones. This must indeed be part of our work with the National Fire Chiefs Council. I will ensure that that issue is raised, if it is not already part of its considerations. I acknowledge those important points.

I am also acutely aware that the report concludes there were significant failings in both the construction and design of the building. I want to be clear today that we plan to accept in principle all the recommendations that Sir Martin makes for central government.

My noble friend Lord Bourne and the noble Lord, Lord Stunell, asked about legislation. We will work with stakeholders to deliver that. That will include proposing legislation ahead of the Hackitt reforms, if that would mean that the recommendations can be implemented sooner. Our task must now be to consider how we can best implement the recommendations quickly and build on the work we have already done to ensure that people are safe in their homes.

To answer my noble friend Lord Porter’s question about the decision for phase 1 to focus on the events of the night, I must stress that the order of the independent reports is very much a matter for the chairman. I can only point to Sir Martin’s statement, in which he said that,

“there is an urgent need to find out what aspects of the building’s design and construction”,

led to the disaster, and to,

“understand the chain of events”,

of the night,

“in some detail”—

and, as such, find out what steps must be taken so that those who live in other high-rise buildings are safe.

The noble Lords, Lord Adonis and Lord Stunell, and the noble Baroness, Lady Kidron, made points about timings and urgency. That certainly chimes with me. The Government did not wait for the publication of this report, or the hearings to begin on the phase 2 inquiry, to press ahead with strengthening building and fire safety measures.

My noble friend Lord Bourne asked about high-rise buildings. The department has already consulted on proposals to apply higher standards to new high-rise residential buildings, including on sprinklers, signage and communication systems, which are now also a recommendation of the inquiry.

My noble friend also asked about the height at which buildings are considered to be high-rise. Although the consultation proposes a height of 18 metres, the Secretary of State has been clear that the Government will follow the evidence, should the height threshold need to be changed.

[Lord Adonis]

The Minister mentioned my remarks and those of the noble Baroness, Lady Kidron. The House of Commons committee recommended:

“The Government should set a realistic, but short, deadline by which time all buildings with any form of dangerous cladding should be fully remediated”.


Can the Minister tell us what date the Government intend to set?

[Viscount Younger of Leckie]

There is a lot of detail in what I want to say; I will come on to cladding. I also point out to the noble Lord that much of what we are doing must be regarded as part of a holistic approach so, on timetables, there may not be one particular date by which everything is done. It is a very complex process.

Soon after the fire, in July 2017, the Government commissioned Dame Judith Hackitt to conduct a review of building and fire safety. Noble Lords will recall that we have already agreed to take forward the recommendations of Dame Judith’s report in full as the basis for regulatory reforms in building and fire safety. Our comprehensive building safety programme, announced in the recent Queen’s Speech in the form of a Bill, will bring about a radically new building and fire safety system by: establishing a new regulatory framework; creating greater accountability and responsibility; issuing sanctions to tackle irresponsible behaviour by those responsible for buildings; and giving residents a stronger voice.

The right reverend Prelate the Bishop of Durham referred to social housing. It is important that we improve quality and quantity, with a beneficial knock-on effect on health. We have committed to taking forward the social housing White Paper at pace. It will set out proposals for the standards that we set for social homes. We remain committed to increasing the supply of social housing, committing more than £9 billion as part of our affordable homes programme and delivering more than 250,000 homes by 2022.

Of course, we have had to take urgent steps in the interim to ensure that people are safe today. Much of this work has been around cladding. First, we have banned the use of combustible materials on high-rise homes and identified all buildings over 18 metres with unsafe ACM cladding.

The noble Baroness, Lady Finlay, asked whether gas should no longer be used in high-rise buildings. It is an interesting point. I cannot answer her question easily today, but I can say that the Government have signalled their intention to prohibit the use of fossil fuels such as gas in new homes by 2025 for reasons of environmental protection.

Secondly, we have established a comprehensive programme to oversee the remediation of unsafe ACM cladding, providing £600 million of funding to support this work. My noble friend Lord Young and the noble Lord, Lord Adonis, asked about the funding; it is beyond the £200 million that the Government are putting forward for private residential high-rise remediation. Both noble Lords asked what would happen if the costs go beyond this. I can confirm that the money set aside is an estimate and that plans are in place, should it become necessary, to revisit that estimate.

I am pleased that all social sector residential buildings with ACM cladding either have had the cladding removed, are undergoing work to remove it or, at the very least, have had such work scheduled. We have pushed on every front to ensure that the work is completed quickly, and today only a handful of building owners have yet to confirm their intention to remediate the ACM cladding on their buildings.

We have now completed remediation work on 61 buildings in the social sector, have begun work on a further 81 buildings and are working hard to ensure that remediation is completed on the remaining 16 buildings as soon as possible. My noble friend Lord Young asked about progress on this. As of October, only 10 of the 89 private sector buildings in scope of the fund have yet to engage. We will continue to put pressure on developers and building owners to get on with remediation. In response to a number of questions he raised, I will shortly provide a letter detailing the take-up of the private sector remediation fund and set out a fuller picture of the remediation figures, as well as the responsibilities of leaseholders and freeholders. As the Secretary of State for Housing, Communities and Local Government made clear yesterday in the other place, there will be consequences for any building owners not making clear progress, including naming and shaming and enforcement action.

Thirdly, interim measures are in place in high-rise buildings with ACM cladding to ensure that all residents remain safe. We are working at pace to review different parts of the building safety regime. We have now completed testing on non-ACM cladding panels and are analysing the results, which will be released in the coming months.

We have recently launched a consultation on the use of sprinklers in all new residential buildings over 18 metres—a point that was raised in the debate. It also seeks responses on evacuation alert systems and improved signage, which was raised by my noble friend Lord Bourne and others. The consultation will close in November. My noble friend Lord Bourne also asked about fire doors. On the advice of the independent expert panel, the Government conducted an investigation and testing programme of glass reinforced plastic composite fire doors, leading to their withdrawal from the market. Following this, the Association of Composite Door Manufacturers has committed to deliver an industry- led remediation plan, which has our full support.

The noble Lord, Lord Shipley, asked about product safety, which was part of my old brief when I worked in the former BIS, now BEIS. In May 2018, an independent investigation into the Whirlpool fridge-freezer involved in Grenfell Tower confirmed that there was no need for further action, and BEIS supports its conclusion that no product recall other than corrective action is required. People who own that particular model can continue to use it as normal. The noble Lord also raised a point about electrical safety checks. Existing legislation already requires landlords to keep electrical installations in safe working order. However, the Government have reviewed the issue and have now committed to introducing mandatory five-yearly electrical safety inspections. I am confident that these steps will help us boost safety and transform the way we build in the future.

We have also been working across government to co-ordinate action on fire safety. First, the newly established fire protection board provides a bridge across the Home Office, my department, MHCLG, local government authorities and the National Fire Chiefs Council. The board will provide greater assurance that fire safety risks in high-rise residential buildings with ACM cladding are being identified, managed and properly recorded. It will oversee an increase in inspections and audits of high-risk buildings, and we have already signalled our commitment to getting this right by pledging £10 million a year. As my right honourable friend the Secretary of State said in September in the other place, he expects,

“all high-rise buildings to have been inspected or assured by the time the new building safety regime is in place, or no later than 2021”.—[Official Report, Commons, 5/9/19; col. 373.]

Secondly, the Home Office has run a call for evidence, alongside MHCLG’s Building a Safer Future consultation, on the fire safety order. This consultation seeks to ensure that the order remains effective and works as a whole with the new regulatory regime and other existing legislation. The call for evidence closed on 31 July and we are now analysing the responses.

Thirdly, the Home Office has established an independent Fire Standards Board, which should not be confused with the FPB, and has provided £1.5 million of funding to support its work. The board is supported by the National Fire Chiefs Council’s Central Programme Office to support continuous improvement of fire and rescue services. The board will be responsible for the development of a high-quality useable framework of professional standards, aligned to the work of the National Fire Chiefs Council and its national initiatives. It is clear from the report’s findings that this Government need to be playing an active role in supporting the sector through the fire reform programme.

In July 2017, the then Home Secretary expanded the remit of HMIC to establish Her Majesty’s Inspectorate of Constabulary and Fire & Rescue Services. This move sought to highlight areas for continuous improvement of good practice for fire and rescue services and to increase transparency for the communities they serve. The inspectorate has now completed inspections of all 45 FRSs in England and has published reports on 30 of them. We expect reports on the remaining 15 to be published shortly, alongside the inspectorate’s first “state of fire” reports.

[Baroness Brinton]

Does that also include ensuring that all the points that I referred to that used to be covered by inspections are being covered by plans throughout every area of each fire service? It is one thing to do this at a superficial level, but part of the problem appears to be that inspections have not been as detailed as they used to be.

[Viscount Younger of Leckie]

Yes, I can reassure the noble Baroness on that front and reiterate the point I made earlier about greater joined-up thinking across different agencies and bodies.

Learning from the inspectorate’s reports and the creation of national standards based on the best operational practice will help the LFB and the fire and rescue service as a whole to respond to the issues that the inquiry identified. We expect the NFCC to support services faced with challenging reports to drive improvement and make sure that cross-service learning is happening, which helps to answer the noble Baroness’s question.  

The noble Baroness, Lady Finlay, and my noble friend Lord Bourne asked about collaboration and co-ordination, and communication within the emergency services. An assurance programme was conducted in 2017 on joint interoperability with more than 100 police, fire and ambulance services. Findings showed that new processes are embedding, and the Home Office is continuing to drive work to embed this programme locally.

The noble Lord, Lord Harris, and others raised the issue of problems with communication between firefighters. Each fire and rescue authority, including the London Fire Brigade, must evaluate local risks and determine its priorities, policies and standards for fire protection and response, including equipment. It does this through an integrated risk management plan. It is for the Mayor of London to set the budget for the London Fire Brigade so that it has the equipment needed to do its work. The Government will work with the fire and rescue services to ensure that lessons are learned from this terrible tragedy.

[Lord Harris of Haringey]

To make it clear, my point about emergency alert communications was not a matter for individual fire brigades or for the Mayor of London. It is a more general one about the Cabinet Office and other government departments agreeing a system and ensuring that it is available for all emergency services.

[Viscount Younger of Leckie]

I take note of the noble Lord’s point and will feed that back.

I realise that my time is running out, but on this very important subject I want to spend a couple of minutes on some final remarks. I want to reflect on the work of the Government in and around the Grenfell community. Rehousing the 201 households that lost their homes has been an absolute priority for the Government. Today, 95% of these households have now moved into their new permanent homes and, as the right reverend Prelate the Bishop of Durham alluded to, they must truly be places that they can call home.

We will continue to support the Royal Borough of Kensington and Chelsea Council to ensure that the nine remaining households can move into permanent homes, and that those affected continue to have access to the services and support they need to rebuild their lives. But of course, there is much more to do to restore trust in that community and, as the right reverend Prelate the Bishop of Durham said, bringing different faiths together to help with this is of paramount importance.

We are committed to ensuring that government support remains in place for the bereaved and survivors for the long term. This is reflected in the Grenfell Tower Memorial Commission, which is made up of representatives of the bereaved, survivors and local residents. While the Government have taken ownership of the site of the tower, it is for the community to determine the most fitting and appropriate way to remember those who lost their lives.

The right reverend Prelate the Bishop of Durham spoke about his concern about the neglect of humanity. Let us never forget that this tragedy is about human beings: human beings who lost their lives, human beings who survived and human beings who keep fighting for the truth and justice they so rightly seek, but now it is also about human beings who are taking—and must continue to take—responsibility and bring about the changes we need to see. No report can change what happened that night or bring back those who lost their lives, but yesterday’s report is an important step on the road to lasting change, and we must work tirelessly and without delay to ensure that we achieve it, so that when we say “Never again” we really mean it.

Housing: Rental Market

Viscount Younger of Leckie Excerpts

Monday 28th October 2019 Lords Chamber

[Baroness Gardner of Parkes (Con)]

My Lords, I beg leave to ask the Question standing in my name on the Order Paper. In doing so, I declare my interests as set out in the register. The Question is appropriate given that it follows the last one on a similar issue.

[The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government and Wales Office (Viscount Younger of Leckie) (Con)]

My Lords, the Government have no current proposals to regulate short-term platforms. We welcome the efforts of the Short Term Accommodation Association to improve standards. With the support of my department, the Minister for tourism will soon host a round table on short-term lets with senior industry stakeholders. Short-term lets account for a fraction of the dwelling stock in England and there is little evidence to suggest that the availability of housing for rent has been adversely affected.

[Baroness Gardner of Parkes]

I thank the Minister for that Answer, but I believe that it would be desirable to reintroduce licensing rights for local authorities so that they have powers in this area. The whole of London has recently been damaged by the fact that there are no arrangements whatever for rubbish to be put out. On the day people leave such lettings, they just dump their rubbish outside the property. The Government’s response has been that local authorities are entitled to collect a special amount in this respect, but there is no one at the property from whom to collect the money because they have already gone. I ask the Minister to look seriously at ensuring that local authorities are now given more control, as they had before they were lost in the 2015 Act, over licensing and inspection, and in particular to check whether owners have the legal right to let their property.

[Viscount Younger of Leckie]

On the subject of possible registration, we welcome Airbnb’s plans to hold a national discussion on this matter and we are engaging with it and other similar stakeholders on their proposals. Perhaps I may say that local authorities already have powers to take action against issues such as noise, anti-social behaviour or the accumulation of rubbish, as my noble friend has pointed out, that may arise in relation to short-term properties. I would urge anyone with such a complaint to take it to their local authority. We want to encourage responsible short-term letting where hosts behave in accordance with the law and with respect for both their guests’ safety and their neighbours’ peace.

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

My Lords, I refer the House to my relevant interests. Is the noble Viscount saying that he does not accept that there is a problem here which needs to be dealt with?

[Viscount Younger of Leckie]

No, I am not saying that there is no problem. We take the view that we welcome the voluntary approach. We are encouraging the Short Term Accommodation Association to drive up standards. Its self-regulatory measures to date include the Safe, Clean and Legal accreditation scheme in partnership with Quality in Tourism, its collaboration with Westminster City Council to develop and promote the considerate short-term lets charter and its members’ voluntary imposition of checks to help enforce the 90-day limit in London only.

[Lord Bird (CB)]

If thousands of houses are taken out of the housing market in London, does the Minister not agree that that would have an effect on the price of rents and on homelessness?

[Viscount Younger of Leckie]

I said in my initial Answer that the increase in Airbnb lettings is not having an effect on houses to rent. But on the noble Lord’s point about prices paid by rental tenants in the UK, prices rose by only 1.3% in the 12 months to September 2019, a rate unchanged since May 2019.

[Lord Palmer of Childs Hill (LD)]

My Lords, the Minister replied very blithely to the question asked by the noble Lord, Lord Bird, but Airbnb has become very profitable. Does the noble Viscount not agree that there has been a big decrease in properties for long-term rent and purchase, despite the percentages in his answer, and that the vast increase in short lets is not how to build communities?

[Viscount Younger of Leckie]

I can only quote the figures that I have given noble Lords, which show that there is an increase but it is not having an impact on private rented property. As I said, we want to continue to follow the advocation for self-regulation and to support local authorities. In 2018, the Short Term Accommodation Association implemented the considerate nightly letting charter with Westminster City Council. With the fines that have been imposed—I have the details of those—it seems to be working. As I said, we are determined to follow the voluntary approach at present.

[Lord Whitty (Lab)]

My Lords, a few months ago, I asked Ministers what they were doing about the situation where leaseholders and tenants of social housing were subletting to Airbnb and equivalent bodies, and the Minister indicated that it was not their problem but it was local authorities’ problem. I now ask about an issue that clearly is central Government’s problem: how many of the 80,000 odd premises that are let to Airbnb in London are registered for business rates, business for profit tax or VAT, because this form of tourism is detrimental to a lot of areas in central London where people live and where housing is in very short supply?

[Viscount Younger of Leckie]

As I said earlier, we think it is right that local authorities remain responsible for this area. Westminster City Council has investigated or is in the process of investigating over 1,500 properties for unlawful short-term letting. In one case earlier this year, a fine of over £100,000 was imposed. But the noble Lord is right that those who let out their properties for Airbnb must pay taxes. That is something that local authorities should look at. Of course, when they register, local authorities can find out who the hosts are and whether taxes have been paid or not.

[Lord Best (CB)]

My Lords, the Government decided, very wisely, to establish a regulator for property agents—for estate agents, letting agents and managing agents of leasehold property—but have decided at the moment not to include in that the organisations that provide these very short-term lets such as the Airbnbs of this world. In view of the misgivings that abound about Airbnb and others and the campaigning work of the noble Baroness, Lady Gardner of Parkes, over so many years, might it not be a good idea for the regulator’s remit to include these organisations as well?

[Viscount Younger of Leckie]

We welcome the report by the working group on regulation of property agents chaired by the noble Lord. It was published in July this year and extends to some 24,000 words, with 53 recommendations. Since then, I reassure the noble Lord and the House that officials have begun an extensive programme of evidence-gathering with over 30 interviews with key stakeholders either already or soon to be conducted. That will form the careful consideration that we will give to the point he raised. While we are open to following the evidence, it is not government policy to support regulation of short-term lets at this time.

[Baroness Bennett of Manor Castle (GP)]

My Lords, the Minister may not be aware—the discussion thus far has focused on London—that in York the number of Airbnb and HomeAway listings is growing at 12% per quarter, not per year. Since 2016, there has been a 300% increase in the number of entire homes advertised in York. The Minister referred to councils acting on the law. Will he consider how councils can be assisted with laws and regulations and resources to enforce the 90-day change-of-use rule?

[Viscount Younger of Leckie]

The 90-day change-of-rule applies to London alone. York is a wonderful place to go, and it is a good thing that Airbnb operates there because short-term lets allow households to boost their income, which in turn promotes economic growth through tourism, although I agree that a balance has to be struck with impinging on the business of local hotels. Hull, which is not too far from York, appreciates having extra accommodation during peak times. During its year as City of Culture it ran an initiative with Airbnb called “Everyone Back to Ours” to help attract more people to the city, so there is a balance to be struck.

Neighbourhood Services: Government Support

Viscount Younger of Leckie Excerpts

Thursday 24th October 2019 Lords Chamber

[The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government and Wales Office (Viscount Younger of Leckie) (Con)]

My Lords, I thank the noble Lord, Lord Greaves, for securing this debate and all noble Lords for their remarks. This is my first debate in my new role, although I have covered the department in the past as a Whip. I am, however, only too aware of the experience of the noble Lord in local government. If there is a verb “to Pendle”, the noble Lord could be described as a “much-Pendled” Peer. I am also aware of the experience and knowledge of the noble Lord, Lord Kennedy, in this sector and the length of time that he has spent in his role on the Front Bench.

All types of local authorities play a central role in supporting communities, including the most vulnerable, across the country, and district councils are at the heart of delivering many of the key services that matter to communities. We have heard a lot about that today. We are grateful for the transformative changes they have championed and for their continued commitment to providing the day-to-day services that their residents rely on. The Government make it a priority to visit councils—including, I understand, Pendle this month—in order to see the issues and opportunities at first hand.

I want to be clear that it is not only upper-tier authorities that are a priority for this Government: we want all authorities, regardless of size, to know that their concerns are being heard. However, while we seek to understand and address the daily issues faced by councils, it is right that we step back and ask ourselves some strategic questions. What is the best model to serve local needs, especially for the most vulnerable groups? How do different authorities best work with their communities to meet the needs and priorities of local areas, which will no doubt differ across the country? The noble Lord, Lord Goddard, alluded to this in his remarks. What is the right balance between state intervention and support and the power of local democracy for local decision-making and authorities?

These are big questions and we must raise them. Indeed, it is not only me asking questions about the role of local government; the sector itself, including the Local Government Association, is constantly challenging itself to do better for all the people it serves. As my noble friend Lady Redfern said, there have been tough times. There continue to be challenging issues to address, but authorities are being innovative.

Social care services are essential to protect our most vulnerable. This is a priority for this Government. The Prime Minister has been entirely clear on this matter and I am keen today to dedicate some time to how we are supporting district councils and the universal services which neighbourhoods rely on. I will also be reflecting later on the important issues of empowerment and community—which I feel strongly about and which was a major theme in the speech of the noble Lord, Lord Greaves.

I turn first to the spending round. This Government understand their responsibility to make sure that local authorities are adequately funded. I was pleased—as I am sure were all noble Lords—with the positive outcome of the spending round. Core spending power, the measurement we use for local government funding, is expected to grow by £2.9 billion for England, which is an estimated 4.3% real-terms rise. I know that the Secretary of State was delighted to have secured the largest year-on-year increase in spending power since 2010—a package which will allow councils to,

“provide more support for areas such as adult and children’s social care and make sure that we are supporting the most vulnerable people in our local communities”.

Beyond social care, we are protecting vital front-line services by increasing the biggest elements of core settlement funding in line with inflation, and we are consulting on a 2% core council tax principle for all councils next year. I take account of the remarks made by the noble Lord, Lord Greaves, on that issue. This significant result is a testament to what happens when we work together with the sector. I am grateful to councils up and down the country which fed into our preparations. The LGA has said that we provided local authorities with,

“much of the funding certainty and stability they need for next year”.

I shall address the point raised by the noble Lords, Lord Greaves and Lord Kennedy, on the new homes bonus. The Government have previously noted that 2019-20 was the final year of new homes bonus funding as agreed in the spending review 2015, and that any funding beyond 2019-20 would need to be agreed as part of the next spending review. I understand that the new homes bonus represents an important part of district council budgets and can form a large percentage of core spending power. We have listened to requests from local authorities to honour previously announced legacy payments totalling £624 million. As part of the roll-forward settlement, the Government are minded to make a new round of allocations for 2020-21, and I would welcome views on our proposals.

The noble Lord, Lord Adonis, raised a point on the Public Works Loan Board. I am not particularly familiar with it, but I hope I can reassure him that the Treasury recently increased the margin that applies to new loans from the PWLB by 100 basis points on top of the usual lending terms. The Government also successfully legislated to increase the lending limit of the PWLB from £85 billion to £95 billion to reflect their commitment to ensuring that local authorities can continue to access the financing that they need to support their capital plans. Since this change took effect, my department has been engaging with the sector to understand the potential impact that it could have on its capital plans and strategies, especially with regard to housing and regeneration.

[Lord Adonis]

The Minister has not addressed my point about the substantial increase in the interest rate. I am not expecting him to be able to do so across the House, but will he write to me about it? Would he be prepared to meet me and other noble Lords to discuss this issue, which I understand is central to the ability of local authorities to borrow to build new housing?

[Viscount Younger of Leckie]

I was coming on to address some of the other points on the subject of housing. I will come to the noble Lord’s point in a moment. He raised a number of questions and I want to be sure that he receives full answers.

The Government remain committed to business rates retention, which is yielding strong results, including for district councils. We are aiming to increase the level of retention from 50% to 75% from 2021 to give councils greater flexibility over their funding and to reward authorities for generating economic growth.

I now move on to the important issue of relative needs and resources. The noble Lord, Lord Goddard, warned against an easy formula of salami-slicing as opposed to better targeting. That is a very good point. The Government understand that demographic pressures have affected local areas in different ways, as has the cost of providing particular services. Councils told us that they wanted a simpler, up-to-date funding formula based on the best available evidence, and that is exactly what we are working to deliver. We are working closely with local government representatives to consider the drivers of local authorities’ costs, the resources available to them to fund services and how to account for them in a way that draws a more transparent and understandable link between local circumstances and local authority funding. This is a thorough, evidence-based review of the costs faced by all authorities. We have confirmed that we now aim to implement the review in 2021-22 so that the sector has the certainty that it needs to plan for 2020-21. It is important that we get direct feedback from local authorities, and we are grateful for the trusted links that we have across the sector. The more that we can consult, the more likely it is that we can get it right.

In looking ahead to the upcoming local government finance settlement, we have set out our proposals in a technical consultation which will close on 31 October. It sets out the package for local government in more detail and responds to the calls from the sector for certainty and stability. We will listen closely to the views and contributions from representatives of local government and aim to publish a response in the provisional local government finance settlement in early December.

I shall now address a number of questions that were raised. The noble Lord, Lord Greaves, mentioned the critical services on which all communities rely. He mentioned street cleaning, recycling, community services, libraries, housing and many others. I, too, recognise the critical role that all local authorities play in delivering these services. The noble Baroness, Lady Pinnock, is right that parish councils play an important part in local services. I reassure her that we want them to grow and expand and that we are doing our best in our communities brief to do that. Councils have managed reductions in funding and people’s satisfaction with waste collection and libraries has largely held up. Satisfaction levels are high—but that does not mean that we are complacent.

The noble Lord, Lord Greaves, spoke about provision of park and community services. We continue to support parks and community spaces. In fact, I am looking at this area particularly strongly at the moment to see what more can be done. In 2018-19, we invested £15 million in an innovative parks programme, and we will launch a new £1.35 million programme to support the next round of pocket parks very soon. Working with our partner, Pub is the Hub, we have funded almost 200 pub diversification projects, introducing new services that are of value to the community. The noble Lord spoke about waste management and climate change. He was right to raise these important global issues. Like the whole of government, my department supports the objectives of the Environment Bill. Local authorities, as local leaders, experts, place shapers and convenors of local communities, are empowered to play a fundamental role in delivering the environmental action needed in their areas.

My noble friend Lady Redfern, the noble Lord, Lord Adonis, and the noble Baroness, Lady Pinnock, referred to libraries. I thank them for that. I have spoken on libraries in the past. I recognise the work of staff and volunteers. I know that the Department for Digital, Culture, Media and Sport is working closely with the noble Lord, Lord Bird, to look at the future of libraries in the 21st century. I understand that it is called the libraries task force. Many innovative approaches are being taken across the country, for example in Warrington, to bring services together in communities. My noble friend Lady Redfern and the noble Lord, Lord Kennedy, spoke about libraries having to innovate, and they are right.

Councils across the country are transforming not just how they work but their role in leading local places, strengthening local infrastructure and reinventing localities. Many areas are achieving fantastic results, such as district councils in former coalfield areas collaborating on First Art.

The noble Lords, Lord Adonis and Lord Kennedy, spoke about social housing. I shall make a few remarks about housing; there is a lot more I could say, but I am not sure I shall have time. I am delighted to accept the invitation to visit. I think there were probably two visits, one with the noble Lord, Lord Kennedy, and one with the noble Lord, Lord Adonis. We have announced a comprehensive package of reform, which will support our ambition to raise housing supply by 300,000 per year by the mid-2020s. We are driving the delivery of affordable housing through measures such as the £9 billion affordable homes programme, abolishing HRA borrowing caps and setting a long-term rent deal for social landlords from 2020. This Government have seen housing supply increase by 1.3 million since 2010. We have also backed schemes such as Help to Buy and Right to Buy, which have supported more than 566,000 households to purchase a home.

The noble Lord, Lord Adonis, raised a number of questions. I shall look at Hansard to make sure that his questions receive detailed answers.

I shall pick up on what the noble Earl, Lord Listowel, said about homelessness. It is an issue that we take incredibly seriously in the department under my honourable friend Luke Hall. I thank the noble Earl for his contribution, and I was saddened by the stories he shared with us. He is right that funding is needed alongside community support. That is why, alongside the additional £2.9 billion for local government, this Government are committing over £1.2 billion to tackle homelessness and rough sleeping, and a flexible homelessness support grant of £670 million. The Chancellor also announced an increase in the level of funding for public health grant so that local authorities can continue to invest in prevention, which, as I am sure the noble Earl agrees, is most important.

I now turn to the communities section of my remarks —an area I regard as very important. The Government are committed to continuing to build strong communities where people feel proud of their neighbourhoods and are actively involved in local decision-making. As my noble friend Lady Redfern said, local government, including the district councils that provide important neighbourhood services, is a vital partner in supporting communities across the country. We also want communities themselves to take an active role in changing their area for the better, because there is much power and potential in our communities. Across the country we see examples of local people coming together and leading change, from community clean-ups and community groups running valued front-line services, to volunteers in libraries, mentioned by my noble friend Lady Redfern. The Government want to continue to unlock that potential and help create an environment where all our communities feel empowered.

That mission is at the heart of the Government’s approach to communities, and, in case there was any doubt, I can say that I am involving myself with great enthusiasm in this area. As the noble Lords, Lord Goddard and Lord Kennedy, said, it is a question of collaboration and integral working to achieve more. As we have discovered, when organisations work together, they are better placed to apply for specific new funding.

This summer my department published a new communities framework, setting out a vision of how we can strengthen our communities with four areas of focus. The first is building trust and local pride. High levels of trust and social capital are a crucial building block for a thriving integrated community and for our nation’s well-being and economic prosperity. We want people to feel a sense of pride and connectedness in where they live and to build strong local relationships. That is why my department is supporting work to overcome barriers to integration and help bring people together. That work includes the Near Neighbours scheme, which has supported over 1,600 local community projects, bringing together people from different backgrounds to tackle local issues; programmes to help people improve their English skills, which I believe was mentioned this afternoon, so that they can become part of community life—some people who have been in this country for decades have not addressed that, so we have high hopes—and the Integration Area programme, which is working with five local councils to overcome integration challenges and share their learning, with an additional £10 million announced for the second wave of areas in 2020.

Secondly, I want to focus on active citizenship and giving communities control over local decision-making. This Government are focused on pushing power down and enabling decisions that affect local people to be made at the local level. We will continue to support the community rights and powers established under the Localism Act, such as neighbourhood planning, which enables communities to develop a shared vision for their area for the future.

The third area is shared community spaces. In our busy world, it is becoming increasingly challenging to connect with one another, but shared spaces such as our parks, which were referred to this afternoon, community centres, pubs and libraries provide the vital community infrastructure that brings people together. We have provided additional funding for our parks, which I mentioned earlier, with a new £1.35 million programme, working with our partner Pub is the Hub, which I also mentioned earlier.

The fourth area is shared economic prosperity, with no community left behind. We know that some communities have not shared in the wider economic growth experienced in the UK. The Government are committed to building strong communities that help create a thriving and inclusive economy, and to ensuring that prosperity is shared.

The noble Lord, Lord Greaves, spoke about towns and high streets. He will know about this but we have committed to a £3.6 billion towns fund, and local people will have a say in how that money is spent. He spoke about competition but it is right that there is a competitive approach. Towns are being invited to approach us and to put in, in effect, business plans setting out how they can reinvigorate their high streets. We want to work closely with them to make sure that funding is directed to the right place. I hope he will forgive me when I say that, in this area, I think competition is a good thing.

Through our support for those four areas of work—trust and local pride, active citizenship, community spaces and shared prosperity—the Government will continue to work to empower communities.

I recently visited Walsall, which is one of our integration areas, and met several community groups and organisations doing amazing work to support local people. I met groups running English classes to enable people to increase their confidence, make the most of the opportunities available, and play a full and active role in the local community. I also heard about the Places of Welcome scheme, which tackles loneliness and social isolation by providing places where people can go simply to see a friendly face or have a cup of tea and connect with others. This is an example of what can be achieved when local government works in partnership with local actors to build stronger and more integrated communities. It is one thing that I will definitely continue to press ahead with.

In conclusion, I assure noble Lords that this Government are committed to providing local government with the funding it needs and to ensuring that the funding is both flexible and proportionate to an area’s demographic needs. The noble Earl, Lord Listowel, spoke about homelessness and I want to write to him on that specific point.

Homeless People: Prevention of Deaths

Viscount Younger of Leckie Excerpts

Tuesday 1st October 2019 Lords Chamber

[The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government and Wales Office (Viscount Younger of Leckie) (Con)]

My Lords, with the leave of the House, I will now repeat in the form of a Statement the Answer given to an Urgent Question today by my honourable friend the Parliamentary Under-Secretary of State for Housing, Communities and Local Government in the other place. The Statement is as follows:

“Mr Speaker, let me say first and foremost that every single death on our streets is a tragedy. Today’s statistics have provided us all with a stark reminder that there is so much more to be done. Every death on our streets is one too many, and this Government will work tirelessly to ensure that lives are not needlessly cut short. The fact that an estimated 726 people—mothers, fathers, siblings; all somebody’s loved one—died while homeless in 2018 will concern not only every Member of this House but everyone up and down the country.

As you will know, this Government are committed to putting an end to rough sleeping by 2027 and halving it by 2022. We changed the law to help make this happen. In April 2018, the Homelessness Reduction Act—some of the most ambitious legislation in this area in decades—came into force. We now have a year’s worth of evidence, which shows that more people are being supported earlier, and this is having a clear impact on the prevention of homelessness.

Last year, the Government published the first rough sleeping strategy, underpinned by £1.2 billion of funding, which laid out how we will work towards ending rough sleeping for good. Indeed, last year we reversed the trend when we saw a reduction in rough sleeping. A key element of this was the rough sleeping initiative. A total of £76 million has been invested in over 200 areas. This year, the rough sleeping initiative will fund 750 additional staff and approximately 2,600 new bed spaces.

Next year, we are going further. We will be providing a further £422 million to tackle homelessness and rough sleeping. This is a £54 million increase in funding from the previous year—a real-terms increase of 13%.

The cold weather period is a particularly difficult time for those sleeping rough, so the Government have launched a second year of the cold weather fund. We are making £10 million available to local authorities to support rough sleepers off the streets. This will build on last year’s fund, which helped relieve more than 7,000 individuals from rough sleeping over the winter.

These statistics have reminded us of the fateful impact of substance and alcohol misuse. We know that the use of new psychoactive substances—so-called NPS—is rising. These are dangerous drugs with unpredictable effects and that is why it is so important that people get the support they need. In 2019, we brought forward new training for front-line staff to help them engage with and support rough sleepers under the influence of such substances, and we are working with the Home Office to ensure that rough sleepers are considered in the forthcoming alcohol strategy, which will focus on vulnerable people.

There is so much more to be done. Our work is continuing, our funding is increasing, and our determination is unfaltering. We are committed to making rough sleeping a thing of the past”.

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

My Lords, first, I draw to the attention of the House my relevant interest as a vice-president of the Local Government Association. I thank the Minister for repeating the answer to the Urgent Question given in the other place earlier today.

We have seen a huge rise in rough sleeping. We can see it in in every town and city in this country. This simply was not the case 10 years ago. Just look at Westminster tube station—I come in via the tube station almost every day; I have been in this House nearly 10 years—and it just was not the case. Every day now there are more and more homeless people in the tube station. It is absolutely appalling and shameful in one of the richest countries in the world.

There is the widest possible agreement—from homeless charities to the National Audit Office to cross-party Select Committees—that government policy has not helped in this respect. Today’s figures from the Office for National Statistics show that 726 homeless people died last year. That is up by half in the last five years.

I have two questions for the Minister. First, does he accept that the £10 million in respect of the cold weather fund will be insufficient and that further funds will have to be provided for this fund? Secondly, will he agree to meet me and a delegation of local government leaders and charities to discuss the inadequate levels of funding being provided for the Homelessness Reduction Act? It is a good bit of legislation, but we need funds to make it work.

[Viscount Younger of Leckie]

I agree with the noble Lord, Lord Kennedy, and the rest of the House that one death in this way is one too many. I am very sorry to report that there was one further death in Wiltshire last night, which noble Lords may have heard of.

I will answer the noble Lord’s two questions. First, on the £10 million, we believe that this is enough, but clearly this is such a serious matter that we will keep this very much under review, but this is a figure that has taken account of the statistics. Secondly, of course I would be very pleased to meet the noble Lord and anybody else he cared to bring along to discuss the level of funding for this important matter.

[Baroness Pinnock (LD)]

My Lords, I draw the House’s attention to my local government interests. While the Minister has used the example of the Homelessness Reduction Act as being a good start, which I would agree with, the Government nevertheless have failed to repeal the Vagrancy Act, a nearly 200-year-old Act, which is still being used by police forces up and down the country to remove rough sleepers from the streets. In March 2019 the Ministry of Justice reported that, between 2014 and 2017, 6,518 people were found guilty under the Vagrancy Act. Does the Minister agree that the Act ought to be repealed at the earliest opportunity?

[Viscount Younger of Leckie]

This matter has not particularly come up in my brief. It was discussed, but I do not agree with it. Having said that, the noble Baroness has raised an issue that I will certainly take back and consider. As she will know, of course we are talking about deaths here rather than pure homelessness. Homelessness is bad enough in itself, but, as has been mentioned, the reasons for the deaths are based largely —52%—on drug misuse and alcohol misuse, and this is an area that I think we urgently need to look at. We are already, and have been for some time, in touch with the Department of Health and Social Care and also the DWP. This, I think, is the real essence of the problem.

[Lord Young of Cookham (Con)]

My Lords, I welcome the extra £54 million in last month’s spending review to combat rough sleeping and homelessness, particularly as there is strong evidence that, where the resources of the RSI have been focused, rough sleeping has fallen much faster than elsewhere. If we are to make further progress in tackling rough sleeping, particularly among single people, I ask my noble friend to ensure that the local housing allowances are reviewed so that single people who are threatened with homelessness can find suitable, affordable accommodation in the area.

[Viscount Younger of Leckie]

I thank my noble friend for that. I believe that he raised this in a debate, I think last week. It is clearly a matter of concern to him, and also to us. I will take this matter back to the Treasury, and no doubt it will be put into the melting pot, as it were, for the next round.

[The Earl of Listowel (CB)]

My Lords, the Government recognise in their strategy that 10% of rough sleepers in London come from a background of local authority care and they have set aside money for personal advisers to support young people leaving care who are at risk of rough sleeping and homelessness so that they do not arrive at that stage. But recent reports have highlighted that local authorities are under such pressure that too often young people leaving care are placed in supported accommodation that is often anything but that. Can the Minister tell the House how effective the Government’s strategy has been so far in reducing the percentage of rough sleepers who come from a background of local authority care?

[Viscount Younger of Leckie]

The noble Earl makes a good point. It is very important that we have skilled people on the ground, because the only way to help people is to go to them individually, find out what their problems are and help them. To answer the noble Earl’s question, the number of households in temporary accommodation has increased by 5%. Good work is being done to take people off the streets and put them into temporary accommodation. The figure is actually 84,740—up from 80,720 at the end of March last year. It is small progress, but at least it is progress.

[Lord Rooker (Lab)]

I do not have anything to declare, other than the period of 2003-05 when I had ministerial responsibility for this area. I inherited from my noble friend Lady Armstrong the scheme put together by Louise Casey that, between 1997 and 2010, led to the virtual elimination of rough sleeping in a very technical, measured, practical way, which I saw working at first hand over those couple of years. Can the Minister say whether all the new things he has just read out, with extra money for this, that and the other, will put the resource level back to what it was in 2010?

[Viscount Younger of Leckie]

I do not believe so. I take note of what the noble Lord said about his experience, but I do think that, putting aside these tragic deaths, because that is the focus of the Question, the rough sleeping initiative is showing some success in terms of homelessness itself. As I said, in 2018, the annual rough sleeping snapshot recorded a 19% reduction in rough sleeping since 2017, but as I also said, there is much work to be done. This is a really serious issue and we can see it ourselves outside Westminster tube and beyond.

[Lord Roberts of Llandudno (LD)]

Does the Minister agree that we owe a great debt to the many voluntary organisations that are filling the gap that the Government are unable to fill? I have a link with the Whitechapel Mission. Last year it served 100,000 breakfasts. They are tremendous people and we say thank you to them, wherever they are, whatever they do.

The Minister praised the reduction in the number of rough sleepers in the last year. That total is 80 out of more than 8,000. It is not something we can be proud of. Today’s figure, which has been referred to already, is that we are worse off than we were in 2010. The Government’s strategy certainly is not generous enough to meet the needs of so many people, especially as the winter is coming on. For instance, I speak to people at these various places and they say, “Yes, we can provide breakfasts, showers and clothing, but we can’t provide beds”. I know that one particular part of London that used to have 37 places—I think I have the correct figure—where people who wanted to sleep could do so has had that reduced to two. I ask the Minister to do something to reverse this trend instead of just praising ourselves for something that just is not true.

[Viscount Younger of Leckie]

It is important to be clear on the facts. A reduction is still a reduction, but I am also very clear about the challenges we have. There is no question of pulling the wool over anybody’s eyes about this. I think the noble Lord is being far too pessimistic, because the rough sleeping initiative investment for 2019-20 is estimated to deliver 750 staff on the ground, providing more than 2,600 bed spaces this year. That has not happened before and I think the noble Lord should be a little more generous in acknowledging that. I finish by saying that I too pay tribute to the number of local charities that help in this very difficult area, often working through the night.

Non-Domestic Rating (Lists) Bill

Viscount Younger of Leckie Excerpts

2nd reading (Hansard): House of Lords
Monday 30th September 2019 Lords Chamber

Moved by

[Viscount Younger of Leckie]

That the Bill be read a second time.

[The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Viscount Younger of Leckie) (Con)]

My Lords, the Bill gives this House the opportunity to support a measure widely requested by businesses. It will improve the business rates system by ensuring that rating assessments are more up to date and fairer. It is a Bill which will increase the frequency of business rates revaluations. A move to more frequent revaluations has been one of the most repeated requests from the business community, including from representative bodies such as the Federation of Small Businesses, the Confederation of British Industry and the British Retail Consortium.

Business rates are a tax on non-domestic property. They are paid not just on business premises but on local and central government buildings, hospitals, utility networks and even the very building we are in today—the Palace of Westminster—so although this Bill may seem small and technical it is in fact important to very many ratepayers and local authorities across the country. The tax base for business rates is the property’s rateable value which, in broad terms, is based on its annual rental value. Like all rateable values, the assessment of the Palace of Westminster can be seen on the current non-domestic rating list, which dates from 2017 and is available to view on the website of the Valuation Office Agency. Before noble Lords reach for their iPhones to look up that website, I can save them some time and effort: the rateable value of Parliament is currently £16.09 million.

Rateable values are currently based on the rental market values as at 1 April 2015, and the purpose of regular revaluations is to ensure that those values keep pace with the changes in the rental property market. The next revaluation was due to take place in 2022 but this Bill will bring it forward to 2021. As I have said, this has been requested by a wide range of business groups. Preparation for the revaluation is already under way and it will be based on the rental property market as at 1 April 2019.

It may be helpful to noble Lords if I explain how the revaluations work and why they are so important to businesses. Revaluation is a significant undertaking. The Valuation Office Agency has collected details of hundreds of thousands of rents to ensure that it has a good evidence base for the revaluation. It is now analysing that rental information and preparing valuations on more than 2 million properties. This is clearly a substantial exercise and one of the most important undertaken by the agency. This Bill will ensure that the results of its work will come into force one year early on 1 April 2021.

I shall give noble Lords an example. Take a shop on the high street. A shopkeeper will currently pay business rates based on the market value of rents in that high street as at 1 April 2015 and will have been paying that since 2017. Clearly, much has changed since 2015 and businesses rightly expect to see the information underpinning their bills updated accordingly. Over recent months, the Valuation Office Agency will have been collecting all the new rental evidence it can on that high street. This evidence will come from new leases and tenants moving into empty shops and from lease renewals and rent reviews on existing shops. The agency will have collected these rents on official returns and will now be analysing the results. Having regard to all this rental evidence, the valuation officer will then take a view—in line with certain statutory assumptions—of the market rental value of that high street as at 1 April 2019, which, as I have said, will be the valuation date for the 2021 revaluation.

This new assessment of market rental values will then be used to update all the shops on that high street, so the 2021 revaluation will therefore reflect the change in rents on that high street between 2015 and 2019. This exercise is repeated across all high streets, shopping centres, industrial estates, business parks and offices in order to give a full picture of the change in the relative value of non-domestic property across England and Wales. It is on this updated picture of rateable values that the new bills are based. I hope noble Lords will be able to see how important the revaluation and this Bill are to those businesses. More frequent revaluations will ensure that business rates bills are more up to date and more closely reflect the current rental value of the property and relative changes in rents.

However, in deciding whether to have more frequent revaluations, we need to strike a balance between the more up-to-date assessments that would flow from such a reform and the uncertainty that more regular changes to bills will create; and of course there is a cost to more frequent revaluations. The 2021 revaluation is expected to cost about £50 million over its duration. We believe that revaluations every three years strike the right balance, so this Bill will ensure that that happens after 2021.

Finally, the Bill will change the latest date by when draft rateable values can be published before the revaluation from the end of September to the end of the preceding December. Ratepayers have told us that they accept the trade-off that comes from increasing the frequency of revaluations and favour fairer, more up-to-date assessments. Shortening the period of the draft rating list is part of this trade-off and ensures that the time the list remains in draft continues to be proportionate to the shorter revaluation cycle. This change in the publication of the draft rating list will help pave the way for three-yearly revaluations. However, the Bill will still allow the valuation office to publish rateable values earlier than the end of December, so we will give ratepayers as much notice as possible of their draft rateable values and new rate bills within the new three-yearly cycle.

This Bill makes a step-change improvement to business rates. It is supported by the business community and is necessary to allow the Valuation Office Agency to complete the 2021 revaluation. Last, but no means least, I greatly look forward to the maiden speech from my noble friend Lord Randall of Uxbridge this afternoon. I beg to move.

--- Later in debate ---

[Viscount Younger of Leckie]

I thank noble Lords for their contribution to this short debate. I shall deal with all the points they have raised in just a moment, but I start by paying tribute to the excellent maiden speech from my noble friend Lord Randall of Uxbridge. I am pleased to know that his voice can now, at last, be heard in this Chamber. I found the speech rather reflective, not just of the historical context of Uxbridge—it was interesting to hear of the role of air defences in the Battle of Britain—and more; my noble friend was also quite right that in this House there is more of a focus on compromise. Perhaps it is fair to say that there is a lot more courtesy in this House. He did not say “compared to the other place” but, given the climate at the moment, his point was well made.

I also thank all noble Lords for their kind words about my new appointment. It is not lost on me that I have big shoes to fill. My predecessor, my noble friend Lord Bourne, held the role for some time, so I have much to learn.

A good number of points were raised by the noble Baroness, Lady Pinnock, and the noble Earl, Lord Lytton. If they will forgive me, I will address their points towards the end of my remarks.

As I said in my opening speech, business rates are an important tax, providing a vital source of revenue to help local government pay for local services. We believe that in this country we offer a highly competitive basket of taxes, which ensures that public services are funded in a balanced and fair way. Of course, we also recognise that some businesses need help. Since the 2016 Budget we have announced reductions in business rates worth more than £13 billion coming up over the next five years.

For example, we have made 100% small business rate relief permanent and doubled the threshold for 100% relief from 2017. This means that 675,000 of the smallest businesses now pay no rates at all. For the high street, at Budget 2018 we announced the business rates retail discount, providing eligible retailers with a rateable value of less than £51,000 with a third off their bills for two years from April 2019. That is delivering help now worth an estimated £1 billion and is in addition to the Prime Minister’s plan to unite and level up cities, towns and coastal and rural areas across our country. In July, we announced a £3.6 billion towns fund to re-energise local economies so that everyone can share in a new era of prosperity.

I listened carefully to the remarks made by the noble Baroness, Lady Pinnock, and the noble Lord, Lord Kennedy, about high streets, and they are absolutely right to raise the issue. The point should be made that we want to encourage people into high streets as well as out-of-town retail centres. The high streets are a focus at the moment and have a crucial role to play as we work to grow the economies of all parts of the country, so the fund I just mentioned includes an accelerated £1 billion future high streets fund. This will support local areas in England to renew and reshape town centres and high streets in a way that improves experience, drives growth and ensures future sustainability. I add one more thing, which is that it provides an excellent experience for those who want to come into the high street, and we have much more to say about that as we take the policy forward.

More than 300 local authorities bid for a share of the funding in round one. More than 100 places have now been successful in progressing to the next phase of developing, detailed business cases; 51 places were announced on 5 July and a further 50 on 26 August. Successful local authorities will each receive up to £150,000 revenue funding and support from officials.

In response to the noble Baroness, Lady Pinnock, who asked about the impact on local authorities of the rates retention scheme, I assure her that local authorities will be compensated for the revaluation. As was the case at the 2017 revaluation, we intend to make any adjustments as are necessary to the rates retention scheme to ensure that locally retained income is, as far as practicable, unaffected by the 2021 revaluation. However, to reassure her further, we will consult local government on how to make those revaluation adjustments to the rates retention scheme nearer the time. This is something we successfully achieved for the 2017 revaluation, and I am confident that that can be repeated for 2021.

We are aware of concern from local authorities that changing the date of the draft rating list from the end of the previous September will impact on their billing and budgeting process. The Bill provides only that the end of December preceding the revaluation is the latest date by which the draft list must be published. It may be that a sensible time to make the draft list available is at the time of the autumn Budget, alongside the confirmation of the multipliers and transitional relief. That is something that we will discuss with local government, and the Bill will allow us to do just that.

For local authorities, we intend to make any adjustments as are necessary to the rates retention scheme to ensure that locally retained income is, as far as practicable, unaffected by the 2021 revaluation. As I said, we will consult local government on that.

I recognise that this matter was raised in Committee on the Bill in the other place, and we are working with the Local Government Association and other local government representatives to ensure that the publication of the draft list fits with the local government budgeting process. My officials met the LGA in August to discuss this matter, and we continue to work with the sector. As was noted by Councillor Watts of the LGA when giving evidence to the Bill Committee in the other place, we are confident that this matter is perfectly soluble.

I turn to another question raised by the noble Baroness, Lady Pinnock. She asked about scrapping business rates and explained the Liberal Democrat policy. I just say that the Government concluded a fundamental review of the business rates at Budget 2016 and decided to retain business rates as a property tax. Respondents to the review agreed that property-based taxes were easy to collect, difficult to avoid, relatively stable and clearly linked with local authority spending. Some respondents suggested alternative tax bases. However, there was no consensus, as respondents were clear that other taxes, such as a land value tax, have their own issues, including agreement on how land should be valued, and would not address the perceived unfairness between high street and online retail. I should not expect the noble Baroness to agree with that, but that is based on real evidence that we produced.

The noble Baroness also asked about resources for the Valuation Office Agency. I reassure her and the noble Lord, Lord Kennedy, that we believe that good progress has been made, particularly in clearing outstanding appeals, which were mentioned, going back to the 2010 list. At 30 June, there were around 62,000 outstanding appeals from the 2010 list. The majority of these—more than 50,000—are waiting for the resolution of litigation. We understand that the VOA is on track to clear the 2010 appeals within its control by the end of September 2019. I believe that good progress has been made. While I do not have completely up-to-date figures to hand, I understand that the VOA is expecting to have cleared the remaining appeals today—the end of the month. If for any reason situations arise where this does not occur, I have been assured that a timetable will be agreed with the ratepayer or their agent for the resolution of their case. I recognise the seriousness of this matter, but I hope that noble Lords are reassured that we are on the case and have the evidence to support that.

The noble Earl, Lord Lytton, raised a number of questions. He started by saying that this is too little, too late. He might not be surprised to hear that I do not agree with him. However, I shall address his question. The first was about whether the 2021 revaluation will be revenue neutral and how the multiplier will be adjusted. We will adjust the multiplier from 2021 to 2022 to offset the estimated change in total rateable value due to the valuation after allowing for inflation and forecast future appeals. He will know that we are required by law to do that. He further asked whether we plan to move to more frequent revaluations. To be fair to him, I understand how annual revaluations would further improve the rating system. It is something we will certainly consider in future, but in deciding whether to have revaluations more frequently than three years, rather than five years, we will need to strike a balance between the more up-to-date assessments which would flow from such a reform and the uncertainty that it would create by more regular changes to bills, and we will need to take the cost into consideration.

The noble Earl also asked about the revaluation process and the unacceptable burden on businesses. As I said earlier, and as he will know, revaluation is an important part of the business rates system that ensures that bills are more closely aligned with relative market values. The majority of businesses saw no change or a fall in their business rates liability following the 2017 revaluation. A £3.6 billion transitional relief scheme is providing support for the minority of businesses facing an increase in their bills. An additional £435 million of support to businesses was announced at the 2017 Spring Budget. I hope that reassures him that it is not the problem he thinks it might be.

The noble Earl also said that the CCA system was criticised at the Commons Treasury Select Committee. The numbers show that the system is operational and customers are using the service to make checks and challenges. The VOA published its road map in 2018, which set out the IT improvements that it will make to the system as it continues to deliver against that plan. The VOA has delivered some key improvements to the system, addressing specific concerns from stakeholders, including adding frequently requested features, such as an application programming interface—a so-called API—on check and streamlining the registration process to make the system easier to use. As of 31 March 2019, the VOA has registered more than 100,000 checks and more than 17,000 challenges under the new “check, challenge, appeal” system.

Towards the end of his remarks, the noble Earl asked how the revaluation will be delivered. I fully understand concerns regarding funding for the Valuation Office Agency, some of which I addressed earlier. Rating valuation is a specialised field, but we are confident that it can secure the staff it needs to discharge its statutory duty now and in the future. We are keeping a very close eye on it. I confirm that the agency is currently on track with preparations and resourcing for delivering the 2021 revaluation. The agency is also actively working to train and recruit staff to ensure that it can continue to fulfil its statutory duties. To this end the agency is continuing to develop and train its workforce for the future, including a targeted rolling recruitment campaign for chartered surveyors and those studying for accredited surveying qualifications.

I am ever grateful to all noble Lords this afternoon, for their many helpful points and questions raised. Your Lordships have that expertise and knowledge in the field of local government, and it is my first experience of that. Noble Lords’ expertise in the field of business rates valuation is less well known but equally appreciated. I am delighted that we have the noble Earl, Lord Lytton, here to keep us up to the mark—put it that way.

The Bill looks small and technical but, in fact, has widespread application in improving the business rate system for over 2 million ratepayers. It underpins the £50 million revaluation project currently being delivered by the Valuation Office Agency.

Bill read a second time and committed to Committee of the Whole House.