Neighbourhood Planning (Referendums) (Amendment) Regulations 2013

Lord Ahmad of Wimbledon Excerpts

Monday 18th March 2013 Grand Committee

Moved by

[Lord Ahmad of Wimbledon]

That the Grand Committee do report to the House that it has considered the Neighbourhood Planning (Referendums) (Amendment) Regulations 2013.

Relevant document: 21st Report from the Joint Committee on Statutory Instruments.

[Lord Ahmad of Wimbledon]

My Lords, neighbourhood planning is a vital part of the Government’s reforms to help local communities play a much stronger role in shaping the areas in which they live and work and in supporting new development proposals. For the first time, community groups can produce plans that have a real statutory weight in the planning system. Neighbourhood planning is therefore one of the most exciting innovations of the localism agenda.

We are delighted that neighbourhood planning is taking off across the country. Indeed, we are aware of more than 500 places looking to bring forward a neighbourhood plan and to shape the development and growth of their local areas. More than 400 of these have taken formal steps to have their area designated. Three plans have already passed the independent examination stage, and the first to reach a referendum was in Upper Eden, which saw 90% of local people, based on a turnout of 34%, voting in favour of the neighbourhood plan. This was a positive result for the 17 parishes of Upper Eden that are now able to deliver new homes on farms, houses for older people and more affordable housing in a way that suits their local character and needs. Other areas are hot on the heels of Upper Eden and we expect to see many more neighbourhood plans in the very near future. Regulations governing the conduct of neighbourhood planning referendums, of which Eden was the first, were considered last year.

The Localism Act also provided for some areas to be designated as business areas where they are wholly or predominantly commercial in nature. In such areas, non-domestic ratepayers will be able to vote in a business neighbourhood planning referendum. This provides the opportunity for businesses to take the lead in neighbourhood planning. We are already seeing this happen in practice in central Milton Keynes, where it is proposed to develop a dynamic city based on high-quality buildings and spaces. Businesses are also taking the lead in areas such as Trafford Park, central Ealing and Liverpool Innovation Park.

The Neighbourhood Planning (Referendums) (Amendment) Regulations 2013 amend the 2012 regulations to provide for the conduct of “business referendums”, which will be required to be held alongside a “residential referendum” where it relates to whether a neighbourhood plan or a neighbourhood development order should come into force in a designated business area.

I shall briefly summarise the main provisions of the amending regulations. Regulation 4 requires a local authority to fulfil certain publicity requirements relating to the referendum and imposes certain time limits by which notice of the referendum taking place must be given. This is 56 days where a referendum in a designated business area is required to be held, rather than the 28 days where a referendum is held in the residential neighbourhood area. This longer period was the outcome of discussions with the Electoral Commission and local authorities and was considered necessary to allow for the effective registration of non-domestic ratepayers.

In a designated business area, there will be two referendums, one for residents and one for non-domestic ratepayers. Regulation 7 therefore provides for the residential referendum to be held on the same date as the business referendum. As with referendums more generally, a register of those eligible to vote is required. In order to compile this register, a specific registration process is needed. Schedule 1 provides for the creation of a business voting register of all the non-domestic ratepayers who register to vote in a business referendum, for the purposes of that referendum only. The business voting register lists the names of all the non-domestic ratepayers who have registered to vote and the addresses of the premises within the referendum area on which they pay non-domestic rates. In practice, a local authority will send a registration form to each non-domestic ratepayer of which they are aware, and each ratepayer will nominate an individual, which may be himself or herself—the “named voter”—to vote on behalf of the business.

Schedule 2 sets out the detailed rules to be followed when conducting a neighbourhood planning business referendum. This includes the rules in relation to the content of ballot papers and other voting forms, the operation of polling stations, the counting of votes and the declaration of results.

Schedule 3 applies, with necessary modifications to existing electoral law, to the conduct of neighbourhood planning business referendums. In short, the amended regulations will put in place the rules needed to ensure the effective administration of neighbourhood planning referendums in business areas, in which the electorate can have confidence. In large part, they follow a tried and trusted practice. An external group of interested parties has been used to help develop the amended regulations in a manner that ensures that they can be effectively implemented. This particular group includes the Electoral Commission and the Association of Electoral Administrators, both of which have fed into the process and commented in detail, in particular on the business referendum registration forms. I take this opportunity to thank them for their contributions in assisting us to develop these particular regulations. In line with best practice, the registration forms have been tested with business users for design, clarity and impartiality. I am therefore confident that the amended regulations will ensure efficient and effective administration of any neighbourhood planning referendum in a designated business area. I commend the regulations to the Committee.

[Lord McKenzie of Luton]

My Lords, I start by thanking the Minister for a very full and clear explanation of the order we are considering today. Like the Government, we very much support neighbourhood planning and the engagement of business with that. However, it is important that we do not make the process overly bureaucratic and expensive. In introducing this, the noble Lord referred to the fact that 500 places were developing a neighbourhood plan. How many business districts have been created to date? I am just trying to see the dynamics of that. Can the Minister tell us how the timing works? If a neighbourhood plan is being developed but there is a business district component, or a potential one, how does that all work? If the plan is some way to being finalised, does that preclude a business district coming in? Presumably the idea is to get the business district there at the start. Given that nothing like 500 business districts have been created yet, how does that all work in practice?

I have one or two questions on the specifics of the regulations. It is clear that there is one vote per business, however many separate hereditaments are involved. How does that work within a group? Are separate members of a group separate voters for this purpose or is there some sort of aggregation of that for connected parties or formal group companies? What happens if a business goes into administration? Is it then precluded from participating? Presumably, that depends a little on what stage the administration has reached.

In Part 2, in Regulation 8(2)(c), there is a requirement to specify the rateable value. Why is that? Presumably that itself is not relevant to the entitlement to vote. What happens to a hereditament that is entitled to 100% relief on one basis or another? Does that still create an entitlement to vote under these regulations? I think the question has to be the same for individual voters and a voter on behalf of a business hereditament but perhaps the noble Lord could confirm that.

Obviously, we broadly support the thrust of these regulations but I would be grateful if the Minister could say a little more about the dynamics of how these fit together, how that is working in practice with all this activity in the development of neighbourhood plans and how business districts so far are fitting into that.

[Lord Ahmad of Wimbledon]

My Lords, first, I thank the noble Lord, Lord McKenzie, for his broad support. I am delighted that we are putting forward these particular regulations. The noble Lord asked how the two are linking up, at a very high level. It is very much the final piece in the jigsaw of how neighbourhood planning comes together, which is allowing neighbourhood planning referendums to happen up and down the country.

There were some very specific questions and I will seek to answer each one in turn. If I do not answer all of them, I will write to the noble Lord in detail on those particular matters. He raised the question of how many business districts have been created. Only three neighbourhood areas have so far been designated as business neighbourhood areas but there are a number of other neighbourhood areas that are seeking to be so designated. I believe it to be at least another seven. There is a particular measure or standard to be met for the designation—that the area is in effect wholly or predominantly commercial—so there are criteria in this regard. The regulations will also allow leading businesses and neighbourhood plans to proceed towards examination and referendum, and provide a powerful opportunity for local residents and businesses to work in partnership to attract investment and to shape the future development and growth of their local areas.

The noble Lord asked how the timing works. As I indicated earlier, I believe that the two referendums will work in parallel to ensure that the results, when they are taken in, are consistent and the decision can be based on the outcome of both together. One of the things I would raise that is linked to that, which was a question I certainly raised when looking at this, was what would happen if there was a variation between the result of the business referendum and the residential one? Bearing in mind the spirit of local neighbourhood plans, it would remain the remit of the local authority to adjudicate on the difference between the two referendums.

The noble Lord also asked about one vote for every business. That is true irrespective of size. He raised a quite specific issue of registered groups of businesses. Speaking with my business hat on—I will seek clarification if what I say is not correct—if it is a separate established entity within that local area, it would be one business, one vote. If there is a single group with a single address then, no matter how large the actual business, there would be one particular vote for that business as well.

The noble Lord raised the issue of what happens if the business goes into administration. It would depend on the exact situation and I will seek clarification on that. I am being told that as long as they are on the non-domestic rating list, they have a vote. However, that is a separate question and, coming back to the issue of whether they have gone into administration, I will clarify that point. If they are in a business that has already gone into administration at the start of that referendum process, I assume they would not be included.

The noble Lord, Lord McKenzie, also asked how companies that have 100% rate relief would be managed. As long as they are on the non-domestic rating list they have a vote as well. He also asked about how and when an area is designated. When designating a neighbourhood area, local planning authorities must consider whether to designate the area as a business area, which is a neighbourhood area that, as I have already said, is wholly or predominantly business in nature. These are areas in which an additional business referendum is required to be held alongside the residential one. He asked about the question that would be posed on the business referendum and the residential one. As far as I understand, bearing in mind that the results would need to be consistent, the question posed would be the same as well.

As I have said to the noble Lord, if there are issues that I need to clarify I will, of course, write to him. However, I think I have covered, if not all, most of the questions he raised.

[Lord McKenzie of Luton]

I thank the Minister, who has indeed covered a lot of the questions that were posed, but would be grateful if there was anything further that he could say about the dynamics of business districts. If there are 500 neighbourhood plans on the way but only there business districts, clearly business districts are not leading the charge on this. Where a neighbourhood plan is being contemplated by the residents of a designated area and then a business district is created as part of that, which could happen, I am trying to see how it gets its foot in the door in terms of participating in the development of the plan. Is there a risk here, or could the circumstances be such, that the neighbourhood plan is developed by the residents of an area and a business district is created later? I think that a referendum would have to take place at the same time, with the same question, but is the business district the business community’s opportunity to engage in the development of that plan? Perhaps the Minister will write if he is not able to cover that issue today. I thank him for his other answers.

[Lord Ahmad of Wimbledon]

I will write to the noble Lord specifically in response to that point, although I am sure that he will know from his own experience that the neighbourhood planning issue will remain, in his word, “dynamic”. Input into it, to see how neighbourhood plans can be improved for each local area, needs to be reflected and dynamic in its own nature. Based on the answers that I have given and my earlier comments, and acknowledging the noble Lord’s support, I commend these regulations to the Committee.

Motion agreed.