Localism Bill

Lord Cameron of Dillington Excerpts

Tuesday 28th June 2011 Lords Chamber

[The Lord Bishop of Birmingham]

My Lords, it might help to progress the debate if I admit that I am speaking on behalf of my right reverend friend the Bishop of Exeter and that I fly under the flag of Birmingham, although I share a Scottish name with the noble Lord opposite.

My right reverend friend the Bishop of Exeter gave notice of his intention to oppose the question that Clause 39 stand part in order to seek an assurance from the Minister on the future of discretionary relief for charities from non-domestic rates. I probe, from these Benches, the Government’s intention in this area.

Currently, under the terms of the Local Government Finance Act 1988, buildings used by charities qualify for a mandatory 80 per cent discount on their non-domestic rates. In addition, as already mentioned, local authorities have discretion to waive some or all of the remaining 20 per cent. Clause 39 deals with the exercise of that discretion. The clause appears to be largely a simplification measure. It removes a series of detailed conditions that must currently be applied when deciding whether to grant discretionary relief. In effect, it appears to replace those detailed conditions with a simple “yes” or “no” exercise of discretion by the billing authority. However, under the terms of new subsection (5A),

“the billing authority may make the decision only if it is satisfied that it would be reasonable for it to do so, having regard to the interests of persons liable to pay council tax set by it”.

We all know that local authorities are currently under severe financial constraints and I am aware of fear among some in the charity sector—here, I declare an interest in several charities with which I am associated as a trustee, president or patron, but hope that noble Lords will excuse me from listing them all now—that the discretionary relief is under threat because cash-strapped councils are looking to make any possible savings that they can. The change proposed in Clause 39 might of course be totally innocuous, but what worries charities is that it might be the green light to cease granting discretionary relief. What does the phrase,

“only if it is satisfied that it would be reasonable for it to do so”,

mean in this situation? Is this what might be called the traditional Wednesbury “reasonable” from 1947 or is it a milder test? My question is very simple: do Ministers expect councils to continue giving discretionary relief or are the Government trying to make it easier for councils to refuse such requests? If the DCLG is trying to make it easier for councils not to give the 20 per cent discretionary relief, how does that square with the big society agenda? Looking to the future, how secure is the 80 per cent mandatory relief?

I very much hope that the Minister can reassure us on both the general intention of this clause and the precise meaning of the words to which I have referred.

[Lord Cameron of Dillington]

My Lords, I support the right reverend Prelate in his intention to oppose the clause standing part. In so doing, as this is the first occasion on which I have spoken in this Committee stage, I declare all my interests as a landowner and farmer and, in this instance, as chairman of the Charities’ Property Association, whose membership includes many charities that either have property as part of their core business as a charity or own property as part of a wider portfolio. I have been asked by my members to probe the Government’s intentions here and, without repeating what the right reverend Prelate has said, I hope that we get some encouraging words from the Minister.

[Lord True]

My Lords, I intervene briefly from the perspective of a local authority. I think that most local authorities would have enormous sympathy with what the right reverend Prelate has just said. I am generally very suspicious of definitional creep. I do not think that the charity world has necessarily been helped by the major attempt to redefine a charity after doing away with the great simplicity and proven law of the Elizabethan statute. Therefore, I hope that we are not going to move down another definitional road.

I would not want to see local authorities not being able to have constructive dialogue with charitable organisations, because I think that discretionary relief is extremely important. On the other hand, sometimes premises are certainly not used as efficiently as they might be. It might be for the general good if two or three charities shared offices that might be improved, and I would not want to see that kind of exploration forbidden. Therefore, I, too, should like to hear from my noble friend, but I certainly feel that this is a provision that local authorities would like to stay long in law.

I could speak for a long time on the subject of the fine arts but I do not think that I will. The noble Lord, Lord McKenzie, referred to eloquence and I wondered whether his much admired contributions to these debates meant that debating was a fine art as well. If so, he should be part of it.