Neighbourhood Planning Bill

Lord Shipley Excerpts

Committee: 4th sitting (Hansard): House of Lords
Wednesday 8th February 2017 Grand Committee

[Baroness Deech (CB)]

My Lords, I support the amendment and every word uttered by the noble Lords, Lord Kennedy and Lord Cameron. I am not exactly a drinker, let alone of real ale, even when it is warm, but living where I do I have sadly seen the onward march of more and more soulless developments. Much-needed housing—of course, there is a housing crisis—is often built contrary to the wishes of the locality and the people living there. With the march of housing, the hubs that have made living in certain parts of the country so agreeable have been lost. It is all the more important to keep the local pub, whether in a suburb or village, as more housing is added. Those pubs add to integration and help to cement a community.

I find it particularly upsetting, having participated in neighbourhood planning, that the wishes of the residents of a locality are so often ignored. It is very important, before any pub is removed or changed, that the local residents be consulted and that we all do our best to promote more integration and mixing as more housing is built, as it will continue to be in the years to come. I hope the Government will accept the amendment.

[Lord Shipley (LD)]

My Lords, I support Amendment 60 but speak to Amendment 61 in my name, which broadly reflects the amendment moved by Greg Mulholland MP in the other place a few weeks ago.

I too am grateful for the advice given by CAMRA. It has summed up the case in three lines:

“The removal of Permitted Development Rights relating to the demolition and change of use of pubs will substantially reduce the need for Asset of Community Value nominations and reduce the associated burdens on communities and business”.


There are other considerations about the rights of neighbourhoods and communities and so on, which I fully support.

The previous Government introduced the asset of community value register. It is particularly impressive that it has been reported that 2,000 pubs are now registered as assets of community value. It raises two questions: first, it could be argued that because 2,000 have been registered, the system therefore works. The other way of looking at it, which I prefer, is to say that if 2,000 pubs have been felt by their communities and neighbourhoods to need registration, that is a problem because the volume is so great. A simpler method of dealing with the problem is required.

I understand that the London Borough of Wandsworth has applied Article 4 direction in the borough. I am particularly interested in that as a solution. As I well know from having to introduce Article 4 directions in my own council in Newcastle years ago, it is a very complex procedure. Anyway, it is quite difficult to introduce Article 4 in a rural area; it suits an urban area better.

I hope the Minister will take this seriously, because we will be back to this on Report. There is a simple remedy. The amendment moved by the noble Lord, Lord Kennedy, and my amendment provide that simple remedy, which is to remove permitted development rights. If the Government did that, someone wishing to change the purpose of a pub to something else would have to apply for planning permission, which seems to me entirely reasonable. I hope that when we get to Report, the Minister will see the justification for this case.

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Moved by

[Lord Shipley]

65: Clause 14, page 13, line 13, leave out subsection (1) and insert—
“(1) Subsection (2) applies where a person (an “acquiring authority”) could be authorised to acquire land compulsorily under another enactment or under subordinate legislation.”

[Lord Shipley]

I shall speak also to Amendments 68, 72 and 73. This group is the first of several about the procedures to be followed by an authority taking temporary possession of land. Current legislation permits only permanent compulsory purchase. As an example of what I think the Government are intending, we could take the building of a bridge. There may be a permanent compulsory purchase order for the bridge itself with a temporary compulsory purchase order for the building compound to store equipment and materials for the period of the building works.

This group of amendments relates to Clause 14. Other groups will follow which address further issues around temporary possession. For the avoidance of doubt, I state that all the amendments in my name are probing amendments to help to improve and clarify the meaning of the Bill. I thank the Compulsory Purchase Association for its advice on what I shall say on this group and on later groups.

Clause 14 sets out the power for acquiring authorities to take temporary possession of land if they could otherwise be authorised to acquire interest in that land permanently, but it could also be an opportunity to codify various statutory instruments authorising temporary possession, and it may prove beneficial for powers of temporary possession—for example, for post-construction inspection and correction of minor defects—to be incorporated. Can the Minister confirm whether codification that would provide a single process for temporary possession might be introduced? Amendment 65 substitutes a new subsection which makes it clear that a single code is envisaged.

There are several government amendments in this group, but at present I think that the wording of the four amendments in my name in this group is more suited to the ambition of the proposed change. Amendment 68 contains words which may not be needed, and I would appreciate the Minister’s guidance on that. Amendment 72 clarifies and emphasises that temporary possession of land need not be taken compulsorily but can be by agreement. Perhaps that needs to be emphasised. Amendment 73 explains the rights and responsibilities of an acquiring authority and proposed paragraph (c) protects the rights of tenants, particularly where a tenant maintains an intention to resume occupation when the acquiring authority ceases temporary possession. I am very happy to listen to the Minister’s response and to look at this again when the government amendments have been incorporated in the Bill, and so I am happy to wait for Report before speaking further on this group. I beg to move.

[Lord Beecham]

My Lords, I shall speak to Amendments 69 and 75. They are pretty much self-explanatory. The former simply requires that guidance should be provided when there are temporary rights that can be granted at the same time over the same piece of land. Amendment 75 is rather more important because it provides that the section should not come into force until guidance has been published in relation to it. I assume that is the Government’s intention, and I hope they will accept that amendment.

[Lord Young of Cookham (Con)]

My Lords, the co-pilot is back in charge. I thank the noble Lords, Lord Shipley and Lord Beecham, for tabling their amendments to Clause 14. The noble Lord, Lord Shipley, made it clear that his amendment was probing. Before I move on to discuss these and the government amendments to this clause, it may be helpful if I begin with a brief description of Clauses 14 to 26, which introduce the new temporary possession power.

All acquiring authorities may need to enter and use land for a temporary period. For example, they may require land to store materials for a scheme or to provide access to a construction site, as the noble Lord, Lord Shipley, explained. The problem is that, currently, only certain acquiring authorities have temporary possession powers—for example, under special Acts which are needed for very large schemes such as the Crossrail Act 2008. Crucially, compulsory purchase orders cannot authorise temporary possession. There is no good reason for this difference, and it is unfair to those who do not have the powers. Clauses 14 to 26 seek to create a level playing field by giving all acquiring authorities the same power to take temporary possession of land. It may also be in the interests of those on the receiving end of a CPO to have the possibility of being deprived of their land temporarily rather than permanently.

In giving acquiring authorities this power, we shall ensure that those whose land is taken are fairly compensated and that there are appropriate safeguards in place to protect their interests. That is set out in Clause 19. For example, temporary possession will have to be authorised in the same way as compulsory acquisition. Also, in certain circumstances, owners and occupiers will be able to require the acquiring authority to acquire the land permanently instead of occupying it on a temporary basis, if that is what they want.

Government Amendments 66, 67, 70, 71, 74 with Amendments 105 and 106 and amendments to other clauses, which I shall deal with later, remove the requirement for the temporary possession to be linked directly to a scheme for the acquisition of other land either by compulsion or agreement. Decoupling is the word that the professionals have been using. The reason for this change is that there may be situations where an acquiring authority needs to take only temporary possession of land. For example, an acquiring authority may need temporary possession of land for a contractor’s compound when they have been able to buy all the land needed for their scheme by agreement, or they may need access to land temporarily to maintain a highway. That is the impact of some of our amendments.

Government Amendments 105 and 106 are consequential on Amendment 66; they simply remove definitions of terms that are no longer required. Non-government Amendments 65, 68 and 72, which were tabled by the noble Lord, Lord Shipley, also seek to remove the requirement for the temporary possession to be directly linked to a compulsory acquisition scheme. I hope, therefore, that he will agree they are unnecessary in the light of the Government’s amendments.

On Amendment 69, tabled by the noble Lords, Lord Beecham and Lord Kennedy, I agree with the noble Lord that we need to ensure that the interests of leaseholders are adequately protected in introducing this new power. However, I believe that that amendment is not needed, because we have already built in a safeguard which would deliver the same outcome that is requested, but in a more flexible way.

Amendment 69 would restrict the temporary possession power so that it could never be used when a leasehold interest would have less than a year to run after the land was handed back, even if that was the preference of the leaseholder, the freeholder and the acquiring authority. It sounds counterintuitive to prohibit that. The effect of this amendment would be that, if the land was essential to the delivery of the scheme, the acquiring authority would instead be driven to exercising the more draconian power of compulsory acquisition of the land permanently. However, as I have said, we have already built in a safeguard for leaseholders, which I believe will achieve the outcome that noble Lords are seeking. The safeguard is in Clause 17(3), which allows leaseholders to serve a counternotice preventing the acquiring authority taking temporary possession of the land. On receipt of the counternotice, if the land is essential to the delivery of the scheme, the acquiring authority can proceed as if the land were subject to compulsory acquisition and take the land permanently. In these circumstances, the leaseholder would, of course, be compensated for both the value of his lease and losses caused by reason of being disturbed from possession of the land taken. I believe this is a neater solution, which gives leaseholders the flexibility to decide what is right for them.

Amendment 73, tabled by the noble Lord, Lord Shipley, seeks to clarify what will happen when a tenant’s land is subject to compulsory purchase. As government Amendment 103 seeks to do the same thing—although our approach is different—I will speak to both amendments together. Government Amendment 103 provides that the terms and obligations under the tenancy, with the exception of the payment of rent and the length of the tenancy, will be disapplied to the extent that the temporary possession prevents reasonable compliance with them. Any expenditure which a leaseholder incurs as a result of the temporary possession would be claimed back from the acquiring authority. The noble Lord’s amendment, in contrast, provides that all the terms and obligations are unenforceable for the period of temporary possession.

The reason we have disapplied the terms and obligations only to the extent that the temporary possession prevents reasonable compliance with them is that there may be circumstances in which only a small part of land subject to a lease is also subject to temporary possession. In these situations, there may be no easy way in which to separate out the terms that relate to the land subject to temporary possession from terms that relate to the remainder of the land.

The second point of difference is the exclusion of the payment of rent and the length of the tenancy. We have done this because, again, where only a small part of a tenant’s land is required, making these terms unenforceable could result in a tenant having to pay an uncertain portion of the rent for the land not subject to temporary possession. The loss that would be compensated is not the rent payable for the existing lease, but any rent payable for alternative premises, as that is the loss that has been caused. Under the Government’s amendment, responsibility for paying the rent for the land under temporary possession remains with the tenant. However, the tenant will be entitled to claim compensation from the acquiring authority in relation to any expenditure which a leaseholder reasonably incurs as a result of the temporary possession.

The other point of difference with the noble Lord’s amendment is to do with proposed subsections (4) to (6), which make provision with regards to those who have protected tenancies under the Landlord and Tenant Act 1954. Occupiers with such a protected tenancy have a right to apply for the grant of a new tenancy, provided they remain in occupation. However, if their land is subject to temporary possession they will no longer be in occupation and will lose this right. Government Amendment 103 and non-government Amendment 73 both seek to preserve this right to renew the tenancy. However, in doing so, the government amendment imposes a requirement for the tenant to confirm in writing to both the landlord and the acquiring authority that they intend to resume occupation after temporary possession. I think it is clear that both amendments are after the same thing: greater clarity for tenants and landlords as to what happens during the temporary possession period, including the treatment of rent.

Finally, in this group, I will respond to Amendment 75, tabled by the noble Lord, Lord Beecham. The noble Lord made a very valid point, which I entirely agree with, that where the Government intend to provide guidance on the use of a new power, that guidance should be available by the time the provisions come into force. That is, of course, the Government’s intention. The particular element of the temporary possession provisions that the noble Lord has identified is in Clause 15(3)(a), which will allow both temporary possession and compulsory acquisition powers to be obtained concurrently for the same piece of land.

Although this so-called doubling-up of temporary and permanent powers can be authorised, it will not give acquiring authorities carte blanche to double up in all cases. It would not be fair to claimants if there was not a very good reason for an acquiring authority to make an order which included this doubling-up. It would not be wise to anticipate precisely what might be in the guidance at this point, but as I have just said, there would be a high bar to justify doubling-up. The most likely circumstances would be linear transport projects where the final design is not complete by the time compulsory powers are obtained. We know of a handful of orders in the last dozen years where this has been authorised, such as the Docklands Light Railway and the Nottingham tramway.

As for compulsory acquisitions, each case would be considered on its individual merits at a public inquiry before an inspector, and considered by the relevant Secretary of State, before a decision was made whether doubling-up was justified in the public interest.

I hope that I have been able to reassure the noble Lord, Lord Beecham, with a firm undertaking that the Government will be seeking views on the draft guidance and will publish it before these provisions come into force. I apologise to the Committee for a somewhat lengthy oration on these amendments, but there are quite a few of them. When the time comes, I will move government Amendments 66, 67, 70, 71, 74, 103, 105 and 106. In the meantime, I ask the noble Lord to withdraw Amendment 65 and for noble Lords not to press Amendments 68, 69, 72, 73 and 75.

[Lord Shipley]

I am grateful to the Minister for his reply. I draw his attention to two facts. First, the Government have brought 34 amendments for consideration this afternoon, this Bill having passed in the other place. Secondly, some of them were tabled quite late, and after I tabled my amendment. I understand the need for all this to be brought together for Report, so I beg leave to withdraw the amendment.

Amendment 65 withdrawn.

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[Lord Young of Cookham]

My Lords, we now move to the second group of amendments on temporary possession. Clause 15 deals with the procedure for authorising temporary possession of land, requiring it to be authorised by the type of authorising instrument that would be required for the permanent acquisition of land—for example, a compulsory purchase order.

Government Amendments 76 to 79 remove redundant wording in Clause 15(2) as a consequence of government Amendment 66 to Clause 14(1). Government Amendments 80 to 82 amend Clause 15(3) to clarify that the same land may be subject to both temporary possession and compulsory acquisition powers concurrently. We debated the need for guidance relating to the clause a moment ago on Amendment 75, tabled by the noble Lord, Lord Beecham, so I shall not repeat what I said about that. Government Amendments 83 to 85 and 87—the last also, happily, endorsed by the noble Lord, Lord Shipley—all remove redundant provisions in the context of the previous amendments. For example, Amendment 87 refers to “relevant land”: this is no longer needed because the concept of relevant land is removed by Amendment 66. I beg to move.

[Lord Shipley]

My Lords, Amendment 86 is in my name, and I want to ask the Minister a question. Clause 15 sets out the procedures for authorising temporary possession. It is not clear from the clause whether it is intended that there be a time limit for the life of a temporary power—for instance, three years for service of a notice post the confirmation of a compulsory purchase order. Do the three-year and five-year standards for compulsory purchase orders in statutory instruments apply, and does the power apply to post-construction maintenance during a defect period?

The Government’s amendments to remove superfluous words are helpful. I am not sure whether Amendment 87, which deletes subsection (7), is right—I am having second thoughts about it. I think it is right, but as the relevant land is the land required for the scheme, it seems appropriate to make it clear that temporary possession can be taken after action to secure the land required permanently. I would be grateful for the Minister’s comment.

[Lord Young of Cookham]

I may need to write to the noble Lord, Lord Shipley, about the specific issue he has raised on Amendment 87 and subsection (7) relating to relevant land. As I said, this is no longer needed, because the concept of relevant land has been removed by Amendment 66, with which we have just dealt. However, I will make some inquiries following his representations.

The noble Lord, Lord Shipley, has proposed in Amendment 86 that Clause 15(6) should be omitted. This is intended to be helpful clarification. It confirms that the authorising instrument—for example, a CPO—does not need to include the dates for any particular period of temporary possession. It would be difficult for an acquiring authority to do that, because it would not know the date of the confirmation at that stage. The cross-reference to Clause 16 points users to the provisions which specify the dates of temporary possession. The Government believe that there is no need for users of this legislation to be deprived of this clarification. He also asked a question about whether CPO powers would expire after a certain period. Again, I will write to him about this when I have made some inquiries. In the meantime, I hope that he will not move his Amendment 86.

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[Lord Kennedy of Southwark]

My Lords, I am aware that I have tabled a number of amendments to this section of the Bill. I am also aware that some detailed discussion has taken place outside the Chamber. I am generally content that we are moving in the right direction and do not intend to delay the Committee for long.

We welcome the statutory framework for dealing with temporary possession. Amendment 88 seeks to make it clear that an acquiring authority may serve one or more notices under the clause. I was concerned that that was not very clear from where we stand at the moment. I would like to hear a response from the noble Lord, Lord Young of Cookham, in respect of this amendment. I beg to move.

[Lord Shipley]

My Lords, I shall speak to Amendments 89, 91, 92, 93 and 94 in my name. These five amendments relate to Clause 17, which makes provision for a person affected by temporary possession to serve a counternotice to limit the total period which the temporary possession can last to 12 months in the case of a dwelling and six years in any other case. Leaseholders can also serve a counternotice providing that the acquiring authority may not take temporary possession. Having received the counternotice the acquiring authority must decide whether to accept it, withdraw the notice or proceed to take the land permanently.

As drafted, Clause 17 seems unnecessarily complex. The hope is that the Government might be able to simplify it without losing any of its statutory force. Regarding Amendment 89, Clause 17 applies wherever an acquiring authority gives notice of intended entry on to land for a temporary period to a person who is either the freeholder of the land affected or a leasehold owner. The clauses that follow seem to have a different counternotice procedure, depending on whether it is a freeholder or a leaseholder. So in connection with Amendment 89, is there a need to distinguish between leaseholders and freeholders? This amendment and the consequential amendments seek to avoid that and therefore to simplify the clause.

Amendment 91 refers to Clause 17(3), which allows a leaseholder to give the acquiring authority a counternotice to prevent it taking temporary possession of the land. It appears that this right is not available to freeholders, who can serve only a counternotice limiting the period of temporary possession. Surely, this right should be available to freeholders. This amendment therefore seeks to clarify the matter by stating:

“The owner may give the acquiring authority a counter-notice which provides that the authority may not take temporary possession of the owner’s interest”.


We then have consequential Amendments 92, 93 and 94. Clause 17(10) states that nothing in that clause,

“prevents an acquiring authority acquiring land compulsorily after accepting a counter-notice or withdrawing a notice of intended entry”.

My question is: should a permanent acquisition be available for temporary land unless a counternotice has been served requiring a permanent rather than temporary acquisition? Clause 17(8) is relevant in this respect. Amendment 94 would therefore leave out lines 38 to 40 on page 15. The concern is that landowners could potentially face a period of six years of temporary possession with the acquiring authority then deciding to acquire the land permanently. In the interests of fairness, the land should surely have been acquired permanently in the beginning. Scheme promoters should know how they wish to use the land and whether it needs to be permanently acquired from the outset.

[Lord Young of Cookham]

My Lords, I thank the noble Lord, Lord Kennedy, for tabling his Amendment 88. I appreciate that his aim in doing so was to make things clearer, an ambition which I fully support. However, on this occasion I do not think that an amendment is necessary because subsection (7) provides that Clause 16 must be complied with,

“in relation to each subsequent period of temporary possession”.

That makes it clear that acquiring authorities can serve more than one notice. Having said that, this is the sort of thing that could usefully be covered in guidance. We will update our compulsory purchase guidance in light of the reforms in the Bill, and in the light of what the noble Lord has said, I will ask for this matter to be looked at again.

Amendments 89 and 91 to 93 deal with the counternotice provisions in Clause 17. These provisions are an improvement on the current temporary possession regimes, which have no counternotice procedure in them. I thank the noble Lord, Lord Shipley, for tabling his amendments. No one would be keener than I to simplify all this, if it were possible so to do. I doubt whether it would be realistic wholly to redraft this clause between now and Report but I endorse his sense of direction. He is quite right to say that there is a difference between the treatment of leaseholders and that of freeholders. This is because the Government believe that there could be a greater impact on leaseholders than freeholders when their land is subject to temporary possession, as the leaseholder may be left with a useless lease at the end of the temporary possession period—for example, when there is only a short period left to run on the lease. We considered this in debate on Amendment 69.

Clause 17(3) affords leaseholders additional protections in these circumstances by giving them the option to serve a counternotice, as the noble Lord, Lord Shipley, said, providing that an acquiring authority cannot take temporary possession of their land at all. However, no such issues arise for freeholders. The justification for the temporary possession of the land will have been carefully considered on its individual merits at a public local inquiry before an independent inspector and confirmed only where it is in the public interest.

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Moved by

[Lord Shipley]

95: Clause 19, page 16, line 8, leave out “injury the claimant sustains as a result” and insert “damage the claimant sustains as a result of the temporary possession of the land”

[Lord Shipley]

My Lords, in moving Amendment 95, I will also speak to Amendments 96, 97 and 102. Clause 19 makes provision in respect of the payment of compensation to those who suffer loss or injury as a result of the exercise of powers of temporary possession, but there are concerns about a number of subsections in the clause. Amendment 95 addresses Clause 19(2), which provides a person—the “claimant”—with an entitlement to compensation in respect of,

“any loss or injury the claimant sustains as a result”.

I have two points here. First, would it not be better to replace “injury” with “damage”? Is there a legal reason why the word injury is used? Damage is of course more wide-ranging. Secondly, should the subsection be redrafted to make it clear that the loss or damage—or perhaps injury—must have been sustained as a result of the temporary possession of the land? The amendment would bring the drafting into line with the usual form adopted in clauses relating to compensation for the temporary possession of land, which typically state that the loss, injury or damage must have resulted from the exercise of the powers—I refer in particular to the Crossrail Act 2008. In addition, are those subsections still needed, given that other amendments are being proposed?

Amendment 97 refers to Clause 19(7), which is intended to clarify that, for the purposes of the statutory limitation period, time will not begin to run until the expiry of the last day of the temporary possession period. I understand that the Bill originally sought to achieve this objective by stating that a “claim for compensation” would “accrue on the last day of the temporary possession period”. The Compulsory Purchase Association’s view is that the original drafting would have caused problems, but that the revised drafting is not complete. The original drafting would have left claimants exposed to a potential argument that, because the claim was stated not to accrue until that time for the purposes of Section 9 of the Limitation Act 1980, they also had no cause of action enabling them to claim for compensation or refer the matter to a tribunal at any earlier time. Thus, in cases where temporary possession is to last a number of years, it could result in claimants having to bear losses without compensation for a number of years, which seems unfair.

The government amendment is intended to address that problem, but it may still permit an argument that, if the cause of action is to be treated as accruing on the last day of the temporary possession period for the purposes of the Limitation Act, notwithstanding that it would otherwise be regarded as accruing before or during the temporary possession period, the cause of action should also be regarded as accruing at that later time for other purposes, including the making of a claim or reference.

The advice that I have received is that an addition should be made to the subsection to confirm that the deemed accrual applies for the purpose of the Limitation Act alone. As such, I am advised that my drafting for Clause 19(7) helps to avoid doubt. The amendment states:

“for all other purposes a claim will accrue as the possible damages suffered as a claimant is not precluded from making a claim pursuant to subsection (2) prior to the last day of that period”.

I understand the complexity of this, and that the Minister may want to respond in writing; the 34 government amendments this afternoon reveal that this is a complex matter. I am not necessarily looking to the Minister to reply to this now. I just hope that before we get to Report, the matter can be clarified so that we have a Bill that is clear in its meaning and will not end up being challenged in the courts. I beg to move.

[Lord Beecham]

My Lords, speaking as a lawyer, although happily not practising, I see no need to amend the term “injury” to “damage”. Legally, injury embraces damage of all kinds. I would not go to extremes to defend the Government on this or any other occasion, but if the Minister felt disinclined to accept the amendment, I would not dissent from his judgment.

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Amendments 101 and 102 deal with the same subject. Government Amendment 101 makes clear that interest will accrue for each separate head of claim from the day after the last day on which that particular loss or injury occurs. This is fairer to claimants than treating all loss and injury as a whole. Amendment 102, tabled by the noble Lord, Lord Shipley, would mean that claimants could be entitled to interest on outstanding payments of compensation for losses that had not yet been incurred. In our view, that would be unfair to acquiring authorities, but I accept with alacrity his suggestion that I should pursue this matter further with him in correspondence.

[Lord Shipley]

I am grateful for the Minister’s clarification of that and look forward to further discussion and any correspondence that may help us reach Report with absolute clarity about what we are dealing with. I beg leave to withdraw the amendment.

Amendment 95 withdrawn.

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Moved by

[Lord Shipley]

107: Clause 27, page 21, line 24, after “scheme” insert “(or the prospect of the scheme)”

[Lord Shipley]

Clause 27 relates to the no-scheme principle. In moving Amendment 107, I wish to speak also to Amendments 109 and 111.

Clause 27 seeks to put the no-scheme principle in the compensation code on to a statutory footing. The Bill defines the no-scheme principle as,

“any increase in the value of land caused by the scheme for which the authority acquires the land is to be disregarded”.

Amendment 107 seeks to take this further to make the Bill state that,

“any increase in the value of land caused by the scheme or the prospect of the scheme”,

should also be disregarded. The Government have tabled a very similar amendment. I welcome that amendment and do not plan to say any more about it.

I turn to Amendment 109. New Section 6A(3) on page 21 of the Bill states:

“In applying the no-scheme principle the following rules in particular … are to be observed”.


This amendment seeks to delete the words “in particular” given that new Section 6A contains five rules which are clearly defined. I will come on to Rule 4 in a moment. If one has rules defining what the position is, why do we need the words “in particular”? That implies that there are other rules that might be considered and there is no indication as to what those might be. The current position is that only the statutory disregards can be taken into account in disregarding the scheme. This provides clarity over the valuation exercise to be undertaken. I hope the Minister will agree that “in particular” on page 21, line 28 should be taken out.

Finally, Amendment 111 relates to Rule 4. The purpose of scheme cancellation being on the valuation date is to avoid the need to speculate on what may have happened between the date of cancelation and valuation because they are the same. It is not clear what the purpose of Rule 4 is. It seems to be unnecessary and likely to create confusion, particularly in the context of the other four rules. I hope the Minister will be able to explain why it forms part of the Bill and why the words “in particular” need to appear in new Section 6A in Clause 27. I beg to move.

[Lord Kennedy of Southwark]

My Lords, I will be brief. In this group, I have Amendments 116, 117, 118 and 119. The first three seek to leave out “highway” on page 24, lines 14, 16 and 17, and insert “transport project”. We thought that would make the issue clearer. New Sections 6D(3), 6D(4)(a) and 6D(4)(b) in Clause 27 use “transport project” and I therefore did not understand why later in the same clause it was referred to as a highway scheme. Can the Minister explain why that is the case and if my amendments are not necessary? If they are, I hope he will accept them as it is odd to move from the wider and encompassing definition of transport project to the narrower definition of “highway”.

Amendment 119 seeks to provide further clarity by removing “announced”. In these sorts of schemes you get into arguments about when things were announced so we thought it would be much clearer to put,

“first proposed in consultation with the public”.

There will be an actual date on which a consultation is started and when papers and a clear plan are sent out. We thought this would be much better as we do not want disputes later because everyone is arguing about when the scheme was formally announced. That is the purpose behind the amendment and I look forward to the Minister’s response.

[Lord Young of Cookham]

My Lords, we have moved on to the no-scheme principle. The problem with this principle is that since it was first established it has been interpreted in a number of complex and often contradictory ways. Clause 27 is intended to clarify the position. It creates a statutory no-scheme principle and sets out a series of clear rules to establish the methodology of valuation in the no-scheme world. It also extends the definition of the scheme to include a relevant transport project in circumstances where land acquired in the vicinity for a regeneration or redevelopment scheme is facilitated or made possible by that project. We are extending the scheme because we want to ensure that an acquiring authority should not pay more for the land it is acquiring by reason of its own or someone else’s public investment.

I am grateful to the noble Lord, Lord Shipley, for explaining the need for Amendment 107. The Committee will have observed that it is similar to government Amendment 108, so I am pleased to say that I am in complete agreement with the noble Lord. It is entirely correct that increases, as well as decreases, in the value of the land caused by the prospect of the scheme should be disregarded.

Amendment 109 was also proposed by the noble Lord, Lord Shipley. He argues that the words “in particular” should be omitted from the introduction to the rules defining the no-scheme world as they imply that some other rules might also be in play. He argues that the rules set out in new Section 6A should be an exclusive list. The Government’s expectation is that in the vast majority of cases the application of the rules as set out will be sufficient to establish the no-scheme world. There may, however, be rare cases in unforeseen circumstances where the Upper Tribunal considers that the application of the rules alone would not give a fair result. Retaining the phrase “in particular” gives the tribunal sufficient flexibility in these rare cases to fall back on the underlying no-scheme principle set out in new Section 6A(2) and its own common sense to arrive at a fair outcome. While I appreciate the noble Lord’s point about the need for clarity, the Government’s view is that the Upper Tribunal should retain this flexibility in order to reach a fair outcome in such unforeseen circumstances.

With Amendment 111, tabled by the noble Lord, Lord Shipley, and government Amendment 112 we now move to consideration of the rules themselves. The noble Lord, Lord Shipley, argues that Rule 4 is unnecessary and should be omitted. The Government’s view is that it remains necessary in order to complement Rule 3. Rule 3 assumes that there is no prospect of the same scheme or any other project to meet the same or substantially the same need as the scheme underlying the compulsory purchase. Rule 4 assumes that there is no prospect of any other scheme taking place on the land concerned. As currently drafted, this is too wide, so Amendment 112 restricts Rule 4 to disregarding only those schemes that could be undertaken only by the exercise of statutory functions or compulsory purchase powers. This means that the prospect of schemes brought forward by the private sector would still be considered as part of the no-scheme world. This is a fine point of valuation practice. In the light of what the noble Lord said, I think that the Government should further consider this issue very carefully with the expert practitioners who may conceivably have been briefing the noble Lord to find a solution.

Amendments 116, 117 and 118 were tabled by the noble Lord, Lord Kennedy. New Section 6D(6) specifies that when the scheme to be disregarded under Rule 3 is a highway scheme, the reference to “any other project” includes another highway scheme to meet the same need as the actual scheme. This provision reflects the planning assumption in Section 14(5)(d) of the Land Compensation Act 1961. It is important that the assumptions for the no-scheme world and the planning assumptions that should be applied in that no-scheme world should be consistent. The current Section 14 was substituted by the Localism Act 2011. A similar provision was added to the original version of Section 14 by the Planning and Compensation Act 1991. The noble Lord put forward a powerful case that this clarification could apply equally to other transport projects. If it did, Section 14 would also need to be amended to keep the two sets of assumptions in step. I think that this is another issue which the Government should reflect on with expert practitioners.

Turning to the definition of the scheme that must be disregarded before compensation may be assessed, government Amendments 113, 114 and 115 make some small adjustments in the context of the extension of the scheme to relevant transport projects. These have arisen from discussions between the Government and the Greater London Authority and Transport for London, which have only recently been concluded. I am very happy to give details if noble Lords would like them, but as they are relatively small adjustments, I propose to skip that part of the text.

I now return to the amendments tabled by the noble Lord, Lord Kennedy. Amendment 119 seeks to clarify new Section 6E(3) which disapplies Section 6E for land bought after a relevant transport project was announced but before this Bill was published. If such land were to be included in a redevelopment or regeneration project in the vicinity of that relevant transport project, it would be valued as if the relevant transport project was not part of the scheme to be disregarded.

The noble Lord’s amendment is much more specific than the Bill as currently drafted. The Government’s view is that such precision may not be necessary. The provision refers to an event that has already happened, and it is quite possible that a project may have been announced in some other way than that specified by the announcement. If so, it would be unfair to restrict this provision because the announcement did not fit within the somewhat narrow definition proposed.

However, having said that, it might be possible to clarify, perhaps in guidance, exactly what is meant by an announcement. That is certainly something that I would like to reflect on. I invite the noble Lord, Lord Shipley, to withdraw Amendment 107.

[Lord Shipley]

My Lords, I beg leave to withdraw Amendment 107. I look forward to reading carefully in Hansard what the Minister has said, with a view to potentially coming back to this on Report.

Amendment 107 withdrawn.

--- Later in debate ---

[Lord Stunell (LD)]

I want to add my amateur voice to that of the professionals who have commented so far. At our previous sitting, we had an extended discussion about the sweeping provisions of Clause 12, making it a Henry VIII clause. The Minister went out of his way to reassure us about the very limited intent of Ministers in relation to that clause. One of the issues, which was perhaps not made very explicit in that debate, is exactly the point that the noble Lord, Lord True, made about the lack of public trust in the system, which the Neighbourhood Planning Bill and the Localism Act were specifically introduced to reverse. The Act seems to be doing so in places where it is taking root, which is absolutely excellent, and anything which would tend to undermine that trust and lead to uncertainty about the effectiveness of the new system is certainly to be avoided if possible.

I look at this from a pragmatic point of view, though I absolutely accept and endorse the constitutional point of view that has been put forward. With Clause 12 and Clause 38 we basically have a Henry VIII clause followed by a William I Clause. William I galloped through England laying waste to everything he saw, and that does not leave a very favourable impression of the direction of travel of the Bill. I hope that on top of any constitutional considerations, issues of news management, at least, might penetrate and make a difference to the Government’s approach.

My noble friend Lord Thomas said that there is surely some wording that could be used to make this a clause about owning up to mistakes. A phrase limiting its application only to cases where there was manifest error or omission would at least put on record and in the Bill its intended limitations.

[Lord Shipley]

I tried to add my name to this clause stand part Motion but unfortunately the queue was too long and I was not able to. I understand that mistakes can be made and need to be rectified. I again draw the Committee’s attention to the fact that we have, on day one of Committee, had 34 government amendments to a Bill which has passed to us from the other place. That shows that Bills have to be drafted better so that we do not end up with people wanting to change them because the right level of thought was not put in to them in the first place. In her emphasis on neighbourhood planning, the noble Baroness, Lady Cumberlege, had it absolutely right—a clause of this kind in a Bill to do with neighbourhood planning, which can, in effect, put a coach and horses through any aspect of it, is unacceptable. I hope that the Minister understands that, and I very much hope that this clause will not survive beyond Committee.

[Lord Beecham]

My Lords, there is a certain irony in a Henry VIII clause applying to Wales, given that the Tudor monarchy was based on Welsh lineage. I am also reminded of the lines of TS Eliot in The Hollow Men:

“This is the way the world ends

Not with a bang but a whimper”.

The Bill is ending in the reverse order. We have had a generally mild and constructive discussion for the past four days in Committee, but we end with something of a bang, because if the Government stick to their position, what is being perpetrated in the clause will lead to significant disagreement.

It is particularly important that the Government should listen to advice from the noble and learned Lord, Lord Judge. Others of us have our own views—we perhaps have a political approach, even those of us who are lawyers of a senior vintage, if I may put it that way. To hear the noble and learned Lord’s critique must surely give the Government pause for thought. It is simply unacceptable to insist on a procedure that leaves so much power in the hands of the Government effectively to ignore the obligations which ought to apply in relation to the Welsh Assembly, in this case, but in general to the operation of secondary legislation. In the few years that I have been here, that has time and again been shown to be defective as a mechanism for sustaining proper parliamentary consideration at the appropriate time of important measures with significant implications for various aspects of public policy.

I hope that the Minister will take this back and respond constructively, or secure permission to do so, to the views of this Committee and those of the Delegated Powers and Regulatory Reform Committee and, it appears—for I had not noticed its report—to take the views of the Constitution Committee into account. Obviously, he cannot give us any firm commitments tonight but I hope that, after consulting his colleagues, he will be able to satisfy the House by indicating that. Otherwise, it will undoubtedly have to go to Report and, if necessary, a vote at Report. I hope that we can avoid that because, on the whole, the Bill has proceeded in a fairly consensual way. Most of us have endeavoured to work with the grain of the Government’s policy. It would be a shame if that were in contrast with a rigid decision to stick with very unsatisfactory drafting right at the end of the Bill.