Local Government Finance Bill

Lord Tope Excerpts

Thursday 5th July 2012 Grand Committee

Moved by

[Lord Tope]

35: Schedule 1, page 24, line 33, at end insert—
“( ) A review of the basis on which the Secretary of State calculates payments to authorities must be undertaken in conjunction with any revaluation of rateable values on non-domestic property after 2015.”

[Lord Tope]

My Lords, in moving this amendment I will also speak to Amendment 36. Both are in the name of the noble Lord, Lord Jenkin. However, as noble Lords will know, he has literally just finished a three-and-a-half-hour debate in the Chamber and I have agreed to speak to these amendments since my noble friend Lord Shipley and I added our names to them. The noble Lord, Lord Jenkin, has promised to return when I have finished.

Amendment 35 refers to the review of the basis on which the Secretary of State calculates payments to authorities. That is probably best known to all of us here as the reset. The reset will review the needs and resources formula on which the local share calculations, such as the tariff and top-up, are based. The Government’s intention, as set out in the statement of intent on the central and local shares published on 17 May, is that the first reset should take place in 2020, which will also coincide with a revaluation; subsequently, as we know, the resets would be at 10-year intervals.

Amendment 35 prescribes that resets should happen at the same time as the five-yearly revaluation of non-domestic rates. The next revaluation is due in 2015 and the following reset would therefore be in 2020, as currently intended. Amendment 36 requires a review of the baseline funding level and changes in needs and resources to be carried out when local authorities are compiling their non-domestic rating lists. This is the same as a revaluation. Section 41 of the 1988 Act provides that this must happen once every five years. Therefore, the effect of both these amendments is the same. I beg to move.

--- Later in debate ---

[Baroness Hanham]

My Lords, the needs assessment will be the same as the assessments for the baseline that were made initially. As I understand it, you would have to revaluate against that baseline. Any adjustments needed to that as a result of the revaluation would be made on the financial basis that there is no change to the amount a local authority is receiving unless there has been some change in the baseline or in the ingredients of the baseline. I think that is correct as to how the assessment will be made and, again, I will write if it is not.

[Lord Tope]

I am very grateful to the Minister for that explanation and to all noble Lords who took part in this debate, which raised some interesting and useful points. We will read it carefully in Hansard and I am quite certain the noble Lord, Lord Jenkin, will read it with even more care and interest. I do not speak for what he may intend to do when he has done so, but in the mean time I beg leave to withdraw the amendment.

Amendment 35 withdrawn.