Local Government Finance

Peter Aldous Excerpts

Wednesday 7th February 2024 Commons Chamber

[Peter Aldous (Waveney) (Con)]

This settlement is welcome because for many councils it staves off financial armageddon. However, as we have heard, we need a far more strategic approach to the funding of local councils and to how they deliver the crucial services that they provide. Year after year we go through an annual routine of the Government issuing a provisional local government funding settlement in December, which presents many councils with significant challenges. That is followed by an intense period of lobbying by councils, their representative bodies and MPs. The Government then find some more money to solve the short-term challenge. We then agree the settlement, as we will do tonight. Life goes on, and we repeat the whole exercise again the next year. I think there is consensus across the Chamber that we must break out of that cycle.

A county such as Suffolk faces significant challenges, including an ageing population, which means that there is an ever-increasing group of vulnerable people who require care and support. It is right that my right hon. Friend the Chancellor increased the national living wage in his autumn statement but it was wrong that, in the first instance, councils such as Suffolk were asked to fund most of the increase themselves from their existing resources. We need to pay properly and support the thousands of workers going out in all weather conditions to care for and assist vulnerable people in their own homes.

Like Cornwall, Somerset and Dorset, Suffolk covers a large geographical area. In such circumstances it is expensive to deliver services, including, as we have heard, home to school transport and SEND provision. Faced with those challenges and an inadequate provisional settlement, Suffolk County Council cut its funding for arts and heritage. The latter in particular leaves the Waveney and Lowestoft area inadequately served and resourced with regard to archives and records. I am sure that I will return to that issue in due course.

My right hon. Friend the Levelling Up Secretary is right to set up an expert panel to advise on financial stability, and to ask local authorities to produce productivity plans, but more is required. As I have said, we need to move away from the current short-term approach to local government funding. To do that, I suggest the following changes should be considered. First, as many Members have said, there should be multi-year financial settlements rather than the annual settlements that we have had for the past six years. Secondly, we must recognise the added cost of delivering services over large rural and coastal areas such as Suffolk. Thirdly, working in conjunction with the Department of Health and Social Care, the Department for Levelling Up, Housing and Communities must provide a sustainable long-term plan for social care, with care workers being fairly paid and provided with proper career paths.

There should also be a review of statutory responsibilities in such areas as home to school transport, to ensure that they are properly funded. Finally, as we have heard, the Government should carry out the relative needs and resources review—the so-called fair funding review. The review should look at not only the opaque and complicated formulas used, but the data used for the assessment of relative needs, which, as we have heard, dates way back—much of it to the last century.

In his summing up, I hope that the Minister, my hon. Friend the Member for North Dorset (Simon Hoare), who has taken extremely well to his new role, will be able to herald in the long-term strategic approach that local government so desperately needs.

Oral Answers to Questions

Peter Aldous Excerpts

Monday 4th December 2023 Commons Chamber

[Michael Gove]

That is a very important point, and yes, we are on it.

[Peter Aldous (Waveney) (Con)]

T9. The Great Yarmouth and Lowestoft enterprise zone, which was set up in 2012, has been very successful. With no investment zones in the east of England, will my hon. Friend meet my right hon. Friend the Member for Great Yarmouth (Sir Brandon Lewis) and me to consider how best the enterprise zone can be enhanced, so that it can continue to create jobs in the low-carbon energy sector?

[Jacob Young]

I would be delighted to meet my hon. Friend and my right hon. Friend the Member for Great Yarmouth. We have no plans at present to amend enterprise zones, but I am keen to ensure that their constituents continue to reap the rewards of levelling up, including the £100 million of investment for Sizewell C and freeport east, which will generate thousands of jobs across his region in new low-carbon technology.

Non-Domestic Rating Bill

Peter Aldous Excerpts

Consideration of Lords amendments
Wednesday 25th October 2023 Commons Chamber

[James Murray (Ealing North) (Lab/Co-op)]

I am pleased to respond to these three Lords amendments on behalf of the Opposition. Clause 13 of the Bill introduces new duties on ratepayers to provide information to the Valuation Office Agency in order to support digitisation and a shorter revaluation cycle. It also introduces penalties to promote compliance and establishes an associated appeal system.

Through the Bill, ratepayers will initially face a penalty for failing to comply with the new duties the Bill introduces. If, having received that initial penalty, the ratepayer continues not to comply for a further 30 days, they will be liable for an additional penalty of £60 per day. As we heard from the Minister, Lords amendment 1 caps the total charge arising from that additional penalty at £1,800, equivalent to 30 days’ worth of daily fines. As my hon. Friend the Member for Luton North (Sarah Owen) said on Second Reading, we are aware of concerns relating to the new duty and the associated penalties from those representing shops, and small shops in particular. Although I doubt that all the concerns of those representative organisations and their members have been addressed by the Government, we realise that this limit on the level of the penalty may help to protect ratepayers from much larger charges while still supporting the Valuation Office Agency’s move toward frequent revaluations, which we support. On that basis, we will not be opposing its inclusion in the Bill.

Through clause 13, the Bill also introduces a new criminal penalty, which applies if a person makes a false statement while purporting to comply with the new duties it introduces. The Bill sets out that the Valuation Office Agency will decide whether an offence has been committed, and its decision may be appealed to the Valuation Tribunal for England. As originally drafted, the Bill permits the tribunal to remit such a penalty when it is not satisfied beyond reasonable doubt that the person had knowingly or recklessly made a false statement. Lords amendment 2 would require, rather than merely permit, the tribunal to remit the penalty in such circumstances. We believe that the amendment is sensible, so we will not be opposing its inclusion in the Bill.

Finally, Lords amendment 3 makes a technical change to the Local Government Finance Act 1988, omitting section 140(2)(b) of that Act. That section, which refers to Ministers making separate estimates of rateable value for England and Wales, has become obsolete as a result of clause 15 of the Bill, which makes a separate provision about the calculation of multipliers for England. As this is essentially a drafting amendment, we will not be opposing it either.

I am tempted to talk at much greater length about Labour’s plans to scrap the current system of business rates, replacing it with a system of business property tax that rebalances the burden of business property taxation away from the high street and retail firms towards online tech giants. However, I realise that that may be out of scope and that time is tight, so I will simply confirm our intention not to oppose any of these three amendments.

[Peter Aldous (Waveney) (Con)]

This Bill, unlike the Levelling-up and Regeneration Bill, on which we considered a further round of Lords amendments yesterday, has progressed through Parliament quickly. Second Reading in this place took place on 24 April, and the Bill will complete its passage today or tomorrow. It was a 2019 Conservative manifesto commitment to carry out a fundamental review of the business rates system. This Bill is the start of that process, but it does not mark its completion, and on its own it cannot be described as fundamental.

The amendments before us are straightforward. Lords amendment 3 is a drafting correction to omit a requirement relating to Wales that is now obsolete. Lords amendments 1 and 2 relate to the new duty to notify. They cap the level of, and increase the burden of proof required for, penalties that will be applied for not complying with the obligation to give required information to the Valuation Office Agency. They are to be welcomed, but as highlighted on Report, this burden should have been much reduced and there should be reciprocal penalties on the VOA.

As I have mentioned, this Bill must mark the beginning of the reform of business rates, not the completion of the task. Business rates remain a heavy and uncertain burden on many businesses. They act as a brake on growth, disincentivise capital investments and are a barrier to levelling up. Reform must be more radical and must be carried out much more quickly.

I urge the Government to strive towards achieving the following goals. First, the uniform business rate multiplier must be reduced to an affordable level. The UBR currently sits at 51p in the pound. At such a high level, it deters investment and ultimately reduces the tax base. It should be reduced to the order of 34p, the level at which it was first introduced in 1990. Lowering the UBR would have the long-term effect of expanding the tax base. A failure to do this will ultimately see the Government increasing the UBR on an ever-shrinking tax base, and in doing so, threatening a vital source of local government revenue.

Secondly, as important as they are to so many businesses, we ultimately need to remove the myriad sticking plaster reliefs that are invariably lobbied for and announced at every spring Budget and autumn statement. They are an implicit admission that the UBR is too high. The Government have been forced to offer many of these reliefs as many businesses are unable to pay a UBR of 51p. By removing these reliefs and reducing the UBR, the Government would simplify the system and reduce the administrative burden on both ratepayers and the VOA. Instead of the annual cliff edges, as businesses lobby for and then nervously wait for a relief to be extended, such a reform would introduce an element of long-term certainty, which would encourage investment.

Finally, while the Government have taken a welcome step in the right direction by moving to three-year revaluations, they must keep going towards the ultimate goal of annual valuations. Shorter valuations are necessary to ensure that business rates respond to the dynamic and increasingly volatile movements of the market. It is vital that rateable values are assessed as frequently as possible to ensure that ratepayers are paying a fair amount.

My last point is to express regret at the curtailment in the definition of a “material change of circumstances”. This is a provision that gives ratepayers recourse to pursue a relief on their business rates bills when circumstances outside their control hinder their ability to run their businesses. Despite the Government’s protestations, the Bill in effect disapplies many common situations of material change that up to now have been acknowledged as such and are even described in the VOA’s own guidance.

In conclusion, this is the start of the reform of business rates, but it is not the finish. There is some way to go before we reach that Magnus Magnusson moment. I thank my hon. Friend the Minister for listening to my concerns during the passage of this Bill, and I am grateful to him for meeting me last month to discuss the situation. I have subsequently written to my hon. Friend the Financial Secretary to the Treasury setting out some ideas as to how this reform process can be continued. I would be grateful if he and she committed to completing the task of the fundamental review of business rates that is so vital for businesses large and small all around the UK.

Levelling-up and Regeneration Bill

Peter Aldous Excerpts

Consideration of Lords message
Tuesday 24th October 2023 Commons Chamber

[Peter Aldous (Waveney) (Con)]

I supported the two amendments that the other place has returned to us in their previous guise last week, when I urged the Government to accept them. It is welcome that we have the opportunity to consider these two important issues again.

With regard to the holding of virtual meetings by councils, I prefer the original Lords amendment 22, which provided local authorities with the local discretion to pursue a common-sense and pragmatic approach on the form and conduct of their meetings. That said, the amendment in lieu tabled by my right hon. and noble Friend, Baroness McIntosh, is pragmatic, conciliatory and takes into account the Government’s concerns about council meetings being held solely online. I urge the Government to consider it in the spirit in which it has been put forward.

I also re-emphasise other considerations that were raised in last week’s debate. Set in the overall context of a Bill that gives local communities and local councils greater discretion and greater autonomy and looks to devolve powers away from Whitehall, it is perverse that the Government are dictating to local authorities how they conduct themselves. There is, as we heard last week, 90% to 95% support from local councils, clerks and their representative bodies for this provision. They understand best the challenges that they face, and they are responsible people who will use wisely any discretion with which they are provided. The provision will strengthen local democracy and will make it easier for such groups as the disabled, parents with young children, carers and those in full-time employment to participate in decision making in their own local communities. For those local authorities that cover large geographical areas, such as Suffolk County Council and the Broads Authority, it is sensible to hold some meetings virtually, rather than insisting that councillors—some of whom are elderly—travel long distances, often in inclement weather, such as we had last week.

When we debated this issue last Tuesday, there was widespread disquiet on the Government Benches about the straitjacket approach that the Government are pursuing. I would be grateful if in her summing up my hon. Friend could outline the strategy that the Government will be putting in place to address those concerns, if they reject the sensible and conciliatory amendment 22B.

In the wake of Storm Babet, the Lords have asked us to look again at amendment 45. The weekend’s events highlighted the need for climate change mitigation to be fully and deeply embedded in local and national planning policy. Although the Government are proposing again to reject the amendment, they have proposed their own alternative, which is to be welcomed. It is necessary to consider, first, whether that will help deliver a more consistent alignment of planning policy and development management with the existing framework for tackling climate change and, secondly, whether it will provide the certainty, consistency and clarity required to deliver the enormous amount of private sector funding required to achieve our net-zero obligations.

I would be grateful if my hon. Friend answered the following questions in her summing up. Will the Government’s amendment bridge the gap in planning policy due to the delay in the review of the national planning policy framework? Will she give an assurance that the review will start as soon as possible, and ideally provide a timescale?

Secondly, there is presently an inconsistency in that a local planning authority’s well thought-through and bespoke climate change mitigation policies can be overturned by either the Secretary of State or the Planning Inspectorate. In that context, will my hon. Friend advise whether the Government’s amendment in lieu removes that contradiction, which undermines proactive and bespoke local planning?

I am grateful to you for your time, Mr Deputy Speaker. It is welcome that the Lords have provided us with a further opportunity to improve the Bill. While the two amendments are in many respects very different, they both give local communities a full opportunity to shape the future of the places where they live and work and, in doing so, achieve meaningful regeneration and levelling up.

[Mr Deputy Speaker (Sir Roger Gale)]

I call the Opposition Front-Bench spokesperson.

Levelling-up and Regeneration Bill

Peter Aldous Excerpts

Consideration of Lords amendments
Tuesday 17th October 2023 Commons Chamber

[Mr Deputy Speaker (Mr Nigel Evans)]

I call Peter Aldous to make the last Back-Bench contribution, so anybody who has contributed to the debate should start making their way to the Chamber. We are expecting a large number of votes.

[Peter Aldous (Waveney) (Con)]

I will speak to three amendments, to highlight some concerns about why the Government are opposing changes made in the other place that, at face value, appear to have some merit, and to seek further clarification as to what they are doing to address those concerns.

A number of my hon. and right hon. Friends have mentioned Lords amendment 22, which relates to local authorities holding virtual meetings. I am a vice-president of the Suffolk Association of Local Councils, and the feedback I have received from all tiers of local government in Suffolk is that they support the Lords amendment, which the Government oppose. I acknowledge the Government’s view that a core principle of local democracy is that citizens should be able to attend local council meetings to interact in person with their local representatives. However, instead of an absolute bar on virtual attendance, I would suggest that allowing local discretion, pursuing a common-sense approach, is more appropriate for the following reasons.

First, 90% to 95% of councils at all levels, based on their own individual experiences, support such an approach, which is endorsed by the Local Government Association, the National Association of Local Councils and the Society of Local Council Clerks.

Secondly, many town and parish councils have difficulties in retaining a full slate of councillors. They regularly have to co-opt new members, and contested elections are invariably the exception rather than the rule. Allowing some local discretion with regard to the holding of council meetings would remove barriers to becoming a councillor for such groups as the disabled, parents, carers and full-time workers. These groups all have a great deal to contribute to their local communities, but many of them are put off by the straitjacket of being expected to attend all council meetings in person.

--- Later in debate ---

[Peter Aldous]

I agree entirely with my right hon. Friend on that point. Coming out of covid, a lot of parish councils have raised that issue with me. From their perspective, they have made well-reasoned cases. They are not going to go daft. There is perhaps a nightmare scenario of local councillors never leaving their homes and, as a result, being abstract from the communities they represent. But they will not do that. They will be very mindful of their responsibilities and they would use this provision sensibly. At a time when we are talking about cascading down responsibilities to local authorities, it appears slightly perverse to be saying, “No, you’ve got to do it this way.”

My next point relates to Lords amendments 46 and 327, which would require the Secretary of State to promote healthy homes and neighbourhoods through a regulatory framework for planning and the built environment. As we have heard, the Government are seeking to strike out those amendments, on the basis that they will cut across the actions the Government are already taking to improve the quality of new homes, will create uncertainty and risk legal challenge and delay. I would readily accept that argument if the existing policy was working well, but it is not; it is complex and focused only on risk reduction. We should bear it in mind that from a high-quality home a host of benefits ensue and cascade down: better health and less pressure on the NHS; and an enhanced environment for learning, doing homework and passing the exams and getting the qualifications that enable people to realise their life ambitions, thereby ensuring social mobility. That in turn leads to improvement in national economic productivity. If the Government are to strike out those amendments, they need to fast-track their reviews of the decent homes standard and future homes standard and to put them in a coherent, positive and ambitious framework.

Finally, Lords amendment 45 requires the Secretary of State to have special regard to climate change mitigation and adaptation in preparing national policy, planning policy and advice relating to the development or use of land. As we have heard, the Government oppose the amendment on the basis that it could trigger a slew of litigation, which would hinder action needed to safeguard the environment, and that it repeats existing policy and statutory requirements. They also say that the importance of the environment is already restated in the Bill. I take that on board, although I would highlight three concerns.

First, to achieve our net zero obligations, there is a need for an enormous amount of private sector investment. As the UK Green Building Council points out, pension funds, corporate investors and construction companies require clarity, consistency and certainty in the policy framework. At present, that is missing and the business and investment community is confused.

Secondly, the existing system has created an inconsistency whereby local authorities must take net zero into account in developing their local plans, but the Planning Inspectorate and the Secretary of State, as we heard on a number of occasions, do not have to give net zero the same level of consideration. If this Lords amendment does not stand, at the very least the Government need to remove that ambiguity as quickly as possible.

Finally, I am mindful that in Waveney, my own backyard, in Suffolk and across East Anglia, we are at the forefront of the challenges and opportunities arising from climate change. We have an exposed and vulnerable coast, we are low lying and prone to flooding, and we are the driest region in the UK. That said, we have great economic opportunities arising from the low-carbon economy, in the form of offshore wind, nuclear and hydrogen.

Local authorities and local business in the eastern region have innovative plans to best address these threats and to maximise the benefits arising from these opportunities. However, as matters stand, they are constrained by the inconsistencies I have outlined. A greater emphasis on climate change mitigation would provide some certainty and would help to attract the private sector investment I mentioned that, as we are seeing, is globally footloose.

These are the concerns I have. I acknowledge that the Bill should not be seen as the panacea for all our ills and I have listened to the assurances that my hon. Friend the Minister has provided. I hope that she might be able to allay some of the concerns I have outlined in her summing up.

[Rachel Maclean]

It is a pleasure to be able to respond to the points made by colleagues across the House. This is a complex and important Bill, and it has been a thoughtful and well set out debate; everyone has contributed.

I thank colleagues across the House for their remarks. I can assure everyone that the Government have listened extremely carefully to those. Because I have limited time, I may not be able to give as full an exposition on every single point, but I hope colleagues will not be disappointed and my door is always open to colleagues —as are the doors of all my ministerial colleagues in the Department for Levelling Up, Housing and Communities—to listen to any specific problems that people will have. Therefore, I want to thank the Father of the House, my hon. Friend the Member for Worthing West (Sir Peter Bottomley) and my right hon. Friend the Member for North Somerset (Dr Fox) for their comments.

I thank the hon. Member for Somerton and Frome (Sarah Dyke) for her maiden speech and congratulate her on how she delivered it and its content. I listened to it with great interest and particularly noted her advocacy for and championing of the cider industry in her constituency, as well as her standing up for farmers. I am sure that is something that every single Member of the House can strongly agree with. I wish her all the best for her parliamentary career.

I thank my hon. Friend the Member for St Ives (Derek Thomas), my right hon. Friend the Member for Aldridge-Brownhills (Wendy Morton), the hon. Member for North Shropshire (Helen Morgan), my right hon. Friend the Member for Wokingham (John Redwood), my hon. Friend the Member for Buckingham (Greg Smith), my right hon. Friend the Member for New Forest East (Sir Julian Lewis) and my hon. Friends the Members for Mansfield (Ben Bradley) and for Waveney (Peter Aldous) for their comments. I also thank colleagues from the Opposition Front Benches for their constructive comments. We have definitely reached agreement on some points, although not all, which is not surprising given the range of issues we have been looking at.

I want to touch on a few themes that colleagues have raised. I hope that we can go some way to addressing the specific questions put to me by them. Colleagues have raised concerns about how national development management policies will operate in practice; people have said they are thinking ahead to how those could operate in practice. I want to be clear that, where a decision is made in accordance with the development plan, national development management policies and a specific local policy, and NDMPs are relevant considerations but not in conflict, as part of a planning judgment, it will still be for the decision maker to decide how much weight is afforded to those different policies based on their relevance to the proposed development. The precedence clause sets out only what should be done in the event of a conflict between policies and where they contradict one another. We do expect such conflicts to be limited in future because of the more distinct roles that national and local policy will have. In response to questions asked by many hon. and right hon. Members, I can assure the House that we will be consulting further on how that will operate. My right hon. Friend the Member for Aldridge-Brownhills asked: what does the provision mean when it says the Secretary of State can act urgently? I reassure her that that refers to very limited circumstances such as the unprecedented situations that we saw during the pandemic. It is envisaged that that provision would be used only in those sorts of urgent and emergency situations.

There has been much debate about the role of district councils in the future combined county authorities. I have definitely heard the points that colleagues have made. We do value the amazing work that is done by district councils. I wish to thank my own district council—Redditch Borough Council—for the incredible work that it does. I know that Members have thanked their own local authorities. I listened very carefully to the points made by my hon. Friend the Member for Mansfield. It is right that we want devolution to work and the voices of those district councils are really important. The Under-Secretary of State, my hon. Friend the Member for Redcar (Jacob Young), has been very clear in his discussions that we are encouraging potential areas to consider how best to involve district councils—they make a unique contribution—in recognition of the role that they play, without holding up those important devolution arrangements.

I have been struck by the number of colleagues who have talked about remote meetings and challenged the Government’s position on that. It is the Government’s view that face-to-face democracy should remain in place and that physical attendance at meetings is important, not just to build strong working relationships, but to deliver good governance and democratic accountability. It is clearly right that councillors are regularly and routinely meeting other councillors in person and that members of the public can ask questions in person. Some of these measures were brought in during the pandemic. Now that the pandemic has passed, it is right to consider reversing those and getting back to that face-to-face democracy. However, we are looking at a call for evidence on this matter and we will publish the results of that as soon as possible.

Oral Answers to Questions

Peter Aldous Excerpts

Monday 10th July 2023 Commons Chamber

[Kate Kniveton (Burton) (Con)]

16. What steps his Department is taking to support house building.

[Peter Aldous (Waveney) (Con)]

20. What steps his Department is taking to support house building.

[Paul Holmes (Eastleigh) (Con)]

24. What steps his Department is taking to support house building.

--- Later in debate ---

[Peter Aldous]

To address the housing crisis, we need to be building more homes for social rent, and planning departments must be properly resourced in personnel and funding. Will my hon. Friend set out the steps she is taking to address those two specific issues?

[Rachel Maclean]

My hon. Friend speaks with considerable expertise on these matters. We know that many local planning authorities are facing capacity and capability challenges, which is why we have developed a programme of support, working with partners across the planning sector, to put more skills and capacity into planning authorities. Our levelling up White Paper is committed to increasing the supply of social rented homes across the country.

New Housing Supply

Peter Aldous Excerpts

Monday 5th June 2023 Commons Chamber

[Vicky Ford (Chelmsford) (Con)]

Chelmsford, my constituency, has a vibrant community, excellent schools, low crime rates and a popular city centre, and is an easy commute to London. It is also the home of the legendary Essex Cricket, so it is no wonder that it is a very popular place to live. Since becoming a city in 2012, Chelmsford has grown considerably. In the past five years, about 1,000 new homes have been built every year, and in Chelmsford a new garden community is being built right now. Many right hon. and hon. Members have mentioned that they want to see more new garden cities and communities—if they pop on the train down to Chelmsford, I will take them to see what we are doing.

Many of the new homes that have been built meet the Government’s definition of affordable housing, because when a new development of over 11 homes is built in Chelmsford, the local authority applies an affordable housing obligation of 35%. Furthermore, over the past decade many Chelmsford people have used Government schemes to help them get a foot on the housing ladder. However, despite the many new homes, the fact that many of them meet the Government’s definition of being affordable and the many years of generous support to help people buy their homes, we still have a shortage of housing that people can afford either to buy or to rent.

The pressure on social housing is acute. About 360 families are currently housed in temporary accommodation, which is an all-time high. I spoke about that in this place when I presented my Bill on conversions of office blocks into homes. In Chelmsford, many office blocks are being converted into homes. In the past nine years that we have data for, approval was given for over 1,400 homes to be created by converting office blocks into flats, and we are expecting to see even more of that. Post pandemic, more people are of course working from home and there is less demand for office space, so we expect to see more conversions.

However, there is currently no ability for the local authority to apply an affordable housing obligation when a commercial property is converted into flats. Someone can take an entire office block and convert it entirely into luxury flats without causing one single extra affordable home to be created. My ten-minute rule Bill would enable local authorities to apply an affordable housing obligation to conversions of commercial property to residential use. If we had had that in the past decade in Chelmsford, it could have released 453 more affordable homes—that is more than the number of families who are currently in temporary accommodation because they cannot get social housing. I do hope that my wonderful hon. Friend the Housing Minister is listening this evening, and that she will continue to look favourably at my suggestion.

Another issue that is often raised by my constituents is infrastructure. Many people in Chelmsford tell me that they are not opposed to new homes being built—they know that people need somewhere to live—but that they are getting more and more frustrated at seeing new homes going up and the infrastructure not keeping pace. It has not kept pace with the massive growth in housing in Chelmsford. In Chelmsford, the city council uses the community infrastructure levy, which is much better than the old section 106 approach. It gives more flexibility to how developer contributions are used for infrastructure, which means that both existing residents and residents of a new development can benefit from the new infrastructure.

However, there are some problems with CIL funding. For example, there is no CIL contribution for new houses on previously developed land. As a lover of the green belt, of course I want to prioritise building on brownfield sites. I recognise that some brownfield sites are costly to develop due to previous contamination, and if a levy cost was put on top of the decontamination cost, that might make those sites unprofitable for developers and they would not get developed. However, not all previously developed land is contaminated and brings that cost, yet every single home that is built puts additional pressure on the infrastructure. Let me give an example. If someone builds on a field that used to be a farm, provided there are more than 11 homes, they pay a contribution towards infrastructure, but if they build on what used to be a riding school, they do not. I hope that the Minister, through the work in the Department, will look at closing that anomaly.

[Peter Aldous (Waveney) (Con)]

In many ways, what my right hon. Friend is saying cuts across what I am going to say, which I think is because property values in Chelmsford are much higher than they are in Lowestoft. We are therefore illustrating what my hon. Friend the Member for Carlisle (John Stevenson) said, which is that we actually have lots of different property markets throughout the country. Would she not agree with me that what is right for one place may not necessarily be right for another?

[Vicky Ford]

I absolutely agree that what is right for one place may not be right for another. I would just like to point out that the purpose of all my suggestions is to enable local authorities to make the right decisions for their area. These would not be top-down quotas set by Government; they would not set the proportion of affordable homes to be put on which office block development. That would be the decision of the local authority in line with the local plan. At the moment, however, the local authority does not have that power at all.

A second point about CIL funding is that at the moment it is not sufficient to cover all infrastructure needs, especially when we have larger infrastructure projects due to larger developments. I am extremely grateful to the Government for the quarter of a million pound housing infrastructure fund grant for Chelmsford. As a result of that grant, a new train station is being built. This is the first time a new train station has been built on the Great Eastern main line for over a century. It is the most amazing engineering project, and the grant will also help to deliver our north east bypass. Both of those are crucial to delivering the garden community. However, those two projects alone will not deal with other massive problems we have from traffic jams due to the increased number of people living locally. People from all over Essex are wasting valuable time stuck in Chelmsford’s traffic jams and that is hampering economic growth in large parts of Essex. So I ask DLUHC Ministers urgently to help me get support for the bid, currently with the Treasury team, for funding to upgrade the Army and Navy junction with a package of new sustainable traffic measures. Without that investment, Chelmsford will grind to a halt and will not be able to support the future housing growth.

Finally, there are real concerns about how CIL money is allocated locally. The process is not transparent and decisions about significant amounts of money are made without them coming back to full council members for approval. Cost overruns appear out of control, especially since the Lib Dems took control of the council. They spent £4 million on refurbishing a theatre, which was meant to cost £1 million, and redesigning Tindal Square with fancy pavements at the top of the high street has cost over £4 million, more than double the original budget.

Furthermore, CIL monies are not necessarily being spent by the Lib Dems on people’s priorities. My constituents often tell me about the pressure on NHS GP surgeries. Tens of millions of pounds have been spent in the past four years, but the two projects to help enlarge the capacity of GP surgeries have been massively delayed. We need better planning by local authorities in all the different areas that need infrastructure, including the NHS, to ensure that all sectors of critical infrastructure keep pace with housing growth. If we do not do that, we will lose public support for the new homes.

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[Peter Aldous (Waveney) (Con)]

I thank the Backbench Business Committee for granting this important debate, and I congratulate my right hon. Friend the Member for Haltemprice and Howden (Mr Davis) on securing and leading it.

Before I came to this place, I practised as a chartered surveyor for 27 years in Suffolk and Norfolk. Much of my work focused on the residential development sector, advising landowners, house builders and local authorities. Today, my involvement revolves around meeting the needs of often desperate constituents seeking a decent home, addressing concerns about the pressure on infrastructure that arises from developments and working with local authorities to regenerate town centres.

The extent of the national housing crisis has been graphically illustrated by what we have heard across the Chamber this evening, and by the briefings provided by Crisis, the National Housing Federation and Policy Exchange. They all illustrate the advantages of a vibrant and dynamic house building sector. In the time available, I shall briefly highlight how I believe we can meet this major challenge.

First, it is important to focus on all sectors of the housing market, including the elderly. We need to ensure that we have sufficient and properly laid out and designed homes for older people. I mention that as I co-chair the all-party parliamentary group on housing and care for older people, along with Lord Best, who does much vital work in this sector. We have an ageing population who need and deserve properly adapted and comfortable homes. The provision of more such accommodation will free up other homes for others to move into.

Secondly, we must also build more homes for social rent. Crisis and the National Housing Federation both calculate that we need to build 90,000 homes for social rent each year if we are to tackle the current homelessness crisis. Policy Exchange also highlights that if we invest in and expand social house building, we will also restart the stalled conveyor belt of home ownership.

Thirdly, there is a need to improve the planning system, to ensure that all local planning authorities are functioning properly, have up-to-date local plans, supplemented by local design codes, and that they all determine planning applications promptly. Planning departments must be properly resourced and adequately staffed in order to do that, which means they need funding from national Government.

Fourthly, one of the solutions to the housing supply crisis is already in place in the form of Homes England, which does good work in facilitating development on challenging sites in urban areas and provides development finance through the levelling-up home building fund. It would help if its role and resources could be increased, so that it can do more to facilitate urban regeneration.

My fifth point is that we should consider whether there is a need for investment zones to promote the redevelopment of derelict sites in urban areas. In Lowestoft, in my constituency, the enterprise zone, which is focused on commercial development, has been a great success, although to a degree it has run out of steam and is in need of re-energising. The proposed investment zones, announced last September, provided a vehicle for doing that. The proposals, worked up by Suffolk County Council and East Suffolk Council, included three large, primarily residential redevelopment sites—the Sanyo, the Jeld Wen and the Brookes sites. It is disappointing that the plans for investment zones announced in the March Budget were much more limited than those originally proposed.

Finally, I am mindful of another challenge that confronts us in towns and cities across the country: the decline of our high streets and town centres, which urgently need revitalising. In those locations there are millions of square feet of former office and shop space, often on upper floors, and we need to promote and encourage their residential reuse. If we do that, we can provide customers for the shops and leisure facilities that remain in those town centres. Invariably, such properties can be difficult to convert, so developers prefer greenfield sites, too readily at times. We need to work with those developers to remove the barriers to carrying out town centre projects. As a start, the Government could consider the zero-rating of VAT for conversion and refurbishment work, so as to put such projects on a level playing field with new build.

In conclusion, increasing the supply of new housing opportunities is a panacea for many of the challenges that we face: providing people with warm and decent homes, enabling them to get that first important step on the housing ladder, improving the nation’s health, regenerating urban areas and town centres, and delivering meaningful levelling up.

Non-Domestic Rating Bill

Peter Aldous Excerpts

Committee of the whole House
Monday 22nd May 2023 Commons Chamber

[The First Deputy Chairman of Ways and Means (Dame Rosie Winterton)]

Before I call the mover of amendment 4, I remind the Committee that, while I am in the Chair, I can be addressed as Madam Chair or Dame Rosie, but not as Madam Deputy Speaker. We always have to remind colleagues of this as we move into Committee.

[Peter Aldous (Waveney) (Con)]

I beg to move amendment 4, page 1, line 10, at end insert—

“(2A) In section 64 (Hereditaments) of the Act—

(a) omit subsection (2), and

(b) in subsection 4(3), after “subsection” omit “(2)”.

(2B) In section 65 (Owners and occupiers) of the Act—

(a) omit subsection (8), and

(b) omit subsection (8A).”

The intention of this amendment is to abolish liability to non-domestic rates of advertising when a right is granted permitting the use of land for advertising (section 64) or when land is used for advertising or the erection of an advertising structure (section 65).

[The First Deputy Chairman of Ways and Means]

With this it will be convenient to consider the following:

Amendment 5, page 3, line 3, leave out “one year” and insert “five years”.

The intention of this amendment is to extend the delay in uplifts to business rate bills.

Clauses 1 to 4 stand part.

Amendment 1, in clause 5, page 16, line 3, leave out from “(b),” to end of line 4 and insert “omit “fifth””.

This amendment would require local non-domestic rating lists to be compiled every year.

Amendment 6, in clause 5, page 16, leave out line 4 and insert “in every fifth” substitute

“no less frequently than in every third”.

The intention of this amendment is to move towards revaluations on local non-domestic rating lists at no more than three-yearly intervals.

Amendment 7, in clause 5, page 16, leave out line 4 and insert

“”on 1 April in every fifth year afterwards”

substitute

“on 1 April 2026 and on 1 April in every year afterwards””.

The intention of this amendment is to move towards annual revaluations on local non-domestic rating lists from April 2026 onwards.

Amendment 2, in clause 5, page 16, leave out line 6 and insert “omit “fifth””.

This amendment would require central non-domestic rating lists to be compiled every year.

Amendment 8, in clause 5, page 16, leave out line 6 and insert ““in every fifth” substitute

“no less frequently than in every third””.

The intention of this amendment is to move towards revaluations on central non-domestic rating lists at no more than three-yearly intervals.

Amendment 9, in clause 5, page 16, leave out line 6 and insert

““on 1 April in every fifth year afterwards”

substitute

“on 1 April 2026 and on 1 April in every year afterwards””.

The intention of this amendment is to move towards annual revaluations on central non-domestic rating lists from April 2026 onwards.

Amendment 3, in clause 5, page 16, leave out lines 12 and 13 and insert—

“(ii) the year beginning on 1 April 2023 and each year beginning 1 April after that date”.

This amendment would make every year from now on a relevant period for transitional provision under the 1988 Act.

Amendment 10, in clause 5, page 16, leave out lines 12 and 13 and insert—

“(ii) the period of three years beginning on 1 April 2023 and each year beginning on 1 April from 1 April 2026 onwards.”

The intention of this amendment is to move towards each single year being the relevant period for transitional provision under the 1988 Act.

Clause 5 stand part.

Amendment 11, in clause 6, page 16, line 15, at end insert—

“(za) in subsection (4), for “different from what it would be” substitute “less than it would be””.

The intention of this amendment is to effectively abolish downwards transition.

Amendment 12, in clause 6, page 16, line 17, at end insert—

“(c) in making these regulations the Secretary of State shall ensure that no ratepayer pays a higher amount in business rates than the amount derived from multiplying the uniform business rate by the property’s rateable value.”

The intention of this amendment is to remove downward transitional phasing.

Clauses 6 to 12 stand part.

Amendment 13, in clause 13, page 21, line 31, leave out “paragraph 4G” and insert “paragraphs 4FA and 4G”.

This is a paving amendment for Amendment 14.

Amendment 14, in clause 13, page 22, line 26, at end insert—

“4FA The definition of a person (“P”) for the purpose of paragraphs 4C to 4E does not include a person who is in receipt of relief of 100 per cent with a chargeable amount of nil.”

The intention of this amendment is exclude businesses who have nothing to pay from the duty to notify HMRC and the VOA.

Amendment 20, in clause 13, page 23, line 35, at end insert—

“4LA Paragraphs 4K and 4L do not apply if P is eligible for small business rate relief (for example, because the rateable value of the hereditament for which P is or would be a ratepayer is less than £15,000).”

This amendment would exempt businesses in receipt of Small Business Rate Relief Exemption from annual reporting if there is no change to report.

Amendment 15, in clause 13, page 27, line 44, at end insert—

“(5A) After paragraph 5ZF (inserted by subsection (5)) insert—

“Rebate in case of failure by valuation officer to provide confirmation

5ZG Where the valuation officer has not provided confirmation to P of a change following a notification by P that will affect the valuation of a hereditament within 60 days of the valuation officer receiving that notification, the total amount of non-domestic rates payable on that hereditament is reduced by—

(a) £100, and

(b) (b) a further £60 for each day until the confirmation is received by P, up to a maximum of £1,800.””

The intention of this amendment is to impose reciprocal penalties on the VOA for failure to notify ratepayers on changes in their rate assessments.

Clause 13 stand part.

Amendment 17, in clause 14, page 32, line 37, at end insert—

“(e) after paragraph 2C insert—

“2D(1) This paragraph applies where—

(a) a hereditament consists wholly or in part of land on which an advertising right is exercisable; and

(b) the right is not severed from the occupation of the land.

(2) For the purposes of determining the rateable values of the hereditament under paragraph 2 above, the rent at which the hereditament might reasonably be expected to be let shall be estimated as if the adverting right did not exist.

(3) In this paragraph “advertising right” means a right to use any land for the purpose of exhibiting advertisements.””

The intention of this amendment is to provide that the rateable value of hereditaments which consist wholly or in part of land on which an advertising right is exercisable to be calculated as though the advertising right does not exist.

Clauses 14 to 18 stand part.

Amendment 18, in clause 19, page 39, line 11, at beginning insert “Subject to subsection (4A)”.

This is a paving amendment for Amendment 19.

Amendment 19, in clause 19, page 39, line 17, at end insert—

“(4A) Section 13 may not be brought into force until at least 6 months after guidance has been published by the Valuation Office Agency on the requirement this Act will place on business ratepayers.”

This amendment is to ensure that guidance is made available to business ratepayers before the duty to notify comes into effect.

Clauses 19 and 20 stand part.

New clause 1—Valuation Office Agency performance targets—

“(1) The Secretary of State must within three months of the date on which this Act is passed prescribe by regulations performance targets for the Valuation Office Agency to respond to requests for updates to the central and local non-domestic rating lists and to challenges to the valuations on those lists.

(2) The Secretary of State may by regulations require the Valuation Office Agency to report at least annually on its performance in such detail as the Secretary of State may require in or by virtue of those regulations.

(3) The Secretary of State must lay before Parliament any reports made under subsection (2).

(4) Any regulations made under this section must be made by statutory instrument and are subject to negative procedure (annulment by either House of Parliament).

(5) Regulations under subsection (1) may not come into force until an impact assessment has been laid before Parliament.”

This new clause would require annual reports from the VOA on its performance against targets to be set by the Secretary of State.

New clause 2— Non-domestic rating: retail sector review—

“(1) The Secretary of State must conduct a review of the effect of non-domestic rateable values on the retail sector.

(2) The review must be commissioned no later than 6 weeks after the date on which this Act is passed.

(3) The review must assess the impact of non-domestic rateable values on competition between different parts of the retail sector, for example—

(a) stand-alone businesses operating from a single shop premises in a village, town or suburban high street setting,

(b) chain stores with multiple premises in city centres and out-of-centre shopping malls, or

(c) mainly online operations based on making deliveries from very large warehouses or fulfilment centres.

(4) The report of the review must be laid before Parliament no later than 1 May 2024.”

This new clause would require a review of the differential impact of business rates on different parts of the retail sector.

New clause 3—Non-domestic rating: hospitality sector review—

“(1) The Secretary of State must conduct a review of the effect of non-domestic rateable values on the hospitality sector.

(2) The review must be commissioned no later than 6 weeks after the date on which this Act is passed.

(3) The review must assess the consistency of approach to setting of non-domestic rateable values between hospitality businesses occupying premises of similar size and trading style, including—

(a) public houses,

(b) restaurants

(c) live performance theatres, and

(d) exhibition spaces.

(4) The report of the review must be laid before Parliament no later than 1 May 2024.”

This new clause would require a review of the differential impact of business rates on different parts of the hospitality sector.

Amendment 25, in schedule, page 47, line 2, at end, insert —

“18A In the Non-Domestic Rating (Alteration of List and Appeals) (England) Regulations 2009 (S.I. 2009/2268), omit regulation 15 (Advertising rights).

18B In the Non-Domestic Rating (Alteration of List and Appeals) (Wales) Regulations 2009 (S.I. 2005/758), omit regulation 15 (Advertising rights).

18C In the Non-Domestic Rating (Miscellaneous Provisions) (No. 2) Regulations 1989 (S.I. 1989/2303), omit regulation 4 (Advertising rights).”

These consequential amendments would be required to remove references to advertising rights following the abolition of liability to non-domestic rating in respect of advertising rights effected by Amendment 4 to Clause 1 of this Bill.

Government amendments 21 to 24.

That the schedule be the schedule to the Bill.

[Peter Aldous]

I shall start off where I left off in the Bill’s Second Reading debate. By way of background, the Bill is to be welcomed, although it is important that it is viewed as the start of the process of fundamentally reforming business rates and not the endgame. It probably would have been preferable to have heeded the advice of the Chartered Institute of Taxation and for the Government to have brought forward a new consolidated business rates Bill, rather than to amend the Local Government Finance Act 1988. That would have sent the message to businesses both large and small that real change was on the way. However, we are where we are and we must ensure that, ultimately, this Bill paves the way to reducing business rates to an affordable level, putting the business rates system on a long-term, more easily understood footing and removing those barriers to regional growth.

We must have in mind the ultimate end goal, which should be to get the uniform business rate multiplier back down from in excess of 50p in the pound to the more affordable 30p in the pound, which is where we started when the system came in in the early ’90s. To get to that, we need annual valuations, the abolition of the multitude of complicated reliefs and to digitalise the Valuation Office Agency. The Bill moves us in that direction—although perhaps a little too tentatively. Moreover, the duty to notify, which takes up much of the Bill, adds a bureaucratic burden on businesses and there are some unintended consequences that we should avoid. We must have in mind the need at all times for increased transparency. The amendments that I tabled have those considerations in mind.

Any adjustments to the business rates system should be guided by two principles: reducing the regulatory burden on businesses and, as I said, reducing the uniform business rate multiplier. We should look at the Bill with those considerations in mind and aim to move towards a sustainable system that provides a long-term revenue stream that businesses can find bearable, which has not been the case so often in recent years.

A properly functioning property tax system is critical to achieving a vibrant and sustainable economy. For most of this century, an outdated and unresponsive business rates system has placed enormous strain on many businesses, particularly those in the retail and hospitality sectors. Moreover, that strain has not been shared equally across the country. That illustrates how the current system is a hindrance—a logjam—to levelling up. We need non-domestic rates to be more responsive to changes in the economy so as to ensure that the system does not place an undue and unfair strain on businesses. If we can achieve that, we shall be more able to attract long-term investment into our towns and cities, and we shall be better placed to meet other vital policy objectives such as revitalising our high streets and achieving our net zero aims and goals.

Clause 5 relates to the frequency at which revaluations take place.

As I have mentioned, we need to move to the end goal of annual valuations, so that business rates are more in line with the economic outlook. I have tabled amendments 6, 7, 8, 9 and 10 with that objective in mind. To achieve a responsive business rates system, valuations should be carried out as regularly as possible. The Bill is a good first step, and increases valuations from every five to every three years, but it should provide the flexibility for a future Government to require more frequent valuations —ultimately, every year. Annual revaluation could bring bills more in line with commercial property values, rather than lagging many years behind. Even with a three-year list and a two-year antecedent valuation date, occupiers will be paying business rates bills in early 2026 that are based on valuations from nearly five years beforehand.

Annual revaluations are essential if the Government are serious about modernising the business rates system. They take place in countries as diverse as Hong Kong and the Netherlands, and thus there is no reason why they should not take place in England and Wales. To conclude on this issue, the enormous administrative burden placed on ratepayers by the new duty to notify would certainly not be worth the distress and inconvenience it will cause if it does not ultimately result in the introduction of annual revaluations. In that context, I urge the Government to give full consideration to these amendments.

Clause 13 sets out the requirement for ratepayers to provide information—this is the new duty to notify, which, as drafted, places an unnecessary burden on businesses. Amendments 13, 14 and 15 have the objective of reducing that burden and imposing penalties on the Valuation Office Agency.

Amendments 18 and 19 relate to clause 19, and would ensure that guidance is made available to business ratepayers before the duty to notify comes into effect. The new duty to notify will place an onus on all ratepayers to provide the Valuation Office Agency with any information that they reasonably believe could impact on the business rates valuation. This is an enormous additional ask, not least for the 700,000 businesses which, up to now, have not been subject to business rates and might be completely unaware of what is proposed. The duty requires ratepayers to notify the VOA of changes to their properties within a 60-day window, and carries the risk of financial sanctions and even imprisonment if they fail to comply.

As a former chartered surveyor, I cannot see how such a burdensome duty on all commercial property occupiers—including, as I have said, current non-ratepayers—can be justified as necessary to administer a move to three-yearly revaluations. This duty might be bearable for businesses if it assisted the VOA in administering the move to annual revaluations. For small businesses, it will cause more pain than the gain that will be derived from moving to three-yearly valuations.

The new duty will leave many ratepayers wondering what might qualify as a notifiable change. The VOA is yet to publish any guidance; thus many businesses will take no chances and will notify the VOA of any changes to their properties. The VOA will hence be hoist with its own petard, as it will be flooded with paperwork.

As I mentioned on Second Reading, many businesses, particularly small and medium-sized enterprises without any rating expertise, will turn to rogue rating advisers for help. Business rates advisers do not require a licence to practise, and many unscrupulous operators will see the new duty to notify as an opportunity to take advantage of small businesses.

While the ratepayer has a short period in which to notify the VOA of any changes to the property, as the Bill stands, the VOA has no such obligation. It can, in effect, respond to notifications at its leisure. I therefore propose a reciprocal provision that places on the VOA a 60-day timeframe in which to respond to notifications, with rebates to the ratepayer equivalent to the fines set out in clause 13 that accompany a failure to comply.

Clause 6 is a short and simple but nevertheless extremely important clause, which gives effect to the removal of downwards transitional phasing, as announced by my right hon. Friend the Chancellor on 17 November last year in his autumn statement. That was a positive step, but clause 6 as drafted does not permanently remove the threat of downwards phasing, which is a punitive tax that unfairly penalises occupiers whose rateable values have fallen. It is wrong to force those whose property values have fallen to subsidise those whose property values have risen.

The clause as it stands simply removes the requirement for transitional phasing mechanisms to be revenue-neutral. That means that the Government no longer need to fund any upwards transitional mechanism with a corresponding downwards transitional mechanism. However, that means that a downwards mechanism can be easily introduced by a future Government without any parliamentary scrutiny. Amendments 11 and 12 would plug that loophole and permanently abolish downwards transitional phasing. If any future Government want to reintroduce it, they should come to Parliament and make the case for it, rather than bringing it in through the back door.

Amendment 16 would delete clause 14, which, from my perspective, is inequitable and unfair to businesses. As it stands, clause 14 exempts Government legislation from qualifying for the pursuit of a material change of circumstances. That would remove a vital check on Government and would allow future Governments to legislate with impunity at the expense of businesses right across the country, leaving them no recourse to challenge legislation that interferes with their ability to do business.

A material change in circumstances gives ratepayers recourse to pursue relief on their business rates when circumstances outside their control hinder their ability to do business. Clause 14 exempts Government legislation from being a qualifying reason for a material change in circumstances. I anticipate that the Government have included this clause because they want business rates to be a predictable source of revenue, even if their own legislation or action undermines the very rateable value of the properties occupied by businesses.

During the covid lockdown, to prevent the spread of the virus, the Government forced a number of businesses to cease trading. However, instead of accepting that there had been a material change of circumstances for those occupiers and allowing appeals to be launched, the Government introduced a locally administered compensation scheme. With clause 14, the Government are seeking the freedom to introduce any legislation at any time that might alter the rateable value of a property. That is both unprecedented and wrong.

Clause 14 can be viewed as a power grab that sets a dangerous precedent and tells occupiers that they will have to accept the detrimental impact of legislation on their ability to do business, with no legal recourse. Amendment 16 would delete clause 14, restoring the ability of ratepayers to claim a material change of circumstances, regardless of how the change in circumstances arose.

Amendments 4, 5, 17 and 25 would amend and add to clauses 1 and 14 and part 1 of the schedule. They address a niche issue, albeit an extremely important one. The out-of-home advertising industry includes adverts on billboards, walls, digital posters, street furniture, bus shelters, buses and railway stations, which we see every day as we go about our lives and probably take for granted. The industry provides an important form of income for local authorities, and it is estimated that almost half the revenue generated goes back into local communities. These amendments would abolish the liability to non-domestic rating in respect of advertising rights.

The removal of business rates on advertising rights from the rating lists would have three advantages. First, it would increase the value and level of services provided by local authorities. Secondly, it would remove a competitive disadvantage to growth that impacts the out-of-home advertising industry, but that does not apply to its rivals—broadcast, print and online media. Thirdly, it would reduce the high level of inefficiencies relating to advertising rights applied through the Valuation Office Agency, local authorities and the out-of-home advertising industry.

As drafted, the Bill will directly and adversely impact the industry’s ability to invest in local communities. That runs contrary to the Bill’s objective of reducing barriers to business investment. In 2023, business rates charged on advertising rights are an antiquated, out-of-date and ineffective tax. Advertising rights are the only remaining right attracting liability for non-domestic rating. The liability to non-domestic rating in respect of sporting rights was abolished by the Local Government and Rating Act 1997. Amendments 4, 5, 17 and 25 would remove that anomaly.

In conclusion, I have enormous respect for the Minister and for his co-sponsor of the Bill, my hon. Friend the Financial Secretary to the Treasury. Although Treasury Ministers are not currently present on the Front Bench, I am mindful that the Bill has been drafted from a Treasury perspective, gathering in all that money. That is incredibly important—don’t get me wrong—but I suggest we also need to look at the issue through the prism of business.

Whether large, medium-sized or small, businesses need confidence, certainty and a fully reformed business rates system that takes on board some of the amendments I have put forward. A fully reformed system will mean that businesses will know where they stand, and business rates will not be the elephant in the room. People will be able to invest in, build on and expand their businesses with a degree of confidence, leading to increased profits. What that will do—joy to the Treasury—is increase taxation. The Bill makes a start and provides an opportunity for us to turn the vicious circle of business rates into a virtuous circle.

[The First Deputy Chairman of Ways and Means (Dame Rosie Winterton)]

I call the shadow Minister.

--- Later in debate ---

[Lee Rowley]

That tells us everything we need to know about the Liberal Democrats. They want to talk about only this Bill, ignoring every other policy. They look one way when talking to one part of the country, and the other way when talking to the other part of the country. That shows the Liberal Democrats’ lack of seriousness in understanding how taxation actually works, in understanding how to run a modern, dynamic market economy and in understanding how we need to pay our way to make sure our economy is successful in the long term. It is for those reasons that we oppose amendment 20.

[Peter Aldous]

The points I made were genuine. I think this Bill needs to be changed, and I hope the Government will have an open mind in considering whether to do so in the other place. We may well review this situation again.

I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 1 ordered to stand part of the Bill.

Clauses 2 to 12 ordered to stand part of the Bill.

Clause 13

Requirements for ratepayers etc to provide information

Amendment proposed: 20, on page 23, line 35, at end insert—

“4LA Paragraphs 4K and 4L do not apply if P is eligible for small business rate relief (for example, because the rateable value of the hereditament for which P is or would be a ratepayer is less than £15,000).”—(Helen Morgan.)

This amendment would exempt businesses in receipt of Small Business Rate Relief Exemption from annual reporting if there is no change to report.

Question put, That the amendment be made.

Oral Answers to Questions

Peter Aldous Excerpts

Monday 20th February 2023 Commons Chamber

[Alison Thewliss (Glasgow Central) (SNP)]

9. What assessment he has made of the adequacy of the levelling-up funding allocated in the second round.

[Peter Aldous (Waveney) (Con)]

19. What assessment he has made of the adequacy of the geographical spread of the funding awarded in the second round of the levelling-up fund.

[The Parliamentary Under-Secretary of State for Levelling Up, Housing and Communities (Dehenna Davison)]

The second round of the levelling-up fund will invest up to £2.1 billion in 111 vital local infrastructure projects. We prioritised investment in high-quality bids in places that have not previously received levelling-up fund money in order to maximise the spread of overall funding from rounds 1 and 2. In this round of the fund, two thirds of the funding went to those places in the greatest need, which we designated as category 1. In Scotland, across both rounds, the amount of money awarded exceeded our public funding commitments.

[Dehenna Davison]

I ask the hon. Lady to retract that statement, because in no way have I said that the process was rigged. It absolutely was not. The decision-making framework that we use was outlined in full, in writing, in the technical note that we published, and I would be happy to send her a link to it on gov.uk. She has raised the question of the People’s Palace, and I would be happy to sit down with her to talk about the bid once she has received the written feedback, to see if we can strengthen it for any future funding rounds, potentially including round 3 of the levelling-up fund, which will be announced in due course.

[Peter Aldous]

Projects to protect coastal communities against erosion and flooding bring significant economic and social benefits on their own. Can my hon. Friend therefore review the investment criteria for round 3 of the levelling-up fund to include stand-alone coastal defence schemes that are not part of a wider transport regeneration or cultural bid?

[Dehenna Davison]

My hon. Friend is a fantastic champion not only for the east of England but, in particular, for coastal communities. We know that coastal communities add unique value to our country and offer significant growth potential, which is why 22 coastal areas are benefiting from more than £673 million of investment via the towns fund, why eight English freeports are in coastal areas and why coastal areas such as Ramsgate continue to benefit from the levelling-up fund, but of course I will be happy to meet him to discuss this further.

Levelling-up Missions: East of England

Peter Aldous Excerpts

Tuesday 31st January 2023 Westminster Hall

[Peter Aldous (Waveney) (Con)]

I beg to move,

That this House has considered progress on the Government’s levelling up missions in the East of England.

It is a pleasure to serve with you in the Chair, Mr Davies. I thank the Backbench Business Committee for granting this debate, which comes a year after a similar debate, when the opportunities and challenges facing the east of England were also considered through the prism of levelling up.

Last February the Government published their White Paper, “Levelling Up the United Kingdom”, in which they set out 12 levelling-up missions, with targets to be achieved by 2030. Last month, in December, the all-party parliamentary group for the east of England, which I co-chair with the hon. Member for Cambridge (Daniel Zeichner), published a report in conjunction with the East of England Local Government Association and various private sector partners that analysed confidence in the region in achieving those targets.

In summary, the report found that there was high confidence in achieving three of the levelling-up missions: employment and pay, research and development, and wellbeing. There was medium confidence in achieving four of the missions: improving digital connectivity, delivering pride in place, reducing crime and widening devolution. However, there is low confidence in five policy areas, many of which are the most important to the people of, and the prospects for, the east of England: improved educational attainment, more skills, better transport, longer, healthier living, and more affordable housing to buy and rent.

[Daniel Zeichner (Cambridge) (Lab)]

The hon. Member is doing an excellent job of making the case for the east of England. One of the five areas of concern he referenced was transport. Does he agree that it is essential to keep up the pressure for important rail improvements at Ely and Haughley junctions, to restore four trains per hour to London Stansted, to secure East West Rail and to ensure that affordable, reliable bus services become the norm rather than the exception across the region?

[Peter Aldous]

I thank the hon. Member for that intervention, and I greatly enjoy working with him on the APPG. He is correct to raise those issues. I will comment on the rail issues in passing a little later, but they are vital to the east of England and to the whole UK.

I will comment in a little more detail on the five issues where there is low confidence and on what needs to be done so that we can get on course to deliver the 2030 targets. I anticipate that colleagues will home in on areas and issues that are important to them and their constituents. I should add that each of the issues warrants a debate of its own, and I am conscious that I will only scratch the surface of each mission.

Earlier this month the Government published the results of round 2 of the levelling-up fund. In the two rounds that have taken place so far, there have been 12 awards in the east of England, with a total value of £252.5 million. In both rounds we secured the fourth lowest amount of funding in the UK. Although, on an allocation per head basis, the situation has improved significantly, from £14 per head in the first round to £26 per head in the second, the east of England remains the region with the third lowest funding over both rounds.

It would be wrong to judge levelling up solely on the basis of those grants, but there is a worry that there is a lack of understanding in Whitehall of the challenges faced by many people in the east of England and of the exciting opportunities available in the region. With the right policies and support, the Government can help unlock these opportunities, which will benefit not just our region but the whole United Kingdom.

Down here in London, there may be a view that East Anglia is a comfortably-off region where levelling up does not apply. That is wrong, as we have relatively low levels of pay and there are deep pockets of deprivation in coastal communities such as Lowestoft, which I represent, in rural areas and in our larger cities and towns, such as Norwich and Ipswich.

[Giles Watling (Clacton) (Con)]

Does my hon. Friend agree that some coastal regions around the country suffer from pockets of deprivation that are unrecognised because the central hinterland looks wealthy?

[Peter Aldous]

My hon. Friend raises a good point. I am mindful of the fact that Jaywick, which is in his constituency, is statistically the most deprived area in the east of England. As he rightly says, pockets of deprivation can be hidden, because there are often areas of wealth within a few miles of them that camouflage that deprivation.

The east of England is an economic success story, and it is one of only three regions that are net contributors to the Exchequer. With the right policies and the necessary initiatives, we can significantly reduce poverty and create what, in effect, would be a global powerhouse, with specialist skills and expertise in such sectors as low-carbon energy, agritech, life sciences and sustainable fishing. Despite the drawbacks, a good start has been made locally in Waveney, and much of Lowestoft resembles a building site at present, with work well under way on the Gull Wing bridge—the long-awaited and much-needed third crossing of the port, which divides the town—as well as on the construction of permanent flood defences.

At this stage it is appropriate to pause and to recall that this evening is the 70th anniversary of the 1953 storm surge that hit our coast so cruelly, causing death, destruction and, ultimately, the demise of the beach village in Lowestoft. Today the region remains extremely vulnerable to rising sea levels and the threat of climate change, but the drive towards net zero presents our economy with significant opportunities, which we must grasp. In Lowestoft, work is also getting under way on the various towns fund projects designed to regenerate the town centre and the surrounds. These projects, together with the flood defence scheme and the new bridge, currently represent a public investment in the town of in excess of £220 million.

Due to inflation, the shortage of raw materials and supply chain challenges, delivering such construction projects is not easy at present, and I commend the project managers at Suffolk County Council, Coastal Partnership East and East Suffolk Council for their hard work. Our task locally is to ensure that the developments act as a catalyst for private sector investment and that they fit in with and complement the overall economic strategy for the region.

I will now briefly touch on the five missions where there is low confidence of meeting the 2030 targets.

[Jim Shannon (Strangford) (DUP)]

The hon. Gentleman’s constituency and mine are very alike from a fishing point of view. He mentioned 1953, which is also an anniversary for us back home: the MV Princess Victoria went down that year, and I was at the service on Sunday, so 1953 also resonates with us.

Does the hon. Gentleman agree that it sometimes appears that the regions that shout the loudest get the lion’s share of the funding? Does he agree that the Government should consider introducing a scoring matrix, which would ensure that each constituency sees projects delivered? That would mean that my constituency could level up with the rest of the United Kingdom.

[Peter Aldous]

The hon. Gentleman is quite right that there are significant similarities between the east of England—East Anglia—and Northern Ireland. As far as a matrix is concerned, I am not 100% sure about that, but there needs to be much better feedback from Government on why particular bids are not successful. We probably need to look at the criteria that bids must satisfy before we come on to the next round.

I will comment on the five missions where there is low confidence in achieving the 2030 targets, and I will start with transport. It should be highlighted at the outset that the east of England, with 17 ports and airports—including two freeports and Stansted—is very much a strategic gateway to the whole UK. If the east of England has a fit-for-purpose, 21st-century transport system, the whole UK benefits; unfortunately, we are some way from achieving that. There is concern that the transport needs of the region are being overlooked in Whitehall, notwithstanding the good, co-ordinated work of our two strategic transport bodies, Transport East and England’s Economic Heartland.

On the railways, it is vital that funding is provided for the upgrading of the Ely and Haughley junctions. That will improve connectivity from the Felixstowe-Harwich freeport to the midlands and the north, thereby facilitating levelling up in those regions. It will get freight off the busy A14 and help to provide additional capacity for passenger services into London Liverpool Street. Reinstating the four trains per hour from Liverpool Street to Stansted would help to attract investment from airlines and to secure new routes to destinations such as San Francisco and Boston—that is the one in Massachusetts, not our near neighbour in Lincolnshire, although that road also needs improvement.

It is estimated that, if such routes are opened up, they will deliver £95 million in new investment to the east of England. However, if we are to deliver such investment, there is a need for good transport links to and from the airport. Locally, the Waveney constituency is served by two railway lines—the East Suffolk and the Wherry—which must be upgraded to improve accessibility and connectivity. That is vital to deliver meaningful levelling up to coastal communities such as Lowestoft and Yarmouth.

I will turn now to education. Achieving good grades not only benefits the individuals themselves, improving their life chances and sense of wellbeing, but enhances the prospects of economic growth. Unfortunately, the overall level of attainment across the region is behind that in England as a whole. That is predominantly because the funding for east of England schools is way below the national average. The f40 is a group of the lowest-funded education authorities in England; it is a club to which one does not aspire to belong but, unfortunately, Suffolk, Cambridgeshire and Central Bedfordshire are all members. To ensure that young people in the east of England have a fair opportunity to realise their full potential, attention should be given to revising the funding formula that applies to rural schools, and a significant part of the increased funding of £4.6 billion over the next few years should be allocated to councils to support children and young people with educational needs and disabilities.

On skills, exciting opportunities are emerging in the east of England, such as in the energy sector and in further education colleges such as East Coast College, with its campuses in Lowestoft and Great Yarmouth. Such colleges are doing great work, but they are hamstrung by a lack of revenue funding and a shortage of teachers and trainers. The key recommendations in the APPG’s report when it comes to meeting the region’s future needs are that there should be much greater in-work education provision and participation in further education and skills training for adults; improvements in the overall quality of training; better access to training, taking into account rurality and transport challenges; and better alignment with employers’ needs.

Local skills improvement plans, which are being worked up by chambers of commerce, councils and local enterprise partnerships, are the vehicle for bringing about that sea change. However, when we look at energy—with the construction of Sizewell C, with 50% of the UK’s offshore wind fleet anchored off our coast and with the potential for hydrogen production distribution starting from the gas terminal at Bacton—there is concern that the scale of the opportunity has not been fully recognised and acknowledged. The fact that we do not have a bespoke institute of technology is a disappointment.

With regard to the health mission, insufficient regard is had to the fact that population of the east of England is increasing and that a higher percentage of elderly people are resident in the area than in other areas. Those factors apply added pressure to our health and care sector, which is grappling with unprecedented demand and a workforce crisis. There are also significant health inequalities, including an increasing number of children living in poverty and an alarming gap in healthy life expectancy between areas that are often only a few miles apart. To meet those challenges, Government policy should recognise the significant population growth and pressures in the east of England to ensure that the region gets a fair share of funding overall for its demography and that the most deprived areas are recognised within that.

While home ownership in the east of England is the highest of any English region, at 67.4% in 2021, those homes are less affordable than in the rest of the UK. In 42 out of 48 areas in the region, average house prices are more than eight times the median wage. The bottom rungs of the housing ladder have, in effect, been sawn off. In my own constituency casework, the No. 1 issue is the challenges faced by many people seeking a comfortable, warm and dry place to live that they can truly call home. To meet that challenge, we need to build more houses, with the necessary supporting infrastructure, across all tenures, including social housing. We need to meet the needs of all people, whether those setting up home for the first time, those starting families or those looking to downsize or rightsize as their children leave home.

Moreover, the Government need to follow up on their recently announced and welcome ambition to reduce energy demand by driving forward a national retrofit programme. We have successful individual schemes, such as the energy company obligation, but we are yet to embark on the journey to upgrade the bulk of the UK’s existing building stock. Policies should be set in Whitehall—hopefully, the Chancellor will have more to say on that next month—and then delivered locally, carried out by local craftsmen who are trained in local colleges and overseen by local councils.

In conclusion, I will make three observations about levelling up in the east of England. First, those living in the east of England will clearly benefit if we achieve the 2030 targets for the 12 missions, but so will the rest of the UK. For example, as I mentioned, improved connectivity and transport links across the region will lead to benefits flowing to all corners of Great Britain.

Secondly, there is the opportunity not just to level up but to create global exemplars in sectors such as low-carbon energy, life sciences and agritech. Low-carbon energy is particularly important in my constituency on the East Anglian coast—the all-energy coast. Nowhere else in the UK, quite likely nowhere else in Europe and possibly nowhere else in the world, do we find offshore wind, nuclear, carbon capture and hydrogen clustered so closely together. We must realise the full potential of this once-in-a-lifetime opportunity. It is an open goal staring us in the face, and it is vital that we do not kick the ball over the bar.

Thirdly, in these uncertain times, we need to have in mind our national security, which the east of England played a crucial role in providing during world war two, when the RAF and the US air force flew from our network of airfields across the region. I hope that security in that form will not be necessary again, but in a geopolitical context, we are in worrying and uncertain times. As the breadbasket of Britain, and as the aforementioned all-energy coast, we have a vital role to play in providing food and energy security.

Delivering on the levelling-up missions, not just in the east of England but across the country, requires collaboration. There is a need for Departments to be properly co-ordinated—I am conscious that I have commented on many issues that do not fall within the Minister’s remit, and I apologise for that. There is also a need for collaboration between national Government and local government, and with the region’s businesses. We need a delivery vehicle to achieve that. I look forward to the Minister’s summing up, and I hope she can pledge that the Government will commit to this important partnership approach.

--- Later in debate ---

[Peter Aldous]

We have had a very full debate. I will go through the contributions made by hon. Members and hon. Friends, and I will try to pull one or two things together out of those.

The hon. Member for Bedford (Mohammad Yasin) highlighted the importance of investment in health infrastructure and services. He is right to do so, because it is something that particularly concerns a great many of our constituents, and we must get that right. We have had a lot of discussion about the importance of rail, which I will come to in a minute. Being at the west of the region, he has highlighted the importance of East West Rail and, generally, in the east of England that can be a challenge.

We look so much north-south and at the roads to London; in fact, very often our road network is focused on the roads down to London. The A12 used to be a toll road from Yarmouth, and it was the main road serving that part of the area, and there was also the A10. Actually, those cross-country routes—whether they are the railways or the roads—are so important. In Suffolk or Norfolk, there is the A143, which links to Lowestoft but actually runs from Yarmouth right down on the county border through to Bury St Edmunds and down to Haverhill. That is a tortuous way to go down, so those cross-country routes are absolutely vital.

My hon. Friend the Member for Clacton (Giles Watling) emphasised the challenges faced by Jaywick and also highlighted the railways. Like me, his constituency is served by two railway lines, and he highlighted the slow, tortuous journey to Liverpool Street. From my perspective, on the East Suffolk line from Lowestoft to Ipswich the journey time has not improved since 1859. That is another particular challenge that we need to address.

A lot of our strategic investment in the coming years will be in the railways, but the road network is there and we must not forget it. There are pinch points and particular challenges. The A12 through Essex is heavily overused. Quite frankly, its activity justifies M status, but I do not think that will ever come, and we have to address that. Because of a lack of maintenance, a lot of our main roads are turning into little more than country tracks in some respects, which reminds me that there were most regrettable accidents on the B1062, which links Beccles to Bungay, over the new year period. I talked that through with the local community and the county council. The county council engineer is doing great work. He said, “We have analysed what happened and think there is a need for improvement, and you are now in the top 20% of our priority schemes.” I thought, “Great.” I said to him, “How many priority schemes do you have?” And he said, “Oh, 10,000”. That illustrates that investment in the existing network—

[Geraint Davies (in the Chair)]

I remind the hon. Gentleman that this should be a short winding-up rather than a full second speech.

[Peter Aldous]

I take that on board, Mr Davies. I thought I had a bit more time.

[Geraint Davies (in the Chair)]

Just a few minutes.

--- Later in debate ---

[Peter Aldous]

That is fine. My right hon. Friend the Member for Witham (Priti Patel) gave an impassioned speech, which emphasised the railways. She raised reform of the apprenticeship levy, which is vital, and investment in skills.

My hon. Friend the Member for North West Norfolk (James Wild) raised digital connectivity, which, although a medium risk in the report, is a challenge in the east of England because of our dispersed population, which covers a relatively large geographical area. I also have an interest in the A47, which runs from the A1 and, one might say, begins or finishes in my constituency—in Lowestoft. It is good that work has been done on that. He is an impassioned campaigner for the Queen Elizabeth Hospital. The James Paget University Hospital, which serves my constituency, is going to be rebuilt. Investment in NHS buildings is important, as is addressing demand and the workforce.

The hon. Member for Nottingham North (Alex Norris), speaking for the Opposition, raised some interesting points, including the common challenges across the country and how the approach that we have adopted might be an exemplar elsewhere. He also highlighted the particular challenges of coastal communities.

I thought the Minister gave a tremendous speech. It is unfortunate that, as I understand it, we will be losing her. She gets it; there was no camouflaging, and she came straight to the point, for which I thank her.

To sum up—my right hon. Friend the Member for Witham got this right—we have to break out of departmental silos. Levelling up is not just for my hon. Friend the Minister’s Department but for all Departments. There were so many issues that were not necessarily for her to address in her remit; they cover the whole of Government. It is about thinking in a joined-up way down here in Whitehall and Westminster, and devolution to local authorities, which will be very important. My right hon. Friend also raised the fact that we have to bring business with us. I think the LEPs have been a success, because they have put business at the forefront. I am not sure about the future of LEPs, but whatever happens, business has to be there, working in partnership and in collaboration with local and national Government. [Interruption.] I see that you are getting impatient, Mr Davies, so on that point I will sum up. I thank all colleagues for their contributions to the debate and thank you for chairing it.

[Geraint Davies (in the Chair)]

Thank you so much. We have certainly been levelling up the wind-ups.

Question put and agreed to.

Resolved,

That this House has considered progress on the Government’s levelling up missions in the East of England.