Business Rate Supplements Bill

My Lords, in moving Motion A1, I thank the Minister for his full and careful explanation, to which we all listened very carefully. I again declare my personal interest; I am still a serving councillor in the London borough of Sutton, as I have been for the past 35 years, and a member of the executive on that council. I declare that interest not just because I need to be open and transparent and declare my interests but because I am not only a friend but very much an active part of local government. It is from that standpoint that I come to move this Motion. Secondly, once again I place on record that I and my noble friends have, with qualifications, been supporters of this Bill throughout, and certainly support its application throughout the whole of the country and not simply to London and Crossrail. I say that on record to make it clear that this is not in any way intended to inhibit let alone to wreck the Bill. We think that it is a very important principle and a very important and necessary part of the process for approaching this. We have debated these issues in this House and in the other place a great deal, and there has been very welcome progress during the course of the debate. I recall commenting at Second Reading that I regretted how polarised the two positions seemed to be. On the one hand, we had the business interest appearing to take the view that arrogant, out-of-touch local authorities would impose unwelcome and unneeded taxes on helpless businesses. On the other hand, we seemed to have the local authorities and the LGA equating a business vote to a business veto and saying that under almost no circumstances should there be a business vote. I think that we have moved a long way since that time and all of us recognise that, for any project to which a BRS may apply, whether or not there is a vote, it has to be developed in partnership with the local businesses. They will work together on the concept of the project, on developing a prospectus for the project and developing the budget—and, by the time it comes to a vote, one would hope that the leaders of the business community would be campaigning for a yes vote, such was the support. That may be an idealistic position but, if the partnership is working as good partnerships should, that is what should be the case. So why do we need a vote? We need a vote, first, to give reassurance to the business community. Whether we like it or not—and personally I do not like it at all—consultation these days tends to have a rather unhappy reputation. There is too much an attitude that consultation means that you tell people what is going to happen and, regardless of what they say, it still happens. That may not be fair—in many cases it is not fair—but it is a very real perception at all levels, local, regional and national. The knowledge that there is reassurance there and that a ballot will come and businesses will have their say is important. Secondly, it is important for the process as well. To know that there is going to be a vote and that you will have to win it and persuade people to vote as you would wish them to is a very important part of engagement. There is nothing that concentrates minds better than to know that at the end of the process you are going to win or lose and that you have a vote to win. Therefore, the engagement is bound to be more meaningful if there is knowledge on the one hand that they have to persuade, not just to consult and, on the other hand, that if they really do not like it, they can stop it. We need to remember that a vote does not have to be unanimous. There seems to have been some suggestion, particularly in the other place, that a vote is won or lost depending on what 100 per cent do one way or the other. Some of us in politics might wish that was the case, but it is not. It is a majority vote. We are not talking about necessarily having to win over every single business voter—much though one might aim to do that. I understand very well why the Government have set the limit at one-third of the total cost of the proposed project. Inevitably, that, as any limit would be, is an arbitrary limit. One-third is quite a high threshold. Most likely to be of greater importance to the business, if not to the envisaged project, will be the amount of extra tax that business has to pay, rather than the proportion to which that tax contributes. I suggest that if there is to be a threshold then maybe one-third is too high. Those businesses will be paying an extra tax regardless of what proportion it contributes to the actual project and it may very well be a significantly higher extra tax. If it is, as is likely, to be a significant and substantial project—that is what we are primarily talking about with the Bill—they are likely to be paying it for many years ahead. For those reasons, it is right and proper that they should have an effective say in the decision on whether to levy the rate. I understand why the Government would not want to see—neither would local authorities want to see—disproportionate cost for a relatively small contribution to a project. It may be that we need to look again at the threshold, but I do think that one-third is too high. The Commons amendment is a helpful move in the right direction. In as far as it goes I am prepared to welcome that, although, for the reasons I have stated, it does not yet go far enough. However, it recognises that there is an issue of quite proper concern to the business community. I believe that, working together in partnership with local government, which is why I stressed at the beginning where I personally come from, we can still find a better solution and a better compromise that will meet the quite proper and understandable concerns of local business and the equally proper concerns of local government that they should not have imposed on them disproportionate cost and effort for relatively minor benefit. We are on the way with the Commons amendment. I do not think that we are there yet. I have brought this Motion to your Lordships today in the hope that we will give the Commons an opportunity to continue with their thinking and perhaps to make still further progress. I beg to move.