It is the normal practice when a Government Department proposes to make a gift of a value exceeding £250,000, for the Department concerned to present to the House of Commons a Minute giving particulars of the gift and explaining the circumstances; and to refrain from making the gift until 14 parliamentary sitting days after the issue of the Minute, except in cases of special urgency.

Watling House opened in early 1999 and was a fully operational secure children’s home until it closed in June 2007. Capital grants totalling £3.6 million were paid by the Department of Health to Staffordshire county council for the building and development of the home. In 2003, as part of a machinery of Government change, the policy responsibility for children’s homes (secure and non-secure) transferred to the present Department for Children Schools and Families. The Exchequer interest in Watling House is estimated to be £1.224 million.

Section 82(3) of the Children Act 1989 gives the Secretary of State for Children, Schools and Families (with the consent of HM Treasury) the power to recover, in whole or in part, any capital grant (made under section 82(2)) with respect to secure accommodation, where the grant is not used for the purpose for which it was made or the accommodation is not used as, or ceases to be used as, secure accommodation. Government accounting rules require that the sum to be recovered is based on the exchequer interest in the grant(s) awarded.

Staffordshire county council, which owns the home, are proposing to transfer the home to Staffordshire police authority. The home will then be converted into custody provision. The Secretary of State is content to agree the request from Staffordshire county council to waive the exchequer interest in Watling House as the change of use proposed for the site would mean that it would continue to be used for the benefit of the wider national interest.

Treasury consent has been given, in principle, on the conditions that: the site is retained and used for custody provision for a minimum of nine years; and, should the site cease to be used for these purposes the Department retains the right to cancel the waiver and reclaim the remaining Exchequer interest adjusted for elapsed time.

The Treasury has approved the proposal in principle. If, during the period of fourteen parliamentary sitting days beginning on the date on which this Minute was laid before the House of Commons, a Member signifies an objection by giving notice of a parliamentary question or of a motion relating to the Minute, or by otherwise raising the matter in the House, final approval of the gift will be withheld pending an examination of the objection.