Written Ministerial Statements
Tuesday 10 February 2009
The Economic and Financial Affairs Council will be held in Brussels on 10 February 2009. The following items are on the agenda:
Preparation of the meeting of the European Council
(a) European economic recovery plan
Ministers will hold a debate on the current state of implementation of the European economic recovery plan (EERP), including a first horizontal evaluation report from the European Commission. The Government are a firm supporter of the timely, targeted and temporary measures taken at national level under the framework of the EERP to stimulate growth in the EU.
ECOFIN will also exchange views on the financial aspects of the Commission’s proposals for energy and broadband projects to be funded through the EU budget. The Government will continue to scrutinise the Commission’s proposals in detail.
(b) Key Issues Paper
ECOFIN will have an orientation debate on its main contribution to the spring 2009 European Council—the key issues paper on economic and financial issues. The paper itself will be agreed in March before the European Council, and the presidency has provided a proposed outline. The Government support the outline, which emphasises the challenges in 2009, and the remaining need for action to stabilise financial markets and facilitate a speedy economic recovery.
(c) Reduced rates of VAT
Following discussions in January, the presidency will seek political views from member states on the way forwards to a possible compromise on reduced rates of VAT by the spring. The Government believe that member states should be allowed the flexibility to apply reduced rates of VAT where they do not materially affect the functioning of the single market.
General budget of the EU: Discharge procedure in respect of the implementation of the budget for 2007
ECOFIN is expected to approve the recommendation to the European Parliament on the discharge to be given to the Commission for the implementation of the 2007 general budget. The UK welcomes the references within the recommendation relating to the key role of member states in improving financial management and accountability of EU funds under shared management.
Communities and Local Government
Today I am confirming the legislative steps we are taking to implement the Chancellor’s announcement in the pre-Budget report (PBR) that we would enable port occupiers, and any other businesses similarly affected by significant and unexpected backdated liability for business rates, to pay their backdated liability through staged payments over eight years and to relieve billing authorities of the duty to collect those liabilities in full in the current financial year. In addition to the PBR undertaking to allow the extended time to pay for previous years’ costs, we are enabling any backdated liability arising in the current year’s costs to be included in the scheduled payments.
To implement the schedule of payments policy in England, I am laying regulations before the House today, which are set to come into force on 9 March. The Welsh Assembly will be responsible for similar arrangements it intends in Wales.
The recent Valuation Office Agency’s (VOA) review of the rating of ports and the subsequent separate entry for the first time of 569 properties within ports on the ratings list has highlighted the impact of such backdated liabilities that can arise as a consequence of rating properties that are newly identified by the Valuation Office Agency.
This is an established feature of the way the business rating system operates in order to ensure that all rateable property pays its fair amount of rates, with all business properties being treated equally. In the year 2007-08, some 777 new assessments, caused by some “splitting” of existing properties, were added to the list. This resulted in a potential 33 months or more backdated liability. Some 1,666 such new assessments, including many of the ports occupiers following the VOA ports review, were added to the list up to 31 October 2008. However, in the current economic conditions the Government are concerned about the impact of a significant backdated rates liability on the trading prospects of businesses. The new schedule of payments will therefore apply to all ratepayers occupying properties that meet the criteria in the regulations. Based on historical trends the Government estimate that up to 1,500 properties could benefit from a schedule of payments in the coming financial year.
The VOA has also put in place fast track arrangements to deal with any port-based firms who want to question or challenge their assessment following the ports review. Although there have been some problems with businesses not providing the full information required in their appeal request, valuation officers are talking to the businesses concerned to ensure these issues can be resolved as rapidly as possible. To date, the VOA reports that 78 formal appeals had been received under the fast-track procedure and five are fully resolved. In the remaining cases the VOA has made initial responses and in most instances is in further discussion with the ratepayers. As part of the commitment to bring cases to an early conclusion, all ratepayers who made a proposal before the end of November 2008, including those who did so before the fast-track procedure was introduced, have been contacted to establish whether they require early reference of their appeal to the independent valuation tribunal.
Finally, while any payments between port occupiers and operators are contractual matters between the parties, I—along with the Under-Secretary of State for Transport, my hon. Friend the Member for Poplar and Canning Town (Jim Fitzpatrick), the Minister responsible for ports—will be meeting this month with the port operators to encourage further discussion between the two parties, as it must be in the interests of port operators to ensure their facilities are put to economic use and to work together with their tenants. Otherwise they may be faced with the prospect of empty premises, no fee income from tenants and an eventual liability for empty rates on that property.
To conclude, the Government understand that in the current economic climate, it could be harder for businesses that are faced with significant unexpected backdated rates bills to discharge their liabilities. Therefore to reduce the cash flow impact on businesses given the current economic difficulties, the Government will allow businesses faced with certain unexpected backdated rates bills up to eight years to pay the amounts due.
The Financial Secretary to the Treasury and I have today written to the Treasury Select Committee and Communities and Local Government Select Committee to update them with fuller details of the steps we are taking, and I am placing a copy of this letter in the Library of the House. I am today writing to the leaders of all billing authorities with ports in England confirming the legislation and the arrangements they should now offer to eligible firms in their area. Chief finance officers will receive a detailed business rates information letter with details of the changes. Departmental officials are also writing today directly to the occupiers of the properties affected by the ratings review of ports, to ensure they are aware of the availability of the schedule of payments.
Environment, Food and Rural Affairs
Marine Management Organisation
The Marine Management Organisation (MMO) will become the UK Government’s marine delivery body, subject to the passage of the Marine and Coastal Access Bill
In line with the Marine and Coastal Access Bill, it is proposed the MMO will set the standard in the UK and internationally for strategy and planning in the marine and coastal environment, so delivering the Government’s commitment to introduce a new framework for the sea that meets conservation, energy and resource needs.
I will make an announcement regarding the location of the Marine Management Organisation before the House rises for the recess.
Relevant supporting information will also be placed in the Library of the House.
Legal Aid (Prisoners)
My noble Friend (Lord Bach) the Parliamentary Under-Secretary of State has made the following written ministerial statement:
The Legal Services Commission (LSC) has today published a consultation on the provision of prison law services funded by legal aid in England and Wales. Prison law services enable prisoners to receive advice on legal issues arising from their treatment or discipline in prison, and also advice or representation in connection with parole proceedings. Expenditure on prison law work has increased from £1 million in 2001-02 to approximately £19 million in 2007-08, and is expected to increase further in future years. The proposed reforms aim to ensure a sustainable future for prison law services by addressing rising costs and targeting resources on the most appropriate cases. The consultation paper proposes additional controls on the volume of cases that will be funded, strengthened eligibility criteria, new quality measures and a revised payment structure for solicitors. It also describes longer-term plans to develop alternative means of purchasing and delivering these services.
The 12-week consultation closes on 5 May 2009. Copies of “Prison Law Funding: a Consultation Paper” have been placed in the Libraries of both Houses. The document can be downloaded from the consultation section of the LSC’s website at: www.legalservices.gov.uk.
Machinery of Government
Last October, I announced a series of changes to ministerial responsibilities. I have today placed in the Libraries of both Houses a paper providing more detail on the allocation of responsibilities between the Department for Business, Enterprise and Regulatory Reform, the Department of Energy and Climate Change, and the Department for Environment, Food and Rural Affairs.