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Planning Bill

My Lords, I rise to speak to my amendments in this group. First, I must thank the Minister for her efforts to overcome our concerns on this issue. I recognise that our desire to exempt charities from the potentially devastating consequences of this levy has caused her and her team some difficulty. We do not really understand that difficulty, and our resolve to get this matter right has not been diminished. She mentioned European state aid. The advice we have had from our legal side is different from hers. As I said in Committee, I strongly believe this whole thing is the UK gold-plating. After all, there are exemptions for charities from income tax, capital gains tax, stamp duty and land tax, an 80 per cent exemption for council tax and exemptions from virtually every other tax in every other member state in Europe, and they have not been challenged. I cannot see this being a problem at all. We have to stick to our amendments as we have laid them down. I shall not repeat all the reasons why charities need exemptions, as I said enough about that in Committee, but suffice it to say that charities are exempt from virtually all other taxes. The most important thing is that they deliver benefits to society at a far better rate and at far better value than government possibly can. As the noble Lord, Lord Dixon-Smith, said, it cannot be stressed enough that they are very heavily regulated by the Charity Commission or the Office of the Scottish Charity Regulator in Scotland. Regulation that is good enough for Her Majesty’s Revenue and Customs vis-à-vis income tax and capital gains tax must be good enough for CIL. As the noble Lord, Lord Shutt, said in Committee, what we need is certainty, and that we do not have in the Government’s amendment as currently drafted. I still have the feeling that the only people who are going to benefit from it are lawyers and accountants. I shall run through our amendments to government Amendment No. 136AA, bearing in mind that we want clarity and certainty. I recognise that there is a difference between charities governed by subsection (1) of the new clause, as defined by subsection (4), and other bodies with a charitable purpose as defined in subsection (2). Dealing first with subsection (1), as I understand it, it provides a compulsory exemption from CIL for all charities as defined in subsection (4), but it seems that both subsection (1)(a) and subsection (1)(b) have to be fulfilled before that exemption is a certainty. Subsection (1)(b) restricts the exemption to buildings that are used ““wholly or mainly””, as in the amendment tabled by the noble Lord, Lord Dixon-Smith, for charitable purposes. I have no doubt that the Minister will clarify that in her response. On the question of charitable purposes, the Bill refers to ““a charitable purpose””, so I would be grateful if the Minister could confirm that for ““purpose”” we can also read ““purposes”” so that three of our amendments are taken care of. I have the same concerns as the noble Lord, Lord Dixon-Smith, about which buildings are exempt, or even things that are not buildings. Being a rural person, I immediately think of a dilapidated village hall being sold for development to a developer in order to build another village hall. The hall that is being sold is not going to have a charitable purpose any more, or it could be the car park of the village hall that is being sold by the village hall trust, which would most likely be a registered charity, to reinvest in the village hall. In both cases, if CIL were payable, the developer would almost certainly charge the charity for CIL in its price, and it would thus be the equivalent of the charity paying CIL in the first place. I cannot believe that that is the Government’s purpose in the amendment. In my conversations with the noble Baroness and her team, it was suggested that some of my concerns about the limits of subsection (1) could be covered under subsection (2)(a). If that is the case, that adds weight to the need for our Amendments Nos. 136AD and 136AE, because it is vital that we have the certainty of ““must”” rather than ““may”” governing subsection (2). It is also important that subsection (2)(a) stands by itself, making the word ““or”” in Amendment No. 136AE crucial. The word ““or”” is needed for another reason. The present draft is entirely unclear as to whether it is the Government who are to make the exemption, the individual charging authority, or both. Those three possibilities are a recipe for utter confusion. I hope that, following our conversations, the Government will agree to both those amendments. Amendment No. 136AF is again an attempt to achieve clarity and certainty. The noble Baroness mentioned the words ““or reduction in””. I see her point of view, but I find them undermining and unhelpful. Giving a charity a 1 per cent reduction in CIL would satisfy the terms of subsection (2)(b), but would be of no use to the charity. We need clarification of what the Government mean by a reduction—or, preferably, an alteration in the subsection. We come to subsection (3) of the government amendment and our Amendment No. 136AF. Everyone to whom I have spoken in the charitable sector agrees that that subsection undoes all the certainty towards which we are working in the first two subsections. The words ““may provide”” and, "““only if specified conditions are satisfied””," need no further comment. Frankly, they undermine the whole government amendment and render it useless. The clause has to go; that is our bottom line. Our final amendment in the group is as much for clarification purposes as anything else. Why do we need the words ““or not to be”” in subsection (5)? It might give the persons drawing up the regulation or even the local planning authorities entirely the wrong idea. We would therefore prefer that phrase to be removed. I will not delay the House much longer, because it is very late, but, as I said at the outset, the principle behind our amendments is that no public benefit is to be gained by taking money from charities and giving it to government agencies. Charities are rigorously scrutinised for public benefit by the Charities Commission and provide benefits for society at far better value than CIL or any of its charging authorities ever could. In my view, the government amendment needs to be totally reworded to give greater certainty and clarity to cater for the grave and sensible concerns of the third sector, as I have set them out. At the very least, we need the undermining subsection, subsection (3), removed from the clause.