Clause 16 - ''Capital expenditure''
Local Government Bill
2:30 pm
Mr John Pugh (Southport, Liberal Democrat)
The Under-Secretary made a case for discretion with regard to capital expenditure and we accept that. However, we are trying to find out whether that discretion is fettered or controlled. I think he said that he will consult before varying definitions of what capital expenditure may or may not be, and that is an option for him. We are pressing him to bind himself to consultation so that when he comes up with a definition of capital expenditure it will command wholesale respect. For example, let us take the case of a local authority that decides to buy shares in its local airport. It defines that as capital expenditure and decides to use headroom under capital expenditure limits in order to accommodate it. Is it an option for the Under-Secretary to say, arbitrarily, that it will not count as capital expenditure but as something else? If it is not an option for him and he cannot act in such an arbitrary way, what in the Bill prevents him doing so? I want to press the Under-Secretary on that point.