Robert Syms (Shadow Minister, Local Government Affairs & Communities; Poole, Conservative)

I beg to move, That the clause be read a Second time.

It is quite clear, if we consider the notes on the clauses, that the Bill’s purpose—the postponement of the revaluation—means the suspension of the existing programme of preparatory work for the 2007 revaluation by the Valuation Office Agency. That is clear: work will stop. As the Minister has just said, at the point at which a Secretary of State determines that he wants to proceed again, an affirmative resolution of the House will have to be moved and the House will have ample opportunity to discuss what the future programme will be and what work is undertaken.

The purpose of my new clause is to tease out what happens between those two parameters. We heard from the Minister that the Valuation Office Agency continued to do work in relation to new homes, where properties are altered and where they are sold. There is a modest amount of ongoing work on revaluation.

We also heard on Second Reading that the Government had spent some £60 million on the 2007 revaluation, including £45 million on a new computer system. What happens to that computer system? Will it have alternative uses? Will it be switched off? Will the Valuation Office Agency continue to do work on a year-by-year basis, which might be used in a future revaluation?

We also heard on Second Reading that about 1,200 staff who had been taken on for the 2007 revaluation, many of whom were on short-term contracts, would now be laid off. The purpose of my new clause is to tease out whether there will be any work done on a year-by-year basis.

Concerns have been expressed in the House and in the press about various value codes that the new computer system may use to revalue housing. There are many concerns that work might continue, possibly at a modest level, in providing some ground work for a future revaluation. Therefore, we do not want a sneak revaluation where the Government can move an affirmative resolution on a short time scale and people suddenly find that work has been done which they did not anticipate.

The new clause is a probing one. Will the Minister flesh out what the £45 million-worth of kit in the form of the new computer system will be used for? Beyond the normal changes to new homes, such as those that are altered or sold, shall any further works be undertaken, and shall people do some work on a year-by-year basis? If the answer is no, the matter is simple. If the answer is, “Some work will go on,” the Committee ought to hear about it.

David Howarth (Shadow Minister, Office of the Deputy Prime Minister; Cambridge, Liberal Democrat)

The new clause seeks to bring to the debate a degree of transparency. Since that was the purpose of amendment No. 2, I am glad to support the motion. It seems puzzling, however, that the official Opposition oppose our amendment on the grounds that it would cost officer time, and then immediately propose a new clause that appears to cost exactly the same officer time. The hon. Member for Poole should be careful what he wishes for.

There was a similar incident on Second Reading when Conservative Members voted en masse against the Bill, even though they claim to be against revaluation. Their tactics continue to puzzle me.

Mark Prisk (Whip, Whips; Hertford & Stortford, Conservative)

Good.

David Howarth (Shadow Minister, Office of the Deputy Prime Minister; Cambridge, Liberal Democrat)

I use “puzzle” in its rhetorical sense.

It would be advantageous for the Government to make an annual report, not just for the reason that the hon. Member for Poole gives, which is to find out whether preparation is being made for a sneaking revaluation, but because people would like to know what work is being done, and to be able to question the Government about it.

I fear that one underlying purpose of the motion is to further the extraordinary campaign of fear, with Government inspectors entering people’s bedrooms to carry out revaluations. Although I am opposed to the council tax and therefore to revaluations, it is not one of the reasons that I should give for opposing the tax and the possibility of revaluation. Nevertheless, because the new clause gives the process a certain degree of transparency, I support it.

Phil Woolas (Minister of State (Local Government), Office of the Deputy Prime Minister; Oldham East & Saddleworth, Labour)

I thank the hon. Member for Poole for his probing motion. It gives me the opportunity to put on record some of our obligations to the Valuation Office Agency, and to shed some light on it.

I shall start with this morning’s Daily Mail and The Daily Telegraph, and bring to the Committee’s attention the reason why the Valuation Office Agency has the powers to enter and photograph domestic properties. The answer is contained in section 26(1), subject to the requirements of section 26(2) and (3) of the Local Government Finance Act 1992. The powers have existed since 1992, when the Conservative Government were in power.

If one researches the motivation at that time, it was envisaged that the power should be particularly but not exclusively included in the Act to settle disputes between property owners and the independent Valuation Office Agency to ensure that council tax avoidance does not take place because of false information put in front of valuation tribunals. The power is very sparingly used. I am grateful for the opportunity to put that point on record.

The Valuation Office Agency is an executive agency of the Government, and its work is supported by the independent Valuation Tribunal Service, which is not an executive agency but a non-departmental public body. The Valuation Office Agency and the Valuation Tribunal Service will report as appropriate on   preparations for revaluation and rebanding in the annual reports that they already publish, which are available to the House.

In addition, the sort of report that has been suggested by new clause 1 would serve no purpose in a year in which there had been no such preparatory work because there was no planned revaluation or rebanding. However, in accordance with the proposed clause, the Secretary of State would still be under a duty to publish a report.

Let me answer the hon. Gentleman’s questions. His hon. Friend the Member for Meriden (Mrs. Spelman) has tabled some written parliamentary questions on the subject. I have met the trade union representatives and the management of the Valuation Office Agency to discuss its work and staffing. The agency has reviewed its staffing need in light of the 20 September announcement. The immediate impact is that some 420 staff working on casual and fixed-term contracts will leave the agency by this Friday. The agency is also running an early departure scheme for permanent employees, and it is anticipated that some 600 staff will leave between 30 March 2006 and 30 June 2006. That loss coupled with natural wastage will mean a total reduction, including temporary employees, of some 1,250 staff.

It is the policy of the Valuation Office Agency to avoid compulsory redundancies. The figures should be understood in the context that further staff will be required when revaluation takes place.

Mark Prisk (Whip, Whips; Hertford & Stortford, Conservative)

Could the Minister enlighten the Committee as to whether the numbers of staff to which he has just referred will be included in the savings to which the Chancellor has referred, or are they in addition?

Phil Woolas (Minister of State (Local Government), Office of the Deputy Prime Minister; Oldham East & Saddleworth, Labour)

I will answer that question directly as well. The hon. Member for Meriden has also asked, further to the 20 September announcement, what work the Valuation Office Agency is currently conducting in relation to valuation. The statutory responsibilities of the listings officers employed by the Valuation Office Agency to compile and maintain valuation lists for council tax purposes in England continue.

For the current lists—those based on the 1993 council tax—that means banding new properties, amending the banding of existing properties where appropriate and deleting entries from the list when properties are demolished or converted to non-domestic use. Those activities will now be undertaken with the benefit of the newly digitised database of property records, which the Valuation Office Agency will ensure continues to be comprehensive and up to date. That means that the Valuation Office Agency can introduce improved processes for handling data internally, as it will no longer be reliant on paper records, and can also provide a better service to council tax payers and billing authorities in relation to the 1993 lists. In particular, it will be better placed to deal quickly with inquiries or appeals from taxpayers about their current bandings and to undertake revaluations when required.

Additionally, to secure the investment made to date in the computer system known as the automated valuation model technology, the Valuation Office Agency will ensure that the model is available for use in all locations. Although it has been introduced to support the 2007 revaluation, the Valuation Office Agency plans, with my support, to use the model’s capability to support decisions on properties for the 1993 list, and also for other valuation work on domestic property that it undertakes within its statutory remit.

Costs were incurred in the preparation, which one would now describe as having been wasted—I am referring to the £15 million. The £45 million that the Valuation Office Agency refers to—it is important to remember that that body is independent of Government—relates to the investment in the AVM technology. The Committee will be pleased to learn that that technology is first class, and that it works.

Mr. Burrowesrose—

Phil Woolas (Minister of State (Local Government), Office of the Deputy Prime Minister; Oldham East & Saddleworth, Labour)

I should not have said that.

David Burrowes (Enfield, Southgate, Conservative)

Would the Minister not concede that there is an understandable scepticism about the Government’s capacity and ability to deliver on important IT projects? Would he also not withdraw—at least to a certain extent—his parody of the original system of 1991-92? He suggested that that simply involved estate agents going around with clipboards. That system was praised by the National Audit Office for being able to deliver on time, within a 12-month deadline, and without increasing costs. There is a contrast between that and the Government’s efforts in respect of the revaluation project. It was estimated in 2004 that the costs were £108 million, and then in July 2005 that estimate increased to £178 million. That highlights why the scepticism exists, and the importance of there being both proper transparency and an annual report that gives some degree of confidence to taxpayers that their money will not be wasted—as £15 million has already been.

Phil Woolas (Minister of State (Local Government), Office of the Deputy Prime Minister; Oldham East & Saddleworth, Labour)

No, I do not accept that. That is not a fair reflection of the work of the Valuation Office Agency, and of what has taken place.

I do not know whether the hon. Gentleman remembers the events he referred to—or whether he was involved in them. I think that my right hon. Friend the Member for Sheffield, Brightside (Mr. Blunkett) was the Opposition spokesperson at the time. He pursued the Government from the Opposition Benches, and highlighted the rather farcical—in fact, I withdraw the word “rather”—situation that arose then. The estimates required for revaluation had not been put in place in time, because the council tax was introduced as a panic measure in response to the disastrous poll tax.

David Burrowes (Enfield, Southgate, Conservative)

The NAO stated that

“the completion of 21 million bandings to a 12 month deadline was, by any standards, a significant achievement ... the Valuation Office will have secured the lowest cost for much of the work carried out, without sacrificing standards”.

Does the Minister reject that NAO point of view?

Phil Woolas (Minister of State (Local Government), Office of the Deputy Prime Minister; Oldham East & Saddleworth, Labour)

I remember the period in question very well, but I am not sure whether you, Mrs. Anderson, would let me stray by discussing it, or whether the hon. Gentleman would want me to do so.

Peter Kilfoyle (Liverpool, Walton, Labour)

On the issue of fairness, does my hon. Friend recall—as I recall—that things at that time were so rushed and botched that there were reports of helicopters making assessments from the air of series of properties in order to effect the council tax?

Janet Anderson (Rossendale & Darwen, Labour)

Order. As interesting as this discussion is—we all have memories of those times—I remind hon. Members that we should stick to the issues before us, which are revaluation and the new clause.

Phil Woolas (Minister of State (Local Government), Office of the Deputy Prime Minister; Oldham East & Saddleworth, Labour)

Thank you, Mrs. Anderson. Unfortunately, I am unable to draw the Committee’s attention to the current edition of the Local Government Chronicle in which Michael Heseltine comments on similar activities involving helicopters and decisions about restructuring.

It is been asked whether the Government’s IT projects fail. The automated valuation model has been a great success; it is a considerable asset. I was surprised to learn that the paper records were still the basis of valuations until recently. The AVM equipment and kit enables the Valuation Office Agency to undertake its work more efficiently and accurately, and consideration is currently being given to whether the existence of that computer equipment could produce other benefits for the public. Therefore, I reject the accusation that all the money spent so far has been wasted. Not at all—it is seen as an investment. Indeed, I take this opportunity to praise the professionalism of the Valuation Office Agency and remind the Committee of the hard and dedicated work of the tribunal services, which are made up of volunteers supported by an excellent staff.

I am grateful for the opportunity afforded me by the new clause tabled by the hon. Member for Poole. However, if he presses it to a Division, I ask the Committee to reject it.

Robert Syms (Shadow Minister, Local Government Affairs & Communities; Poole, Conservative)

We have learnt a little more today about what is happening with the Valuation Office Agency. There is an irony in having a computer system that works, but not intending to use it for the reason for which it was purchased. Nevertheless, I am sure that we shall return to those and other matters on Report. I beg to ask leave to withdraw the motion.

Phil Woolas (Minister of State (Local Government), Office of the Deputy Prime Minister; Oldham East & Saddleworth, Labour)

I hope that the Committee will accept that I have used this opportunity to put more information into the public domain. I have also had the opportunity to expose some of the urban myths perpetuated by the debate about revaluation. During the debate in the House, I described the hon. Member for Meriden as the hon. Member for Scaremongering,   South, for that has been the purpose of the Opposition’s policy. I described the hon. Member for Brent, East (Sarah Teather) as the hon. Member for Naive, North. I accept that her party’s policy is well intended and that she believes it would bring about equality, but I believe that it would bring about the opposite to what she intends.

I hope that the debate this morning has given more information and clarity—although they were not necessarily required—to the Government’s position. I look forward to the important debate about local government funding. The hon. Member for Cambridge asked an important political question: what policy will guide a largely technical—although obviously we cannot always separate the technical from the policy—review by Sir Michael Lyons? A close reading of the remit of that inquiry and what I have said today will give some of the answers to that question. It is extremely important to the country that   we should have a robust and buoyant financial base for local authorities, which are our partners in governing the country.

As is traditional, I should like to thank all those involved; it has been an especial pleasure to serve with them today. I thank my Whip, who has conducted affairs excellently; I was the Whip on the Committee that considered the 2003 Act. I thank all Members who have taken part in the Committee today, especially those who contributed on Second Reading. I thank the police, Hansard staff, the Clerk and the officials, who have acted with their usual professionalism and dedication. Most of all, I thank you, Mrs. Anderson, for your excellent chairmanship, discretion and beautiful handling of interventions from hon. Members on both sides.