Clause 24
Finance Bill
12:15 pm
John Healey (Financial Secretary, HM Treasury; Wentworth, Labour)
The clause should improve the operation of the landfill communities fund, which was known until last year as the landfill tax credit scheme. Every member of the Committee will have a significant number of projects or schemes in their constituency that have been supported in recent years by the landfill communities fund—valuable projects, such as improving, building and repairing village halls, churches or historic buildings, or providing sports facilities, cycle trails and wildlife sanctuaries. Since the fund was set up, it has received £875 million towards such ends, providing projects and schemes that benefit a spectrum of our communities.
HMRC approves a regulatory body to oversee the fund. Currently, that body is Entrust. We have not specified Entrust in the legislation, because, as the hon. Gentleman will recognise, there might be circumstances—although we do not have this planned—in which the regulator body would change. It does not seem sensible, therefore, to specify Entrust in the legislation.
Entrust oversees a fund that we increased in the Budget by a further £5 million, so that it will be worth £65 million in this coming year. It already works to conditions agreed by HMRC that are contained in its terms of approval, which is a document agreed between HMRC and Entrust each year. The statutory instrument provided for by the clause will enable the commissioners to impose enforceable conditions. In the event of a failure to observe those conditions, they may take steps in extremis to revoke the approval of the regulatory body.
The statutory instrument will give a binding effect to any targets or performance measures that the commissioners might wish to see from Entrust. It will also allow Entrust to add or remove conditions on environmental bodies in line with best practice and the principles of better regulation. Under the conditions of its approval, Entrust will now have to provide the commissioners with advance notice and obtain their agreement to any general conditions it intends to impose on environmental bodies.
The first condition that is being added will require environmental bodies to provide project details in advance of spending. That is already established as best practice and is followed in the vast majority of cases. However, at present when it is not followed and when there is resistance from the environmental body, Entrust is not in a situation in which it can require that the environmental body follows those best practices. Indeed, as things stand, an environmental body that was determined not to follow the best practices as set out by the regulator could challenge Entrust’s ability to insist on them. The clause and the regulation that stems from it will remove that uncertainty and reinforce Entrust’s hand, quite rightly, in ensuring that environmental bodies follow the best practice that it sets. There is negligible cost to the Exchequer from the changes.
The hon. Gentleman simply asked how many environmental bodies had had their approvals revoked in 2004-05. A very small number have had them compulsorily revoked. My estimate, from dealing with this territory in the past few years, is fewer than five, but, if he will accept this way of dealing with things, I shall write to him if I recover further information from HMRC.
The statutory instrument goes wider than the clause, but it came into effect on 1 April, in line with, and in time for, Entrust’s new financial year, and the business plan that applies to it.