Functions to Include Power to Enter into Contract.

Local Government (Contracts) Bill – in the House of Commons at 9:35 pm on 11 November 1997.

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Lords amendment: No. 1, in page 1, line 19, after ("financier") insert (", or any insurer of or trustee for the financier,")

Photo of Michael Lord Michael Lord Deputy Speaker (Second Deputy Chairman of Ways and Means)

With this, it will be convenient to discuss also Lords amendment No. 9.

Photo of Hilary Armstrong Hilary Armstrong Minister of State (Local Government and Housing), Department of the Environment, Transport and the Regions, Minister of State (Department for Environment, Transport and the Regions) (Local Government)

Clause 1(2) provides that a local authority may make arrangements with financiers for step-in rights; that is, rights to intervene where the contractor is unable to meet his obligations to the authority or to the financier. The amendment provides that these arrangements can also involve—[Interruption.]

Photo of Michael Lord Michael Lord Deputy Speaker (Second Deputy Chairman of Ways and Means)

Order. I ask hon. Members to leave the House quickly and quietly if they are not taking part in the debate.

Photo of Hilary Armstrong Hilary Armstrong Minister of State (Local Government and Housing), Department of the Environment, Transport and the Regions, Minister of State (Department for Environment, Transport and the Regions) (Local Government)

The amendment provides that these arrangements can also involve financiers' insurers or trustees. Amendment No. 9 amends clause 4 of the Bill to provide that a contract between a local authority and a financier's insurer or trustee may be a certified contract and thus may have the protection of clause 2 (1) of the Bill. That is the "safe harbour" provision.

Lords amendment agreed to.