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Clause 4 (Costs of district rates collection)

Executive Committee Business – in the Northern Ireland Assembly at 11:15 am on 3rd November 2009.

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Photo of William Hay William Hay Speaker 11:15 am, 3rd November 2009

We now come to the second group of amendments for debate, which concerns the Minister’s opposition to clause 4 standing part of the Bill. Clause 4 deals with authorising the issue of money from the Northern Ireland Consolidated Fund to the Department of Finance and Personnel in order to cover the cost of collecting rates on behalf of district councils.

Question proposed, That the clause stand part of the Bill.

Photo of Sammy Wilson Sammy Wilson Shadow Spokesperson (Education), Shadow Spokesperson (Treasury)

I object to the inclusion of clause 4 because, upon re-examination of the accounting implications of the proposed clause, it was concluded that the legislation as proposed would not enable the income to be recognised in accounts as had previously been understood. Effectively, therefore, the clause is redundant and should be removed.

The objective of the clause was to enable income that is associated with the cost of collecting rates on behalf of district councils to be recognised in the Department of Finance and Personnel accounts. That income is already recognised in the Department’s budget, and DFP sought to increase the degree of transparency by reflecting it in the annual resource accounts. DFP officials have explored other options for achieving the objective of recognising the income in the Department’s accounts and will receive the position in the context of anticipated changes to accounting policy. In the meantime, the Department is content to continue to recognise the income in budgets alone.

The clause is technical. It has no impact on district councils and, equally, the withdrawal of the clause has no impact on district councils. I hope, therefore, that the House will agree with my decision and vote accordingly.

Photo of Jennifer McCann Jennifer McCann Sinn Féin

Go raibh maith agat, a Cheann Comhairle. In his correspondence of 9 September, the Minister notified the Committee of his intention to oppose the Question that clause 4 stand part of the Bill. During the subsequent briefing by DFP officials on 23 September, the Committee heard that the intention of clause 4 had been to align the budgets of the Department with its estimates and accounts so that there would be fewer reconciliations. However, members were advised that it was considered that the clause, as drafted, did not provide for its intended objective. Members were assured that the Department is content to continue with the current situation, whereby the issue is dealt with as a reconciling item, and that DFP will consider making appropriate legislation provision at a later date.

On behalf of the Committee, therefore, I support the Minister’s intention to oppose the Question that clause 4 stand part of the Bill.

Photo of Peter Weir Peter Weir DUP

Obviously, I was wrong in the prediction that I made about the chastisement of the Minister. In the interests of the House, I shall make no such predictions for this set of amendments, save to say that we are dealing with the deletion of perhaps the second most famous clause 4 in British constitutional history. At the very least, the level of controversy over the deletion of this clause 4 may be a lot less than that for the other clause 4.

This is very much a technical amendment. As the Minister indicated, the matter is already recognised in the DFP accounts. Indeed, it is clear that clause 4, as it stands, does not really provide for the originally intended objective, so it is right that we look at deletion. I am also glad to hear that, in doing so, we will maintain a level of transparency in respect of the registration of rates collection. That is important, particularly for those of us who are involved in local government. It is important that that cost be kept separate. The Minister’s assurance that that will not have any impact on district councils is also to be welcomed.

Essentially, these are technical amendments. Broadly speaking, the House should adopt them because that is a sensible way forward.

Photo of David McNarry David McNarry UUP

When I entered the Chamber, I thought that this would be a friendly debate, but apparently not on the part of a Minister who seems to delight in making things personal, especially when people question him or disagree with him. I have not yet disagreed with him this morning.

The Minister seems to take obvious delight in making an art form out of waffling; therefore, he needs to be heard twice just to ensure that what we heard the first time was correct. I do not think that I can be faulted in saying that, particularly because the Minister seems to enjoy and delight in repeating himself and taunting Members at will. Of course, our court jester of a Minister cannot recognise a helping hand without seeing a conspiracy, and that seems to warp his thinking.

However, I will take no lessons from a double, even triple, jobber on listening when I should be listening, when he is clearly not listening to the public and the electorate.

Photo of Stephen Farry Stephen Farry Alliance

On a point of order, will the Speaker rule on whether this is relevant to the debate? [Laughter.]

Photo of William Hay William Hay Speaker

Order. I have already issued a general reminder that Members should, as far as possible, restrict their remarks to the remit of the debate.

Photo of David McNarry David McNarry UUP

Thank you, Mr Speaker. Perhaps the smart alecs in this place might give me some recognition. [Interruption.]

Photo of David McNarry David McNarry UUP

They might give some recognition that I tested through the Speaker how far I might need to go to make some points that might rebound on me, and I am very grateful. I am sorry only that my colleague Mitchel McLaughlin happened to be someone whom I used to gain that ground.

Photo of Mitchel McLaughlin Mitchel McLaughlin Sinn Féin

I accept the Member’s apology. [Laughter.]

Photo of David McNarry David McNarry UUP

I receive his acceptance of my apology very gracefully and thank him for it.

To return to the business in hand: the Minister’s intention to oppose clause 4, which refers to his Department’s authority to secure money from the Consolidated Fund in order to cover the cost of collecting rates on behalf of the district councils, is explainable, if somewhat bizarre. We were told at Committee Stage that the Department needed that technical change to recognise the cost of collection in its accounts because no cash transaction is involved. We can follow all of that.

However, we are now told that clause 4 is not needed. Will the Minister clarify for me, because I got a bit beyond third form, why there has been such a change of heart?

Photo of Declan O'Loan Declan O'Loan Social Democratic and Labour Party

When the matter was brought to the Committee’s attention, I said that I was content with the removal of clause 4. I remain content with its removal. However, the removal will have a possible major implication about which I want to ask the Minister. He may not have the full answer here and now. If he does not, will he bring it to the Committee?

The Minister’s letter to the Committee on 9 September described clause 4 as follows:

“The objective of this clause was to enable income associated with the cost of collecting rates on behalf of district councils to recognised in the Department of Finance and Personnel’s accounts.”

I draw his attention to his Department’s efficiency delivery plan, which is closely connected to that matter. In respect of the Department of Finance and Personnel’s efficiency savings, one item is described in precisely the same terms. It states:

“Recognition of costs recovered in respect of rate collection.”

That, in fact, makes a big contribution to the overall amounts involved in the Department’s efficiency delivery plan: over the three-year period, the total to be saved is £15·1 million out of £30·8 million. In other words, it accounts for almost half the total efficiency savings of the Department. How half of the efficiency savings of a Department are to be created by a mere change in the way in which its accounts are rendered is a not-insignificant side issue.

However, if the Minister cannot alter how the accounts are rendered in the way that is proposed in clause 4, two questions arise. First, does it mean that those efficiency savings cannot be achieved? Secondly, how will the efficiency savings for the 2008-09 financial year, which has already passed, be affected? Even if clause 4 were necessary to achieve those efficiency savings, and it had gone through, it would only come into effect when the Bill becomes an Act. In 2008-09, £4·4 million out of the £5·7 million of efficiency savings were recovered in respect of rates collection. The Minister must address that significant point.

Photo of Sammy Wilson Sammy Wilson Shadow Spokesperson (Education), Shadow Spokesperson (Treasury) 11:30 am, 3rd November 2009

I shall deal with the Member’s final point first. I do not have the answer to his question, so, rather than waffle, which the Member for Strangford accused me of, I would prefer to give the Member a considered reply. I shall write to him with it. I hope that my reputation is for giving straight answers, rather than for waffling.

Both of the points that have been made are about why clause 4 is in the Bill and why I am proposing that it be removed. I really wish that Mr McNarry would listen when I speak. I think that the record will show that at no stage did I indicate that we believed that that power was “not needed” — Mr McNarry’s words. I made it clear that when we examined the provision in clause 4, it was clear that it would not enable us to identify the cost of collecting rates. Therefore, clause 4 did not fulfil the purpose for which it was designed, hence the reason for not pursuing it at this stage.

One Member asked what we intend to do. We intend to review clause 4 in the context of the wider work that is being carried out on the reporting and accounting statement of the rate levy and collection account. Clause 4 could be looked at in the context of any future rates legislation. I hope that, for the second time, I have cleared up an issue that Mr McNarry seems to have been incapable of understanding the first time.

Clause 4 does not fulfil the function for which it was designed. Mr O’Loan highlighted one reason why it is useful to be able to identify the cost of rates collection, so it is important that the ongoing work on that be done. I will write to him about the point that he raised. In the meantime, I propose that clause 4 be removed.

Photo of William Hay William Hay Speaker

I shall now put the Question on whether clause 4 should stand part of the Bill. I remind Members that if they wish to oppose clause 4 standing part of the Bill, they should say No, and if they wish it to stand part of the Bill they should call Aye.

Question put and negatived.

Clause 4 disagreed to.

Clauses 5 and 6 ordered to stand part of the Bill.

Schedule ordered to stand part of the Bill.

Long Title

Amendment No 3 made: Leave out from “to provide” to

“to the Department of Finance and Personnel” and insert

“to enable the Office of the First Minister and deputy First Minister to incur expenditure for certain purposes” — [The Minister of Finance and Personnel (Mr S Wilson).]

Long Title, as amended, agreed to.

Photo of William Hay William Hay Speaker

That concludes the Consideration Stage of the Financial Provisions Bill. The Bill stands referred to the Speaker. I ask the House to take its ease before we move to the next item of business.

(Mr Deputy Speaker [Mr Molloy] in the Chair)