Clause 18 - Applications for certain orders under Highways Act 1980: cost recovery

Deregulation Bill – in a Public Bill Committee at 12:15 pm on 6th March 2014.

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

Photo of Tom Brake Tom Brake The Deputy Leader of the House of Commons

The clause changes existing legislation to enable both local authorities and the Secretary of State to operate on a full cost recovery basis when dealing with applications by landowners for a diversion or an extinguishment order under the right to apply, as introduced by the Countryside and Rights of Way Act 2000 and amended by clause 16 of the Bill. The right to apply will enable a landowner to make a formal application to divert or extinguish a right of way, and with it will come a right of appeal to the Secretary of State if the authority refuses or fails to act.

The right-to-apply provisions, however, are framed in such a way as to impose a centrally prescribed fee on local authorities, which means that some local authorities charge too much and some too little. The existing law around cost recovery for the process is therefore unsatisfactory. A local authority might be discouraged from processing an application for a diversion, as it could be burdened with substantial costs by being unable to recover them in full. A landowner might therefore be unfairly treated by not having his right of way diverted.

Under the current law, local authorities may recover part of their costs from a landowner when making a diversion or extinguishment order, but cannot be sure of recovering all of their costs. Local authorities are consequently reluctant to respond to applications to make such orders where they involve public expenditure, but are of benefit wholly or mostly to the landowner.

The first part of the clause will remove the centrally prescribed fee, leaving the way open for local authorities to recover their actual costs through the existing regulations. As part of the rights of way reforms package, we will be amending those regulations to enable full cost recovery, while ensuring that recovery does not exceed the actual cost.

The second part of the clause extends the existing arrangements under which the Secretary of State’s costs of handling an appeal may be recovered. At present, only the costs of an inquiry or a hearing may be recovered. The amendment will enable the costs of appeal conducted by the exchange of written representations  also to be recovered. The amount charged may still be less than the actual cost, where the local authority or the Secretary of State judges that a diversion is in the public interest. However, it is right that where diversion or extinguishment is of benefit wholly or mostly to the landowner, it should not be funded through public expenditure. The clause will remove a significant impediment to implementing the right to apply, and I commend it to the Committee.

Photo of Thomas Docherty Thomas Docherty Shadow Minister (Environment, Food and Rural Affairs) 12:30 pm, 6th March 2014

I am grateful to the Minister for sending over the impact assessment for clause 16 yesterday. I am therefore slightly disappointed that we did not receive the economic assessment of the costs for clause 18. I want to press the Minister on this issue. What estimate have the Government made of the costs to the applicant? We all want to reduce the burdens on landowners—for example, farmers—when they make an application. It would therefore be helpful if the Minister provided a figure for the fee that he anticipates will be recovered from the applicant.

Photo of Tom Brake Tom Brake The Deputy Leader of the House of Commons

I thank the hon. Gentleman for that question. I can provide some clarification, but perhaps not in detail that he requires. Clearly, the costs will vary considerably across the country. They will depend on whether there are objections to the order and whether the matter goes to a public inquiry. It is therefore difficult to give him the precise guidelines on the costs that he seeks. The important thing is that there will be full cost recovery, but local authorities will not be allowed to make a return—a profit—when they process the application. As I have said, when there is public interest, the local authority may choose not to pass on the full processing costs.

Photo of Thomas Docherty Thomas Docherty Shadow Minister (Environment, Food and Rural Affairs)

I am slightly disappointed by the Minister’s answer, although I accept that he does not have the figures to hand. In the spirit of co-operation, will he undertake to write to Committee members after today’s sitting to set out the range of figures? If he gives that undertaking, we can proceed in good grace.

Photo of Tom Brake Tom Brake The Deputy Leader of the House of Commons

I am happy to write to the Committee to set out whether there is additional information that can provide greater precision on the likely costs. The difficulty is that the costs will vary depending on things such as the complexity of the application and whether it goes to appeal. Nevertheless, I will provide more clarity if it can be made available.

Photo of Thomas Docherty Thomas Docherty Shadow Minister (Environment, Food and Rural Affairs)

I am grateful for that intervention, but I am genuinely surprised. The Government—I am not making a political point—say that the Bill is about reducing burdens, and they have obviously done a lot of work on it, so they must have a range of figures. I appreciate that the Minister will need to ask his officials to dig out the relevant paperwork, but it is not beyond the wit of the Government to tell the Committee whether the process will cost £50 or £50,000. I am trying to be helpful by suggesting that they give the Committee the range of costs. I take the Minister’s point that the costs will vary; it is horses for courses. Will he write to us and  say, “This is based on experience.”? Clearly, the Government would not have introduced the clause if they did not have an idea of what the burden on businesses will be.

Photo of Toby Perkins Toby Perkins Shadow Minister (Business, Innovation and Skills)

My hon. Friend is being generous in giving way, as always. It is not self-evident that the Government would not have introduced the measure without knowing how much it will save. They have introduced it without knowing how much it will save.

Photo of Thomas Docherty Thomas Docherty Shadow Minister (Environment, Food and Rural Affairs)

My hon. Friend is perceptive. I am not sure whether “scooby” is a parliamentary word—it is certainly a word in Scotland—but it appears that the Government do not have a scooby about the cost. I am surprised because we have repeatedly heard, as I am sure the Members who served on the Joint Committee will have done, that the Bill is about reducing burdens.

I am slightly nervous that the Government do not seem to know what the cost to landowners and farmers will be. However, I suspect that while I have been on my feet the Minister may have received some inspiration, so if he wants to intervene on me I shall be happy to give way.

Andrew Bridgen rose—

Photo of Tom Brake Tom Brake The Deputy Leader of the House of Commons

I am happy to intervene. Inspiration sometimes comes in a flash in Committee, and I appreciate that. We have some research on the matter, and I am in a position to give a range of figures for the likely cost. I shall happily write to the hon. Gentleman and other members of the Committee setting them out.

Photo of Thomas Docherty Thomas Docherty Shadow Minister (Environment, Food and Rural Affairs)

I am grateful. If the hon. Member for North West Leicestershire still wants to intervene, I am happy to give way.

Photo of Andrew Bridgen Andrew Bridgen Conservative, North West Leicestershire

Surely, the hon. Gentleman knows from his own experience how contentious, protracted and expensive disputes over rights of way can be and understands that anything that cuts the time will cut the expense.

Photo of Thomas Docherty Thomas Docherty Shadow Minister (Environment, Food and Rural Affairs)

I am conscious that you may pull me up, Mr Chope, for reopening a debate that we have already had, but the clause is really about who pays and the transfer of that, rather than the simplification of overall bureaucracy: I shall try to avoid temptation. Given the generous offer by the Parliamentary Secretary to write to members of the Committee, I am more than happy to express our continued support for the clause.

Question put and agreed to.

Clause 18 accordingly ordered to stand part of the Bill.