Sections 80 to 82: Enforcement

178.     Schedule 4 to the LGFA 1992 enables the Secretary of State (in Wales the NAW) to make regulations allowing local authorities to secure payment of any outstanding sum specified in a liability order. A liability order must be obtained from the magistrates' court before any of the other enforcement steps can be taken. The detailed requirements are set out in the Council Tax (Administration and Enforcement) Regulations 1992 (S.I. 1992/613).

Section 80: Amendments relating to distress

179.     Under paragraph 5 of Schedule 4 to the LGFA 1992, regulations can be made allowing billing authorities to make an attachment of earnings order, so that the outstanding council tax can be recovered by requiring the debtor's employer to deduct amounts from the debtor's pay. Quite often, a local authority only finds out about a debtor's employment details late in the enforcement process, after the authority has tried other enforcement mechanisms provided by regulations under Schedule 4, including seeking to levy distress (permitted by regulations under paragraph 7 of Schedule 4), and if that proves unsuccessful, by applying to magistrates for a warrant to commit the debtor to prison (permitted by regulations under paragraph 8 of Schedule 4).

180.     For example, a person may only reveal their employment details during a hearing of an application for a warrant of commitment, since the magistrates are required to inquire into the debtor's means before they can issue a warrant of commitment. Where this happens, rather than proceed with the hearing of an application for a warrant of commitment, the billing authority is likely to serve an attachment of earnings order. However, only the amount specified in the original liability order can at present be recovered through attachment of earnings. This will include the outstanding amount of council tax, plus a sum in respect of the costs of obtaining the liability order (in accordance with regulations made under paragraph 3 of Schedule 4 to the LGFA 1992). It will not, however, include any costs incurred trying to levy distress after the issue of the liability order or any costs incurred during the committal hearing itself.

181.     Section 80(1), (2) and (3) will enable costs incurred in trying to levy distress or incurred during the aborted hearing of an application for a warrant of commitment to be recoverable through an attachment of earnings order.

182.     Section 80(4) amends paragraph 7 of Schedule 4 to the LGFA by inserting a new sub-paragraph (4A). This will enable regulations to be made by the Secretary of State (in Wales the NAW) to prescribe information which authorities or bailiffs must supply to debtors when distress has been levied or when distress has been attempted unsuccessfully. The existing paragraph 7(4)(a) of Schedule 4 only allows the imposition of requirements on local authorities to supply information prior to the levy of distress. There are no powers to impose requirements to supply information when the process is complete or when someone tries to levy distress but fails.

Schedule 7: Minor and Consequential amendments

Paragraph 54: Exercise of powers by the NAW under section 80

183.     Paragraph 54 of Schedule 7 amends Schedule 4 to the LGFA 1992 in consequence of subsections (2) and (3) of section 80. These subsections refer to prescribed amounts in relation to the costs of the application for commitment which can be included in the attachment of earnings order.

184.     Paragraph 54 of Schedule 7 defines prescribed as prescribed in regulations made by the Secretary of State, in relation to England, and by the NAW in relation to Wales. Because subsections (2) and (3) confer a new power on the Secretary of State to prescribe amounts in regulations, this power has not already been devolved to the NAW under the National Assembly for Wales (Transfer of Functions) Order 1998 (S.I. 1998/672) which provided for other functions under Schedule 4 (except those under paragraph 6) to be exercisable by the NAW.

Section 81: Charging orders: aggregation

185.     Paragraph 11 of Schedule 4 to the LGFA 1992 enables billing authorities to apply to the county court for a charge against the debtor's dwelling for which the council tax remains unpaid, in respect of a liability order made by the magistrates' court. Regulation 50 of the Council Tax (Administration and Enforcement) Regulations 1992 stipulates that at the time of the application for the charging order, at least £1000 of the amount for which the liability order was made must remain outstanding.

186.     Section 81 enables local authorities to aggregate two or more liability orders made against the same person to meet the £1000 threshold for making an application for a charging order. The section inserts a new paragraph 11A into Schedule 4 to the LGFA 1992 to allow regulations made under that Schedule to include appropriate provision.

Section 82: Quashing of liability orders

187.     When a taxpayer falls behind with their council tax, billing authorities have to apply to the magistrates' court for a liability order before they can seek to use various powers to recover the debt. There are relatively few defences against the making of a liability order - these include the fact that an amount has not properly been demanded or that the amount has been paid. Unless a defence is accepted by the court, the order will be granted. In practice very few are refused.

188.     However, it can emerge after the order has been made that a mistake has occurred, for example, the taxpayer may later find receipts proving that he had paid. In such cases, no action should be taken under the liability order. However, some taxpayers view the liability order as an unwarranted stain on their character and demand that the liability order be deleted from the record. At present, this can only be achieved on application to a higher court. The cost involved is unwarranted where there is no dispute about the facts.

189.     Section 82 (which inserts into Schedule 4 to the LGFA 1992 a new paragraph 12A) allows the Secretary of State (in Wales the NAW) to make regulations giving magistrates' courts powers to quash a liability order if the court is satisfied that the liability order should not have been made. This only applies where the local authority has applied to have the liability order quashed. It does not give council taxpayers a right to require magistrates' courts to reconsider all liability orders made.

190.     New paragraph 12A(b) enables regulations to be made permitting the magistrates' courts to substitute a liability order for a lower amount where it considers that a liability order could properly have been made had it been made for that lower amount (which would include a sum for the costs incurred in obtaining the original order).

Section 83: Major precepting authorities: combined fire authorities

191.     Section 83(1) adds combined fire authorities ('CFAs') in England established under section 6 of the Fire Services Act 1947 ('FSA 1947') to the list of major precepting authorities in section 39(1) of the LGFA 1992. Twenty four CFAs were established in the former county council areas affected by local government reorganisation in England between 1996 and 1998. These CFAs were established by combination schemes set out in orders made by the Secretary of State under section 6 of the FSA 1947. The constituent authorities (whose representatives make up the CFAs) are district and county councils, or in some areas just district councils.

192.     At present, section 5(2)(c) of the FSA 1947 requires combination scheme orders to include provision for the contribution to the expenses of CFAs by the constituent authorities. Under these orders, the constituent authorities currently contribute to the CFA's expenses in proportion to their council tax bases.

193.     As major precepting authorities, CFAs will be required under section 40 of the LGFA 1992 to issue a precept or precepts for each financial year. The precepts will be issued to billing authorities (district councils) in their areas. Each precept will have to state the amount of council tax that has been calculated for each category and band of dwelling in the area, and the total amount payable to the CFA by the council to which it is issued.

194.     Paragraph 1 of Schedule 7 amends section 6 of the FSA 1947. Its effect is that combination scheme orders made for CFAs in England need not contain provisions as to the contributions to the CFA's expenses to be made by the constituent authorities. Such provision will not be required as Chapter 4 of Part 1 of the LGFA 1992 will make the appropriate provision instead.

195.     Part 2 of Schedule 8 details the extent of the revocation of the provisions in the combination scheme orders which currently provide for the contributions of the constituent authorities to the CFA's expenses, consequent on section 83(1). These provisions will not be needed since the provisions in Chapter 4 of Part 1 of the LGFA 1992 which govern the calculation and issue of precepts will apply instead to determine authorities' contributions.

196.     Subsection (2) of section 83 provides a power to allow the National Assembly for Wales to make an order to add Welsh CFAs to the list in section 39(1) of the LGFA 1992. Subsection (3) provides that the National Assembly for Wales should consult such representatives of local government and other bodies and persons as it considers appropriate, before it exercises the order-making power.

197.     The National Assembly for Wales would (by virtue of section 123 of the Act) be able to include in such an order the necessary consequential amendment to section 6(1A) of the Fire Services Act 1947 (which is to be inserted by paragraph 1 of Schedule 7), so that combination scheme orders for Welsh combined fire authorities need not contain provisions as to the contributions to the CFA's expenses to be made by the constituent authorities. Section 123 would also allow the National Assembly for Wales to make consequential amendments, equivalent to those contained in Part 2 of Schedule 8, to the combination scheme orders establishing the Welsh combined fire authorities.

Section 84: Amendment of section 67 of the Local Government Finance Act 1992

198.     Section 84 amends section 67 of the LGFA 1992 so that a full council meeting is no longer required to adopt the council tax base that is used when setting council taxes.

199.     The items T referred to in paragraphs (a), (c) and (f) of subsection (2A) to be inserted into section 67 of the LGFA 1992 by subsection (3) of section 84, are the tax bases for the whole of an authority's area (respectively, for a billing authority, major precepting authority other than the Greater London Authority ("the GLA"), and the GLA). Billing authorities must notify major precepting authorities of their tax bases in a prescribed period: the tax base for the whole of a major precepting authority's area is the aggregate of that for the billing authorities in the area. The Local Authorities (Calculation of Council Tax Base) Regulations 1992 (S.I. 1992/612) (as amended) set out how these amounts are calculated, and how they are determined if a billing authority fails to notify the major precepting authority.

200.     The items TP referred to in paragraphs (b), (d) and (e) of subsection (2A) are the tax bases for the relevant part of an authority's area to which a special item relates. They are respectively for part of a billing authority's area (e.g. the area of a parish for which the parish council issues a precept), part of the area of a major precepting authority other than the GLA (e.g. the area of part of a county in respect of which a levy is issued to a county council) and part only of a billing authority's area, which forms part of a major precepting authority's area in respect of which the major precepting authority has power to issue precepts. Item TP2 in section 89(4) of the Greater London Authority Act 1999, referred to in paragraph (g), is the tax base for the Metropolitan Police District (i.e. the area of the London boroughs only) in respect of which the Metropolitan Police Authority, financed through the GLA, provides police services.

201.     Paragraph (h) of subsection (2A) makes clear that a full council meeting is not needed when e.g. a major precepting authority determines the tax base for part of a billing authority's area as part of determining its own tax base (e.g. where the billing authority had failed to notify it of its tax base during the prescribed period).

Section 85: Vacant dwellings: use of council tax information

202.     Billing authorities will collect information about the numbers of empty (vacant) homes in their area which are exempt dwellings for council tax purposes. Many local authorities employ empty property officers whose role is to identify empty homes and develop policies and initiatives to bring them back into use. The presence of empty homes can lead to social, economic and environmental problems (e.g. reduce neighbouring property values, encourage vandalism and increase the pressure on housing stock and land for development).

203.     The LGFA 1992 does not contain clear provision allowing information collected pursuant to council tax powers under that Act, to be used for other purposes. The Information Commissioner has issued guidance advising authorities that they cannot use council tax data for other purposes.

204.     Section 85 inserts a new paragraph 18A into Schedule 2 to the LGFA 1992 to allow a billing authority to use information it has obtained for the purpose of carrying out its council tax functions for the purpose of identifying vacant dwellings or taking steps to bring vacant dwellings back into use. New subparagraph 18A(2) limits the extent of personal information which may be shared to an individual's name or an address or number (e.g. telephone number) for communicating with him.

205.     The Government is conscious that it is arguable that allowing the use for other purposes of personal data collected for council tax purposes may in some circumstances constitute an interference with an individual's right to privacy protected by article 8 of the European Convention on Human Rights. It is considered that any data sharing permitted under section 86 does not interfere with an individual's right to privacy. The data will be used only by the billing authority which collected it and it will be used only for public functions in the public interest. Section 85 does not permit disclosure to third parties such as commercial organisations.

Section 86: Repeal of section 31 of the Local Government Act 1999

206.     Section 31 of the Local Government Act 1999 was needed to help implement the council tax benefit subsidy limitation scheme which required authorities to contribute to the costs of council tax benefit where their council tax exceeded a threshold set by the Government. Section 31 allowed regulations to be made requiring payments by major precepting authorities (county councils, police authorities, the Greater London Authority, metropolitan county fire and civil defence authorities) whose council tax exceeded the thresholds, to billing authorities (in England, district councils, London borough councils, the Common Council of the City of London, the Council of the Isles of Scilly, county councils with the functions of district councils, and in Wales, the county and county borough councils). Billing authorities are responsible for administering council tax benefit.

207.     With effect from 1 April 2002, the scheme was no longer operated in England. The NAW had ceased to operate the scheme earlier in Wales.

208.     Section 31 is redundant and this section repeals it.

Schedule 7: Minor and Consequential amendments

Paragraph 43: Completion notices

209.     When new dwellings are nearing completion, billing authorities can serve a 'completion notice' on the owner of a building if it can reasonably be expected to be completed within three months, under section 17 of the LGFA 1992 which applies Schedule 4A to the LGFA 1988 for the purposes of the council tax. A completion notice specifies the day which the authority proposes as the completion day for the building.

210.     There is a right of appeal to a valuation tribunal against a completion notice under paragraph 4 of Schedule 4A of the LGFA 1988. Paragraph 4(2) of Schedule 4A provides that where an appeal is not withdrawn or dismissed, the completion day shall be such day as the tribunal shall determine. Paragraph 5 of Schedule 4A provides that where no appeal is brought, or any appeal is dismissed or withdrawn, the day stated in the notice shall be the completion day in relation to the building.

211.     However, section 17(4) of the LGFA 1992 contains an error. Section 17(4) defines 'the relevant day' in relation to a completion notice, for the purposes of section 17(3). Section 17(3) provides that where a completion notice is served under Schedule 4A to the LGFA 1988 and the building to which the notice relates is not completed on or before the relevant day, any dwelling in which the building or any part of it will be comprised shall be deemed for the purposes of Part 1 of the LGFA 1992 to have come into existence on that day (i.e. on the relevant day).

212.     In paragraphs (a) and (b) of section 17(4) of the LGFA 1992, the words 'an appeal' and 'no appeal' appear to have been transposed. The effect is that, if the provision is applied literally, if an appeal against the completion notice is successful, the relevant day in relation to a completion notice will remain the day shown in the notice. However, where no appeal is made against the notice, the relevant day will be the day determined under the Schedule, i.e. on appeal, by the tribunal.

213.     If an appeal against a completion notice is upheld, the date of the completion notice should be the date determined by the tribunal. Conversely, if there is no appeal, the date should be the original date on the notice.

214.     Paragraph 43 of Schedule 7 rectifies this error. Paragraph 43(2) of Schedule 7 provides that the correction will apply to any completion notice served on or after the day of coming into force of that section. It will also apply to any completion notice served prior to that date which is or becomes subject to an appeal on or after the coming into force of that section.

PART 7: HOUSING FINANCE ETC

Sections 87 and 88: Local housing strategies and statements, and Housing Revenue Account business plans

215.     A local housing strategy is the local housing authority's vision for housing in its area. It sets out objectives and targets and policies on how the authority intends to manage and deliver its strategic housing role and provides an overarching framework against which the authority considers and formulates other policies on more specific housing issues.

216.     In England, local housing strategies are currently prepared by local housing authorities. They are set out in specific documents - dissemination of the housing strategy to key service users, key stakeholders and other interested parties is an important part of the strategic housing role. These documents are made available to and appraised by the Government Offices for the Regions to ensure they are "fit for purpose" i.e they are capable of delivering the local authority's housing function to the standard demanded by Government. They are currently sent to the Government Offices pursuant to section 65 of the Local Government and Housing Act 1989. In Wales, the Welsh Assembly Government has asked local housing authorities to have local housing strategies in place by April 2004. Previously, it asked authorities to prepare annually a "housing strategy and operational plan".

217.     There has not, until now, been a statutory provision which specifically requires local housing authorities to have a housing strategy. Section 87 puts local housing strategies on a statutory basis to reflect the Government's belief that a robust strategy is essential to the delivery of local authorities' housing functions.

218.     Local housing strategies are among a number of housing plans, policies and strategies which local authorities are required or asked to prepare by central Government or the Welsh Assembly Government. One is the non-statutory Housing Revenue Account business plan, relating to the management of the authority's own housing stock, prepared by local housing authorities in England who maintain a Housing Revenue Account. These are also submitted by authorities to the Government Offices for the Regions. Others are the Homelessness Strategy prepared by local housing authorities in England and Wales pursuant to the Homelessness Act 2002 and the reports on home energy conservation measures prepared under the Home Energy Conservation Act 1995.

219.     The current guidance on local housing strategies in England and Wales stresses the importance of addressing all relevant issues, including homelessness and energy efficiency of housing stock in the strategy. Local housing strategies are also expected to be consistent with the community strategies prepared by authorities under section 4 of the Local Government Act 2000.

220.     In many cases there may be considerable overlap between the material included in the different documents and it may not always be properly linked.

221.     It is expected that a document prepared by an authority under subsection (2) of section 87 will be known as the "Local Housing Strategy". But it will be for the authority to decide what to call such a document in the light of its contents. The section enables a local housing authority to be required to include in its Local Housing Strategy material that is currently set out in separate documents. However even where an authority is not required to do that, it will normally have the freedom to include in its Local Housing Strategy some or all of the material that would otherwise be set out in separate documents. Accordingly, an authority will be free to produce just a single housing document, or a number of documents, as best suits its local circumstances.

222.     Section 87 therefore draws a distinction between formulating and having a strategy, and promulgating this, e.g. through a document recording or setting out that strategy.

223.     If the authority was required only to prepare a statement setting out that authority's policy or strategy on housing or related matters, then if the authority had formulated no such policy or strategy, it would simply prepare a statement saying that it had no such policy or strategy on that particular issue.

224.     Section 87(1) allows the appropriate person (defined in section 124 as the Secretary of State, in relation to authorities in England, and the National Assembly for Wales, in relation to authorities in Wales) to require local housing authorities to have a strategy on certain specified matters relating to housing. In order to have such a strategy, authorities will have to have considered the relevant issues and formulated policies to achieve certain ends. Subsection (1)(b) provides that requirements can be imposed as to the ends the strategy must achieve (e.g. the availability of better quality housing in the authority's area), the formulation of policy for the purposes of the strategy (e.g. that it must be consistent with any national housing strategy or an authority's community strategy) and the review of the strategy (e.g. that the strategy must be reviewed after a certain period of time).

225.     In practice the requirements which the Secretary of State and National Assembly for Wales propose to impose under section 87(1) are unlikely to differ from what authorities are asked to do on a non-statutory basis for their local housing strategies at present. If authorities have already formulated the relevant policies and strategies (albeit that they were not compelled to do so by an explicit statutory provision) then section 87(1) will not have the effect of imposing any further burdens on the authorities.

226.     Section 87(2)(a) will allow the appropriate person to require the authority to set out the strategy which it has formulated in accordance with section 87(1), and submit it to him at such time as he may specify. Section 87(3) allows the appropriate person to impose requirements with respect to the contents and form of this and its supply by the authority to the appropriate person in accordance with subsection (2).

227.     Section 88 makes it clear that the appropriate person can, in imposing requirements as to the contents of any document prepared for the purposes of section 87, require the inclusion of material relating to property in the authority's Housing Revenue Account, designated as the authority's Housing Revenue Account business plan. This would set out how the authority manages its housing stock and performs its role as a landlord. If an authority in England is required to submit to the Secretary of State (in practice the relevant Government Regional Office), a document whose contents include the Housing Revenue Account business plan, the plan (although not necessarily any other material in the statement) may be taken into account in calculating HRA subsidy in accordance with section 89.

228.     Different requirements as to the formulation of local housing strategies, and the preparation and submission of documents evidencing them, may be imposed on different authorities. Differing requirements as to how often an authority may be required to revise its strategy, or submit a document evidencing it to the appropriate person may be imposed, depending on an assessment of the authority's performance. Authorities which no longer keep a Housing Revenue Account (e.g. if they have disposed of all their housing stock) will not be required to prepare a Housing Revenue Account business plan.

229.     Unless the power under subsection (3) of section 87 is exercised so as to require authorities to include no more material in the statement than the strategy formulated under subsection (1), authorities will be free to incorporate other material in the same document, in addition to any material they are required to include under section 87. The decision as to what if any additional material to include will be for authorities to take depending on their individual circumstances. If local housing authorities decide to include additional material evidencing plans, strategies or policies which they are statutorily required to have, parts of the statement would then have to be updated as and when those other strategies, plans or policies were required to be reviewed or updated.

230.     The types of plans, policies and strategies which it is anticipated that authorities may wish to incorporate in a single document, along with the local housing strategy required under section 87(1), include the Homelessness Strategy prepared under the Homelessness Act 2002, and the reports on home energy conservation measures prepared under the Home Energy Conservation Act 1995.

231.     The Secretary of State in addition to imposing formal requirements pursuant to sections 87 and 88, proposes to issue guidance to local housing authorities. The National Assembly for Wales guidance issued in June 2002 has conveyed this advice to local authorities in Wales The guidance will assist authorities to understand how they may comply with the formal requirements imposed as to the preparation of housing strategies and the documents evidencing those strategies, and as to how they might incorporate other material into documents prepared for the purposes of section 87(2). The guidance may be issued in a single document along with the formal requirements themselves.