Statutory Instrument 1990 No. 763

The Local Government (Promotion of Economic Development) Regulations 1990

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© Crown Copyright 1990

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1990 No. 763

LOCAL GOVERNMENT, ENGLAND AND WALES

The Local Government (Promotion of Economic Development) Regulations 1990

The Secretary of State for the Environment, as respects England, and the Secretary of State for Wales, as respects Wales, in exercise of the powers conferred upon them by sections 33(3)(f) and (4), 34(1), (2) and (5), 190 and 191(1) of the Local Government and Housing Act 1989^[1], and of all other powers enabling them in that behalf, hereby make the following Regulations:

Citation and commencement
    1.    These Regulations may be cited as the Local Government (Promotion of Economic Development) Regulations 1990 and shall come into force on 1st April 1990.

Interpretation
    2.—(1)  In these Regulations, except where the context otherwise requires—
"the Act" means the Local Government and Housing Act 1989;
"economic development powers" means the powers conferred by section 33(1) of the Act or any other enactment by virtue of which a relevant authority may promote the economic development of its area;
"financial assistance" means assistance of any of the descriptions specified in paragraphs (a) to (f) of section 33(3) of the Act;
"scheduled authority" means a district council in Wales and an authority specified in Schedule 1 to these Regulations.


    (2)  For the purposes of these Regulations, a relevant authority shall be regarded as providing financial assistance if, in the exercise of economic development powers, it agrees to provide or joins with any other person in agreeing to provide financial assistance.

Application
    3.—(1)  Subject to paragraph (2), these Regulations apply—
 (a) where the economic development power in question is that conferred by section 33(1) of the Act, to its exercise on or after 1st April 1990;
 (b) in any other case, where the power is exercised on or after 1st July 1990.

    (2)  Nothing in any other provision of these Regulations shall apply to preclude a relevant authority from providing financial assistance in fulfilment of an agreement entered into before 1st April 1990.

Provision of property, services and other financial benefits
    4.    The condition specified for the purposes of section 33(3)(f) of the Act is that the property, services or other financial benefit is provided for a consideration that is less than the best that can reasonably be obtained.

Excluded activities
    5.—(1)  Subject to paragraph (2), there are specified for the purposes of section 34(1) of the Act the steps listed in Schedule 2 to these Regulations.

    (2)  Nothing in paragraph (1) or Schedule 2 shall preclude an authority from—
 (a) carrying out or participating in estate agency work—
 (i) which consists solely of the publication of information about land; or
 (ii) in connection with the acquisition or disposal of land that adjoins land which the authority proposes to acquire or dispose of;
 (b) carrying out or participating in insurance broking in connection with policies relating to moveable property in any building or on any land of which the occupier is a tenant of the authority;
 (c) publishing a newspaper where the sole or main purpose of such publication is the promotion of the economic development of the authority's area;
 (d) doing anything which is—
 (i) incidental to the provision by the authority of any training facility, the construction or maintenance of any building or the management of any land in which the authority has an interest; or
 (ii) connected with the promotion of tourism or the provision of information to the public;
 (e) doing anything on behalf of a Minister of the Crown or, in pursuance of the Local Authorities (Goods and Services) Act 1970^[2], on behalf of any public body within the meaning of section 1 of that Act.

Excluded forms of financial assistance
    6.—(1)  Subject to paragraph (3), there are specified for the purposes of section 34(1) of the Act the steps mentioned in paragraph (2).

    (2)  The steps referred to in paragraph (1) are the provision of financial assistance of any of the descriptions specified in paragraphs (a) to (c) of section 33(3) of the Act to a person who conducts a business or undertaking with a view to profit where—
 (a) the amount of the assistance is determinable solely by reference to the financial results of that business or undertaking over a period which at the date on which the authority considers the provision of the assistance is not wholly in the past; or
 (b) it is intended that the assistance should be applied, either wholly or in part, in or towards the payment of the wages or salary of any employee of that person.

    (3)  Nothing in paragraph (1) or (2) shall preclude a relevant authority from providing financial assistance by way of grant which—
 (a) is made for the purpose of enabling the recipient—
 (i) to employ a person who, for the period of at least seven days immediately preceding the commencement of the employment, was unemployed;
 (ii) to employ a person for the duration of any period in which he is undergoing training;
 (iii) to employ not more than three persons who are qualified to provide some particular knowledge or skill required for the purposes of the business or undertaking; or
 (b) is provided as part of a scheme to which contributions are made by a Minister of the Crown or the European Commission.

Restrictions on exercise of economic development powers
    7.—(1)  Subject to paragraphs (2) and (3), a relevant authority that is not a scheduled authority shall not, in the exercise of economic development powers, in any financial year provide financial assistance of any of the descriptions specified in section 33(3)(a) to (e) of the Act or by accepting or purchasing any bill of exchange within the meaning of the Bills of Exchange Act 1882^[3]—
 (a) to any person whose undertaking or business is conducted with a view to profit; or
 (b) to any voluntary organisation for the purposes of enabling that organisation to make a grant or loan or give a guarantee to a person whose business or undertaking is conducted with a view to profit,
where the total value or amount of that assistance in that year exceeds £10,000.

    (2)  Nothing in paragraph (1) shall preclude an authority from providing such assistance as is mentioned in regulation 6(3).

    (3)  Nothing in paragraph (1) shall preclude a county council from doing anything if any scheduled authority in the county could do it.

Consultation with other authorities
    8.—(1)  There are specified for the purposes of section 34(1) of the Act the steps mentioned in paragraphs (2) and (3).

    (2)  The step mentioned in this paragraph is the provision, after 1st April 1991, by a relevant authority which is not a local education authority within the meaning of the Education Act 1944^[4], to a person who is not a member, officer or other employee of the authority, of training or education services other than those included within a programme of such services which the local education authority for the area in which the services are to be provided has approved.

    (3)  The steps mentioned in this paragraph are—
 (a) the acquisition by a relevant authority of any land outside its area; or
 (b) the provision of financial assistance for the acquistion or improvement by any other person of any such land, or the acquisition or improvement of plant or machinery in, on or under, any such land,
otherwise than after consultation with such authority for the area in which the land in question is situated as is mentioned in the Table below.
TABLE

Area in which land is situated	Authority exercising powers	Authority to be consulted
A London borough	Any relevant authority	The council of the London borough
A metropolitan district	Any relevant authority	The council of the metropolitan district
A non-metropolitan county	Any county council	The county council
	Any non-metropolitan district council	The district council
	Any London borough council or council of a metropolitan district	The county council and the council of the non-metropolitan district

Loans
    9.—(1)  Where a relevant authority in the exercise of economic development powers provides financial assistance in the form of a loan and the rate of interest in respect of that loan is more favourable than that reasonably obtainable on the open market, the accounts of that authority for each financial year in which an amount of principal is outstanding as respects any such loan, shall include a separate account of—
 (a) the amount of any such loan;
 (b) the difference between the amount of interest payable in that year in respect of that loan and the amount which would have been payable in that year if interest on that loan had been payable at the rate prevailing in the market for a loan of that nature.

    (2)  A copy of a statement of the account required to be kept in accordance with paragraph (1) shall be deposited with the proper officer of the authority at the time that a statement of the authority's accounts is published in accordance with regulations under section 23 of the Local Government Finance Act 1982^[5].

Chris Patten

Secretary of State for the Environment

27th March 1990

Peter Walker

Secretary of State for Wales

27th March 1990

[1] 1989 c. 42. back

[2] 1970 c. 39. back

[3] 1882 c. 61. back

[4] 1944 c. 31. back

[5] 1982 c. 32. back

Explanatory Note