Planning Bill

That is true, but I have said that the substantive point is that the Secretary of State is required to find an exemption and then there are some choices that are also in the text of the amendment. The noble Earl, Lord Caithness, made an interesting point about timing. I will read Hansard carefully on that point. To ensure that the mechanism we provide to achieve this relief is compliant with the criteria, we have to go on talking to the charitable sector. The matter is complex and will take time. We have to consult through the draft regulations. It is therefore right that the detail of how this relief will work is laid out in secondary legislation. We have to be careful about avoidance. Proposed new subsection (4B) provides a mechanism against that. It provides a mechanism to claw back CIL money if the use of a development which was already deemed to be exempt or subject to reductions changes for a purpose which is not exempt. This addition to the Bill provides reassurance that an exemption or reduction from CIL liability relating to charities will be in CIL regulations. It is a guarantee that the Secretary of State will act. It is the right starting point for a discussion with the sector about how an exemption should be framed. The regulation-making power gives us the latitude to frame with care the workings of this power. Other amendments reflect, for example, on the notion of a blanket exemption. Amendment No. 437CZA seeks to amend our amendment so that the Secretary of State cannot provide for a reduction in CIL in relation to charities or to development for charitable purposes. If she uses those powers she must provide a complete exemption. I understand the argument, and I understand the search for simplicity and certainty, but noble Lords should follow the logic of this argument too. On arguing for a complete exemption, I would be deeply sympathetic if noble Lords could tell me where a blanket exemption would start and finish, given the complexity of the sector. What would it mean in watertight legal terms? Where would the boundaries lie across this very complex sector? How would we anticipate and deal with distortions that would occur at the far edge, where charitable activity is often a minor element of major private and commercial concerns? Those are the sort of difficulties we have to face. I am sympathetic, and I have set out the principles and safeguards that would guide us. We have the responsibility of ensuring that we have the right tools in the right place. We do not have an annual Finance Act in which we can put things right on a regular basis. That is why regulations are so useful to us, but that is why blanket exemptions cause us problems, for all the reasons I have said. Regulations will be subject to very thorough consultation. We do not want to unduly limit the relief. Amendment No. 438A seeks to secure two exemptions in the Bill for CIL. These would be for two classes of development—developments that are solely concerned with the provision of infrastructure and developments undertaken by a charity exclusively for the charitable purposes for which the charity was established. Almost all development has some impact on the need for infrastructure. It is not a homogenous category. That is why we envisage what types of development relating to buildings will be liable to pay CIL. It is worth noting that the existing system of planning obligations can operate in relation to development consisting of infrastructure. Again, the conclusion I draw, because that can cover such a wide variety of developments, is that it is not appropriate to provide a blanket exemption for infrastructure from CIL. As we made clear at paragraphs 4.1 to 4.14 of the document in August, we indicated that we are giving serious thought to what type of development ought to be liable to pay CIL. Government Amendment No. 437A principally defines development in relation to buildings. I have addressed the point about development rights. Amendment No. 438A would also exempt all charities from paying CIL where the development they undertake is exclusively for the purposes for which they were established. Our Amendment No. 437C is intended to provide assurance to noble Lords that there will be some provision providing relief in relation to charities, as I have said. Amendment No. 438B of the noble Earl, Lord Caithness, specifies that limited companies with charitable status should be included. I reassure the noble Earl that in our Amendment No. 437C, our use of the term ““charity”” includes ““bodies corporate”” and, therefore, limited companies. I hope that that will satisfy him. I am not so sure about the status of sporting clubs, although we have a fairly wide definition; I will have to come back to the noble Lord, Lord Greaves, on that. Finally, Amendments Nos. 436BC, 438BA and 438BB seek to require that a charitable exemption is laid out in CIL regulations operating in a way similar to charitable relief under the stamp duty land tax. Amendment No. 438BA in effect provides that a development would be exempt from paying CIL where, on the commencement of development, the land is owned by a charity, or being developed by a charity, and it is intended to be used for charitable purposes. Amendments Nos. 438BA to 438BC are all self-explanatory, so I shall cut to the chase. I have listened to what noble Lords across the Committee have said, and their strength of feeling about this. I recognise the strong desire of many in this Committee and the charity sector to have confirmation of how any exemption provided for will work. I am committed to working with the sector intensively over the next two weeks, before we come back, to deliver a meaningful relief. It would be unwise to commit myself to a particular mechanism at this early stage. I must be absolutely certain and careful to ensure that the relief we provide is as wide as possible without breaching the criteria for exemptions which we have formulated, and without creating unintended consequences. That would not serve the purposes of the sector. CIL is a new tool built on the existing system for which there is no clear precedent. National taxes are cited as precedent here but, looking at the Bill after today, I do not think that anyone could claim that CIL is a national tax. It has to be an iterative process. These are local taxes I assure noble Lords that we will be considering a range of existing mechanisms as part of the process. We have already taken on board the principle of clawback. I have listened to what has been said this afternoon but, on the basis of what I have said in a long and wearying speech, I hope that the noble Lord with withdraw his amendment.