Local Government Committee, 07 Mar 2000

Meeting date: Tuesday, March 7, 2000

Official Report 280KB pdf

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Subordinate Legislation

The first item on our agenda is consideration of statutory instruments. Rule 10.6.3 of standing orders allows for a debate on draft affirmative instruments of up to 90 minutes. As the instruments that are before the committee are all designed to achieve the same objectives, I suggest that we agree to hold one debate to cover all seven instruments. I suspect that that will not take 90 minutes, but standing orders allow us to take that long if members so wish. Do we agree to debate the instruments together?

Members indicated agreement.

As the next agenda item is scheduled for 2.45 pm, that is probably a good idea.

You noticed the deliberate mistake, did you?

Members of the committee received an e-mail on this subject on 24 February. The Subordinate Legislation Committee report has also been made available. No comments have been received by the clerks so far—except from Donald Gorrie, who is not here at the moment. If he arrives later, I will pick up on what he said.

Before the debate, I will introduce the team. As members know, Jack McConnell is the Minister for Finance. On his right is Bill Howat and on his left is Peter Hancock. Behind them are Stephen Orr, Ian Christie, Paul Cackette and Alex Mowat. The minister will not be able to answer any technical questions. Such questions should be addressed to the civil servants. [Laughter.] For some reason, that has caused great hilarity among SNP members.

Do members have any questions about technicalities, as those must be dealt with before we begin the formal debate?

This is not really a technical question—

Why are you asking it then?

You will hear why. I want to make a technical declaration of interest—at the time of the election, I was an employee of Great North Eastern Railway Ltd, which is one of the organisations whose rateable values are being assessed today. I have no current pecuniary interest in GNER.

I should declare an interest, because I own businesses that pay a lot of rates.

I have two questions. First, from reading the documents, am I to gather that these utilities would be assessed individually for a given area? For example, would electricity lands in the Grampians be assessed separately from those in the Borders, or would the rate apply to the whole utility?

Secondly, we have been informed in an explanatory memorandum from the Executive that the

"non domestic rate income that will be raised from business in Scotland after the revaluation will be the same in real terms as before."

I understand what that means—in Scottish terms, the take will be exactly the same. Can you clarify whether that means that there will be winners and losers in Scotland? I understand that values in Scotland are generally lower than values in England. Although there will be losers and gainers in England as well, will England as a whole be gaining and Scotland losing, because the playing field has been levelled?

I should begin by clarifying that the numbers that appear in the orders have been negotiated entirely through a consultation process between the assessors and the relevant industries.

Mr Paterson's understanding of the first point—apportionment—is correct. Indeed, as many of the industries are UK-wide, wide-ranging consultation—involving the industries, the Valuation Office Agency south of the border and the Scottish Assessors Association—begins at UK level. The orders that I hope the committee will approve today will determine a figure for each of the industries in Scotland, which each of the 14 assessors will apportion within their area. In agreement with the industry, the assessors will apportion elements of the total that are relevant to the area.

The second question was about winners and losers. You said, Mr Paterson, that we had calculated the poundage to maintain the tax take in real terms. In effect, that means that the average uplift in Scotland will be of the order of 12.5 per cent. You are right in saying that there will be winners and losers. Even within individual areas there will be winners and losers. Some parts of Edinburgh, for example, have experienced considerable growth, where the market evidence has led the assessors to conclude that there is a significant uplift. In some areas the uplift has been 30 or 40 per cent, whereas in other areas there has been a decrease. We have published the calculations of the poundage figures, which show the overall effect, but we will not know the final swings—who is gaining and who is losing—for more than a year. We will not get that information from the amounts that the assessors bill over the next few weeks, because there will be a large number of appeals, which it will take time to work through.

Finally, you asked about the difference between Scotland and England. In principle, there is none whatever. We have applied an uplift factor of 13 per cent to the non-formula valued industries in Scotland, whereas in England the expected uplift is 24 per cent. The same calculation has been applied—the swings and roundabouts in England will happen within the same overall tax take in real terms. The same principles have been followed north and south of the border.

There was a fourth question, which is whether the values in Scotland are lower than those in England. That might be an unfair question, because you may not yet have that information.

I do not have that information. It might be better to address that question to the assessors. We could give the committee a note on that, if it would be helpful. I could make an estimate of the total Scottish rate valuation basis, but that might not provide a direct answer to your question. I will come back to the committee on that.

That would be very helpful.

I apologise for being late. The comparison with last year's figures is very helpful. Without such a comparison, the documents are of limited interest. Can you persuade me that this is a scientific exercise, rather than a modern form of alchemy?

I am tempted to say no. If you want to understand how the consultations take place and on what basis each of the industries is assessed, you should consult the Scottish Assessors Association. I am not an assessor, but I understand that they consider the information available and what is most relevant to the nature of each industry. They then seek to reach agreement on a valuation basis. There is an element of science and an element of negotiation. I suspect that there comes a time when people realise that they must reach agreement. Agreement with the industry has been reached on all the statutory instruments that the committee is considering today.

I have two questions on the figures. My first point is rather nationalist. Our railways have increased in value, whereas those of the English and Welsh have decreased in value. The values may have been erroneously estimated at the time of privatisation, but the difference seems curious.

Secondly, we have previously been told by Jack McConnell and others that the average, overall increase in non-domestic rates is about 15 per cent. All the industries concerned have a lower increase. Is the burden therefore passing from some of the big industries to smaller companies?

I could not add to your speculation on why the value of the railways has gone up or down. To some extent, it is relevant that some of the industries were previously under one regime and moved to another. There have been some significant swings. I can only suggest that members speak to the assessors about that.

As for the final uplift factor, the 15 per cent was our original estimate, which we made towards the end of last year. Our final figure is nearing 12.5 per cent. There is a lower average uplift for the formula-valued industries. That uplift is a clear figure, because the end of the road has been reached: if the committee approves these instruments today, we will be able to say conclusively that the uplift figure has been reached. We will not, however, be able to say what the total uplift figure is until, as was said earlier, all the appeals have come through. Our expectation is that, for the non-formula-valued industries, the factor will be between 12 per cent and 13 per cent.

I am curious, as is Donald Gorrie, about the fact that the rateable value for the railways has decreased by 24 per cent in England and has increased by 27.75 per cent in Scotland. I do not think that, in the relevant period, any of us has noticed any significant improvement over England in the quality of the railways. It is regrettable that Mr Howat cannot answer Donald's question. It is difficult for us to ask these questions if no one can give a distinct answer. Is there no one among the seven officials who can answer? It seems curious that there is such a marked difference between the rateable value of the railways in Scotland and in England, and indeed that there is an even more marked difference between the railways in Scotland and those in Wales.

The answer to Mr Gibson's question is no, as far as the detail is concerned. I am happy to consult the assessors and provide a note on the figures.

One of my colleagues has just passed me a note to remind me that Donald Gorrie was absolutely right in saying that a large part of the explanation for these figures comes from the fact that more information has become available and that the nature of the apportionment in this revaluation has changed from the one in the revaluation five years ago. We can certainly provide the details for members.

How much was raised in non-domestic rates in 1999-2000? How much will be raised in 2000-01?

Those figures are in a paper that we published. From memory—I cannot provide the precise figure—we are expecting to raise around £1.5 billion in the current year.

We have made our new calculation by uplifting the figure by the retail prices index—1.1 per cent—and by taking into account an estimated loss in appeal of 3.6 per cent. That is a total take, but allowances then have to be made for the various discounts and so on. We should make it clear that these are our estimates of what we think that we will get. If the economy performs well, the amount could be greater; if there is a downturn, it could be poorer.

Would I be right in saying that, between 1999-2000 and 2000-01, there is expected to be a differential of £200 million or so in the amount of money raised from non-domestic rates?

I will check that. The figure is in a paper that we have published. One of my colleagues will help me to provide it in a moment.

We are talking about the actual figures that business will have to pay in addition this year. If the differential is £200 million, that will have to come from the business sector, will it not?

If that is the estimated differential and the estimated tax take, yes.

I would like you to confirm that all the proposed rateable values in the seven statutory instruments have been agreed with the industries. Has there been any dispute with the industries over any of the instruments?

None as of today. I would be telling a lie if I said that every industry is universally happy with the figures that have been agreed, but we have a reached an agreement to which they are prepared to sign up. We will have further discussions, with the electricity industry in particular. As industries change, new regulatory regimes are introduced; the process is continuous. I could have given you a straight yes in answer to your question, but it is important to understand that this is a snapshot; these are the valuations to which the industries are prepared to sign up. We will continue to review the matter.

With great apologies, I draw the attention of the committee to a technical issue. We have identified a small error on page 4 of the Electricity Lands (Rateable Values) (Scotland) Order 2000. The error has arisen because of difficulties of apportionment and was identified only this morning. To emphasise Bristow Muldoon's point, I can say that it was identified by Scottish Power. The figure of £53,080,000 in paragraph 8(1)(a) should read £52,870,000, which represents a decrease for Scottish Power of £210,000. There is a consequential change in paragraph 7(a): the figure of £73,110,000 has to be reduced by £210,000. We have consulted the clerks and the Parliamentary Bureau today. With our apologies, it is suggested that you should approve this order. We will undertake to bring forward as quickly as possible an amending regulation that could be taken with some of the other instruments that have to come forward.

We will consider that matter when we take the order. If there are no more technical questions, I will now ask the Minister for Finance to tell us more about the orders.

Although I was not allowed to answer any technical questions, I hope that you will take the chance to ask my ministerial colleague, Mr McAveety, some questions on this interesting subject when he appears, as I am sure that he knows a lot about it. I have warned him that you might test him, which I suspect might be fun.

I wish to clarify that the estimates for next year's non-domestic rates total are based on the retail prices index increase of 1.1 per cent and not on an increase of £200 million. Over a longer period, the issue arises of the balancing out of non-domestic rates from one year to the next. That used to be taken as a burden by the Treasury—if we ran short, the Treasury would make up the difference, and if we made extra, the Treasury would take it back. There is now a Scottish budget, so the non-domestic rates pool will need to balance from year to year. The built-in increase from this year to next will be only 1.1 per cent, which represents between £15 million and £20 million, rather than £200 million. I hope that that is helpful.

The seven draft orders before the committee today relate to the revaluation of non-domestic rates, which is required by statute to take place across Great Britain every five years. Regular revaluations ensure that the rateable values of properties do not get out of line over time and that they reflect current rental evidence. In Scotland, non-domestic rates provide about 21 per cent of local authority expenditure, which represents about £1.5 billion annually of a total of almost £7 billion. Non-domestic income is collected locally but the structure and parameters of the tax are set by central Government and the proceeds are pooled and distributed to local authorities as part of the central Government support that I announced on Wednesday.

The seven orders deal with types of properties and industries that do not easily lend themselves to valuation by the conventional method. Such properties belong to what are known as the prescribed industries. For the most part, they are utilities that were previously, or still are, in some form of public ownership.

There are also cross-border networks, including the electricity, gas, rail and water industries, as well as large ports. Apart from the Train Operating Companies (Rateable Values) (Scotland) Order, which has been made annually in recent years, the draft orders that are before the committee supersede those that were made at Westminster in 1995 at the time of the previous revaluation.

In Scotland, valuation for rating of non-domestic properties is carried out by council or joint board assessors. In England and Wales, the Valuation Office Agency performs the same function. The assessors are independent of central Government and local government and reach their decisions in accordance with applicable statute, case law and valuation practice.

All the draft orders have been subject to detailed discussion and consultation with the industries concerned and with appropriate national bodies. In Scotland, those discussions took place between the industry representatives, officials from the Scottish Executive and the Scottish assessors. The industry representatives approached the discussions realistically. As a result of the process, valuation figures were arrived at that are, for the most part, acceptable to the industries and to us. Similar discussions took place simultaneously in England and Wales, and cross-border contact with officials in the Department of the Environment, Transport and the Regions and the Valuation Office Agency was maintained.

Harmonisation of valuation treatment and practice, north and south of the border, is a key feature of the revaluation. Wherever possible, the valuations reflect that. Aggregate rateable values are apportioned among local authorities on the same basis as in previous revaluations. That does not mean that there was universal agreement, and I shall mention two areas in which there are still outstanding issues.

The docks and harbour operators, north and south of the border, remain opposed to proposed changes to the assessment of their rateable valuation. Lack of consensus in that area has meant that a draft docks and harbours order is still in preparation and will not be presented to the committee until early in the new financial year.

British Energy, which operates nuclear generation in Scotland, is also concerned about the valuation methodology that applies to its generating plants throughout Great Britain. However, agreement on the outcome in Scotland has been reached with the industry's representatives and draft electricity orders have been prepared for the committee to consider today. Given British Energy's objections to the approach to its valuation, officials will liaise with colleagues in England and Wales and will give further consideration to the concerns raised by British Energy following the revaluation. I am prepared to revisit the order and come back to the committee in the light of those discussions, or to consider rate relief if we decide to end prescription.

I shall pause after those general remarks to allow questions, before dealing briefly with the detail of the seven orders. I stress that, in approving the statutory instruments today, the committee will be setting the rateable values for the next five years and will provide stability and certainty for the industries concerned.

I call Kenny Gibson to ask the first question. I should make it clear that these are not to be technical questions.

On non-domestic rates, are you considering allowing local authorities to keep the rates that they raise to make them more business-friendly? Are you considering adjusting the revenue support grant to allow for the differential in the amount of money that local authorities have under aggregate external finance? I am confused about the response to my earlier question on the increased amount of money coming through non-domestic rates. I understood that, under AEF, there was an increase of about £200 million. According to the figures that the Convention of Scottish Local Authorities published last week, the differential between the amount raised this financial year and next is about £223 million. Could you clarify that? Are you actively considering allowing local authorities to keep their business rates, even though the amount that they have to spend may not be adjusted?

I am happy to answer those two points, although neither of them has anything to do with the seven orders that are before the committee.

We made it clear that there should be a national system of non-domestic rates and that there should be a national non-domestic rate in Scotland. That position has been widely welcomed by business. It is now accepted by local authorities as well and we have no intention of changing that. We have agreed with the Convention of Scottish Local Authorities and business organisations that they might have discussions about pilot projects involving business improvement districts where the rate could be more flexible—parts of a local authority area where the money is used specifically to invest in that area in a way that might help business and the local community. Those discussions will take place this year.

The estimates for next year allow for an inflation-only increase in the total for non-domestic rates in Scotland. The amount of money that came in through non-domestic rates in this financial year is expected to be higher than the initial estimate, which is probably where those figures come from. The overall position on non-domestic rates is that we are totally responsible for that money here in Scotland. In pre-devolution days, if the non-domestic rates income in Scotland fell short over a financial year the Treasury picked up the tab. If the non-domestic rates income in Scotland was greater than expected, the Treasury kept the surplus. Now that we are responsible for our own budget, and solely responsible for non-domestic rates, we have to balance that from one year to the next. It is our intention to ensure that, over the course of three, four or five years, that balance is achieved. We will review the figures in the course of the next financial year to ensure that that is the case.

I was lenient in allowing that question. I suspected that it had been asked before by another member of this committee, and that Jack McConnell had already answered it. I ask Gil Paterson to ensure that his question is in order and addresses the subordinate legislation issues that we are considering today.

I will need to be guided, although I think that it is within that scope. My question relates to communities and industry. Is there scope for an industry, or a group of industries, to begin to use the rates system to gain some assistance? Is there more armoury left in the locker with which to help industry?

That question is not absolutely relevant to what we are here to discuss today. You may answer it if you want to, minister, but it is not relevant to the present discussion.

One point of clarification might be helpful. Last Wednesday, I was able to announce a transitional relief scheme through the scale of increases that certain industries or companies might face throughout Scotland. That will apply to large industries as much as to small businesses. Those industries that appear in the paper that you have received today, which will face increases of more than 7.5 per cent in their likely rates bill for next year, will have the increase pegged to 7.5 per cent as a result of the transitional relief scheme. That rule will also apply to industries at the other end of the scale, which will receive decreases.

We are trying to accommodate changing economic patterns, and the whole evaluation system is designed to accommodate changing patterns of economic success. The purpose of having a five-yearly business rates revaluation process is to ensure that, where industries or commercial areas within local communities are either having difficulties or are experiencing high levels of commercial success, the valuation figures reflect that. People can either pay their share or be compensated for a downturn in commercial activity.

I hope that this question is relevant, convener. Jack, when you mentioned two organisations—docks and harbours and one other—which had not signed up, it raised the issue of the element of negotiation that is involved. I do not suppose that there is any negotiation over small businesses or domestic rates. Will you explain the degree to which negotiation is required, why it is necessary, and—the bottom line—whether more money could have been taken for the public purse from these organisations, some of which make quite a bit of money from the public before the revaluation takes place?

I am satisfied that the valuations that we are agreeing today are good for the public purse. They will ensure a neutral effect: although some will go down and some will go up, across the piece the impact will be the same as the general revaluation and our income will hold steady.

The reason for having partially negotiated valuations is partly because of the size of the industries involved, and partly because they are so difficult to value by the conventional method due to the nature of the industries and the valuation of the assets. They are not commercial rented properties; for example, the orders that apply to the railways cover the railways part of the railway network and railway property, not the shops that might be found in a railway station, which are valued by the conventional method. Such areas are harder to define.

Furthermore, there is no right of appeal against these orders. When assessors value a small commercial business or business property in Scotland by the conventional method, owners of those businesses and properties have the right of appeal. Obviously, many of those appeals are successful. However, after the committee agrees the orders today, they are final.

We have negotiated a settlement for the United Kingdom that takes account of regional differences, the current position of these industries and the assets that they have gained or lost since the previous valuation and that agrees a sum total that does not lose the public purse any money. By doing so, we remove the element of risk. We are talking about an awful lot of money, and introducing an independent system of evaluation with the right of appeal could lead to more uncertainty for the industries involved, which might damage job prospects. It could also lead to more uncertainty for us. If we started losing appeals of that size, we would clearly have difficulties with our income.

As a result, the proposed system suits both the public purse and the industries, although I should make it clear that the system is under review. In the past, there has been talk about moving to a more conventional system, and I would not want to rule out such an option five years from now. However, consistency and stability are the best things for the first five years of the Scottish Parliament and the Scottish Executive.

The revaluation 2000 paper says:

"So far as the gas and railways are concerned, the approach employed was to arrive at a UK cumulo valuation and then apportion between Scotland, England and Wales."

If, in the next five years, the Scottish Parliament decided that it wanted a different system of local government finance that involved changes to non-domestic rates, would we have to leave the gas and rail industries alone because they are UK matters, or could they be unscrambled from that situation?

My team can correct me if I am wrong, but my assumption is that the overall valuation would still require some apportionment on a UK basis with an agreement of the Scottish total, followed by an apportionment within Scotland to the different properties owned by such companies.

However, if you are suggesting that, at that point, non-domestic rates might become a more localised decision, I should say that once the valuations are set, the local authorities would presumably keep the money that had been raised in their area. In other words, although the gas and rail industries could be unscrambled, there would still have to be a national picture of the valuation and an apportionment to the authorities concerned through some sensible formula that reflected the amount of land, property or activity in their areas.

I want to return to the question about the total increase in uplift. Although I bow to your superior mathematical knowledge, if we examine the calculations that you have provided today, the industries involved will be paying an extra £10 million, which is more than half of the total uplift in Scotland. Will the rest of Scotland's businesses and industries provide only about £5 million?

I am not sure which total you mean.

The increases in rateable value come to £23 million, minus the £3 million decrease for the water authorities, which brings the total to £20 million. With a rate of 50p in the pound—actually the rate is about 45p—that means roughly £10 million in increased rates for those industries.

That would not be my calculation.

As an ex-mathematician, what would yours be?

The total amount of money that will be raised from the prescribed industries—which appears at the bottom of the paper—will be about £136.2 million.

Yes, but we are not told how much was raised last year: that figure would have been about £125 million.

I do not think so. This year we will raise between £130 million and £136 million, as the increase in take from one year to the next is, as I said earlier, 1.1 per cent.

Under distribution alone, we are told that the increase will be from £167,375,000 to £180,913,000. That is an increase of £13.6 million.

Perhaps I should have made this a bit clearer. Those figures relate to rateable value rather than the rates that are paid. Mr Harding is making the point that, if the difference is multiplied by the business rate of 45.8p in the pound, that figure would be arrived at. However, that does not allow for the fact that the current business rate in Scotland is 49p in the pound. In the case of the electricity industry, for example, £180 million times 4p in the pound would have to be taken away before any increase could be considered.

That would still amount to an increase of nearly £10 million for these industries alone.

I shall check that calculation during the debate and get back to you. That was not my calculation before we came in.

I do not want to get too technical, but I am trying to make a political point. The difficulty with a lot of these figures is that they are not easily understandable. Take, for example, the Water Undertakings (Rateable Values) (Scotland) Order 2000. How are people supposed to understand these figures? Both you and I are graduates of Stirling; your degree is in mathematics, and mine is in economics. Even so, it is difficult to understand the figures on page 2, under paragraph 5(3). We are informed that

"'the relevant adjusted volume of supply'"

will be calculated in accordance with the formula D+[1/3Ex2/3F]+1/2G+1/6H+1/3J+5/6K.

Kenny, I must stop you for a moment. We do not know where you are reading from.

Page 2.

Of the instrument?

There are seven orders. Which order are you reading from?

I read that out a moment ago. It is the Water Undertakings (Rateable Values) (Scotland) Order 2000. Sorry. I was perhaps reading a bit fast.

Convener, I suggested that I was stopping in the middle of my introductory comments to talk about the general position, before going through the seven orders. I think it would make more sense to go about it in that way.

I have a general point, minister. Do you have any plans to ensure that the calculations will be simplified the next time, so that ordinary people will be able to understand the way in which these figures are arrived at? They currently rely on very involved mathematical formulae, which 99.9 per cent of the population will not be able to understand. That is obviously a flaw.

You cannot change the instrument, but perhaps an explanatory note could be provided in future, which would be helpful for people such as Kenny and me.

I am keen to ensure that the maximum information is available. I understand that, last year, these instruments took two minutes to process at Westminster. We have tried to provide more information for this committee today, to improve that situation, and I am keen for us to continue to increase the amount of information that is available.

The technical orders have to be technical in nature. They have to specify the formula and the outcome, give the industries certainty and deal with the negotiated agreement between the assessors and the industries. Our job is to process them in legal terms. What we can do—not only in this forum, but in other ways—is answer questions and provide further information that will make them more understandable. However, I suspect that members of the public in Scotland would be keener to read about other local government finance issues than about some of this stuff.

We will now move on. I understand that you have to finish your speech, minister.

I am checking Mr Harding's calculations. Despite the fact that he is not a maths teacher, I would like to pay him that much respect at least before we finish this afternoon.

There has been a change of format of the draft orders that relate to the electricity industry. At the 1995 revaluation, in addition to the orders dealing with independent generators and the aluminium manufacturers that are before us today, there were three other orders that dealt with generation, transmission and distribution of electricity by the three principal electricity companies. For the purposes of brevity and convenience, those orders have been combined into one order, the Electricity Lands (Rateable Values) (Scotland) Order 2000. The content of the draft order remains consistent with that in the orders that were made at the 1995 revaluation.

The draft BG Transco plc (Rateable Values) (Scotland) Order 2000 provides for that company's valuation for the financial years 2000 to 2005 and updates the provisions to reflect the position. Since the de-merger of British Gas in 1997, Transco has become the largest company within British Gas and is concerned with the transportation of gas.

The draft Railtrack plc (Rateable Values) (Scotland) Order 2000 provides for the rateable value of certain lands and heritages occupied by Railtrack for the financial year 2000-01 and subsequent financial years. Railtrack is in occupation of the Scottish network tracks and sidings, Waverley station in Edinburgh and Glasgow Central high level. The order provides for the Scottish share of the UK total.

The draft Train Operating Companies (Rateable Values) (Scotland) Order provides for the rateable values of lands and heritages occupied by train operators for the financial year 1999-2000. Since 1998, retrospective orders have been made annually in order that changes taking place in the rail industry could be accommodated. However, given the relative stability of conditions in Scotland, I think it better to bring the train operators into line with the other industries by making longer-term orders.

Early in the new financial year, I will bring forward a further draft order dealing with train operators, which will be put before the committee. That order will relate to the rateable values for the years 2000 to 2005 and is intended to be the last of the retrospective orders.

The draft Water Undertakings (Rateable Values) (Scotland) Order 2000 provides for the rateable value of properties occupied by Scotland's three water authorities for the next five years. In calculating the rateable values for the water industry, the discussions have taken into account the fact that the water authorities have inherited old assets and substructure that will require substantial investment. For that reason, the total valuation figures for the three water authorities is lower for 2000 than the equivalent figures arising from the 1995 revaluation. That means that we have taken account of the increased expenditure in the authorities on investment, which will be of benefit to those who pay water charges across Scotland.

I emphasise that the orders presented to the committee today will provide stability and certainty for the industries concerned for the next five years, and for us in regard to income. That will enable the companies to continue their financial planning in a stable environment and will allow us to budget for non-domestic rates properly. I commend the orders to the committee.

Motions agreed to.

That the Local Government Committee in consideration of The Electricity Lands (Rateable Values) (Scotland) Order 2000 recommends that the Order be approved.

That the Local Government Committee in consideration of The BG Transco plc (Rateable Values) (Scotland) Order 2000 recommends that the Order be approved.

That the Local Government Committee in consideration of The Railtrack plc (Rateable Values) (Scotland) Order 2000 recommends that the Order be approved.

That the Local Government Committee in consideration of The Electricity Generators (Aluminium) (Rateable Values) (Scotland) Order 2000 recommends that the Order be approved.

That the Local Government Committee in consideration of The Electricity Generators (Rateable Values) (Scotland) Order 2000 recommends that the Order be approved.

That the Local Government Committee in consideration of The Water Undertakings (Rateable Values) (Scotland) Order 2000 recommends that the Order be approved.

That the Local Government Committee in consideration of The Train Operating Companies (Rateable Values) (Scotland) Order 2000 recommends that the Order be approved.—[Mr McConnell.]

Minister, do you wish to answer Mr Harding's point?

We are having some problems with the calculator. I am happy to undertake to provide the committee with a written explanation of the calculations.

Are members happy with that? Keith Harding cannot believe that you cannot work it out, minister.

It is quite straightforward.

It is more complex than you think, Keith.

Minister, thank you for your time.