| Description | The Local Government in Scotland Act 2003 allowed for Regulations to be prepared that would allow local authorities to dispose of land for less than best value, without the need to seek the prior consent of Scottish Ministers. |
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| ISBN | (Web Only) |
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| Official Print Publication Date | |
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| Website Publication Date | August 16, 2007 |
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Introduction
1. The Scottish Executive invites you to participate in a 12-week public consultation on draft Regulations and guidance for the disposal of local authority land for less than the best consideration that can reasonably be obtained.
2. The Executive consulted widely in 2005 on an earlier draft of The Disposal of Land by Local Authorities (Scotland) Regulations. In light of the comments received during the first round of consultation, amended drafts of the Regulations and accompanying Statutory Guidance are now being circulated for further comment. The Executive is working towards introducing these Regulations before the end of 2007.
Local Government (Scotland) Act 1973: Section 74
3. Section 74(1) of Local Government (Scotland) Act 1973 ('the 1973 Act') provides local authorities with the power to dispose of land in any manner they wish, subject to Part II of the Town and Country Planning Act (Scotland) Act 1959. However, in cases where the disposal is for less than the best consideration that can reasonably be obtained, then the specific consent of Scottish Ministers is required to that disposal of land, in accordance with section 74(2) of the 1973 Act.
Local Government in Scotland Act 2003: Section 11
4. Section 11 of the Local Government in Scotland Act 2003 ('the 2003 Act') amends section 74 of the 1973 Act by replacing the requirement to apply for Ministerial consent in circumstances in which local authorities are seeking to sell or otherwise dispose of land and associated assets at less than the best consideration that can reasonably be obtained. Section 11 also allows for Regulations to make provision in relation to the circumstances in which, and procedures by which, local authorities may dispose of land at an undervalue.
The Disposal of Land by Local Authorities ( Scotland ) Regulations 200[7] - Second Draft
5. These measures will replace the current requirement where local authorities must apply to Ministers for consent in every discounted land disposal case. Local authorities will be granted the autonomy to carry out their statutory duties and functions and to fulfil such other objectives, as they consider to be necessary or desirable.
6. In general terms, this second draft of the Regulations responds to comments received that the proposed regulatory regime was too prescriptive. Points of note in the revised draft Regulations are:
- Regulation 3 regarding 'disposals of land at a substantial undervalue' is new and introduces an upper limit for disposals that will continue to require the prior consent of Scottish Ministers. Views are sought on the appropriateness of whether a limit of £1,000,000 or £2,000,000 [one or two million pounds] should be set.
- Regulation 4 is less prescriptive than previously and now sets out the factors which a local authority should have regard to as part of the consideration process for a disposal.
- The terms 'marginal amount' and 'threshold amount' caused some confusion in the earlier consultation. The 'Explanatory Note', which is not part of the Regulations, has been amended to better define the marginal and threshold terminology.
- For the purposes of these Regulations, land is defined as including "land covered with water and any interest right or servitude in or over land" (s235(1) of the 1973 Act).
Draft Stautory Guidance regarding the duty placed on local authorities to appoint a suitably qualified valuer
- For consistency we concur that the clearest definition to use when describing disposals at less than market value, where appropriate, is "best consideration that can reasonably be obtained" (as used in the 1973 Act).
- The term 'corporate' member of the Royal Institution of Chartered Surveyors (RICS) has been changed to 'chartered' and reference to the Institute of Rating Revenues and Valuation (IRRV) has been deemed unncessary.
- With regard to the factors to be taken into account when assessing best consideration, the draft guidance now includes the requirements of the RICS "Red Book" as the basis of the valuation as well as the CPO Code, to allow for any bid by a special purchaser.