EXPLANATORY MEMORANDUM TO - PDF document

EXPLANATORY MEMORANDUM TO THE REMOVAL, STORAGE AND DISPOSAL OF VEHICLES (PRESCRIBED SUMS AND 2008 No. 2095 THE POLICE (RETENTION AND DISPOSAL OF MOTOR VEHICLES) (AMENDMENT) This explanatory memorandum has been prepared by the Home Office and is laid before Parliament by Command of Her Majesty. This memorandum contains information for the Joint Committee on Statutory Instruments. 2. Description 2.1 3.1 The new regulations provide for above inflation fee increases. The prescribed sums (commonly referred to as statutory charges) are currently £105 for removal, £12 per day for storage and £50 for disposal. These sums were 1 4. Legislative Background 4.1 The Road Traffic Regulation Act 1988 and the Refuse Disposal (Amenity) Act 1978 allow the Secretary of State to prescribe charges for the removal, storage or disposal of vehicles that powers are exercised in the Removal, Storage and Disposal of Vehicles (Prescribed Sums and 4.2 Under the Police Reform Act 2002, the police canin a manner causing, or likely to cause, alarm, distreto prescribe charges in respect of the removal aexercised in the Police (Retention and Disposal of Motor Vehicles) (Amendment) Regulations 2008 which amend the charges set out in the Poli 4.3 Under the Road Traffic Act 1988, the police can remove a vehiclc Act 1988 (Retention and Disposal of Seized Motor Vehicles) (Amendment) Regulations 2008 which amend the ch 5. Territorial Extent and Application 5.1 The Removal, Storage and Disposal of Vehicles (Prescribed Sums and Charges) hicles) (Amendment) Regulations 2008 apply to England and Wales.hicles) (Amendment) Regulations apply to Great Britain. 6. European Convention on Human Rights 6.1 As the instrumentsprocedure and do not amend primary legislation, no statement is required. 7. Policy Background 7.1 Ministers have decided to since 1993 as explained in section 3 above. Ministers are satisfied that they are necessary to ensure the removal operations. 7.2 Removals are normally undertaken by recovery or within a managed scheme run for the force by an independent managing agent. The number of such removals is not known. One smaller,s estimated around 3,000 a year, another larger, more metropolitan, force 30,000. 7.3 For such removals and any subsequent storagpolice are entitled to recover from the owners such sums as the Secretary of State may prescribe. It is these sums which largely determine the income that police contracted recovery operators derive from the statutory removals they carry out. 7.4 A vehicle once removed does not usually have to be released to its owner until the sums are paid. If the sums are not paid they can be pursued through the courts. While in general 2 sums are legally enforceable. 7.5 Ministers take the view that the charges should not be punitive or an income generator for l as to make removal operations viable. 7.6 The new higher charges are necessary because to become uneconomic erations. This is especially so if there were any increase in the numbers who insisted that thcharges, whatever the actual 7.7 If contractors decided to stop work for the police, this would have a detrimental effect on the police’s ability to enforce the law, remove obstructions and of the vehicles, their being used for crime or becoming a focus for crime or environmental Consultation and subsequent work 7.8 As part of the review a public consultation on the RTRA charges took place for 12 weeks from May to July 2007. Its major proposal was to refor removal with a set of charges dependent on some possible charges, but emphasised that thes 7.9 There were 31 responses to the consultation pa http://www.homeoffice.gov.uk/docum The responses came exclusively from bodies with a professional, commercial or offibecome clear that most parties believed the current regime was unsatisfactory and needed significant change. Most respondents welcomed the consultation; the majority gave scenario based charging their broad support. There was some opposition to some of the detail, but this which individual respondents formed part. 7.10 Ministers noted the overwhelming support for moving away from a single flat rate. They believed this necessary to recognise the varied requirements that might arise and to avoid the inequity of, for example, the owner of a car broken to pay the same as would relate to a limited range of scenarios each defined by reference to vehicle type or size, its size. These factors are all considered to have 7.11 The Government thought it would be unhelpful to exempt particular vehicles or scenarios from the charge. The police must be able to remove any vehicle, using their RTRA powers, and recover the cost of such removals. 7.12 Ministers noted that the responses had included many suggestions as to the scenarios to be therefore, there was detailed further work to 7.13 In setting the charges the Government took account of suggestions made during the information was also of limited value, being put tors or insurers or 3 suggestion sometimes being more than twice the lowest. The sums now prescribed are within the minima and maxima put forward. advice from the police. Interestedgather information over the first year of the new charges and Ministers intend to carry out 7.14 The new charges have been notis no change in police powers, there will be no formal guidance. However, the Home Office will be writing to the interested parties to elaborate on how, subject ultimately to any ruling by the courts, the scenarios might 8. Impact 8.1 An impact assessment is attached. 8.2 The impact of the new charges on the public insurance company. The statutory component of what they pay will in future be greater. Contractors will have a surer source of income more closely related to the costs they actually incur. 9. Contact 9.1 Geoffrey Biddulph at the Home Office, Public Order Unit, can answer any queries mail: geoffreycharles.biddulph@homeoffice.gsi.gov.uk 4 Summary: Intervention & Options Department /Agency: Home Office Title: Impact Assessment of revised statutory charges for the removal , storage and disposal of vehicles by the police Implementation Version: 4 Date: 10 July 2008 Related Publications: Available to view or download at: http://www . hom e office.gov.uk/about - us/publications/regulatory - im pact - assessm ents Contact for enquiries: John Crozier Telephone: 020 7035 1797 What is the problem under consideration? Why is government intervention necessary? The police are empowered under three different Acts to remove vehiclessums as may be prescribed in respect of the removal and any subsequent storage and in some casese unsatisfactory in that the they do not meet the costs incurred and the extra has to be met through negotiation and agreement. This breakdown in arrangements for removal, which would prevent necessary removals from being undertaken What are the policy objectives and the intended effects? The aim is to ensure the continuation of an effective and viable means of vehicle removal by setting charges that meet but do not exceed the costs necessarily involved in these police undertakings.The costs should meet as far as possible the differing inlic, individual motorists, police. Removals serve to prevent obstruction, danger, environmental degradfor crime, anti-social behaviour and driving lin What policy options have been consider no charge for some cases; distinguish between straightforward removals and more complex recoveries; ce scenario-based charging. Scenario-based charging is the only option that addresses all the issues, doesdisadvantage, is least likely to lead g islation. When will the policy be reviewed to establish the actual costs and benefits and the achievement of the desired effects? After first year of application of the new charges; thereafter, regular periodic reviews. Ministerial Sign-off For final proposal/implementation stage Impact Assessments: and I am satisfied that (a) it represents a fair and reasonable view of the expected costs, benefits Signed by the responsible Minister: ............................................................................Date: 28 July 2008 5 Summary: Analysis & Evidence Policy Option: Description: ANNUAL COSTS One-off (Transition) Yrs £ Average Annual Cost (excluding one-off) key monetised costs by ‘main affected groups’ The increased charges do not affect the actual costs involved in removal, etc. They make a higher proportion of er than a matter of negotiation. prescribed sum are equal and oppos tt Unknown Total Cost (PV) Unknown C O S T S by ‘main affected groups’ ANNUAL BENEFITS One-off Yrs £ Average Annual Benefit (excluding one-off) key monetised benefits by ‘main affected groups’ higher sums that are legally enforceable rathe rthan negotiable. Unknown Total Benefit (PV) Unknown B E N E F I T S by ‘main affected groups’ Clarification for all parties of the amount legally payable for any incident and avoidaable removal service to assist police o p e ra tions in tend ed to prom ote public safety and c onvenience and r educe c rim e . Key Assumptions/Sensitivities/Risks Removals, etc will be carried out as at present. Police powers remain the same. Their use and the practical arrangements for removals, etc remain operational/commercial/contractual matters for the police. Statutory requirements as to payment also remain the same: an y thin g further remains a matter b etweenthe p arties. Price Base Time Period Net Benefit Range (NPV) NET BENEFIT (NPV Best £ estimate) What is the g eo g ra p hic covera g e of the p olic y /o p tion? En g land and Wales On what date will the p olic y be im p lemented? 1 October 2008 Which or g anisation ( s ) will enforce the p olic y ? Police What is the total annual cost of enforcement for these or g anisations? £ Nil Does enforcement com p l y with Ham p ton p rinci p les? Yes/No Will im p lementation g o be y ond minimum EU re q uirements? Yes/No What is the value of the p ro p osed offsettin g measure p er y ear? £ Not a pp licable What is the value of chan g es in g reenhouse g as emissions? £ Not a pp icable Will the p ro p osal have a si g nificant im p act on com p etition? No Annual cost (£-£) per organisation (excluding one - off) Micro Nil Small Nil Medium Large Nil Nil Are an y of these or g anisations exem p t? Yes/No Yes/No N/A N/A Im p act on Admin Burdens Baseline ( 2005 Prices ) ( Increase - Decrease ) Not applicable Net Impact Increase of Decrease of Annual c osts and b enefits: (Net) P res ent Key: 6 Evidence Base (for summary sheets) [Use this space (with a recommended maximum of 30 pages) to set out the evidence, analysis and detailed narrative from which you have generated information is organised in such a way as to explain clearly the summary information on the preceding pages of this form.] Current situation e police are empowered to remove vehicles that are illegally, dangerously or obstructively parked, or broken down, or abandoned Such removals are important to enable the police to enforce the law, remove obstructions and potential dangers, prevent theft of the vehicles, their being used for crime or becoming a focus for crime or environmental degradation, or being driven whilst in a dangerous condition. The Government is committed to ensuring that there are no obstacles to such removals. The police also have powers to remove vehicles under the Road Traffic Act 1988 (RTA) and the Police Reform Act 2002 (PRA). Under the RTA, the police manner as to cause or be likely to be cause alarm, distress or annoyance to memberpowers are important to enable the police to put an immediate stop to setackle effectively serious criminality often associated with danger to other road users. The removals are normally undertaken on behalf of thparticular force or within a managed scheme set up managing agent. There are an estimated 5,000 recovesome 700 - 800 concentrate on the general range of recovery work, from road traffic ge for repair work. It is from their scheme managers select, according to their cremovals. e case of RTRA removals, disposal of the vehicles recover from the owners such sumsprescribe (in the case of RTRA removals, these costs may be met by insurers: it isvers these costs and if they do whether to make a claim). It is these sums which largely determine the income that police contracted recovery operators derive from the A vehicle once removed does not normally have to be released to its owner until the sums are paid. While in general insurance companies circumstances, only the prescribed sums are legally enforceable for any removal, etc. Rationale for new prescribed sums e sums. Ministers have however consistently taken the view that they should not be punitive or an income generator for the police, but should be set at such a level as to make removal opeinvolved in removals, etc are met. The prescribed sums for RTRA removals (commonly referred to as statutory charges) were last amended in 1993. Up to and including that time, the charges by relation to the costs incurred in removals, etc. ordered by the Metropolitan Police. Ministers believed this was a pragmatic 7 charges and that there was no more wide-ranging information available. At the time the Metropolitan Police’s removal operations were the largest in the country and contracted out rather than conducted in-down, chiefly following the introduction of decriminalised pa under these should be the same since the costs involved in a removal would be the same under s arose originally from a belief thatthe different costs that might be incurred in different kinds of removal. that removal, etc operations might become non-viable. The higher charges expected to result from the review the police might become uneconomic for them to continue. This would particularly be the case if there was any increase in the numbers who insisted that aking RTRA removals for the police was not economically viable, and there were no other reasons for remaining on police contract, they might decide have a detrimental effect on the police ability to enforce the law, remove obstructions and potential dangers, prevent theft of the vehicles, their being used for crime or becoming a focus for crime or environmental degradation or being driven whilst inrms of longer road closures, more severe congestion, longer journey times, etc. Any lessening of police ability to seize and remove vehicles using RTA and PRA powers could lead to more uncontrolled anti-social behaviour using vehicles and more driving without to other road users and who may be involved in other criminality. Consultation RTRA charges took place over May, June and July 2007. Its major proposal was to replace arge for removal with a set of io charging. (There were also did suggest some possible charges that might apply to the different scenarios, but emphasised that these and not final. The main purpose views on moving from flat rate charges. (Although the document was publicly available, these came exclusively from bodies with cial interest,) Prior to the consultation, it had already become clear that most interested parties believed the current regime was therefore welcomed the consultation as likely to lead to some level of improvement. The majority gave the proposalsupport. They thought that their essential componentbe a significant change for the better. There was some opposition in principle to various elements in the vidual respondents formed part. No The Government noted the overwhelming support for moving away from a single flat rate. To achieve the aim of ensuring the viability of effective removal operations, they believed such a move necessary to recognise the varied requirements that might arise in a removal and to the range of removals that might be required under thfrom the situation with decriminalised parking regime or other situations in which a flat rate might 8 apply. The Government therefore rulethe current flat rate charges in The consultation document and Government’s response are available on the HO website at http://www.homeoffice.gov.uk/docum moved under the RTA and PRA powers the same as the RTRA charges. They made no comments. Options e Government considered five options: circumstances or vehicle types Secretary of State is empowered to prescribe charges; she is not required to do so. It would therefore be eg removal of an HGV, or else to prescribe is would leave any payment for removal, etc as a matter lice must be able to remove any vehicle, using their RTRA powers, when they consider it necessary and subject to any requirements they have for speed of removal, protection of possible evidence, etc. The situation in whicsomeone’s vehicle is quite different from the situation operator to effect a removal and agvery operators by denying them the current security of charges that ead to their regular involvement in unnecessary disputes and potential court proceedings. This could lead to their being unwilling to continue RTRA work for the police. Menu-pricing. Under this option an over-all charge would be built up from different prescribed charges for different elements of an operation, eg for each hour worked, for each person employed, for each type of recovery vehicle or other equipment used. This lly costly arguments over what waindividual case. Building up an over-all charge from prescribed charges for different elements would also d be less likely to meet but not exceed the costs necessarily involved in removals. This option might benefit operators, but would be unlikely to meet the differing inte ard “removals” (via tow or simple pick-up) and “recoveries” (from complex situations, requi different provisions might apply actituted a removal or a recovery: there might be a higher charge for a recovery or recoveries might ed. Any movement of a vehicle from one place to another is necessarily a removal. to define in advance whether any individual removal might fall into helpful. The governing primary legislation would not permit the Secretary to State to prescribe that for by another party. The Secretary of State is empowered to prescribe charges not a system whereby charges are set or to delegate the is in any case unnecessary since the Government’s preferred option of mmonly associated with recoveries by tbetween recoveries and removals. 9 Negotiable charges r any removal would be as agreed between the parties or in accordance with a table of charges determined by can only prescribe set sums. Payment above the prescribed amount can however be made by agreement Scenario charges was the preferred option. The Government to a limited range of scenarios each being definecommercial vehicles, whet They noted however that the responses had included macategories, the scenarios and the different levels of charges that might apply. Detailed further work on these took place over the following months, including further communications with those who had oncluded as a matter of principle that the costs of in a managed scheme should not beundertaking a removal. It is for whether to operate a managed scheme or contract diretors and for operators to decide whether to join a scheme. These are commercial and contractual mattethe police, the managing agent and the operators. unavoidably from the removal, which is wh s are as set out in the Annex to this Impact Assessment They have been notified directly to those who engaged directly with Government in the review in a letter that has been placed on the HO website with the original consultation document and Government report on responses. s the Government took account re not supported except by anecdote. Some harder evidence, such as invoices for particular removals, was presented but was of very limited value, being put objective. Respondents’ suggestions considerably, with in some cases the highest suggestion being more than twice the lowest. There were number and detail of the scenarios totors, but this was not always the case, nor was there always agreement between different representatives from the same broad area. For example, for removal of an unladen vehicle between 7.5 and 18 tonnes, off-road but undamaged, the Operators Alliance (AVROA) £1490, the Association of British Insurers (ABI) £1000; for removal of a vehicle between 2.5 and 7,5 tonnes, off-road but undamaged AVRO suggested £500, AROA £400, ABI sters are within the minima and maxima put forward. They take particular account of advice from the police, who habut do not have the direct motivatilower levels. Ministers accept that there will be disagreements over the charges,terms, whether they are too high or too low. Some parties may take a diametrically opposed view to others. Apart from different parties’ assessments of terests to claim as costs necessary for a particular removal or type of removal and different contractual requirements. Ministers believe that the charges e most reasonable outcome that is wever that the firm evidence for these is limited. Interested parties er information over the first year 10 problems that might arise over the available scenarios and their interpretation and to maintain comprehensive records of costs to inform any future changes. Ministers have already agreed that in future there will be regular reviews. Impact of the changes The impact of the changes in individual cases cannot be meaningfully assessed. Thfrom £105 to £150 for the cheapest scenario and to £6000 in the most it is already customary for insurers to pay more than the statutory mean that the element of total payment which is statutory will increase, not necessarily the total payment. In some cases, the total payment may decrease slightly, where a contractor considers the amount obtained under the statutory obligation is sufficiently close to the costs actually incurred to be acceptable. The main change will be in responsibility for meeting thextra cost incurred falls on the police/their recovery operator. Under the new charges, such extra cost will be less. The charges will continue to fall only on owners and their insurers, that is those responsible for the thus be diverted from otcase, however, that the legislation entitles the police to recover the presthem to do so. It would be for individual chief officers to decide if in the special circumstances of a t be recovered. Any payment to tha contractual matter between the police and operator or operator’s managing agent. atutory charges would make it harder to obtain payment. A vehicle does not are paid. RTRA charges canthe courts and a vehicle that is not claimed can be disposed of and sufficient of the proceeds kept to meet the statutory charges. meaningfully assessed. tion as to the numbers of statutory removals they undertake. These range from around 3,000 per year in one more rural county to around 30,000 in a more metropolitan area. There is minimal these removals (though anecdotally between two thirdsmovals are believed to around 70% of removals are of vehicles, commonly private cars, that are not significantly damaged and are on road. (This estimate relates to RTRA removals; virtually all RTA and PRA removals would involve private, undamaged vehicles, though numerous PRA removals Impact on small firms The small firms chiefly affected are the recovery operators working for the police and the firms whose vehicles may be removed by the police under RTRA poweras the charges are not a regulation. The increase in the charges will benefit recovery operators, for the reasons outlined above: they will have a greater certainty of recovering all or the greater part of the costs e, already commonly pay above the in the amount that is legally enforceable. discussions, meetings, written communications with and comments from individual small firms and their representative organisations. Their comments formed the bulk of responses to the formal consultation and follow-up work and have been taken into 11 account as explained. Representative organisations of hauliers and welcomed the new charging regime. 12 Specific Impact Tests: Checklist Use the table below to demonstrate how broadly you ha analysis are contained within the Results in Evidence Base? Results annexed? Type of testing undertaken Competition Assessment No No Small Firms Impact Test No No Legal Aid No No Sustainable Development No No Carbon Assessment No No Other Environment No No Health Impact Assessment No No Race Equality No No Disability Equality No No Gender Equality No No Human Rights No No Rural Proofing No No 13 Annexes TABLES OF CHARGES Charges in relation to the removal of vehicles 1 2 3 4 5 Vehicle position Vehicle equal to tonnes MAM tonnes MAM Vehicle exceeding than 18 MAM exceeding 18 tonnes MAM 1 2 Vehicle on road, substantially damaged or any two wheeled its condition or £150 £200 £350 £350 3 Unladen - £2000 Unladen - substantially damaged or both. £250 £650 Laden - £3000 Laden - £4500 4 Unladen - £1000 Unladen - substantially damaged £200 £400 Laden - £1500 Laden - £2000 5 Unladen - £3000 Unladen - £4500 substantially damaged or both £300 £850 Laden - £4500 Laden - £6000 Charges in relation to the storage of vehicles 1 2 3 4 5 Two wheeled vehicle Vehicle, not Vehicle exceeding Vehicle exceeding exceeding 18 1 14 wheeled vehicle, tonnes MAM but equal to or less tonnes MAM 2 £10 £20 £25 £30 £35 of vehicles (RTRA removals only) 1 2 3 4 5 Two wheeled vehicle wheeled vehicle, Vehicle exceeding Vehicle exceeding exceeding 18 tonnes MAM 1 2 £50 £75 £100 £125 £150 15