LOCAL GOVERNMENT, ENGLAND AND WALES PART I Citation and commencement 1 These Regulations may be cited as the Local Government (Prescribed Expenditure) (Consolidation and Amendment) Regulations 1987 and shall come into force on 13th January 1988. Interpretation 2 In these Regulations — “ the Act ” means the Local Government, Planning and Land Act 1980; “highway authority” has the meaning ascribed to it by section 1(2) and (3) of the Highways Act 1980 ; “housing association” has the meaning ascribed to it by section 5(1) of the Housing Act 1985 ; “shared ownership lease” has the meaning ascribed to it by section 622 of the Housing Act 1985; and “subsidiary” shall be construed in accordance with section 736 of the Companies Act 1985 . PART II Prescribed Proportions of Net Capital Receipts 3 1 For England, the prescribed proportion of an authority’s net capital receipts for the purposes of section 72(3)(d) of the Act shall, in the case of sums received on the disposal of assets of a class mentioned in column 1 of Schedule 1 hereto or the repayment of a grant or advance of a class so mentioned, be the relevant proportion mentioned in column 2 of that Schedule. 2 For Wales, the prescribed proportion of an authority’s net capital receipts for the purposes of section 72(3)(d) of the Act shall, in the case of sums received on the disposal of assets of a class mentioned in paragraphs 2, 4 or 5 of column 1 of Schedule 1, or the repayment of a grant or advance of a class mentioned in paragraphs 6, 7, 8 or 9 of that column, be the relevant proportion mentioned in column 3 of that Schedule. Classes of assets to be treated as if they were not mentioned in section 75(2) 4 1 The following classes of assets shall be treated as if they were not mentioned in section 75(2) of the Act — a land held for the purposes of or in connection with the Central Criminal Court, the police, probation and after-care or magistrates' court services; b leasehold interests in dwelling-houses held for the purposes of Part II of the Housing Act 1985; c leasehold interests in land held for any other purpose, except to the extent of — i any amount which an authority was taken to have paid under section 80 of the Act on the acquisition of that interest or any superior interest in the land, and ii the amount of any prescribed expenditure incurred by an authority on the construction, preparation, conversion, improvement, renewal or replacement of buildings or structures on the land; and d vehicles or vessels, movable or immovable plant, machinery or apparatus held for the purposes of, or provided in connection with, the Central Criminal Court, the police, probation and after-care or magistrates' court services. 2 In this Regulation a leasehold interest means one which — a has an unexpired term not exceeding twenty years which is not capable of being renewed or extended so that the unexpired term and any renewal or extension of the interest together exceed twenty years; b if it is granted to commence on the expiry of another interest, does not, together with any interest in the same land previously disposed of by an authority, exceed twenty years; and in the case of a dwelling-house held for the purposes of Part II of the Housing Act 1985 includes a periodic tenancy. Sums to be treated as capital receipts 5 Sums received by an authority which are mentioned in Schedule 2 to these Regulations shall be capital receipts for the purposes of Part VIII of the Act. Expenditure not to be prescribed expenditure 6 1 The amount prescribed for the purposes of paragraph 2 of Schedule 12 to the Act is £6,000. 2 For England, expenditure incurred in circumstances, or for a purpose, mentioned in Part I of Schedule 3 to these Regulations shall not be prescribed expenditure. 3 For Wales, expenditure incurred in circumstances, or for a purpose, mentioned in Parts I and II of Schedule 3 to these Regulations shall not be prescribed expenditure. PART III Interpretation 7 In this Part — “dwelling-house” shall be construed in accordance with section 112 of the Housing Act 1985 but shall not include any hostel or lodging-house as defined in sections 622 and 56 of that Act respectively; and references to a dwelling-house shall include references to any outhouses and appurtenances belonging to the dwelling-house or usually enjoyed with it; “housing authority” means a district council, a London borough council, the Common Council of the City of London or the Council of the Isles of Scilly; “long lease” shall be construed in accordance with section 458 of the Housing Act 1985; “new town corporation” means a development corporation established by order made, or having effect as if made, under the New Towns Act 1981 , or the Commission for the New Towns; “project” means the aggregate of the works included in a single contract or in two or more contracts where the works are to be carried out on the same or adjacent sites; “public body” means a housing authority, a county council, a new town corporation, an urban development corporation or the Development Board for Rural Wales. Cases to which section 80A(1) of the Act does not apply 8 1 Subject to paragraph (2), section 80A(1) of the Act shall not apply in relation to any works carried out for any authority on or after 1st October 1987 which comprise or form part of a project which is estimated to cost three million pounds or less at the date on which the contract relating to it or, if more than one, the first such contract is made (a “qualifying project”). 2 Paragraph (1) shall not exclude the application of section 80A(1) to a second or further qualifying project carried out for the same authority unless there is an interval of at least sixty consecutive months between the commencement of works on that project and the last previous qualifying project. 3 Subject to paragraph (4), section 80A(1) of the Act shall not apply in relation to works for the construction, preparation, conversion, improvement, renewal or replacement of a dwelling-house carried out for a housing authority on or after 23rd July 1986 pursuant to an agreement whereby the authority retains its interest in the land on which the works are carried out if that agreement provides (or that agreement and any other agreement or arrangement made in connection with that agreement or any variation or extension of those agreements or arrangements together provide) for — a the sale or the grant of a long lease of the dwelling-house by the authority to a person other than — i a public body, or ii a company which is under the control of a public body; or b the retention of the dwelling-house by the authority for the sole purpose of enabling the authority to grant a shared ownership lease. 4 Paragraph (3) shall not apply if the authority does anything that has the effect of releasing it from its obligations to sell or grant a lease of the dwelling-house as mentioned in paragraph 3(a) or (b). 5 A company shall be treated for the purposes of paragraph (3) as under the control of a public body if at the time of the agreement, arrangement, variation or extension either — a it is a subsidiary of a single public body; or b if two or more public bodies who are members of the company were a single body corporate, it would be a subsidiary of that body corporate. Prescribed expenditure 9 Where works to which section 80A(1) does not apply by virtue of regulation 8 are carried out for an authority, the authority shall be taken for the purposes of Part VIII of the Act (capital expenditure of local authorities etc. ) to make payments in respect of expenditure on the works when and as they are actually made. Revocation 10 The instruments listed in Schedule 4 are hereby revoked. Nicholas Ridley Secretary of State for the Environment 17th December 1987 Paul Channon Secretary of State for Transport 16th December 1987 Peter Walker Secretary of State for Wales 15th December 1987