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Council agrees to change basis for imposing fees for licence to occupy in small community following complaint from permanent residents

Local Government
Ombudsmen Act 1975
Legislation display text:
Ombusdmen Act 1975
Local Authority
Sir John Robertson
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Fees for licence to occupy reserve land—differential between permanent and non-permanent residents

The complaint was from a permanent resident in a small fishing settlement. She was one of seven permanent residents out of a total of ninety-six residents and was concerned about the fees set by the Board administering the reserve for licences to occupy. For many years it had been Board practice in setting licence fees to recognise the greater demand that was placed on services by permanent residents and to set their licence fees at a higher rate than the fee for non-permanent residents. The complainant considered that there was little evidence of greater use of services by the permanent residents (in fact they made less use of some services such as caretaking) and that in recent years the gap between the two levels of fees had widened to the point where it no longer reflected any difference in use of services and amounted to unfair discrimination against permanent residents.

It was established that up until 1982, Board policy had been to make a surcharge of $10 for permanent residents. In 1982 the licence fee for permanent residents was set at $120 with non-permanent residents paying $80, but by the time the 1989 fees were set, permanent residents were paying more than twice as much as non-permanent residents.

The complainant pointed out that since the Board were elected from all residents and the total number of permanent residents could not exceed nine, permanent residents were inevitably in a minority on the Board and their arguments against the increasing differential were ignored.

The Ombudsman experienced considerable difficulty in obtaining any useful information from the Board, and the attitude of Board officers to enquiries certainly lent weight to the complainant’s assertion that she had sought assistance because, although she was herself a member of the Board, she had been frustrated in all her efforts to put a case for the permanent residents. ‘We are used to her ways and ignore her as far as possible’ said a Board officer in a telephone conversation with a member of the Ombudsman’s investigating staff.

Six months after the complaint had been notified to the Board, the Ombudsman received the last of the information which had requested from the Board. This was by no means full enough to enable him to reach a balanced conclusion and the Ombudsman was also left with some doubts about the Board’s constitution and its powers to grant licences and set fees. Enquiries of the Department of Conservation who had general overall responsibility for the reserve revealed a complex but comprehensible legal history dating from legislation enacted in 1924, and the Ombudsman was able to resolve his doubts. By this time, however, the Board had, in the course of local government reorganisation, ceased to exist and its functions had passed to a new District Council.

Officers of the Council were anxious to assist in the Ombudsman’s further enquiries, but encountered the same difficulties as he had had in extracting information from officers of the now defunct Board. The Ombudsman was eventually, though reluctantly, obliged to form an opinion on the merits of the complaint largely on information given by the complainant. Her understanding of Board policy was that the differential was set to cover the greater costs to the Board of the services provided but that the only difference she could identify was the  greater demand placed by permanent residents on the power supply for pumping water and sewerage and that this was balanced by the fewer demands made by permanent residents on the Board’s caretaker. The Ombudsman’s own study of the Board’s budget had failed to identify any other items where there was obviously greater expenditure on services to permanent residents.

On this basis, the Ombudsman could only form the opinion that the subcommittee of the Board which considered and recommended to the Board the licence fees, must have erred in setting the differential as widely as it did. The Ombudsman referred his opinion on a preliminary basis to the Council, who by this time had set in place a new reserve management committee, elected from residents of the settlement and to whom the opinion, was, in turn referred. As a result, the Ombudsman was given considerably more information about the management and services provided to residents than his previous enquiries had revealed.

The Ombudsman’s conclusion was that although it seemed likely that permanent residents would make more use than some non-permanent residents of some of the services provided by the committee, individual circumstances would differ. The Ombudsman wondered how usage would compare between, say, a single elderly permanent resident and a family of four or five in residence most holidays and at the weekends.

With this in mind, the Ombudsman formed the opinion that if the licence fee was to include both a fee for the right to occupy an individual section and a fee for the right to use the services provided, then the only logical basis for distinguishing between fees for permanent and non-permanent residents would be the amount of time for which they were entitled to occupy the premises and use the services. As non-permanent residents were entitled to occupation for nine months of the year, this would result in a licence fee of three-quarters that payable by permanent residents.

The Ombudsman also expressed concern that the permanent residents had inevitably been in a minority on the old Board and that they would continue to be in a minority on the new committee. He therefore expressed the opinion that the Council had an obligation to more than merely ‘rubber stamp’ decisions of the committee in matters where there might be a conflict of interest between the majority and minority groups, but to exercise its independent judgment in reaching decisions that were fair and reasonable so far as all members of the community were concerned.

After considering these remarks, the committee resolved to set the licence fee for non-permanent residents as three-quarters of that payable by permanent residents. It was also agreed to form a fees subcommittee which would consist of two permanent residents, two members of the committee and a member of the Council.

The Ombudsman considered that a satisfactory basis had been established for safeguarding the interests of permanent residents in the future and he discontinued his investigation.

This case note is published under the authority of the Ombudsmen Rules 1989. It sets out an Ombudsman’s view on the facts of a particular case. It should not be taken as establishing any legal precedent that would bind an Ombudsman in future.

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