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Mr. Maples : I shall be careful not to stray out of order, Mr. Deputy Speaker. I was merely endeavouring to explain to my right hon. Friend the beneficial effects of rate capping in Lewisham and that to reduce future expenditure to a level that ratepayers will find acceptable we must make savings of £54 million on a budget--after we take responsibility for education--of £400 million.

Such a saving is distinctly achievable--mainly by paying regard to the items I mentioned. The council makes no effort to redeem part of the enormous debt that it has run up over the years--which now totals £450 million, and costs nearly £50 million per year in interest--yet there is a simple way of doing so. If the council gets rid of some of the right- to-buy backlog that it refuses to process, it could easily clear a substantial part of that debt.

Rate capping has been good for Lewisham. For four years it has been welcomed by the residents of the borough, and it will be again this year. The council is finally seeing sense and finding ways of saving money, and, despite its blackmail tactics in respect of cuts in social service provision, it is realising that sensible economies can be made. I am delighted that my right hon. Friend is taking power to continue capping of the community charge, but I hope that, come next year, we shall be able to offer him a far better alternative--a Conservative-controlled council, so that no further such action will be necessary.

11.22 pm

Mr. Matthew Taylor (Truro) : This is the first time that I have had an opportunity to speak in the House on the subject of rate capping, and it may be appropriate to begin by making clear my party's position--which is one of

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opposition to such powers being given to the Minister. We oppose it in the same way that we opposed it on each occasion in the past. I shall explain why that is, and why the House should not agree to the order--any more than it should have accepted earlier orders. I am opposed to rate capping because it is an attack on the principle of local democracy, and because it is a crass way of trying to meet the needs of areas having special and particular problems--some of the poorest, most needy areas of the country. The right hon. Gentleman the Minister refers to needs and expenditure assessment, but they are in each case a matter of his assessment and that of his Government--not of the local people who are forced to suffer the impact of such changes.

No one defends the excesses of the Labour Left that the Minister attacked. I agree with much of what he said, and accept the veracity of many of the examples he gave of local government going wrong. However, I will defend to the last the right of local people to decide whether they agree with their council's actions--rather than the Minister, or this or any Government, making that decision for them. I defend also the needy, who have seen services cut back--yet they have no power, through the ballot box or by making representations to their councillors, to influence what happens. In effect, the Minister and the Government have taken that power to themselves. That should not come as any surprise because throughout the Government have taken the same attitude. They say that they have identified problems in local authorities and identified local authorities which are getting matters substantially wrong, and their response is to take power to sort matters out rather than let the local electorate make their choice.

Mr. Nicholas Bennett (Pembroke) : As the hon. Gentleman should be aware, in the boroughs of Lewisham, Greenwich and Camden especially, less than one third of the electorate pay rates. We intend to change that by introducing the community charge which will affect all voters, creating a direct correlation between those who vote and those who pay for the services that they receive. Why did the hon. Gentleman's party vote against that?

Mr. Taylor : I shall come to that later.

First, let me quote the Secretary of State for the Environment in 1987, who commented very much along the lines of the hon. Gentleman, when he said :

"We must either have more and more central control or local electors must exert real local control. We vote for local control." The hon. Gentleman is trying to say that through the poll tax local control will be given to people in a way that does not exist under the present rating system. That is the justification that Ministers have given. They have said that rate capping is needed because local authorities are unrepresentative. They have referred to near one-party states. They have frequently said that such a step was necessary because so few people contributed to the rates, so few people responded to high rate increases.

The problem is that we now find that the Government are to introduce poll tax capping. If what the hon. Gentleman was saying is correct, they would not have had to do that. The truth is that the Government do not believe that that is what it is about. The Minister sincerely believes that he knows better than the local people what should happen ; that it is necessary for him to reserve the power to

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override the electorate. It is not rate capping or poll tax capping ; it is electorate capping. The Government are telling the local electorate the point beyond which they cannot go.

That should not be much of a surprise because it has been reflected in a host of other Government policies, whether restricting councils' abilities to build housing to meet local needs, the abolition of the local business rate to create a national business rate, or rule after rule on expenditure, quite apart from rate capping.

I do not deny that there are a handful of extreme Labour-controlled authorities which have acted wrongly, as the Minister said. I do not deny that on occasions, as a result of some policies,

Labour-controlled authorities have given the Minister the opportunity to criticise them for maladministration and extravagance, allowing the Government to introduce their policies. But it is not for the Minister to judge that. The principle of local government is that that judgment lies with the local electorate. That is why we have local government. Otherwise we would have a local bureaucracy. We do not need to elect people to translate Government decisions. Let me deal now with poll tax capping--

Mr. Deputy Speaker : Order. I remind the House again that there is nothing in the order about the community charge.

Mr. Taylor : I hope that you, Mr. Deputy Speaker, will allow me to develop the argument because it relates specifically to why we should not pass this order tonight. It reflects entirely on the argument that we have been given for passing it tonight, just as we have been given it in the past.

Last year we were told that this would be the penultimate occasion when a rate-capping order would be before the House and it was supposed to be the last time that councils came under such control. The introduction of the poll tax would make it unnecessary for this sort of control to be exercised.

On each occasion the Minister has justified its introduction by saying that it is because he and the Government believe that local authorities are not adequately controlled at present that ratepayers are not significant in the local elections, that there is a need to make the local authorities accountable and that they do not respond as they should to the needs and desires of local people. All of that was thrown out of the window ; it was shown to be quite false justification. Yet we heard it again tonight when the Government introduced poll tax capping. It has all proved to be a disreputable misleading of the House.

Mr. Patrick McLoughlin (Derbyshire, West) : Will the hon. Gentleman clarify for us once and for all what his party's position on this is? Is he saying that, regardless of what any council did, the Liberal party would not impose any restrictions upon local authorities? Could we be quite clear on that?

Mr. Taylor : We would not have poll tax capping or rate capping or any other sort of capping of the ability of local authorities to raise expenditure ; that is their local decision. But we would want one fundamental change that the Government have avoided on every occasion. They specifically excluded it from what Widdicombe was allowed to look at and from all consideration of local

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authority expenditure. It is the one glaring, obvious way of making local authorities more accountable to their electorate, of ensuring that one-party states do not exist and that every person in a local authority area is able to have his or her voice heard properly. That is proportional representation, and there are people of that view now throughout the House. But the Minister is not even prepared to look at it. He was not prepared to have Widdicombe even consider whether that would be the most appropriate way of bringing local authorities under control.

That is why the Minister has to resort to these measures, because he wants to exercise that control centrally and he thinks that he knows better. He dare not trust what local authorities do. He feels free to criticise them for being unrepresentative, but is not prepared to ensure that they properly reflect what people want. The result is that we debate again tonight what we have debated in so many different ways before : yet another in the battery of powers that the Minister feels obliged to adopt as an attack on local democracy. We are seeing an unwillingness to create genuine local democracy in which people are free to take decisions that reflect the needs of their area as they see them rather than as the Minister sees them.

11.32 pm

Mr. Simon Coombs (Swindon) : I have listened with great interest to the hon. Member for Truro (Mr. Taylor) and would say only this to him. The level of support for democracy which has brought all right hon. and hon. Members to the House is far greater than that which has elected the councillors whose behaviour the House attempts to control with this order tonight. It is therefore reasonable that we should say that democracy is indivisible and that we on the Government Benches have a mandate to carry out this policy.

I sometimes wonder whether Members of the Opposition ever wonder why the local authority in the constituency which I represent is so frequently to be found on the list of rate-capped authorities. One can understand why London boroughs might be there, with the problems they have, but surely the fastest growing town in western Europe ought not to be on the list of rate- capped authorities.

The fact is that Thamesdown has been on the list in each of the five years that we have had to consider orders of this nature. Right from the start Thamesdown borough council was opposed to the idea of rate capping and made it abundantly clear, with a strong political propaganda campaign, that if the borough council were rate-capped it would be the end of services and support for a vast range of activities which it regarded as essential. I have to tell the House that, after five years, none of those threats has come to pass. The threat to withdraw grant from a variety of voluntary bodies and the threat to take away services from the disabled and the elderly have not come to pass.

When I stood for re-election to the House in 1987, after three years of rate-capping, I was told that such was the disgust of my electors with my support for the policy that I would be thrown ignominiously from the House. I remember the hon. Member for Blackburn (Mr. Straw) saying that from the Front Bench. Conservative Members

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who follow these matters will know that, as a result of my support for this policy and others, I was re-elected with a majority of three and a half times greater than in the first place. I took that as an endorsement of rate capping from a turn-out of 75 to 80 per cent. of the electorate, because the people of Thamesdown participated to a far higher degree in that election than in the local elections, which returned my political opponents. There we had turn-outs of 30 to 40 per cent.--half those in the general election. The reason is that only one third of the population of Thamesdown pays rates. The other two thirds had a vested interest in voting in councillors committed to high-spending policies using the money raised by the minority--the ratepayers in the borough--and they continue to do so. Frankly, I am not surprised by that and that is why I welcome the change in the philosophy of local government finance.

Mr. Harry Barnes (Derbyshire, North-East) : The hon. Gentleman referred earlier to the much-vaunted mandate on these matters that the Conservative Government had after the last general election. But there was nothing in the Conservative manifesto on poll tax capping. The terms in which poll tax capping have been laid down are contrary to the Conservative's position at the last general election.

Mr. Coombs : I am not sure that I can see how to answer the hon. Gentleman's question, Mr. Deputy Speaker, without transgressing the strict rules that you have laid down for the debate. However, I shall return to the point later and crave your indulgence then. I want first to deal with the point raised by the hon. Member for Sheffield, Brightside (Mr. Blunkett). He said, rightly, that Thamesdown councillors had come to see my right hon. Friend to press their case and that my right hon. Friend listened carefully to what was said, but was not able to make a redetermination. The hon. Gentleman should know that under the rules approved by Parliament the local authority in question has to apply formally for a redetermination. The simple fact is that over the five years of rate capping Thamesdown council has never made that formal application. It is the only rate-capped council that has never asked the Minister formally to redetermine its rate. I believe that if it had done so, it would have been allowed to increase its rate, but it has never tried. We must look to the councillors of Thamesdown to tell us why they will not do what Labour councillors in every other rate-capped borough have done naturally year upon year.

Instead of doing that, the councillors of Thamesdown have indulged in creative accountancy and have found ways of keeping within the rate limitation imposed on them by Parliament, but at the same time they have continued to allow expenditure to rise in a variety of ways. My right hon. Friend referred to twinning with a town in Nicaragua and I could mention the quite unbelievably unattractive statues that now adorn most public places in Thamesdown. As far as I am aware, nobody wants them.

The most recent attempt to get round the law is the method of raising finance known as factoring. I understand that that is to be the subject of a test case shortly, so it may not be proper to say what is likely to happen.

My right hon. Friend also referred to the idea of selling assets and observed that the borough councillors in Thamesdown had decided to sell a large public park in the centre of the town. That was a little unfair on them--it is

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only a small part of a large public park in the centre of Thamesdown. However, that is a step that other Labour councillors may want to follow in future. The only people who are determined to stop them are the Conservative councillors who represent the ward in question.

Under its Labour masters, the borough council has never been prepared to consider a sensible policy of disposing of assets. The wealth of Thamesdown has been created over many years by its success and by its location as an attractive place in which to relocate industry. The borough has been the beneficiary of that wealth, but it has never been prepared to capitalise on it because Socialists say that all property belongs to them and should never be used for the wider benefit of the community--[ Hon. Members :-- "Rubbish."] Well, if Opposition Members who scoff at that can tell me any other good reason for hanging on to a shopping centre in the centre of the town and if they believe that is the right and duty of a Labour council to be responsible for shopping in the town, let them say so instead of scoffing from sedentary positions.

The order is essential, and may I say in answer to the hon. Member for Derbyshire, North-East (Mr. Barnes) that the successor policy of charge capping is also essential. If we were not to have rate capping in Thamesdown this year, the local labour councillors admit--in private--that the rates would rise by over 60 per cent. My hon. Friend the Member for Basildon (Mr. Amess), who is sitting next to me-- Mr. Blunkett rose --

Mr. Coombs : I shall give way in a moment.

My hon. Friend the Member for Basildon has just told me that, as a result of his local authority being taken out of the provisions of tonight's order, rates in Basildon will rise by 74 per cent. That is the alternative for my constituents if we do not pass the order. I am not prepared to vote against an order that protects my constituents from a rates increase of over 60 per cent.--nor am I prepared to see them submit to that level of increase with a new regime of local authority finance next year. It is right that under the community charge we shall see greater accountability, but that will not happen straight away. Therefore, it would be foolish to withdraw the protection of capping in the first year of the new system. The hon. Member for Brightside said that if Thamesdown had been only a little more moderate in its spending in 1984-85, it need not have been rate- capped. What does he call 90 per cent. above GRE? What does he call the reduction that would have been needed from 90 per cent. to 10 per cent. of GRE to avoid being rate-capped? I do not call that a small reduction in expenditure. It would have been catastrophic. Of course, there was no way in which the council could have escaped it in the first year, but now I am happy to report that the overspending on GRE is down to a modest 37.3 per cent.--still the highest of the four authorities listed in the order, and still impossibly above any level that could be acceptable.

Mr. Blunkett : At the risk of wasting my breath, the point that I was making earlier was that the level that had been set by the Government at which rate capping would start to apply was such that districts such as Thamesdown, having spent slightly less in the years before 1984, would have been exempted for ever, like Suffolk, Coastal and

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Brentwood and Guildford, or any of the other authorities that have increased their spending and rates far in excess of Thamesdown, Greenwich, Lewisham or Camden.

How does the hon. Gentleman square what he said earlier about rate capping being necessary because not everybody pays rates and therefore some people could vote for increased spending without feeling the pain of that with what he has just said, which is that in any case it does not matter because poll charge capping would be justified anyway?

Mr. Coombs : I come back to what I said before : the level was 90 per cent. above GRE, compared with the target of 10 per cent. set at the beginning of the rate-capping saga. That is is an enormous disparity, so it is no good the hon. Gentleman talking about other councils. Under those circumstances, Thamesdown was bound to be rate-capped, and it has never managed to avoid it since because it has not been prepared to tackle the overspending it has indulged in every year since 1984-85. If the hon. Gentleman reads again what I have said this evening he will realise that there was no contradiction between his second point and my remarks.

I join my hon. Friend the Member for Lewisham, West (Mr. Maples) in welcoming the order for the protection it affords my constituents from the depredations of a high-spending Labour authority. I welcome, too, the introduction of a new local government finance system which will give every person in Swindon a vested interest in watching how his money is being abused and wasted by the local authority. I am sure that that will result in a year or two's time in Labour councillors beginning to lose their seats.

11.46 pm

Mr. Paul Boateng (Brent, South) : The hon. Member for Swindon (Mr. Coombs) had the gall to lecture us about democracy and to parade his own re -election as having been a manifestation of the people's will triumphing over the excesses of local government. If the voting procedures being applied under the Housing Act 1988 had been applied to the hon. Gentleman's election--if those who abstained were counted as having voted in the affirmative, and the undead were given a vote--he would not be here today. So his lecture was shot through with the double standards that are typical of Conservative Members when they talk about local government. There is one rule for local councils, and another for the Government : one rule for Conservative councils, and another for Labour-controlled councils.

I apologise to the Minister. I was serving time on the Committee examining the Water Bill during his speech, but I left word with my hon. Friends to let me know if he attacked Brent. You, Mr. Deputy Speaker, have given Conservative Members generous latitude to explore the foibles and failings of other boroughs and the Minister cannot resist the temptation to get Brent in too when discussing the rate capping of other authorities. The Government never miss an opportunity to be vindictive about Labour authorities, or to drag in arguments that they believe can be used against local government in general.

The Minister should not have chosen Brent as an example of a council with excessive rent arrears. Those who advise him can tell him about the measures that Brent has introduced to curb arrears. He knows of the action

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that has been taken to step up the collection of arrears and to move against people who fail to pay their rent or rates. He should be generous enough to admit that Brent is trying to come to grips with its problems. But he has not shown that generosity when talking about Thamesdown, Camden, Greenwich or Lewisham.

The measure is not to do with protecting ratepayers and residents. It is about superimposing the will of the Government on that of the locally elected representatives of the people. It is about substituting the will of the grey-faced, grey-suited men sitting in their little offices and cubby holes in Whitehall, where my constituents cannot get at them--with their calculations of what we should spend on the care of the elderly and of children, or on education, or on the gamut of services that should be run locally--for the will of the elected representatives.

The Minister launched an attack on Brent while talking about Thamesdown, Camden, Greenwich and Lewisham. We know that he could not resist that opportunity. But he ought to consider the experience of Brent. Rate support grant has been reduced during the lifetime of this Government from 65 per cent. of the borough's net needs to some 38 per cent.

Can Conservative Members put aside for a moment their spite and vindictiveness against a steadfast Labour authority? Can they imagine the impact of that reduction on the meals on wheels service or on care for the elderly and the disabled? Can they imagine the impact on bed and breakfast accommodation in my borough? When they talk about empty properties, they really ought to look at their own abysmal record. The biggest owner of empty properties in the country is none other than Her Majesty's Government. They should take that reality on board and not come here to lecture us about democracy and value for money. We know about democracy, we know about value for money, and that is why we are opposing the order.

Mr. Gummer : I knew that the hon. Member for Brent, South (Mr. Boateng) was not in the Chamber when I opened the debate. I made the comparison with another Labour authority in reply to a point that one of his hon. Friends raised with me.

I do not believe that my attack on Brent was vindictive. The vindictive attack was by his neighbour, a Labour Member, the hon. Member for Brent, East (Mr. Livingstone) who referred to it as being worse than the Pol Pot regime. I remind the hon. Gentleman that my point was directed to rate- capped authorities. One of the most important points was that they should collect the rents in arrears. The hon. Gentleman is right to say that the local authority in Brent has said that it will take some new action, but after all that follows newspaper revelations that it did not know who its tenants were, let alone collected the rents, and that keys to flats in Brent were on sale in Nigeria. It was only after those revelations, which were not denied by the borough of Brent, that the changes took place. I do not think that that is vindictive.

Mr. Boateng rose--

Mr. Gummer : No, I do not think that the borough of Brent is in any position to complain, until it has changed its ways. Some of the worst examples of those with rent

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arrears were among the elected councillors of Brent, which was why it was difficult for the officers to get support when they set out to make those changes.

Mr. Blunkett rose --

Mr. Gummer : I have only three minutes to reply, and I do wish to reply to the hon. Gentleman's question. It is only fair of me to do so.

The hon. Member for Sheffield, Brightside (Mr. Blunkett) said that it was very unfair because several authorities, including my own authority of Suffolk, Coastal did not get themselves rate capped. That is not surprising, considering that it has the 206th lowest rate in Britain. It is below the national average. If there is a high percentage increase, it depends where one starts from ; if one adds a penny to 2p one could say that that is a 100 per cent. increase. But the real question is what is the level of rates. I find it difficult to compare the 206th lowest in Britain with the position of rate-capped authorities.

Taking Lewisham as an example, if we had allowed Lewisham to put the rate at the level that it wanted, it would have put another 46p in the pound on top of our proposed limit. That would be £100 per household. That is why we are defending the people of Lewisham. The hon. Member for Brightside attacked the City of London. Let me point out to him that the local authority there increased the rate by a mere 4 per cent. and that the domestic rate in the City, even after allowing for the ILEA precept, is the second lowest in the country. How dare he make the suggestion that he made?

I am sorry that his hon. Friend the Member for Holborn and St. Pancras (Mr. Dobson) is not here, because I was rather careful not to answer him until I had received the exact facts. The truth is that Camden did indeed draw my attention to what the auditor had said, but it quoted only one sentence from the letter, so I asked for the full letter. I got the full letter, and it turns out that the auditor stated that in 1987-88 Camden's street sweeping costs per kilometre of road were £9,000 per annum, compared--

It being one and a half hours after the commencement of proceedings on the motion, Mr. Deputy Speaker-- put the Question, pursuant to Standing Order No. 14 (Exempted Business).

The House divided : Ayes 176, Noes 109.

Division No. 109] [11.55 pm


Alison, Rt Hon Michael

Amess, David

Amos, Alan

Arbuthnot, James

Arnold, Jacques (Gravesham)

Arnold, Tom (Hazel Grove)

Ashby, David

Baker, Nicholas (Dorset N)

Baldry, Tony

Batiste, Spencer

Bendall, Vivian

Bennett, Nicholas (Pembroke)

Blaker, Rt Hon Sir Peter

Boscawen, Hon Robert

Boswell, Tim

Bottomley, Peter

Bottomley, Mrs Virginia

Bowden, Gerald (Dulwich)

Bowis, John

Brazier, Julian

Bright, Graham

Brown, Michael (Brigg & Cl't's)

Browne, John (Winchester)

Buck, Sir Antony

Burns, Simon

Burt, Alistair

Butler, Chris

Butterfill, John

Carlisle, John, (Luton N)

Carlisle, Kenneth (Lincoln)

Carrington, Matthew

Carttiss, Michael

Cash, William

Chope, Christopher

Churchill, Mr

Clark, Dr Michael (Rochford)

Clarke, Rt Hon K. (Rushcliffe)

Conway, Derek

Coombs, Anthony (Wyre F'rest)

Coombs, Simon (Swindon)

Cope, Rt Hon John

Currie, Mrs Edwina

Davies, Q. (Stamf'd & Spald'g)

Davis, David (Boothferry)

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