House of Commons Hansard Debates for 20 Jul 1989

Mr. Richard Livsey (Brecon and Radnor) : Will the Secretary of State note that with the introduction of this iniquitous tax in my constituency-- which is a rural area, like many other parts of Wales--the average poll tax of £175 per head will be an increase of £45 per head on the present rating system? Does he agree that his figure of £4 is way out for rural areas? It will be a case of paying Peter or robbing Paul. The non -domestic rate is forecast to increase by 15 per cent., which is double the rate of inflation, and will hit small businesses, which are the backbone of Wales.

Mr. Walker : That is not so. Small businesses will not be adversely affected by at last having a system in which the business tax is kept within any increases in inflation. Small and large businesses will prefer to have that stability. I repeat that to have a system where 85 per cent. of all local government expenditure is paid for by the Government is of considerable advantage to rural and urban areas in the Principality.

Mr. Gwilym Jones (Cardiff, North) : I welcome the easing of the safety net arrangements which otherwise would have been more disadvantageous for the people of Cardiff. Can my right hon. Friend say whether, with the safety net, there will be lower transfers of funds between councils than there is with the existing rate equalisation mechanisms, that the safety net represents a lower amount of the help that will be received through income support, and that, at last, with the introduction of the far fairer community charge, every citizen in Wales will be able to measure his council against the all-Wales average of £175? If it comes to pass, as has been threatened in Cardiff, that we have a community charge of £275 or more, the responsibility will lie with the local councils who are making a direct attack on the least well off.

Mr. Walker : I think that it will have the result that fewer local authorities will be imprudent. In general, over the years, Welsh local authorities have been prudent compared with those in other parts of the United Kingdom. If individual local authorities decide to break with that, they will impose a considerable burden. Considering the system in terms of Wales as a whole, I decided to reduce the safety net provisions, and having obtained a settlement where 85 per cent. of finance comes from central Government, I considered it right to proceed as quickly as possible to get the full system into operation.

Mr. Donald Anderson (Swansea, East) : The Secretary of State gave the example of the relief to people on income support. Will he consider the gross injustice to those who are just above income support? I shall give him an example. In Landore, in my constituency, where the average rates are rather less than £200, a pensioner couple with a small private income from a works pension will probably have to pay more than double that. That has nothing to do with accountability. Surely the Secretary of State recognises that this is a gross injustice to people who are just above the level of income support.

Mr. Walker : When we finally agree the specific needs element with the local authorities and the figures are finally published, couples in Swansea who have been paying rates,

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and who will pay the community charge, will, if anything, pay less than they do under the rating system. It is all very well to talk about injustice, but quite a few of the hon. Gentleman's constituents in that income bracket who have been widowed or who live alone have been adversely affected by the rating system.

Mr. Nicholas Bennett (Pembroke) : Is my right hon. Friend aware that there will be much envy among English colleagues about the fact that he has, once again, secured a much better settlement for Wales than is the case for the rest of the United Kingdom? I assure him that my constituents will welcome the community charge because it is workable and fair. At the moment, only 50 per cent. of my constituents pay towards the services provided by their local authorities which they all enjoy and for which they have a vote. Under the new system, everybody will look to local authorities to be truly accountable for the services that they provide.

Mr. Walker : I think that there will be a clearer indication of local authorities' performance. There are problems associated with changing any system. There is no perfect system of local government--none has been advocated by any political party. In Wales, we felt that this system, in which we have to meet 15 per cent. of local authority expenditure through the community charge, and which includes rebates for low incomes, will produce both accountability for local authorities and a better deal for people on low incomes.

Mr. Alan Williams (Swansea, West) : I now understand why the Secretary of State gabbled so much when he made his statement. Will he confirm that, on the figures that he just announced, our beleagured councils will receive £14 million less than is necessary just to manage the cost of living increase, and £50 million less than is necessary to match the increase in their costs? After all his fine words, does not this mean that our councils will have to impose cuts in services or increase the poll tax--not to the £175 that the right hon. Gentleman mentioned, but by at least £20 beyond that, so that the true figure will be nearer £200?

Mr. Walker : If there is an increase of more than 7 per cent. on local governments' budgets for last year, it is very difficult to argue that they cannot prudently and sensibly meet their obligations.

I have already given the figures. Local authorities are treated much better now than they were during the time when the right hon. Gentleman was at the Welsh Office.

Several Hon. Members rose--

Mr. Speaker : Order. I say to the two hon. Members who have been rising and who represent English constituencies that this is the United Kingdom Parliament and that they will be called, but I propose to give precedence to Welsh Members because this statement primarily affects Wales.

Mr. Allan Rogers (Rhondda) : May I point out to the Secretary of State that the illustration he used--it was pointed out by his hon. Friend the Member for Delyn (Mr. Raffan)--of Clwyd county council concerned the budget for last year, which was set by a Conservative and independent- controlled council, and that a Labour authority took charge of the council only this year?

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Local authorities in Wales will view this settlement of only £182 million in standard spending with dismay. As my right hon. Friend the Member for Swansea, West (Mr. Williams) said, it will mean real cuts in social services, education and housing.

I wish that the Secretary of State would not take the name of the Rhondda in vain. In Rhondda, a couple living with one child in a house will pay three times as much under the community charge as they would under the old rates system. It is wrong of the Secretary of State to suggest to the House and to the public at large that the people of the Rhondda will be better off : they will not be.

Mr. Walker : I am glad to say that next year the people of the Rhondda will have the lowest community charge of any area in England or Wales. I do not know how many of the hon. Gentleman's constituents are in receipt of full rate rebate now, but there are 300,000 such people in the whole of Wales, so I guess that there are at least 7, 000 or 8,000 in his constituency. In view of all that the hon. Gentleman has said about the community charge, I hope that he will take great care to announce to the 7,000 or 8,000 people in his constituency on the lowest incomes that, instead of receiving 100 per cent. rebates under the rating system, they will receive 130 per cent. rebates under the community charge this year and 114 per cent. thereafter. I hope that the hon. Gentleman will communicate that improvement to his electors.

Mr. Ieuan Wyn Jones (Ynys Mo n) : It is a bit much of the Secretary of State to come to the Dispatch Box and give us the average figure for Welsh local authorities and then proceed to give us three examples of authorities that he says will benefit next year, since he gave us no examples of local authorities that will not benefit and in which consequently people will pay more than the average standard poll tax. The right hon. Gentleman should do his duty to the House and the people of Wales and publish a list, authority by authority, telling us how much people in each will pay--and how much people in the Anglesey borough council area will pay next year.

Mr. Walker : I have already published a list based on last year's, figures since when I have adjusted the safety net. We still have to agree the final distribution with the local authority associations, and I hope to do that in the near future. It was the local authority associations--they are not, in the main, under my party's political control--which asked that no indicative figures should be issued until the figures are finalised. When they are, I shall be delighted to send out the details.

Mr. Donald Coleman (Neith) : During the past two years, the right hon. Gentleman has had some association with us in Wales. In his reply to my hon. Friend the Member for Merthyr Tydfil and Rhymney (Mr. Rowlands) he seemed to equate home ownership and

owner-occupation with income. But many of those who live in these properties are in impoverished circumstances, and the right hon. Gentleman should recognise that.

What are the figures that will affect all of us in all our valley communities? Why has the right hon. Gentleman not brought them here, as his right hon. Friend the Secretary of State for the Environment did yesterday? Surely this is an incomplete statement. If the right hon. Gentleman does not have the figures, he should not have come here and made it.

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Mr. Walker : I shall convey the hon. Gentleman's remarks to the leaders of the Welsh local authority associations, virtually all of whom are of his political persuasion. I shall tell them that they were wrong to demand what they did--if that is the substance of the hon. Gentleman's attack.

A few weeks ago, in reply to a parliamentary question, we published the best estimates available ; they are in Hansard. As soon as we have agreed more detailed and accurate figures with local authorities, I shall be happy to issue them. They tell a good story : when the Government are paying 85 per cent. of all local government expenditure, that is something to be proud of--

Mr. Rhodri Morgan (Cardiff, West) : On a point of order, Mr. Speaker.

Mr. Speaker : Order. Would it not be better if the hon. Gentleman raised this in the form of a question? I shall take it if it is a point of order.

Mr. Morgan : This is the fourth time since I have been in the Chamber that the Secretary of State--I am sure unintentionally--has misled the House by saying that 85 per cent. of grant will come from central Government. That is not what his statement says--

Mr. Speaker : Order. The Minister will have to deal with that.

Mr. Roy Hughes (Newport, East) : Where are the high-spending, Labour -controlled authorities which the Government have been so busily criticising in recent weeks and months? I venture to suggest that, in Wales, they just do not exist. Our local authorities have had to contend, since the Government were elected in 1979, with the loss of no less than £990 million in rate support grant payments. When will the right hon. Gentleman recognise that the poll tax is essentially regressive? The poorer sections of the community--people in low rateable value homes--will have to pay the main burden, and the right hon. Gentleman's safety net is not adequate.

Mr. Walker : When the system has finally settled down and, at the next general election, the people of Newport are offered the choice of returning to the present rating system or sticking to the poll tax, I have a feeling that the hon. Gentleman will not be eager to proclaim a return to the rating system for Newport.

Three hundred thousand of the lowest income group will directly benefit by the proposals.

I have already paid tribute to Welsh local authorities. One of the important reasons why I have been able to negotiate the sort of settlement that I have is that I have been able to show that local authorities in Wales have acted responsibly and prudently under the system that they have enjoyed in the past.

Mr. Alan W. Williams (Carmarthen) : How many gainers and how many losers will there be when the poll tax is introduced? In particular, who are the losers? I grant the right hon. Gentleman that the bottom 14 per cent., on income support, will benefit from the rebate, but the next 30 or 40 per cent., on below average pay, in low rateable value houses will be hit hard.

Mr. Walker : The 80 per cent. rebate for 300,000 people goes to the lowest income group, but the rebate system deals with many more people on lower incomes than I have

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mentioned. Many single people, widows and so on will benefit. Households that include three or four adults will be at a disadvantage if they earn tolerable levels of income. That is the nature of the mixture.

Mr. Neil Hamilton (Tatton) : As one born, bred and educated in Wales, and representing a constituency only 16 miles from the Welsh border, I congratulate my right hon. Friend on the characteristic dexterity with which he presented his statement today, and I counsel him not to be too savagely destructive of the hon. Member for Alyn and Deeside (Mr. Jones), because my right hon. Friend may be in danger of creating a residual sympathy for the hon. Gentleman which might not otherwise exist.

In due course, my right hon. Friend may face some criticism from authorities and from Members representing constituencies which will pay into the safety net during the coming year. I ask my right hon. Friend on the whole to disregard these criticisms because people in the vast majority of these areas will pay no more than they would otherwise have paid under the rating system, and by and large they will benefit significantly in the future.

Mr. Walker : I agree with my hon. Friend that, once the safety provisions have come to an end and the whole system is in operation, many parts of the Principality will have considerable benefits from the change in the system.

Mr. Geraint Howells (Ceredigion and Pembroke, North) : Having listened to the comments of hon. Members on both sides of the House, does the right hon. Gentleman think that the Government made the wrong decision to impose the poll tax on the people of Wales?

Mr. Walker : The measures and the terms of the settlement which we announced are good for Wales, Welsh industry and Welsh business.

Dr. John Marek (Wrexham) : I hope that, on reflection, the Secratary of State will admit that he has done a disservice to the House by making a statement and allowing questions to be asked without the facts and the details being available to any Member. I hope that he will accept that this is not a good practice and that it should not be followed in future years.

Can the right hon. Gentleman tell me about the 100 per cent. rebate for people on income support? Are there any areas in Wales where the 20 per cent. increase that those on income support will have to pay will not be completely rebated?

Mr. Walker : I know that the hon. Gentleman will be delighted to hear that no one in Wales will be in that category. All the people will be net beneficiaries.

Mr. Ron Davies (Caerphilly) : I hope, Mr. Speaker, that you have noted our complaints about the inadequacy of the statement. I hope that, when the detailed information is available on a

district-by-district basis, you will be responsive to any requests for a further opportunity to question the Secretary of State--whoever it may be-- on those arrangements.

Will the Secretary of State acknowledge that the safety net is nothing more than a temporary, hidden subsidy and that, when it is removed, the poll tax will be revealed as having a built-in mechanism to levy increases year by year on Welsh communities?

Will the right hon. Gentleman acknowledge a point that has been made by several of my hon. Friends? We

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obviously welcome the fact that 14 per cent. of the population will receive a full rebate, but that rebate will be raised at the expense of people on low incomes. Does the right hon. Gentleman recognise that he is making the poverty trap which applies to many of our low-income earners considerably greater? In publishing the district-by-district basis of the poll tax, will the right hon. Gentleman take it upon himself also to publish a table showing the impact of this new poverty trap on our Welsh communities?

Mr. Walker : The information to which the hon. Gentleman refers has been made available in considerable detail in reply to parliamentary questions. The updated information has not been issued, at the request of local authority associations, and they were probably quite right to make that request. That information will not be available until the final settlement is reached.

The hon. Gentleman talked about the rebate. I cannot do this through the political party machine or through the Government machine, but I shall do my best to ensure that the Conservative party in the hon. Gentleman's constituency distributes to every household the leaflet on the poll tax which he issued and compares the outrageous predictions that he made to low -income people, which must have scared the life out of them, with what will happen.

Mr. John P. Smith (Vale of Glamorgan) : Does not the Secretary of State recognise that the overwhelming majority of poll tax payers in Wales who will benefit are the people who need help the least? That is why this tax is so obviously unfair. That is why it was rejected so decisively in the Vale of Glamorgan, which is one of the most affluent constituencies in Wales.

Mr. Walker : In fairness, I thought that at the time the hon. Gentleman gave a number of other reasons why he managed to succeed in the Vale of Glamorgan. If that was the reason, I hope that when the community charge is fully implemented in the Vale of Glamorgan he will make it clear to the electors well before the next general election that he would prefer to return to the present rating system or the system that the Labour party advocates. That will help us considerably in winning back the seat.

Mr. Win Griffiths (Bridgend) : To follow the theme of other questions that the Secretary of State has not yet answered successfully, will he confirm that the principal gainers will be those on high incomes and the principal losers will be those on low incomes but who are above any income support level? Many people on high incomes in my constituency are totally against the imposition of the poll tax, and I would be willing to say that in any election manifesto at the next election.

Mr. Walker : When the hon. Gentleman meets those people, he should explain that at least in Wales 85 per cent. of local government expenditure is financed by the taxpayers. Therefore, the hon. Gentleman's argument does not prevail when only 15 per cent. of all the costs are met out of the community charge and 85 per cent. are met by the taxpayer.

Mr. Paul Flynn (Newport, West) : We have had another piece of meaningless trumpeting by the Secretary of State

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in his abuse of statistics again and his claim that those on income support will benefit in some way from the Government's actions. He says, wrongly, that payments will include certain amounts, but people on income support--it is a miserable level--already receive those amounts and have no idea that there is meant to be compensation. It may be true that certain couples will gain, by a few pence, because of the quality of local government in Wales and their prudent and good running of local matters over the years. Where is the trumpeting when people on income support in Wales lose out more than those on income support in the rest of the country? Where was the trumpeting when there were cuts of £650 million in housing benefit and when people lost out on transitional payments? Half a million pensioners in this country, many of them in Wales, had not a penny increase in 1987 or 1988 and may well go on through the next year and the year after without a penny increase. It is an outrage for anyone to suggest that the Government's actions are helping people on income support, whose income has been cut year after year by the Government.

Mr. Walker : The hon. Gentleman's argument that the 20 per cent. rebate has been paid before the community charge has been introduced and therefore should be discontinued gives us a good insight into how the Labour party will attempt to play this matter. As the hon. Gentleman knows, this system for people on low incomes is far better than the rating system.

Mr. Tony Marlow (Northampton, North) : Speaking as the husband of a Welsh woman, should it not be a matter of shame to every decent Welsh woman and Welsh man that, when my right hon. Friend announces a settlement whereby a couple in the Rhonnda will pay signficantly less than the average individual in England and 7,000 or 8,000 people in the Rhonnda will pay about 70p a week and, as my right hon. Friend said, be better off, all that the Labour Front-Bench spokesman can do is whinge? Is it not the case that in Wales the average person will pay £3.50 a week and 300,000 people will pay a mere 70p a week for the whole range of local government services? Are they not getting an incredibly good buy?

Mr. Walker : The people of Wales have a considerable advantage under this settlement, with so much of it centrally financed. Wales has considerable problems because a large number of people are on very low incomes. This will be a far better system for them than the rating system.

Mr. Alun Michael (Cardiff, South and Penarth) : I was interested in the right hon. Gentleman's answer to the question put by my hon. Friend the Member for Vale of Glamorgan (Mr. Smith). Does not the right hon. Gentleman accept that the poll tax is equally unpopular in Penarth, which is the other part of the Vale of Glamorgan and which falls in my constituency, because even gainers regard it as unfair and unacceptable? That is why we are not whingeing but winning. The right hon. Gentleman is patronising and unfair to local authorities when he says that they are spending above the planned level. Does he accept that, with 4 per cent. inflation as the level projected when the budget was set, with poll tax preparation costs and with central Government decisions creating extra costs in preparing for

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education reform, increased demand on social services and so on, local authorities are showing remarkable restraint as well as making positive contributions to efficiency reviews in which the right hon. Gentleman, like Oliver Twist, is always asking for more?

Perhaps we should commiserate today with the Secretary of State who has had another bad afternoon. Will he accept that the statement lacks content, facts, figures and reality for those of us who have knowledge and experience of local government finance? Will he accept that under the smooth surface lurks a heavy burden for many of the low paid and especially for those who fall into the poverty trap, which is the Government's particular creation?

Mr. Walker : I only hope that I shall have many more afternoons as bad as this afternoon. The sight of Labour Members, having heard the degree to which those on low incomes in Wales will benefit, is a sight that I wish could have been televised. When, in a rather speedier time than anticipated, the system is operating fully in Cardiff, I shall be interested to see how many of the hon. Gentleman's constituents want to go over to the old system or the incredibly ridiculous system his party advocates at present.

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Education (No. 2) Act 1986

5.10 pm

Mr. Alan Williams (Swansea, West) : I beg to ask leave to move the Adjournment of the House, under Standing Order No. 20, for the purpose of discussing a specific and important matter that should have urgent consideration.

It is certainly specific, as you know, Mr. Speaker, because I sent you a copy of this letter. It is a preposterous letter which has been issued by Conservative Central Office, setting out its plans to subvert the Government's own education legislation, which forbids political indoctrination in our schools. In this context, it is worth bearing in mind the intervention of my hon. Friend the Member for Blackburn (Mr. Straw), the shadow Education spokesman, during the European elections, to stop the circulation of certain Conservative documents to our schools.

The matter is important because section 44 of the Education (No. 2) Act 1986, which was introduced by this Government, states categorically :

"the governing body and head teacher"--

and I emphasise those posts--

"of the school shall forbid the pursuit of partisan political activities and the promotion of partisan political views in the teaching in the school."

Yet in this letter, of which I gave you a copy Mr. Speaker, from Conservative Central Office, a Mr. John Spiers says that he has been appointed to edit, at the request of the deputy chairman of the Conservative party who is a Minister in this Government, a journal for Conservative school governors.

I want to quote one sentence from the letter. It says : "We hope that it will equip Governors"--

those who are supposed to be monitoring political activity "to manage schools so that head teachers"--

who also have the same responsibility--

"and teachers are motivated to make a Conservative"--

and I emphasise that it is spelled with a capital "C"--

"educational agenda effective in their day-to-day work". Clearly, the letter must be important because the heads of Conservative Central Office-- the chairman and vice-chairman of the Conservative party--are both appointed by the Prime Minister. It is important because both were Ministers at the time when the legislation was passed and it is important because they are both Ministers now. It is also important because it aims to subvert and pressurise the very people the Act forbids to allow any partisan politics in our schools and because we need to know exactly how this vindictive and malevolent Government intend to motivate teachers to carry out their political dirty work in schools.

I suggest that it is urgent because on Monday it is quite likely that the present Secretary of State for Education may himself be chairman of the Conservative party and he could be presiding over this attempt to create a Conservative fifth column in our schools.

Mr. Speaker : Order. Three minutes, please.

Mr. Williams : I am making my final point, Mr. Speaker. The matter is urgent because we go into recess next week and it will be three months before we have a chance to discuss it.

Mr. Speaker : The right hon. Member for Swansea, West (Mr. Williams) asks leave to move the Adjournment

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of the House, under Standing Order No. 20, for the purpose of discussing a specific and important matter that he thinks should have urgent consideration, namely,

"the implementation of section 44 of the Education (No. 2) Act 1986."

As the House knows, under Standing Order No. 20, I have to take into account the requirements of the order and to announce my decision without giving reason to the House. I have listened with care to what the right hon. Gentleman has said, but I regret that the matter he has raised does not meet the requirements of Standing Order No. 20 and I cannot, therefore, submit his application to the House.

Mr. Jack Straw (Blackburn) : On a point of order, Mr. Speaker. Your ruling is, of course, accepted by the whole House, but as the matter is plainly unlawful in the light of section 44 of the Education (No. 2) Act 1986, as it invites Governments to ensure that head teachers are motivated

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to make a Conservative education agenda effective in their day-to-day work and as the Parliamentary Under-Secretary of State for Education and Science, the hon. Member for Coventry, South- West (Mr. Butcher) is in his place, can he be invited to make a statement as to whether the letter has the support of Government Ministers?

Mr. Speaker : That is not a matter for me. We have a heavy day ahead of us.

BILL PRESENTED

Telecommunications (Premium Rate Services and Consumer Representation)

Mr. Terry Lewis presented a Bill to amend the Telecommunications Act 1984 with respect to the provision of advice about premium rate services and to provide for consumer representation on advisory committees : And the same was read the First time ; and ordered to be read a Second time on Thursday 27 July and to be printed. [Bill 191.]

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Orders of the Day

Electricity Bill

Lords amendments considered.

5.15 pm

Ordered,

That the Lords Amendments to the Electricity Bill be considered in the following order, namely, Nos. 4, 5, 9, 10, 95, 14, 101 to 108, 22, 25, 26, 51, 52, 55, 56, 129, 140, 27, 108A to 114, 118, 3, 2, 100, 62 to 65, 6, 90, 7, 119 to 128, 130 to 139, 141 to 143, 11 to 13, 15, 16 to 20, 115 to 117, 53, 54, 57, 58, 59 to 61, 66, 67, 68, 69 to 74, 75 to 77, 144 to 153, 174, 154 to 157, 80, 163 to 167, 91, 92, 168, 93, 94, 169, 170 to 173, 175 to 178, 179 to 181, 96 to 99, 158 to 162, 21, 81 to 89, 28 to 50, 78, 79, 1, 8, 23 and 24-- [Mr. Michael Spicer.]

Mr. Deputy Speaker (Sir Paul Dean) : I have to advise the House that Lords amendment No. 10 involves privilege.

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Lords amendments Nos. 4, 5, 9, 10, 95, 14, 101 to 108, 22, 25, 26, 51, 52, 55, 56, 129, 140, 27, 108A, 109, 109A, 110 to 114 and 118 agreed to.

Lords amendment : No. 3, before clause 3, insert the following new clause-- Promotion of efficient use of electricity --

" . The Secretary of State and the Director shall require each of the public electricity suppliers to make and produce evidence to the Director showing that he has made such arrangements as will promote the efficient use of electricity and may direct any public electricity supplier to take specific action in this area and, if appropriate, may refuse or amend any application for tariff increases or major capital projects."

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