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The Minister for Local Government and Inner Cities (Mr. David Hunt) : Every year we have an interesting and vigorous debate about the level of support for local government. I have had the opportunity of sitting through 26 speeches. Although I cannot say that I agreed with all those made by Conservative Members, I disagreed with every one made by Opposition Members. The debate has been of a high standard. Points have been made effectively and competently and, where a divide has been exposed, it has been done clearly to enable us to make the decisions which we have to take tonight.
Although I welcomed the kind, opening words of the hon. Member for Sheffield, Brightside (Mr. Blunkett), he did not follow the debate as arguments were developed on each side of the Chamber. If he looks at his speech and
Column 501some of the statistics, he will see that he made a series of statements which are not borne out by the way in which the debate has progressed.
My right hon. Friend the Secretary of State started the debate with a quite brilliant speech. It was so good that the hon. Member for Bolsover (Mr. Skinner), whose absence is now noticed, was heard to shout, "My God, this is a seminar." I always pay close attention to what the hon. Member for Bolsover says, and I rushed to the dictionary. A seminar is defined as an opportunity for education and advancement. I do not know where the hon. Gentleman has gone, but he has missed an opportunity.
My right hon. Friend has asked me to deal with the point raised by the hon. Member for Norwood (Mr. Fraser). Lambeth faces not a mistake involving £11 million, but an appeal result on the rateable value of county hall. That has meant that Lambeth will bear half the reduction and must pay back money which the appeal decided it should never have received. That was not the way in which the hon. Member for Norwood put it. I hope that he will accept the facts as I have presented them.
Mr. Fraser : Does the Minister accept that, whatever caused it, that is a huge loss of income which, because of the way in which the system operates, will not be compensated for in the same way as Wandsworth or any other local authority will be compensated for a rise in expenditure of more than £25 per head per annum?
Mr. Hunt : We shall have to consider elsewhere--between officials-- the points which the hon. Gentleman has made. I was making the point that the hon. Gentleman described the incident as an error on the part of the revenue valuation office officials. I am putting that in context.
My hon. Friend the Member for Dorset, South (Mr. Bruce) and--
Mr. Graham Riddick (Colne Valley) : Does my hon. Friend agree that it seems quite clear that a number of Labour councils, including my own of Kirklees, are intending to set as high a comunity charge rate as possible so that they can try to score party political points by blaming the Government for the high level of community charge? Does my hon. Friend agree that councils which act in such a way and penalise many people on modest and low incomes will be acting in a wholly immoral and cruel way? Will he assure me now that he will not flinch from capping those irresponsible Labour authorities?
Mr. Hunt : I give my hon. Friend the assurance that he seeks. I am told by my officials that this is not a time of year when district and county council treasurers are known to underestimate the level of spending that lies ahead. What is wrong is that this year certain Labour councils made a policy decision to increase spending--as in the case of Kirklees, with an increase of about 18 per cent.--with the result that there will be a high community charge.
Mr. John Evans (St. Helens, North) : Is the Minister aware that St. Helens has suffered a £9.8 million reduction in its revenue support grant? That represents an extra payment of £65 for every poll tax payer. St. Helens
Column 502borough council, which, as the Minister knows, is not a profligate authority, faces imposing a poll tax of more than £400 per person. Is that fair on St. Helens?
Mr. Hunt : I do not accept that from the hon. Gentleman. I ask right hon. and hon. Members who want to intervene to allow me to respond first to those right hon. and hon. Members in all parts of the House who attended the entire debate. I have evidence to show that Labour councils are artificially inflating the community charge that they intend to impose. I shall return to that point. I believe that the hon. Member for Dagenham (Mr. Gould) misunderstands the figure of £32.8 billion for total standard spending. He stated, as he will discover if he reads his speech in Hansard, that that figure did not take into account balances. The hon. Gentleman should have compared spending against spending, not spending against the way in which the money is raised. The figure of £32.8 billion represents an 11 per cent. increase over the equivalent figure in this year. That is why my right hon. Friend the Secretary of State clearly made the point that there has been an adequate increase in the assumed and appropriate levels of spending to produce the standard level of service.
The hon. Gentleman mentioned the CIPFA report, which illustrated what the situation would be if spending were substantially increased on top of the overspending this year. The point has been echoed in speech after speech, particularly by my right hon. and hon. Friends, that CIPFA is suggesting overspending on top of overspending. In 1989-90, local authorities budgeted to increase spending by 9 per cent., making a total increase over two years of 20 per cent. The 1989-90, budgeted overspend was 4 per cent., so CIPFA is building overspending on top of overspending.
What would have been the effect if we had accepted those figures and had continued with the existing system? I reiterate the point made by my right hon. Friend the Member for Chingford (Mr. Tebbit) that there would have needed to be a domestic revaluation. If the domestic rate system had continued, on CIPFA's figures, rates would have increased this year by an average of 24 per cent.
Mr. Gould : The Minister's 11 per cent. increase is meaningless because it is an increase on an assumed level of spending for the current year by comparison with the total standard spending of £32.8 billion for the forthcoming year. It is a comparison between two assumed levels of spending rather than a comparison with the actual level of spending, which is what local authorities must face.
The hon. Member for Dagenham also came to the House in an irresponsible manner to give us what he described as a progress report on Labour's alternative. He said, "I'm coming to give you a progress report on where we are." The progress report was--no progress at all.
Ms. Armstrong : Before the Minister gets himself into real trouble, will he tell the House why he assumes that any decisions taken in local government are automatically against the interests of people and that therefore the Government have to protect people? That is his attitude to local government, and how it makes its decisions. Local
Column 503government has been accountable to the electorate since the election of the Government. Why is he so against local government? Why is he right and it is wrong?
Mr. Hunt : I think that that was a brave attempt by Durham to move to the aid of Dagenham. I shall return to that subject in a moment. If the hon. Member for Dagenham intends to be taken seriously then-- [Interruption.] I am winding up the debate and I am responding to points that hon. Members have made. If the hon. Member for Dagenham wants to be taken seriously by the House, he should explain what has happened to the policy that the hon. Member for Copeland (Dr. Cunningham) announced at a press conference. [Interruption.] I am responding to the point that the hon. Member for Dagenham made. The Opposition may not like it, but next time the hon. Gentleman makes a progress report, would he please report progress, because we are getting impatient and so is the country?
We heard an excellent speech from my hon. Friend the Member for Southend, East (Mr. Taylor), who pointed out the importance of making the same decision in this debate as we did when we debated the introduction of the charge in Scotland.
The hon. Member for Berwick-upon-Tweed (Mr. Beith) made an interesting speech and proposed an alternative to the charge, as did the hon. Member for Woolwich (Mr. Cartwright). They proposed a local income tax, but I do not think that that is a proper alternative because, as I have pointed out on many occasions, it would mean having a "Chancellor of the Exchequer" in many town halls, and that is unacceptable.
The hon. Member for Tottenham (Mr. Grant) made a good speech, and I give him credit for staying in the debate for some considerable time. He said that the amount of money provided is not sufficient. He missed the point that my right hon. Friend made--that, if one considers the aggregate external finance coming in to local authorities, one sees that the figure in the coming year of £23.1 billion will mean 8.5 per cent. more financing coming in from outside than in this financial year.
My hon. Friend the Member for Derbyshire, South (Mrs. Currie) made a good speech, and she reminded us of the profligacy of Derbyshire county council.
The hon. Member for Birmingham, Perry Barr (Mr. Rooker) made an interesting speech on wage increases. My record is reasonably good on that issue. When the 8.8 per cent. National and Local Government Officers Association settlement was announced, on the casting vote of Lancashire, as a result of Labour forcing through an inflationary pay increase that took no account of productivity, all the employers met afterwards, and said that it was a disaster. I said that the settlement was bad news for the community charge payer. How can the hon. Gentleman now expect me to fund that increase in full? The comunity charge payers now realise the price that they will have to pay for that inflationary pay award.
Column 504I think that the hon. Member for Stalybridge and Hyde (Mr. Pendry) was wrong about sports clubs, which pay rates at present. Some will experience a drop in value. The hon. Gentleman's main point, however, was that some local authorities--I think that he meant Labour authorities--did not, sadly, recognise the importance of sports clubs. I have given local authorities more power to give sports clubs greater preference, and it is to that that the hon. Gentleman should address his comments.
I listened carefully to what was said by my right hon. Friend the Member for Brent, North (Sir R. Boyson). I recognise that he is one of the most distinguished of my predecessors as Minister for Local Government, and that he did much to sell the principle of the community charge during the 1987 general election campaign. I commend him for that. He would have introduced the charge in a different way, but I hope that he will give us credit for having introduced a transitional relief scheme which, I believe, will provide real relief for just the people he mentioned.
Mr. Robert Boscawen (Somerton and Frome) : Before my hon. Friend leaves the subject of overspending by Labour councils, will he consider the overspending by Liberal councils? One of the issues that worry us in the west of England is that of the many dwellings that will face the standard community charge. Is that taken into account in revenue support grant, or is it a bonus for the councils? If it is a bonus, will the councils be able to return it to the ratepayers in reduced community charge, or will it encourage higher spending?
Mr. Hunt : My hon. Friend is right to recognise that the standard community charge is not included in the settlement that we are debating tonight. According to our calculations, it represents an increase of about £80 million over and above this settlement. It is concentrated in particular parts of the country, such as my hon. Friend's constituency. I have, however, set a discretion for local authorities to use the multiplier in the way that they think fit for local considerations, and they now have the power to reduce the standard charge in a number of cases. I should be happy to deal with that point, and others that I cannot cover now, by writing to the hon. Members concerned. [Interruption.] I have to do that only because of the time constraint.
Responding to my hon. Friend the Member for Surbiton (Mr. Tracey), the hon. Members for Dagenham and for Newham, North-east (Mr. Leighton) sad that it was an outright calumny to suggest that Labour authorities were trying to push up the community charge level that they were now announcing in an attempt to turn people against the community charge. [Interruption.] A document has come into my hands--unfortunately, someone seems to have left it behind after a meeting in Southwark--which advises Labour councillors to consider : "What is more important--short term protection of people by setting low"
community charges, which the document calls
[Interruption.] This is a genuine document--
"or longer term protection by getting rid of the poll tax?" It refers to
"the highest rate you can get away with".
I readily make this available-- [Interruption.]
Column 505I say to my hon. Friends, let us turn the attack where it belongs. Let us concentrate our fire on the Opposition Benches. It is a generous settlement in the present financial climate. It will give local authorities 8.5 per cent. more in business rates and government grants. There is the most generous form of rebates and community charge rebates. We have decided to accelerate the payout to local authorities in payment of grant this year. It is a good settlement. I have no hesitation in recommending it to the House, and I urge my right hon. and hon. Friends to join me in the Lobby tonight in voting for what I sincerely believe will be a simpler and fairer system.
Question put and agreed to.
That the Population Report (England) (House of Commons Paper No. 48), a copy of which was laid before this House on 11th January, be approved.
It being Ten o'clock, Mr. Speaker-- proceeded, pursuant to the Order [12 January], to put forthwith the Questions necessary to dispose of proceedings on the motions.
Motion made, and Question put forthwith,
That the Revenue Support Grant Report (England) 1990-91 (House of Commons Paper No. 47), a copy of which was laid before this House on 11th January, be approved.-- [Mr. Fallon.]
The House proceeded to a Division--
Mr. Joseph Ashton (Bassetlaw) (seated and covered) : On a point of order, Mr. Speaker. Because they find themselves in severe difficulties tonight, the Government have asked the hon. Member for Littleborough and Saddleworth (Mr. Dickens) to come to the House on his crutches and the hon. Member for Harborough (Sir J. Farr) also to be here, although I understand that he has not been well. Do you agree, Mr. Speaker, that, in those circumstances, it would be right to nod those two Members through the Lobby, thereby helping the Government to maintain their majority? That would be preferable to the disabled being dragged through to save the Government.
The House having divided : Ayes 318, Noes 272.
Division No. 39] [10.00
Alison, Rt Hon Michael
Amery, Rt Hon Julian
Arnold, Jacques (Gravesham)
Arnold, Tom (Hazel Grove)
Baker, Rt Hon K. (Mole Valley)
Baker, Nicholas (Dorset N)
Banks, Robert (Harrogate)
Bennett, Nicholas (Pembroke)
Bevan, David Gilroy
Blackburn, Dr John G.
Blaker, Rt Hon Sir Peter
Body, Sir Richard
Boscawen, Hon Robert
Bottomley, Mrs Virginia
Bowden, A (Brighton K'pto'n)
Bowden, Gerald (Dulwich)
Braine, Rt Hon Sir Bernard
Brooke, Rt Hon Peter
Brown, Michael (Brigg & Cl't's)
Column 506Browne, John (Winchester)
Bruce, Ian (Dorset South)
Buck, Sir Antony
Carlisle, John, (Luton N)
Carlisle, Kenneth (Lincoln)
Chalker, Rt Hon Mrs Lynda
Channon, Rt Hon Paul
Clark, Hon Alan (Plym'th S'n)
Clark, Dr Michael (Rochford)
Clark, Sir W. (Croydon S)
Clarke, Rt Hon K. (Rushcliffe)
Coombs, Anthony (Wyre F'rest)
Coombs, Simon (Swindon)
Cope, Rt Hon John
Currie, Mrs Edwina
Davies, Q. (Stamf'd & Spald'g)
Davis, David (Boothferry)
Douglas-Hamilton, Lord James
Emery, Sir Peter
Evans, David (Welwyn Hatf'd)
Fairbairn, Sir Nicholas
Farr, Sir John
Fenner, Dame Peggy
Field, Barry (Isle of Wight)
Finsberg, Sir Geoffrey
Fishburn, John Dudley
Fookes, Dame Janet
Forsyth, Michael (Stirling)
Fowler, Rt Hon Sir Norman
Fox, Sir Marcus
Glyn, Dr Sir Alan
Goodson-Wickes, Dr Charles
Gorman, Mrs Teresa
Grant, Sir Anthony (CambsSW)
Greenway, Harry (Ealing N)
Greenway, John (Ryedale)
Griffiths, Sir Eldon (Bury St E')
Griffiths, Peter (Portsmouth N)
Gummer, Rt Hon John Selwyn
Hamilton, Hon Archie (Epsom)
Hamilton, Neil (Tatton)
Hargreaves, A. (B'ham H'll Gr')
Hicks, Mrs Maureen (Wolv' NE)
Higgins, Rt Hon Terence L.
Hogg, Hon Douglas (Gr'th'm)
Hordern, Sir Peter
Howard, Rt Hon Michael
Howarth, Alan (Strat'd-on-A)
Howarth, G. (Cannock & B'wd)
Howe, Rt Hon Sir Geoffrey
Howell, Rt Hon David (G'dford)
Hughes, Robert G. (Harrow W)
Hunt, David (Wirral W)
Hunt, Sir John (Ravensbourne)
Hurd, Rt Hon Douglas
Irving, Sir Charles
Jones, Gwilym (Cardiff N)
Jones, Robert B (Herts W)
Jopling, Rt Hon Michael
Kellett-Bowman, Dame Elaine
King, Roger (B'ham N'thfield)
King, Rt Hon Tom (Bridgwater)
Knight, Greg (Derby North)
Knight, Dame Jill (Edgbaston)
Lamont, Rt Hon Norman
Lawson, Rt Hon Nigel
Leigh, Edward (Gainsbor'gh)
Lennox-Boyd, Hon Mark
Lloyd, Sir Ian (Havant)
Lloyd, Peter (Fareham)
Luce, Rt Hon Richard
Lyell, Rt Hon Sir Nicholas
Macfarlane, Sir Neil
MacGregor, Rt Hon John