House of Commons Hansard Debates for 23 Jan 1991

(a) an estimate of the additional community charge in the following financial year likely to result from the losses estimated under subsection (1) above ; and

(b) a schedule of the reductions in services which the Secretary of State considers the authority would be likely to be required to make equivalent to any such loss".'.

Brought up, and read the First time.

4.4 pm

Mr. David Blunkett (Sheffield, Brightside) : I beg to move, That the clause be read a Second time.

We have tabled the new clause because we cannot separate the Bill from the shambles of the Government's policy on the poll tax and poll tax capping generally. It is designed to deal with the situation arising out of a substitute bill to be set by the Government consequent on a capping order. We now know from the statement of the Secretary of State last Thursday that the bills that will go out next year will be related directly to the rates that were previously set. The formula involves a £104 difference between the old rates and the assumed bill for the current year plus whatever is levied by the local authorities for the coming financial year.

The Secretary of State not only controls the "assumed" bills but, under the capping arrangements, he controls the bills that will go out next April. He controls both future and present arrangements. It should be left to the authority to try to justify the charge that it thinks should be levied in relation to a given level of services, which the Government are to determine for each individual authority. Matters are made far worse by the fact that the standard spending assessment formulas which the Secretary of State confirmed on Thursday will be

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unchanged, are universally acknowledged to be flawed. The assessment of need, the distribution of grants, the fixing of bills and the determination of capping are all in the hands of a Government who decline under the present Bill to take into account known information that would allow logical decisions to be made about the level of services and the raising of cash to contribute to the collection fund. That is why I described the Government's policy as a shambles. I would have called it a dog's dinner, but the dog takes offence at such remarks.

Things would not be so bad if the Government were willing to accept the new clause, thus acknowledging that those who are in control of decision-making should recognise the need to obtain the maximum up-to-date information on which to base their decisions. The new clause would require them to do that. The Government want to take responsibility for the benefits, as they see them, of poll tax capping and for the new relief scheme, but they do not want to take responsibility for the circumstances relating to the collection fund and consequently for the cuts involved in capped authorities and their effects on residents and citizens.

Mr. Patrick Nicholls (Teignbridge) : The hon. Gentleman referred to a shambles and to decisions that have to be made by decision-makers. Will he comment on the shambles in many Labour-controlled authorities, one of which is Islington? A QC's report on Islington council said :

"Having the cash office staffed by the innumerate, the filing done by the dyslexic and disorganised, and reception by the surly or charmless seems to us a recipe for administrative chaos." That is where the chaos surrounding the community charge really lies--with Labour local authorities which could not organise a celebration in a brewery. Will the hon. Gentleman now address the real problem?

Mr. Blunkett : I think that some Conservative Members know more about celebrations in breweries and the consequences for their party funds than they do about decentralised offices in Islington. I might put on record in relation to Islington the fact that the Prime Minister made a remark yesterday, in answer to questions about empty housing in Islington, which was grossly inaccurate. Islington has one of the best records in London on vacancies ; they now run at less than 2 per cent., which compares extremely favourably with the operation of Government Departments.

Mr. Eric Illsley (Barnsley, Central) : The hon. Member for Teignbridge (Mr. Nicholls) quoted counsel's opinion on a collection office in Islington which stated that it was manned by people who were innumerate and dyslexic. I believe that he was using the terms in a derogative fashion. Will my hon. Friend confirm that "dyslexic" describes people who have a medical condition and is not a term of insult?

Mr. Blunkett : Yes. I hope that the hon. Member for Teignbridge (Mr. Nicholls) will withdraw that. Although none of us wants circumstances in which those who are operating decentralised offices are alleged to be innumerate, all of us accept that dyslexia is an educational medical condition, but that it can be overcome, as

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Conservative Members well know. I give credit to those who have overcome the problem, not least on the Government Benches.

Mr. Nicholls : The hon. Gentleman asked me to withdraw what I said. I do not think that the hon. Member for Barnsley, Central (Mr. Illsley) understood my point. I was not making disparaging remarks about dyslexics. I was quoting a report by a Queen's counsel on the way in which Islington council chooses to organise its affairs. Whatever one may say about the handicaps of dyslexics, to put them in charge of operations such as filing seems a curious way to help them. It is the condemnation of the Labour council which matters. That is the point to which the hon. Gentleman should respond, but which he will seek to avoid.

Mr. Blunkett : It is not a point that I seek to avoid. I made it clear that people who are innumerate should not be dealing with the administration of area offices, whether or not QCs have done an investigation. Dyslexia does not come into it, whether it is in the Department of the Environment or a decentralised office in Islington. I take considerable offence at the idea that the two conditions are synonymous.

Mr. Robert G. Hughes (Harrow, West) : The hon. Gentleman referred to the Prime Minister's remarks yesterday about housing in Islington. In the light of what he said, will he comment on the eight flats rented from private landlords by the council at great expense--using Government money-- which were kept empty by the council for between 40 and 83 weeks? Is that how the council uses Government money to help homeless people?

Mr. Deputy Speaker (Sir Paul Dean) : Order. The hon. Member for Sheffield, Brightside (Mr. Blunkett) is being very generous in giving way. I am sure that he will not be deflected from new clause 1.

Mr. Blunkett : I certainly will not.

Lettings, whether on a leasing arrangement that is being set aside or direct from the housing revenue account, are not the responsibility of the House. There is a direct relationship between the electors of the borough and those they elect. The point of the new clause is that those who have responsibility should be accountable for the decisions that they take. Through the clause, we seek to ensure that those who have the temerity to take decisons about poll tax levels, capping provisions and the necessary resources to meet a given level of service should be accountable for their decisions and should seek the maximum information on which to base their decisions.

Otherwise--I come back to where I left off earlier--the Government will be happy to take responsibility for fixing the poll tax and cuts in general, but will not be happy to take responsibility and to be held accountable for the misery caused by the cuts that they inflict on the electorate of for the confusion and administrative difficulty that they cause to authorities.

Mr. Richard Holt (Langbaurgh) : The hon. Gentleman mentioned manifestos. Which Labour-controlled authority included in its manifesto the figure that it was going to charge in ensuing years, if elected to office, so that community charge payers knew what they were voting for in monetary terms?

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Mr. Blunkett : In London and the metropolitan areas, the poll tax is fixed in February or March. The bills are sent out at the beginning of April, and--unlike central Government--the elected representatives have the temerity to stand for election each year at the beginning of May. There can be no more direct relationship between the bills sent and the judgment of local citizens than that. I am amazed that Conservative Members do not know how the system works--

Dame Elaine Kellett-Bowman (Lancaster) rose --

4.15 pm

Mr. Blunkett : I am delighted to give way to the hon. Lady, who will make an outstanding contribution that will enlighten her fellow Tory Members on how the system works.

Dame Elaine Kellett-Bowman : The hon. Gentleman may be right that there is a relationship under some unitary authorities, but he is wrong about authorities such as mine. The county council spends 9p in every 10p, so there is precious little for local district authorities to do once the money has been blued by the county council.

Mr. Robert G. Hughes : The hon. Gentleman does not care about that.

Mr. Blunkett : The hon. Gentleman says that I do not care about that ; I care greatly about it. We have proposals to improve the operation of local democracy : annual elections in local authorities, the development of unitary government, giving people clear responsibility by removing capping, sensible standard spending assessments and needs systems, reinstating equalisation between different local authorities. All these would introduce direct accountability and would help the hon. Lady's electors to make a direct judgment on what was happening in their area.

The Parliamentary Under-Secretary of State for the Environment (Mr. Robert Key) : I was most interested in the hon. Gentleman's list of proposals for the future of local government. Will he come and discuss them with the Secretary of State and me?

Mr. Blunkett : I repeat what I and my hon. Friend the Member for Dagenham (Mr. Gould) have often said : we are happy to hold discussions on this issue if the Secretary of State will accept the simple principle that the poll tax should be abolished. I welcome the interventions this afternoon, not least because they reveal the paucity of knowledge among Conservative Members, who appear extremely concerned by the clause, which merely seeks to ensure that information is available to Ministers when they make their decisions and that they are held accountable by local electorates for what they do.

Mr. Phillip Oppenheim (Amber Valley) : I appreciate the hon. Gentleman's courtesy in giving way so often on this point. I am worried by his complete failure to mention any funding commitments by a future Labour Government. Last July the hon. Gentleman condemned the £3 billion increase in external funding as "peanuts". If that was peanuts, by how much would a future Labour Government increase funding? Will he answer that in a straightforward way?

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Mr. Deputy Speaker : Order. The hon. Gentleman will find it somewhat difficult to answer that question within the confines of new clause 1.

Mr. Blunkett : I would find it as difficult to answer that question as hon. Members would have found it difficult eight days ago to guess how much the Secretary of State was going to get from the Treasury or from cuts in public services to make up the extra £1 billion. I am glad that the Conservatives are pouring money into the system to try to hold down the poll tax--not just because it helps people, but because it will make our lives a great deal easier when we transfer to a modern property tax based on ability to pay. It will certainly make much easier my arguments and those of my hon. Friend the Member for Dagenham with the new Chancellor when we take office. I return to the Bill. I was simply saying that cuts in services will be initiated by the Government, not only by capping authorities but by using a formula of A minus B minus C over D instead of using the relevant information that is available at the time and taking into account changes that have occurred between the original decision on capping and the order laid for the individual authority's poll tax. Those things are important because, for every £1 that cannot be raised towards the collection fund, £1 of cuts must be made in local authority services or be carried over into the following financial year. This must be picked up by local taxpayers, sometimes entailing the need to borrow ; charges are incurred on the borrowing and this pushes up the actual charge necessary to meet what would have been the previous poll tax or local authority tax. The position is made much worse.

In other words, the Bill is ill-timed, unnecessary and out of date not only because of the Government's change of heart towards the poll tax, but because of last Thursday's statement. Since the conclusion of Standing Committee F, therefore, we have even more reason to reject the Bill and to carry this new clause, which seeks to make some sense of what is before us.

It is clear that we must ask the Government to justify what they are doing. When we did so in Committee we had some interesting replies. The Under- Secretary of State said :

"All authorities must make their best estimate of income and expenditure at the beginning of a year and live with the consequences".--[ Official Report, Standing Committee F, 15 January 1990 ; c. 108.]

Who would disagree with that? But, of course, once the authority has been capped, the situation changes. If the authority has taken into account all the circumstances and has made all the necessary adjustments, it will be ruled out of order.

The Bill deals with the sort of position in which Lambeth found itself when it made a calculation based on its circumstances. Lambeth also made a calculation of what would happen if it was tax-capped. When it went to the High Court, it won. We are debating this Bill on Report and Third Reading and moving the new clause precisely because Lambeth won the case. It was adjudged to have taken due care in its decisions and to have properly weighed the information available to it at the stage to which the Under- Secretary of State referred. That made us wonder whether everyone who supported the Bill really understood what it was about and what it was intended to do.

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Mr. Richard Tracey (Surbiton) : The hon. Gentleman makes it sound as though Lambeth council is a well-organised London borough. Will he confirm that Lambeth council could not send poll tax bills to people earlier than the day before the local elections in May? Can he say whether many people in Lambeth have received their bills from the council? It is our understanding that most people in Lambeth are still waiting for their bills. Lambeth council is in chaos.

Mr. Blunkett : Whatever the rights and wrongs of the debate about the effectiveness of services in Lambeth, the council can hardly be blamed for not sending out the bills by 1 April, consequent on the decision of the Government to cap it. If the hon. Member for Surbiton (Mr. Tracey) examines the logistics of the position, he will be forced to conclude that the best that Lambeth could do was to announce what figure it intended to levy if it were free to do so. The electors in Lambeth made their decision precisely on those figures, with the debate in the House still to take place and with a court judgment on the validity of the Government's action also pending.

Everybody knew about Lambeth's bill because the Government made their best efforts to publicise what it would be and what their substitute setting would be. Therefore, a clear judgment could be made about whether to accept the Government's bill or that of Lambeth council. People made that judgment and voted Labour, and no one can cast aside the result of a clear democratic election that was held only a few weeks after the decision to set the poll tax had been publicised.

In Committee, the Under-Secretary of State said :

"All authorities are in the same boat."

That is the flagship that is rapidly sinking. He said : "Opposition Members are trying to put capped authorities in a boat by themselves".

It would have been appropriate for the Minister to say "a lifeboat". He continued :

"But there is no justification for that. There is no reason why a capped authority should have an opportunity that is not available to other authorities to reconsider matters such as its estimate of non-collection when resetting its charges after capping."

As I said, Lambeth council had an opportunity to weigh up the information available to it before capping and at the point at which it set its poll tax. That was upheld by the court and the Bill deals precisely with that situation by disqualifying the council. Far from us trying to get capped authorities into a lifeboat, which in other circumstances and in another connotation we would seek to do, we are trying to ensure that capped authorities are on all fours about being able to use the information that is available to them.

Mr. Key : I do not wish to be the tail that wags the hon. Gentleman's dog. I know that he is scrupulously fair : if he reads on in column 109, he will find that I said :

"Moreover, it is clear that under the present statute a capped authority cannot change its non-collection estimate to allow for the fact that it has been capped. Haringey tried to do that this year when it reset its charge after capping, but that was subsequently quashed by the divisional court."- -[ Official Report, Standing Committee F, 15 January 1991 ; c. 108- 9.]

Once again the Opposition are confusing the existing statute with the Bill.

Mr. Blunkett : We are not confused and we have shown that not only by our interventions and contributions but by the words that I read to the House. We understand very

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well what we are trying to do. In this somewhat limited and irrelevant Bill, we are trying to prevent the Government from having the power to set poll tax levels without using the necessary information and without making sensible judgments about the impact on the collection fund and, consequently, on the following year's poll tax or on the cuts that will have to be made. In Committee, we went into detail on matters that would affect those judgments. The level of the collection fund will be affected by the precept that is levelled by the precepting authorities and by the national non-domestic rate pool which draws on the collection fund. Of course, it will also be affected by section 95(4) of the 1988 Act, which deals with withdrawal of the local authority's general fund requirements, and by how much is collected. We made a substantial case, and shall make it again, about the importance of bearing in mind when making decisions the consequences of capping itself. Those who cap should be wary of enforcing algebraic formulae on authorities that have to live with the consequences. If collection rates are affected by a delay that inevitably occurs because of capping, it should be taken into account. It is common sense to recognise that collection rates can and will be affected.

The Government do not have to take our word for it, or even the word of local authorities. We know that the Audit Commission is concerned about the difficulty in some areas of collection, such as the 4 million people who are at the bottom income levels and who are charged the minimum poll tax. There is also the question of those who move house and who local authorities, particularly in inner-city areas, are endeavouring to chase for their poll tax payments. In other words, depending on the area of the country, the 10 to 40 per cent. turnover rate in the locality will have a substantial effect. In my authority, between the date at which the relevant population was asssessed and the beginning of the financial year there has been a 6.3 per cent. population change.

4.30 pm

We also pointed out that it was important to understand the difference between the "relevant population" and the "equated population". In a council such as Haringey, it made a difference of £1 million in income --a substantial amount for day nurseries, nursery schooling, home helps and meals on wheels. These things matter greatly, especially in an authority which had to make cuts of £28 million to get within the capping criteria in the first place. The amount that would come off poll tax this year in Haringey was affected by about £6 ; it would have been £70.70 for the relevant population and £64.30 for the equated population, making a difference of £1 million in terms of neglect. The consequences had to be dealt with not by Ministers but by local councillors struggling to make the budget balance.

That is why we tabled the new clause. We want the maximum information about what is happening to the collection fund and its likely outturn, a matter that we would expect any local authority to take into account. This is called fiduciary duty. Under the 1988 Act, local authorities have something called a whistleblower. We would like a whistleblower on Conservative Members. Time is up for the poll tax and the way in which Conservative Members have colluded with a lie. It is a lie that one can enhance democracy by taking it away ; that one can increase accountability by removing it from local

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people and their elected representatives and by taking responsibility but then trying to shift the blame on to the shoulders of local councillors.

The Government want to have the best of both worlds. They want capping, the poll tax and the gerrymandering of bills as a result of last week's announcement, and they want cuts. They want all this without having to deal directly with the consequences and without having to spell out, as we ask in the new clause, the consequences of the expected cuts. They are oblivious of the long-term increase in the poll tax because of the deficiency on the collection fund. For all those reasons, I ask all hon. Members to vote for the new clause.

Miss Emma Nicholson (Torridge and Devon, West) : I oppose new clause 1, not on any ideological account and not because I do not take seriously the interesting and demanding questions posed by the hon. Member for Sheffield, Brightside (Mr. Blunkett). Indeed, I pay tribute to the hon. Gentleman's great courtesy in giving way so many times. The only reason I did not ask him to give way was that I wanted to make a slightly longer series of points in response to his comments.

The hon. Member for Brightside referred to the fact that this was a fundamental platform. He pointed out that every £1 capped equalled a cut of £1. That presupposes both perfect efficiency in every local authority and a level of service throughout that is constant. That would then achieve the result suggested by the hon. Gentleman--every £1 capped would equal £1 of cuts.

Of course, we know that that is not true. That has not happened. In September last year, the National Association of Local Government Officers conducted a survey of the capped authorities, and the union-owned newspaper Public Service reported that Basildon had said that no redundancies were anticipated ; Brent had said that no cuts were required as a result of capping ; Bristol had said that there would be no redundancies, no cuts in services and no charge increases ; Calderdale had said that it was holding growth, increasing some charges and cutting some non-essential services ; and Camden had said that no cuts were necessary. The cap was £4.4 million, but Camden council said :

"Our income is sufficient for us not to need to make cuts." Greenwich said that some redundancies were expected, but that there would be no large- scale job cuts, and Lambeth said that it had managed to avoid closure of front-line services and that there would be no redundancies.

Mr. Illsley : The hon. Lady is reading out an interesting list--

Miss Nicholson : I have a longer one.

Mr. Illsley : In that case, perhaps the hon. Lady will tell us what the list says about my authority, Barnsley, and what cuts it had to make.

Miss Nicholson : I do not intend to list the cuts, results of cuts, or results of capping for every hon. Member's local council. Of course, if I did it would not take too long, as there are so few Opposition Members present for a debate about a matter which they claim causes them great concern.

I was not at all surprised by that survey. The hon. Member for Brightside should not be surprised either, despite his bland statement that every £1 capped should equal £1 of cuts. The reason why I was not surprised is that

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I have had practical job experience working both inside and alongside local authorities, be they district councils, county councils or that great departed monolith whose death I welcomed and whose funeral pyre I should have liked to light myself, the Greater London council.

My work with local authorities was during my pre-parliamentary years, when I worked in industry, in business and in the voluntary sector. I well recall the appalling shock that I received, as someone who believed in the high level of services that local authorities were supposed to provide--I knew less then and I was more naive about the massive incompetence in some of the geographical areas--when I went to the GLC to do a job for the computer industry. You are highly computer-literate, Mr. Deputy Speaker, so you will know that it is crucial that different forms of machinery and different forms of software interlock-- [Interruption.] Of course Mr. Deputy Speaker is computer literate ; everybody with a farming constituency is computer literate these days.

I was genuinely shocked, in a real professional sense, when I discovered that the GLC had made massive incompetent investment in four different mainframe manufacturers, none of whose equipment or software was compatible at that time. The GLC had four huge teams of staff, each pursuing different sorts of machinery and software and trying to carry out different sorts of task. I found that a professional abomination and I was deeply shocked. It was because of the GLC's incompetence that the company for which I was working as a general consultant was called in to do one of the simplest jobs of all--to create a computerised payroll for part of the GLC organisation. Although it appears funny retrospectively, I did not find it amusing at the time when I asked for some software manuals for a particular part of the job and the staff were absolutely astounded. They opened a cupboard, and out fell a load of empty whisky bottles. Such was the enormous competence of the GLC. Subsequently, when I was in the voluntary agency field, I worked alongside social services department people and I recognised with great sadness the enormous disparity in the level of services that they were able to supply--not, I hasten to add, because of their desire to provide less than efficient services, but because of their incompetence in some areas and in certain parts of the country. There is great disparity in levels of competence. That is where new clause 1 comes in.

In the course of his speech, the hon. Member for Brightside made the discredited comment that every £1 capped equalled £1 of cuts. This has clearly not happened in the past 12 months and never will, given these disparities of service. It presupposes perfect efficiency in every local authority.

Subsection (4)(a) of the new clause demands that the Secretary of State shall specify

"an estimate of the additional community charge in the following financial year likely to result from the losses estimated under section (1) above."

In the cases of the seven district councils that I have listed which had charge capping last year and where no cuts resulted, I suggest that the Secretary of State would be offering a nil forecast. He would be offering a nil forecast because capping has meant that councils have been forced to look again at their incompetence and inefficiency and have been forced to tighten their belts.

Mr. Holt : Would my hon. Friend like to speculate what the Labour- controlled authorities would be doing with all

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that money that they would have had without charge capping? They have not had to cut any services, so what would they have done if they had managed to get their grubby hands on all that money?

Miss Nicholson : I am very sorry to say that we would have had even higher staff levels in those local authorities and even slower provision of services to the electorate outside. As we all know, when one builds up a so -called core of administration, even with the best well-meaning people, the line between the centre and the elected gets slower and slower in achievement.

I hope that the Minister will consider this seriously. I believe that we should go further than just putting in agency provisions for the delivery of Government services ; we should go out to private companies, put them under stringent rules and allow them to provide the services, which they will do at perhaps half the cost incurred by so many of our local authorities at present.

The hon. Member for Brightside suggested--and I wholly support him--that those who take the decisions should be accountable. Those were his very words, but he related those words to the Government. He suggested that those who take the decision to charge-cap should be accountable to the electorate. I suggest that the Conservative philosophy reflects those words in local authority action. The local authority should be accountable. From the Conservative perspective, these caps are only a method of creating local accountability. Indeed, as we have seen from the figures I have read out, this has in some measure already occurred.

The hon. Member cannot say that we tell a lie--that is a word I would not normally use in this place--about enhancing democracy by taking it away. We have, in fact, enhanced democracy. Yes, we have done so with some difficulty ; yes, with some elements that I cannot support ; and yes, with some points that I know we are already clearing up and others that need further clearing up. Nevertheless, we have increased democracy and we have brought closer to the people of the United Kingdom the decision making which should be theirs alone--the decision making undertaken on their behalf by local authorities. We have given them the ability to call the tune. There has been no gerrymandering of bills and there may have been a misunderstanding of that word.

Finally, I question the still confused thinking that has been displayed by Opposition Members about the operations of local democracy. I was fascinated to see the utter dichotomy, the contradiction in terms, offered by the hon. Member for Brightside when he called both for the removal of SSAs and for the equalisation of local authorities. He is speaking against himself, because the point of SSAs is to equalise the services offered throughout the United Kingdom. One cannot have equalisation of local authorities without some form of redistribution of income, and SSAs offer a moderately simple way of doing that.

Incidentally, I do not necessarily pay tribute to the eternal values of equalisation of services throughout the United Kingdom. I believe that we may have gone too far on that one. Nevertheless, I call into question the hon. Member's illogicality, which I am sure he does not intend, when he offers two opposing aspects and suggests that they reach one solution.

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4.45 pm

Mr. Illsley : The hon. Lady said that charge capping enhanced democracy and increased accountability. Surely charge capping has done just the opposite. If the Conservative Government had wanted to increase accountability, they would have allowed the electorate to decide on the poll tax bills of the charge-capped authorities. That is the idea of accountability ; it is not just a matter of the Government imposing on these local authorities a poll tax which they then have to sell. The hon. Lady also said that SSAs equalise resources. If that is so, why does Manchester get more money to pay for its standard level of services than many other metropolitan districts such as Westminster?

Miss Nicholson : I agree that in a perfect world we could give complete freedom to local authorities to set their own bills and allow complete freedom to the electorate to turn out those local authorities which failed to deliver the services at the sorts of costs people require. However, as the Opposition's Front-Bench spokesman himself said recently, if a Labour Government were in power they would consider keeping some sort of power in reserve for something like a charge-capping exercise.

Mr. Blunkett rose--

Miss Nicholson : I will give way to the hon. Member when I have finished making this point. The shadow Environment Secretary who was the predecessor to the hon. Member for Brightside said that, in extremis, there must always be that reserve power. He made that statement on Radio 4 on 27 March 1990. The shadow Environment Secretary before him stated in Hansard :

"the Labour party's policy makes it clear that what the Government provide to local authorities would, of necessity, be controlled and limited"--[ Official Report, 18 February 1988 ; Vol. 127, c. 1218] I agree that in a perfect world there would not need to be these controls and limits. I suggest that it is a mere short-term view, simply because of the profligacy of some of the Labour councils which has been so appalling that one shudders to think what the poorer members of society would suffer if these councils were allowed to go full tilt down the road of massive expenditure.

Mr. Blunkett : I simply want to put the record straight, and there is no point in not doing it now. My hon. Friend the Member for Dagenham (Mr. Gould) made it clear that his remarks which the hon. Lady has mentioned, on Radio 4's "Today" programme, referred to propriety and financial probity. The Labour party's position is unequivocal. We will not introduce capping for local revenue raised and spent by a local authority, as distinct from Government grant which in all circumstances has, by its very nature, to be determined by the Government.

Miss Nicholson : The hon. Gentleman tempts me to go a little further down the path, although I had in fact finished. The former shadow Environment Secretary went on to say :

"It is really just a hypothetical question to ask us to define what would be extreme circumstances. What I am saying to you--I am not ducking your question in any sense--I am saying in extremis the reserve power would have to be reserved but that it is impossible to say in advance what those circumstances would be".

In other words, the Labour party has no policy. It has failed to recognise honourably and honestly that it is

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Labour councils which overspend in a way that is unacceptable to the electorate. Labour councils spend on themselves in terms of their central staffing, central comforts and they do not give to the electorate those things that the electorate deserves.

I cannot support new clause 1 or the Labour party's policy on the community charge. I look to my right hon. Friend the Secretary of State and to his most able Ministers to deliver the right and proper answers within the Conservative philosophy.

Mr. Illsley : I support new clause 1 and, in view of what I said in Committee, I hope to keep my remarks brief.

It is not that some authorities are profligate and overspend ; it is simply that the Government have imposed on them standard spending assessments which are deliberately low to force them into a situation where they can easily be charge-capped under the Government's current criteria. In Committee, the Opposition showed clearly that the SSAs bore no relation to the needs of any particular authority. I was interested to hear the comments of the hon. Member for Torridge and Devon, West (Miss Nicholson) about a newspaper published by the National and Local Government Officers Association which I think she said was produced last September. Barnsley is still making cuts as a result of last year's charge capping of which the newspaper probably would not be aware.

New clause 1 requires the Secretary of State to estimate losses that are likely to be carried forward for the forthcoming year. The formula as it stands in the Bill simply passes the result of any charge capping on to the poll tax payer in the following financial year, and no account is taken of the shortfall despite the fact that that information is available at the time of the charge capping. It is nonsense that the Government should force authorities to issue bills which the Government and the local authorities know are ridiculous because they do not take account of the information that is available to the authority at the time. The public do not want that shortfall being stored up for the following year.

For example, in 1990-91 Barnsley allocated 6 per cent. of its poll tax bill to cover any shortfall in the collection of the tax, and that was detailed on the bill. There is considerable resentment among charge payers in my authority because they are expected to pay £16.97 to cover what they look upon as defaulters. Complaints to me and in the local press are now building up from people who refuse to pay that sum. They will pay the rest of the poll tax bill, but they are not prepared to pay for someone who defaults. They do not realise that similar problems existed under the rating system. That is causing problems for the local authority.

It is not just ordinary working people who object, but the business community as well--perhaps more so. They tend to look on people who are unable to pay as shirkers, just as Conservative Members do, although that is not necessarily the case. One can imagine the disgust of charge payers in my local authority if they had to make up a shortfall of more than 6 per cent. That is simply increasing the number of refusals to pay the poll tax and placing an extra burden on the local authority. People are deciding to pay simply a proportion of the poll tax and to withhold the £16.97. Therefore, my local authority is having to send out extra bills, obtain court orders and all the rest simply because people are refusing to pay that 6 per cent. It shows

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