House of Commons Hansard Debates for 29 Jan 1991

Abolition of Warrant Sales (Scotland) Bill

Mr. Dennis Canavan accordingly presented a Bill to abolish the practice of warrant sales and to replace it with a Debt Arbitration Service ; and to control the employment and conduct of sheriff officers : And the same was read the First time ; and ordered to be read a Second time upon Friday 1 March and to be printed. [Bill 69].

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Local Government Finance (England)

4.4 pm

The Secretary of State for the Environment (Mr. Michael Heseltine) : I beg to move,

That the Revenue Support Grant Report (England) 1991-92 (House of Commons Paper No. 93), a copy of which was laid before this House on 21st January, be approved.

Mr. Speaker : With this it will be convenient to consider the next four motions on the Order Paper :

That the Population Report (England) (No. 2) (House of Commons Paper No. 94), a copy of which was laid before this House on 21st January, be approved.

That the Revenue Support Grant Distribution (Amendment) Report (England) (House of Commons Paper No. 95), a copy of which was laid before this House on 21st January, be approved.

That the Special Grant Report (No. 2) (House of Commons Paper No. 96), a copy of which was laid before this House on 21st January, be approved.

That the Rate Support Grant Supplementary Report (England) 1989-90 (House of Commons Paper No. 12), a copy of which was laid before this House on 15th January, be approved.

Divisions will take place at 10 o'clock.

Mr. Heseltine : The House will expect me to say something about the progress of the review of local government structure and finance that I announced on 5 December. As I have said, the review will be a thorough one. I wish to consult widely. I have already had a constructive meeting with the hon. Member for Berwick-upon-Tweed (Mr. Beith), and I have agreed to meet him again. I have met the leaders of the local authority associations, and I shall meet them again next week. I have met individual local authority leaders from all parties and I have an extensive programme of further meetings. I have also arranged to attend a meeting between my right hon. Friend the Secretary of State for Scotland and the hon. Members for Moray (Mrs. Ewing) and for Dunfermline, West (Mr. Douglas). My hon. Friends the Minister of State and the Parliamentary Under-Secretary of State are also consulting widely.

I repeat my invitation to the parliamentary Labour party. It seems curious that the Labour party is co-operating in my review at every level, with the exception of the party leadership.

Depending on the progress of our discussions, I hope to give a first indication of our thinking in the spring. By the nature of the review, anything that I can say then will be unlikely to deal with all the issues that must be addressed, but it may make sense to focus the national debate- -to rule some things out and some things in. I have already announced to the House changes that will have major practical implications for the incidence of the community charge. The community charge reduction scheme will provide £1.7 billion of help to more than half of all charge payers next year. Together with the settlement that we are discussing today and the community charge reduction scheme, I believe that local authorities will have it in their power to hold bills actually paid by charge payers to below £300 on average.

The help will be particularly directed at those couples and single people who experienced the largest increases in their bills last year. Virtually all those who previously had rates bills below three quarters of the average for their areas will benefit.

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The House will wish me also to address the issue of the community charge as it affects our service men serving in the Gulf.

Mr. Robin Maxwell-Hyslop (Tiverton) : Before my right hon. Friend leaves his first point, there is a certain amount of lack of information. What about people who had no rates bills at all because they were not householders and who now get community charge bills?

Mr. Heseltine : If such people are disabled or elderly, they are entitled to special assistance, which is part of already established regimes with which the House will be familiar.

Mr. William O'Brien (Normanton) : What about the others?

Mr. Heseltine : That is the answer to the question. The schemes that exist have already been fully explained to the House. If no scheme relates specifically to them, they are liable to the charges. One of the purposes behind the introduction of the community charge was to bring into its incidence all the adults in the community. Therefore, it follows that people who did not qualify as home owners before the community charge was introduced would be likely to come within its incidence afterwards. That was one of the necessary purposes.

Mr. Jeff Rooker (Birmingham, Perry Barr) : Will the Secretary of State point out by example what he meant by help relating to disability? There is no such help. It is based only on income. That is not the answer to the question posed by his hon. Friend for Tiverton (Mr. Maxwell-Hyslop).

Mr. Heseltine : The hon. Gentleman is not correct. Disabled people qualify for the transitional relief scheme and for the new community charge reduction scheme. [Interruption.] I have done my best to answer the question.

Several Hon. Members rose--

Mr. Heseltine : We have had two specific questions, to which I have given an answer. There is a great deal of detail to deal with in this speech and I intend to make some progress. I intend to deal with the important issue of the affect of the community charge on our service men in the Gulf.

On 5 November, we advised local authorities that, where a service man is posted until further notice outside Great Britain, community charge registration officers should use their discretion to assume that his liability for the personal community charge ceases from the date of posting. There are arrangements for service liaison officers to inform community charge registration officers of postings to enable this arrangement to work efficiently. The spouse of any service man who is posted will continue to be liable to the personal charge where she remains resident in this country. We have advised authorities that, where a service man has an outstanding community charge liability at the date when he is posted, no action should be taken to recover the amount due until the service man's return.

Mr. Julian Critchley (Aldershot) : My right hon. Friend will be aware that in Rushmoor, which covers Aldershot and Farnborough, the register has dropped by more than 2,000 because of the number of service men going to the Gulf. Were the revenue support grant to remain the same

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as last September, most of my constituents would be paying £14 a year more in poll tax. Is he able to help with that?

Mr. Heseltine : I am grateful to my hon. Friend for putting that question to me. I have considered the effect of service men leaving their local authority areas to serve in the Gulf. Most local authorities would be able to absorb the problem within the normal flow of population which effects all such movements of people from one year to the other. That deals with the problems of most authorities when service men move overseas.

My hon. Friend the Member for Aldershot (Mr. Critchley) is seeing my hon. Friend the Minister for local Government and Inner Cities tomorrow about the particular consequences for his constituency and his local authority, given that many service men are involved. We have no specific proposals, but we should like to listen to what my hon. Friend has to say. If it seems that there is a substantial problem, we may consider it in the light of the consultation.

Mr. Dave Nellist (Coventry, South-East) : What happens--God forbid, all of us hope that this does not happen--if a service man who is exempted from the point of departure from these shores does not return? Will their spouses, because of joint and several liability and as has happened with families of trawlermen under Scottish legislation, be levied with a tax for which that service man was liable before leaving these shores? Yesterday, The Guardian and The Times reported that the Department is considering abolishing court hearings for non-payers. That will mean that service men's widows, instead of being prosecuted by councils, will have to initiate proceedings to prove their innocence, unless the right hon. Gentleman says that those service men will be totally exempt.

Mr. Heseltine : The hon. Gentleman raises a hypothetical circumstance which is within the discretion of CCROs. We hope that those circumstances will not arise, but I have explored them and will consider them further if necessary. The existing arrangements are adequate to cope with such a--

Mr. John McAllion (Dundee, East) rose--

Mr. Heseltine : No. The House understands that these matters provide for endless intervention, and one makes no progress with one's speech. Many of the questions that will occur to hon. Members will be covered by my remarks.

My right hon. Friend the Secretary of State for Defence made it clear in response to a question from my hon. Friend the Member for Portsmouth, South (Mr. Martin) on 18 October that no service man was to be financially worse off as a result of service in the Gulf. I can confirm that that assurance applies to auxiliaries and territorials who are posted outside Great Britain and become liable to the standard community charge as a result. That arrangement already applies to regulars. The Ministry of Defence will pay to such people compensation equal to any excess of their standard charge liability over the personal community charge which they had been paying before posting.

I should like to say a word about the apparent anomaly that has emerged in the different treatment of single and married service men for community charge purposes. Under Queen's Regulations, a single soldier who has been

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living in barracks is deemed to have lost any right to return to that accommodation after an absence of 61 days. Our advice to local authorities is that, if the service man returns within that period, he is liable for the personal charge during his absence, whereas, if he returns after 61 days, he should be treated as having had his sole or main residence elsewhere during that period and should not be liable for the personal charge at the address.

However, personnel living in married quarters or in their own homes are assumed not to have changed their sole or main residence until they have been absent for six months--by analogy with the practice adopted by CCROs in respect of other groups, such as merchant seamen. So it is possible for two people--one single, and one married--to be posted to the Gulf, for both to return after, say, 62 days, and for the single person to have no personal community charge liability for that period even if he returns to the same barracks, whereas the married soldier is liable for the whole period. This may seem like an anomaly, but, of course, it applies to any posting outside Great Britain, not just postings to the Gulf.

Also, there is some analogy with the position under the rating system. The single soldier posted outside Great Britain would have ceased to have liability for the rating element of his accommodation charge, whereas the married soldier would have remained liable for a rating charge in respect of his family home. So I do not think that this is the anomaly that it may at first appear to be.

The House will appreciate that the last time we issued local authorities with guidance on the treatment of service personnel was early in November, and that events since then have moved on. There have come to light new cases that were not wholly covered by our guidance. We therefore plan to issue to authorities fresh guidance building on the advice that we have already given them. I shall put details before the House at the earliest opportunity.

The hon. Member fore Sheffield, Brightside (Mr. Blunkett) has today written to me suggesting that we should go further, and introduce legislation exempting from the community charge all service men in the Gulf. I am not convinced that this is necessary. I believe that, if community charge registration officers use their discretion in the way we have advised, service men will be treated equitably. If, however, there emerge problems that can be dealt with only by legislation, I shall come back to the House as soon as I can. At this time of the year, is is customary to hear of cuts --often of horrendous proportions--in local government services. Indeed, one could be forgiven for believing that the 1980s in some way saw the decimation of what local government was asked to provide. It may help hon. Members if I remind them of the simple facts. When the Conservative Government were elected in 1979, local authority manpower--at nearly 2 million full-time equivalents--was at an all-time high. In the following two years, we managed to persuade authorities to look more critically at their manpower requirements. This resulted in a welcome reduction of 80,000 employees, But the encouraging trend was short-lived. Local authority manpower has steadily increased and, on a comparable basis, is now back to virtually the level of 1979. Local

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authority total revenue expenditure increased from £43 billion, at 1990 prices, in 1979-80 to £51 billion in 1990-91--a 17 per cent. real-terms increase.

Mr. Robert B. Jones (Hertfordshire, West) : In view of the larger numbers of socialist councils, my right hon. Friend should not be surprised at what has happened to manpower figures. Is he aware, for example, that in Hertfordshire, where, between 1985 and 1989, the county council had a Labour and Liberal majority, the number of employees increased by 5,000 and that spending was at a level £40 million above the rate of inflation?

Mr. Heseltine : My hon. Friend brings a sad example to our attention. However, the situation is even worse than he suggests. When one looks at the situation in the country at large one finds that Conservative authorities are much more careful about the interests of their charge payers, and that they consistently levy lower charges.

Mr. Dennis Turner (Wolverhampton, South-East) : Taking into account the legislation that the Government have imposed on local authorities, is it any wonder that there should have been manpower increases? Consider, for example, the hundreds of people who, in my area, as in every other, have had to be employed to collect the infamous poll tax.

Mr. Heseltine : The hon. Gentleman must be fully aware that the increases had been going on long before the community charge was introduced. I am grateful to hear him talking about increases in manpower. I am not sure how he squares that with the language about cuts that we continually hear from the Labour party. The whole essence of what I am trying to say to the House is that manpower is broadly where it was, at the highest level ever, in 1979, but that the real expenditure of local government is 17 per cent. higher than it was at the beginning of the decade. Spending across almost all services has increased significantly.

Two examples illustrate my point. In 1981-82, spending on the police amounted to £1.9 billion. In 1989-90, it amounted to £3.8 billion, which is an increase in real terms of 30.3 per cent. Similarly, in 1981-82, spending on personal social services amounted to £1.8 billion, increasing in real terms by 30.1 per cent. to £3.6 billion in 1989-90. The reality is that there has been a consistent real-term increase in local authority expenditure throughout the 1980s.

The settlement announced on 31 October is realistic by any standards. It provides for an increase in total standard spending--that is, the amount that it would be appropriate for local authorities in aggregate to spend-- of 19 per cent. to £39 billion. When viewed in isolation, that is a considerable increase. When set in the context of the substantial growth in local government spending over the past decade, it gives the lie to the suggestion that local government is being forced to make damaging cuts-- [ Hon. Members-- : "No."] It is interesting that, despite all the figures, the Labour party goes on talking about that.

I have a copy here of a publication of the National and Local Government Officers Association called Public Service. It is interesting because it examines the various authorities that were capped last year. The House will be fully aware of all that was said about the consequences to public services if the capping legislation was enforced and if the cuts were brought about. The newspaper has done

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the admirable service for all of us of surveying what happened in some of the capped authorities so that we can see what the horrendous consequences, about which the Labour party talked, were in practice. Let me give an example. Rochdale's budget was cut by £8 million, but there were no compulsory redundancies. Bristol's budget was cut by £7.6 million, but there were no redundancies, no cuts in services and no charge increases, and almost £5 million was saved on financial adjustments. The rest was due to cuts in committees. I do not intend to go further.

Mr. Eric Illsley (Barnsley, Central) : Will the right hon. Gentleman give way?

Mr. Heseltine : No.

This newspaper, admirable as it is in this one rather narrow respect, is available freely for hon. Members to study. There is a difference between what is said in advance about cuts and what happens in practice.

Even in the face of the level of provision about which I have been talking, there is still some complaint that we have not "provided for inflation". That reflects an attitude in certain quarters that inflation is an automatic factor which has to be built into the public expenditure profile, and which must be provided for and perhaps even nurtured.

The realistic point is that inflation must be tackled vigorously if we are to get it down. The clear implication is that, while central Government, industry and every householder have to tighten their belts, local government can be expected to ride on as if there had been no change in its economic fortunes. The logical extension of that argument--that the taxpayers, the business rate payers and the charge payers should fund the high-spending aspirations of the town hall--is set on one side as if there were no logical connection. I regard that as unacceptable.

Mr. Illsley : Utter rubbish.

Mr. Heseltine : It is not utter rubbish ; it is far worse than that.

Mr. Bryan Gould (Dagenham) : I have been trying to follow what the Secretary of State is saying, but I find it somewhat confusing. Is it not the case that, if an increase in central Government grant or an increase in permitted expenditure is lower than the prevailing rate of inflation, the real effect is a cut? Is not that the inevitable consequence of the right hon. Gentleman's settlement, and is not that the very point that has been made by the Opposition and by local authorities?

Mr. Heseltine : I am coming, helpfully, to the Audit Commission's view on the question that has been put to me by Opposition Members. Some people suggest that local authority budgets have been cut to the bone and that therefore, if we do not provide 100 per cent. of the inflationary increases, as the hon. Gentleman asked, we shall impose further cuts. That is to confuse cash spent with the quality of service delivered, without any attempt to get value for money. Since 1982, the Audit Commission has systematically worked its way through many of the services of local government. It has discovered that there is scope for £1.3 billion of value-for-money improvements. Opposition Members would call that a cut. We say that it is expenditure that should long since have been rooted out

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and avoided. That £1.3 billion, only half of which has so far been delivered in economies, was related to only 40 per cent. of local authority expenditure. Quite obviously, there are opportunities for value-for-money reductions without a reduction in service. Those opportunities have been drawn to the attention of local government and of charge payers, formerly ratepayers, by the Audit Commission. What do we hear from Labour Members? They want to get rid of the Audit Commission. That body, which is systematically improving the quality of services by advice to local government, with all the benefit that flows to the local people concerned because they get better services at lower or the same cost, is to be stopped from pursuing that correct interest in taxpayers' money.

Mr. Gould : I am sorry to ask the Secretary of State to allow me to intervene again, but he really cannot get away with that total misstatement of Labour's position. We have made it clear that the audit function of the Audit Commission should be retained and strengthened. It should be placed in the context in which not just the accountants' narrow view of cost cutting prevails, and it should also be placed in the context of value for money and the quality delivery of services. That is the difference between the right hon. Gentleman's side of the argument and ours.

Mr. Heseltine : The hon. Gentleman simply does not understand. We have auditors whose interest is to establish the rectitude of the accounts and whether the books add up. That is an important form of auditing. As I understand it, the hon. Gentleman is keen on that. That is retained. What about the pursuit of value for money, comparative statistics, and quality of service? That is another essential feature of the Audit Commission's activities. The Labour party has defined the function of the Audit Commission as it now exists.

Of course, Labour Members are not prepared to have comparative statistics. They are not prepared for somebody else to monitor the value that is delivered by local government. Why? It is because they know perfectly well that the authorities over which they preside cannot stand the scrutiny of any outside organisation. That is a classic example of the Labour party softening the climate of public expenditure without anyone having regard to the detail that matters.

Mr. David Winnick (Walsall, North) : Will the Secretary of State give way?

Mr. Heseltine : I shall not give way to the hon. Gentleman.

Mr. Robin Squire (Hornchurch) : I am grateful to my right hon. Friend for giving way to an hon. Member on his side of the House. Does he agree that the matter is worse than he has so far stated? Not only is there a highly suspect question mark over the future of the Audit Commission, but compulsory tendering has been thrown into the balance by the Labour party. We are talking of £3 billion-worth of local government contracts every year, and an estimated 20 per cent. savings--all to the benefit of community charge payers--which have been thrown out the window by the Labour party.

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Mr. Heseltine : My hon. Friend says that the matter is worse than I have put it. He may be right. I am known for the moderation with which I describe the vagaries of the Labour party.

Several Hon. Members rose --

Mr. Heseltine : My hon. Friend the Member for Hornchurch (Mr. Squire) has greatly reinforced the point that I wanted to make. If time permitted, I would deal with the benefits of compulsory tendering.

Mr. Winnick : Will the Secretary of State give way on that point?

Mr. Heseltine : No, I shall not give way, if the hon. Gentleman will forgive me. We must make progress.

Parliament has given me powers to cap authorities whose budgets are excessive, or which increase their budgets excessively from year to year. I shall use those powers if it proves necessary. Whether or not it will be necessary is in authorities' own hands. None of them should doubt our determination to ensure that they do not spend more than the nation can afford.

The criteria that we intend to use for next year were set out clearly on 31 October, and I reaffirm them now. Let me also explain the process in more detail, because there has been some misunderstanding about it and I would not be suprised if some hon. Members--

Mr. Winnick rose --

Mr. Heseltine : Perhaps I could make the point before we explore it.

Some of my right hon. and hon. Friends are particularly interested in the way the capping machinery works. We have published the intended criteria for deciding whether a precept or demand on the collection fund is excessive, or has increased excessively between this year and next. It is now for authorities to fix their budgets in that knowledge. When they have done so, I must consider those budgets and make my legal decisions on the criteria to be used. That will determine which authorities are capped.

At the same time, I shall propose the numerical level of the cap for each authority in the light of the information I have about their individual circumstances. The capped authorities then have 28 days within which to accept my proposed level of cap or to suggest an alternative level. Only thereafter, if an authority has not accepted my proposed level of cap, do I bring forward to the House an order finally fixing the level of its cap.

These arrangements apply to all authorities, including the single-service police, and fire and civil defence, authorities, which have expressed a number of concerns to me. I believe that the intended criteria are fair and reasonable for all authorities, but if an authority has budgeted in excess of the criteria I adopt, I must in proposing and fixing the level of its cap take its particular circumstances into account.

Mr. David Ashby (Leicestershire, North-West) : Would this capping apply to the Wimbledon commoners, who have increased their community charge by about 300 or 400 per cent. from last year?

Mr. Heseltine : My hon. Friend knows that there is a £15 million cut-off, and that authorities below that point are not brought within the capping regime--for which the

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House is profoundly grateful. Certainly my hon. Friends are profoundly grateful that we have only a limited number of authorities with which to deal.

Mr. Winnick : Is the right hon. Gentleman not in fact dealing with the main complaint that we hear, which he dealt with when he was on the Back Benches--that the basic system of the poll tax is unfair and will not be accepted by the overwhelming majority of the people? Those people take precisely the point about the poll tax that he made in speech after speech in denouncing it. Why, as Secretary of State, does he keep it going?

Mr. Heseltine : I generously gave way to the hon. Member hoping that he wished to make a constructive point on the matter that I was discussing, but it was a more general point, which he will doubtless explore, Mr. Speaker, if you are good enough to let him catch your eye.

Turning to the standard spending assessments, it is of course essential that we use the most equitable formulae for dividing the resources available, although it does not automatically follow that we are all agreed. We looked once more at the methodology used for calculating SSAs, and our conclusion was that, by and large, it was fair and appropriate. Nevertheless, after listening carefully to what authorities and their associations had to say--and their advice was often conflicting--we accepted that some improvements were necessary, and these were detailed in the consultation paper. In some instances, there have been changes in the provisional SSAs published at the time of consultation compared with those which are now final, owing to the incorporation of new information.

It is worth reiterating at this stage that an authority's SSA is specific to it--a point which is often misunderstood. SSAs represent our view of the amount of revenue expenditure which it would be appropriate for an authority to incur to provide a standard level of service. They take account of each authority's social, demographic and geographical characteristics and the functions for which it is responsible. They are calculated by applying the same formula to various indicators which reflect the particular characteristics of each authority.

Thus, although two neighbouring authorities may be of the same size and have the same population, differences in such matters as pupil numbers, population densities or road lengths will cause SSAs to differ. But the important point is that SSAs are calculated evenhandedly for each authority, taking full account of the particular characteristics of its area.

Dame Elaine Kellett-Bowman (Lancaster) : My local authority of Lancaster feels strongly that the all-ages social index militates harshly against it compared with places such as Blackburn, Burnley or Preston. We are a very economical council but we are made to appear extravagant because our standard spending assessment is so much affected by various considerations such as the all-ages social index.

Mr. Heseltine : I fully understand my hon. Friend's point, but it means that the needs indicators chosen for distribution of the SSAs showed greater requirements in the other authorities to which she referred. It is not within our gift to do anything but follow the statistics upon which the calculations are made. It is essential that these matters are dealt with on a formula basis. Ministers do not have any discretion once the criteria have been established.

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They must follow through the logic of where the criteria take them. I hope that my hon. Friend will understand that that is the basis of the legislative framework of the community charge.

Mr. Churchill (Davyhulme) : Will my right hon. Friend explain why the standard spending assessments have been cut for the metropolitan authorities by £8 million and for the counties by £2 million, whereas those of the London boroughs have been increased by £11 million? Why should the rest of the country pay for London's profligacy?

Mr. Heseltine : Perhaps my hon. Friend has not had time to absorb the full detail of what I am putting to the House. In this settlement, the SSAs are increased by 19.4 per cent. over what we have announced for this year. That is 7 per cent. up on the budget which local authorities set for the current year. Those increases spread right across local authorities. There may be some switch within them as a consequence of judgments that we have reached about the incidence of each SSA and its formulae, but the whole thrust of what has happened is a substantial increase in SSAs across the whole of England. Perhaps I may now consider the other side of the equation--

Mr. John Evans (St. Helens, North) : Will the Secretary of State give way, on the north-west?

Mr. Heseltine : We have had one question from the north-west, but I give way to the hon. Gentleman.

Mr. Evans : Does the Secretary of State accept that anyone who examines local government in the north-west must agree that St. Helens metropolitan district council is probably one of the most efficient councils in the region? Will he explain why St. Helens was the only Merseyside authority to be poll tax-capped last year?

Mr. Heseltine : There is only one answer to that question : it came within the capping criteria. The criteria were set out, the budgets were set and the authority came within the criteria. There is nothing complicated about that. The answer would be exactly the same this year.

Let us move on to the other side of the equation--the funding of all the expenditure involved in financing local government. As the House knows, local authority revenue spending is financed predominantly from three sources : central Government grants, business rates and the community charge. The first two sources, which are referred to collectively as aggregate external finance, are increased this coming year by £3 billion--from £23.1 billion this year to £26.05 billion in 1991- 92. That includes £485 million to finance the area protection grant-- the new government grant which subsumes the old safety net and the grant to areas of low rateable value. The most significant aspect of this grant, from the charge payers' point of view, is that, from next year, central Government will meet the cost of the safety net. As we announced in October, we propose that the business rate for next year should be 38.6p in the pound, an increase in line with the rate of inflation. The burden on business will therefore remain broadly the same in real terms as it has been since 1989-90. This stability of the business rate, where business knows from year to year the maximum increase that it can be asked to meet, contrasts markedly with the previous system, whereby business was frequently asked to contribute higher and higher amounts

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to authorities' growing spending. Locally set poundages rose by an average of 37.4 per cent. more than the rate of inflation between 1979 and 1989.

Mr. Michael Latham (Rutland and Melton) : Is my right hon. Friend aware that, in many small market towns, including some in my constituency, shops have had sharp increases in rateable values as a result of revaluation? Will he reconsider the five-year transition period? I believe that he has powers under the legislation to extend it, if necessary.

Mr. Heseltine : The provision is that, at the end of the five years, we can review the transitional position. That is not a commitment one way or the other on what we may decide, but the power to review is built into the system. I hope that helps my hon. Friend.

Mr. Robert B. Jones : My right hon. Friend rightly stresses, in regard to the uniform business rate, that people in individual local authority areas can plan from one year to another because they know what the maximum increase will be. Therefore, is it not incumbent on my right hon. Friend to say whether the five-year period will be extended, for exactly the same reason?

Mr. Heseltine : If we were intending to have a review at the end of the period, it is not realistic to suggest that we will bring the review period forward by announcing that it will happen before the time originally envisaged. Although I understand the point made by my hon. Friend, I do not want to go further than the already known arrangements.

Mr. Gould : I rise again in spirit of genuine inquiry, because I may not know the answer and the Secretary of State may be able to enlighten me. If he will not move on the question of extending the transitional period and will not look at it until the five-year period has elapsed, surely any possible relief under the transitional arrangements would then by definition come to an end, because it would then be too late.

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