House of Commons Hansard Debates for 10 Jul 1991

Mr. Portillo : On my hon. Friend's first point, he may have seen in the case of his own local authority the effect beginning to operate last year. Thamesdown district council set a budget of £15.06 million, just above the capping threshold. The increase was 7.7 per cent. I cannot help thinking that the increase was so moderate only because the council was just coming into the capping criteria at that point. My hon. Friend asked me to quantify the harm. There are 18 districts with budgets below £15 million that overspent their standard spending assessment by £40 or more per charge payer. There were 44 cases in which the overspending added at least £20 to the bills.

Mr. Bellotti : Will the Minister tell us what he expects local authorities that have been prudent in the past and will fall under the capping regulations next year to do about their services? Does he expect them to cut their services so that there can be no local economic generation? In areas that are dependent on jobs in tourism, such as the area that I represent, what advice would the Minister give a local authority that has been prudent in the past and which has set decent budgets, but which, under the new regulations, faces massive local unemployment?

Mr. Portillo : An authority that has been prudent for many years will not be capped because we will not cap below the standard spending assessment.

Mr. Patrick Thompson : Is my hon. Friend aware of the good effects for my constituents in Norwich of the capping of their overspending council and the resulting reduction in their bills? Will he seek an urgent meeting with the leader of Labour-controlled Norwich city council to point out the anger of my constituents about the politically biased and possibly illegal letters that she is sending out, which are distorting the effects of Government policy and concealing the imprudence of Norwich city council?

Mr. Portillo : I want to help my hon. Friend. If he absolutely insists that I meet the leader of Norwich city council, I suppose that I could be prevailed on to do so. My hon. Friend speaks loudly and clearly for his constituents. He is worried about the community charge burden that they have to bear. Those on Norwich city council are apparently indifferent to that matter and the Labour party is apparently flatly opposed to helping the community charge payer.

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Mr. Flannery : Despite the smart Alec answers from the Minister, is not it a fact that the result not only of capping, but of the vast amounts being taken away from local councils--the total runs into hundreds of millions of pounds--is that beggars are being forced on to the streets and homelessness is created? We have a Minister who apparently treads on bodies when he comes out of the opera. The things that have come about under this Government had not existed for years previously. People are on the streets and, as a nation, not only as a Government, we should all feel deeply ashamed.

Mr. Portillo : The hon. Gentleman is deeply incredible and the whole House will have found what he said laughable. His first contention was that money had been taken away from local authorities. I remind him that the districts about which we are talking had the amount that the Government thought it appropriate for them to spend increased last year by 28 per cent.--vastly ahead of inflation. There can be no complaint that they have been underfunded.

Local Government Reform

11. Mrs. Currie : To ask the Secretary of State for the Environment how many responses he has received to his consultation paper on the reform of local government.

Mr. Key : The Department has received more than 1,700 responses to the recent consultation paper on the structure of local government in England and some 750 responses to the consultation paper on the council tax.

Mrs. Currie : Has the Minister received an all-party response from the Tory-controlled city of Derby, which wants to be a unitary authority and which would like to see the abolition of the county council? Has he received in addition an all-party response from the Labour-controlled South Derbyshire district council, which wants to be a unitary authority and which wishes to see the abolition of the county council? Will my hon. Friend ignore what is certain to come--the response from Derbyshire county council? The only people who wish to see that retained are the members of it. Will he kindly get on with the reform and the abolition of the said county council as quickly as possible?

Mr. Key : It is well known that there is antipathy between the county council and the districts in Derbyshire. I am sure that my hon. Friend will draw that to the attention of what we hope will be the local government commission, which will have the responsibility for listening to the important voices in the community. I am sure that my hon. Friend's voice will be heard loudly and clearly.

Mr. Hardy : How many responses reflected the view that this is now the most overcentralised country in the free world? Will the Government accept that the tendency must soon be to shift power from the centre, rather than seek to accumulate ever more?

Mr. Key : I am all for having local accountability and for local responsibility in local government, so I find it very hard to understand why the Opposition wish to take power from local people and give it to yet another tier of government which they laughingly call regional government.

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Mr. Burt : Has my hon. Friend received, and would he be prepared to receive, any submissions relating to how local authorities make their financial investment decisions? Is he aware of the considerable anger and distress in my constituency this morning as my constituents woke up to find that they had lost £6.5 million because of a decision to invest in the Bank of Credit and Commerce International? Does my hon. Friend agree that the way in which councils make those decisions must come into question? Will he again state the status of the document which was sent out and which did not give any approval to the BCCI in terms of its probity but merely required local authorities to look to their laurels and therefore accept responsibility for their investments?

Mr. Key : My hon. Friend is absolutely right. I can understand his constituents' concern about this matter. Of course, financial decisions are entirely the responsibility of the treasurer of the council. I confirm that we do not issue a list of preferred investments. We give absolutely no advice on that matter ; it is entirely for the council.

Mr. Trimble : The Government have made clear their preference for single-tier local authorities. Does the Minister therefore agree that one of the great advantages of single tier local authorities is that they would provide the space in which one could create regional assemblies in Scotland, Wales, Northern Ireland and the English regions to which the House could then devolve some of its functions?

Mr. Key : That is a matter for my right hon. Friend the Secretary of State for Northern Ireland, but the hon. Gentleman makes an important point about the desirability of unitary authorities.

Beaches

12. Mr. Hind : To ask the Secretary of State for the Environment if he has any plans to meet representatives of the North West Water company to discuss the programme to clean up the Mersey beaches and rivers in the north-west region ; and if he will make a statement.

Mr. Trippier : My right hon. Friend and I maintain regular contacts with the North West Water company about progress on the clean up of bathing waters and rivers.

Mr. Hind : My hon. Friend will be aware of the massive plans involving billions of pounds over 10 years to clean up the Mersey basin and its attendant rivers. Is my hon. Friend aware of the efforts that are being made by the North West Water company to invest in sewage plants on the north-west coast to clean up the Blackpool beaches, Southport and Formby? Does my hon. Friend agree that that can be achieved only by a privatised company borrowing in the marketplace and doing what the public sector neglected to do for years?

Mr. Trippier : I not only agree with my hon. Friend but I am very anxious to join him in his praise of the Mersey basin campaign. Since its formation in the early 1980s, an overall improvement in water quality has taken place throughout the whole basin area. About £400 million is being spent by North West Water in major schemes at Southport, St. Anne's, the Fylde coast, Morecambe and Barrow to bring more bathing waters into compliance by

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1995. The water company has recently announced a preferred option for the Fylde coast scheme to provide full secondary level treatment. I hope that that scheme will go ahead.

Mr. McCartney : When the Minister meets the chairman of North West Water, will he chastise him for his greed and for the massive pay rise that he has awarded himself since privatisation, when constituents such as mine have been waiting years for investment in proper drinking water and sewerage schemes? Is not it an absolute scandal that the Minister is prepared to meet the gentleman who, the day after hiking up water charges, announced at a press conference a huge pay increase for himself and fellow directors?

Mr. Trippier : My right hon. Friend the Prime Minister has already publicly criticised the wage increases to which the hon. Gentleman refers and I agree with him. The Government's policy on the pay of directors is that salaries should be sufficient to recruit, retain and motivate. The Government believe also that it is essential that pay at all levels reflects the economic facts of life and the importance of beating inflation. Directors need to exercise both leadership and restraint in the rate at which salary levels are increased.

Mr. Thurnham : Is my hon. Friend satisfied that far more is being done now than was ever done in the past to clear up pollution, such as that at Eagles brook, which flows from my hon. Friend's constituency to mine and then to the Mersey? Does he agree that that shows the strength of the Government's anti-pollution legislation?

Mr. Trippier : I am happy to agree with my hon. Friend. The money that is now available to the North West Water company, like all the other privatised water companies, is sufficient to enable it to embark on a massive investment programme which will last to the end of the decade and will result in water of a higher quality in this country than anywhere in the rest of Europe.

Mr. Win Griffiths : When the Minister meets the chairman or any of the directors of North West Water or of any of the other water companies of England and Wales, will he take steps to do something about the salary rises that he is so willing to condemn? May I suggest that he knocks £10 off their salaries whenever there is a pollution incident in any part of the Mersey or anywhere else in the United Kingdom? Is it not a disgrace that after 12 years of Tory rule the country still fails to meet the European Community's water quality standards?

Mr. Trippier : The hon. Gentleman completely and utterly ruined his question, which was obviously prepared prior to the substantive answer that I gave to his hon. Friend the Member for Makerfield (Mr. McCartney). I am afraid that his hon. Friend stole his thunder. Perhaps my response was not what the hon. Gentleman had expected. In response to the hon. Gentleman's latter point, he should ask himself, "Who invented the National Rivers Authority?" We did. Who invented Her Majesty's inspectorate of pollution? We did. Who invented the drinking water inspectorate? We did. Why does not the hon. Gentleman take this opportunity to praise the Prime Minister and the Government for the initiative that was taken on Monday to set up the strongest regulatory body in the whole of Europe?

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Countryside Stewardship Scheme

13. Mr. Paice : To ask the Secretary of State for the Environment what response he has had to the launch of his countryside stewardship scheme.

Mr. Heseltine : The countryside stewardship scheme, which is being run on a pilot basis in England by the Countryside Commission, was launched on 25 June. The closing date for applications for this first year of the scheme is not until 31 October. While it is far too early to assess the response, initial reaction has been very encouraging. In the first week following the launch there were more than 300 serious inquiries from potential applicants and there has also been extensive media interest.

Mr. Paice : The whole House should welcome my right hon. Friend's answer, because it demonstrates that the widespread support that that announcement received in the press is clearly mirrored by the response from applicants. Does my right hon. Friend agree that this targeted way of sustaining fine and important landscape features is a far better way of achieving the objective and that the use of the carrots that he is advocating, rather than the big-stick bureaucracy, which is precisely the sort of measure that is advocated by the Labour party, is the better way?

Mr. Heseltine : My hon. Friend is absolutely right. The House may be interested to know that the Countryside Commission has a target for the first two years of the scheme of between 2,000 and 3,000 agreements that will cover 60,000 to 80,000 hectares.

Mr. Andrew F. Bennett : Will the Secretary of State remind the House how much money the Government are putting into the scheme? Is he satisfied that it is sufficient and that, through the Countryside Commission, it is his Department which is best able to handle the scheme, rather than the Ministry of Agriculture, Fisheries and Food which, in many cases, has more contact with the farmers involved?

Mr. Heseltine : There is a commitment of £13 million for the first three years of the scheme. We believe that that is sufficient to prove the value of the experiments that the Countryside Commission has launched. On the hon. Gentleman's point about the relationship between my Department and the Ministry of Agriculture, Fisheries and Food, my right hon. Friend the Minister and I were both present at the launch and are both enthusiasts of the scheme.

Housing Associations

14. Mr. Riddick : To ask the Secretary of State for the Environment if he will outline the level of financial support for housing associations in the current financial year.

Mr. Yeo : The gross capital expenditure planned by the Housing Corporation this year is £1,588 million--an increase of more than 40 per cent. over last year. Revenue support for housing associations is £85 million and housing associations also receive support from local authority housing association grant, estimated at about £300 million in the current year. All that public sector support is supplemented by substantial loans from the private sector.

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Mr. Riddick : Is my hon. Friend aware that Labour councillors in my local authority of Kirklees have complained recently about the increase in the number of homeless, even though they have contributed to that increase by refusing to co-operate with the Housing Corporation because one housing association expressed an interest in the tenants' choice scheme? Has any progress been made following our Adjournment debate? Will he join me in condemning the thoroughly negative attitude of the Labour councillors?

Mr. Yeo : I certainly unreservedly condemn the Labour council in Kirklees for withdrawing its support from the Jephson housing association merely because the housing association responded positively to the Government's initiatives to promote tenants' choice. Labour's determination to force tenants back into the straitjacket of monopoly local authority control is not confined to Kirklees. Only yesterday the hon. Member for Hammersmith (Mr. Soley) threatened the tenants of north Hull that, if it were ever given the chance, Labour would overthrow the result of the recent ballot in which the tenants voted to become tenants of a housing action trust. I am glad to assure my hon. Friend that he has the full support of the Government in his efforts to champion the interests of tenants in his constituency, efforts which I am glad to say have restarted a dialogue between the Housing Corporation and the borough council.

Mr. George Howarth : Is the Minister aware that, once the hot air evaporates, an examination of the agreed Housing Corporation development programme will show that 93 per cent. of the increase in the programme will go to London and the south-east and therefore, by definition, not to the provincial towns and cities? Is he also aware that hardly any housing associations are carrying out rehabilitation work on older properties? Does he realise that all of that will lead to homelessness shifting out into the provincial towns and cities and will do nothing to arrest the decline in the older housing stock in Britain as a whole? What does he intend to do about it? When will he take some action instead of just talking?

Mr. Yeo : My hon. Friend the Minister for Housing and Planning has already referred to the huge increase in local authority spending on renovating the existing housing stock. The House will be aware that the Housing Corporation's budget is to double from £1 billion to more than £2 billion in the space of three years. I am glad to say that so successful are the Government's efforts to clear the problem of homelessness that the census that took place on 21 April revealed that only 2,703 people were sleeping rough that night--less than 1/14th of the figure used by the promoters of national sleep-out week. In London the numbers were down to only 1,275--a demonstration of our clear progress.

Council Tax

15. Mr. Burns : To ask the Secretary of State for the Environment what recent representations he has received on the proposed council tax ; and if he will make a statement.

Mr. Portillo : The Department has received some 750 responses to the recent consultation paper on the council tax, most of which welcome the new tax in principle. These responses are now being considered.

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Mr. Burns : I am grateful to my hon. Friend. Does he agree that the overwhelming response, made not only to his Department but made as he travels around the country, is in support of the proposed council tax? Has my hon. Friend been overwhelmed by any clamour for a return to the discredited old rating system, which is what the Labour party proposes?

Mr. Portillo : Most certainly I am not aware of anyone except the Labour party who wants to go back to the rating system. It would be bad enough if the Labour party merely proposed a return to the rating system, but it proposes a bureaucratic nightmare in which each property would have to be revalued four times over. What little chance people had of understanding the rating system would be blown apart by an even more complicated system. One suspects that the Labour party has struggled to design a system that the public cannot possibly understand because it hopes in that way to avoid the electoral consequences of proposing such an absurd tax.

Mr. Gould : What calculation has the Minister made of the impact on the likely level of the council tax and, indeed, the level of the poll tax in the intervening period, of the failure of the Bank of Credit and Commerce International? Does not the fact that many local authorities now face the prospect of serious loss mean that millions of poll tax payers will suffer as a consequence of the regulatory failure over which the Government have presided? Is not it typical that the Government should now be trying to blame local authorities when they have done no more than act in accordance with the list prepared by the Bank of England and sent out by the Minister's Department to every local authority? That revised list was published and sent out on 21 June and it clearly includes the name of BCCI. Why will not the Minister face up to the part that he has played and the responsibility that his Department must bear in this whole unhappy episode?

Mr. Portillo : First, it is not possible to make any estimate of what anybody has lost, because we do not know. We have no idea of the outcome of this particular bank crash for any local authority. On the question of responsibility, I must say that it might be reasonable to argue that an average person might not realise that an authorised institution, which is accredited under the Banking Act 1987, might crash. However, for local authority treasurers to say that they did not understand the difference between some sort of guarantee--that is now being claimed--and the fact that BCCI happened to be an authorised institution under the Banking Act 1987 is astounding.

The Government are not avoiding any of their responsibilities in this regard, but I fear that some local authority treasurers are trying to imply that the fact that an institution is authorised under the Banking Act gives them some escape from their duty to take due care as to where they invest their funds.

Mr. Anthony Coombs : Can my hon. Friend confirm that the new council tax will, rightly, have reserve rate-capping powers? In that context will he bear in mind the appalling position of the Labour-controlled Wyre Forest district council, which at present is not only spending 58 per cent. above its standard spending assessment, but has such a bloated recreation programme that one museum is subsidised to the extent of £7 per visit?

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Given that that council is proposing this year to increase its expenditure again by 18 per cent. will my hon. Friend invoke his rate-capping powers against that council as quickly as possible?

Mr. Portillo : What my hon. Friend tells me appals and worries me very much. What I think will worry my hon. Friend's constituents when the election comes around is that the Labour party will campaign on there being no restraint whatever on local authority spending or on the bills that will be charged to local people. I believe that that Labour party proposal will be deeply unpopular with the electorate.

16. Mr. Eastham : To ask the Secretary of State for the Environment how he intends to distribute the income from the non-domestic rates under the new council tax ; and if he will make a statement.

Mr. Portillo : We are currently considering the options, and will make clear our conclusions in due course.

Mr. Eastham : Is it not a fact that the whole position regarding local taxes is becoming a complete dog's dinner? Will the Minister apply himself to the question of non-domestic ratepayers, who could account for between 25 and 26 per cent. of the bill of local authorities?

What provision will the Minister make for the hundreds of millions of pounds that may be collected from those who may not be on a local authority register but who are still subject to that authority acting responsibly to make provision for their businesses?

Mr. Portillo : I hope that I can be helpful to the hon. Gentleman. We are not proposing changes to the national non-domestic rate system in general and we have made that perfectly clear in our consultation document. The hon. Gentleman asked about the means by which the income from non- domestic rates would be distributed between local authorities. That is a complicated and technical matter and it would be worth while to spend some time thinking the implications through before making any announcement.

Mr. Ian Bruce : Will my hon. Friend think again about the way in which non-domestic rates' income is no longer

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linked to the local authority area. Many of my local business men, particularly in the hotel sector and the leisure industry, would like to think that their business rates will pay the high costs that their local authority must face to subsidise and supply the facilities for people coming on holiday to the wonderful beaches of Weymouth, Swanage and other resorts in Dorset.

Mr. Portillo : I understand that some business men would like a strong linkage between themselves and local authorities, and that might be provided by the tax base. Business in general welcomes enormously the fact that business rates increase from year to year by only the rate of inflation and not by the rate at which local authorities increase their spending. That means that, in the first year of the uniform business rate, business paid £1 billion less than it would have done under the old system.

Nuclear Waste

17. Mrs. Margaret Ewing : To ask the Secretary of State for the Environment how many meetings he has held in the last year with representatives of UK Nirex to discuss the disposal of nuclear waste ; and what is the date of the next such meeting.

Mr. Trippier : My right hon. Friend has not met representatives of Nirex and no date has been arranged for such a meeting.

Mrs. Ewing : Given the great interest that exists on that subject-- not only in the highlands and islands of Scotland but throughout the United Kingdom--can the Minister confirm or deny a recent newspaper report, which said that Tom McInerney, the managing director of Nirex, would make a clear statement on 18 July that Sellafield would be the chosen option for the disposal of low-level and intermediate waste?

Mr. Trippier : I am sorry to say that I can neither confirm nor deny it. As I said at the last Question Time when I was being drawn on those issues, it is a decision entirely for Nirex. However, an announcement will be made before the end of the year.

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