House of Commons Hansard Debates for 4 Feb 1992

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North-East Derbyshire. The position is similar in areas such as Chesterfield. Conservative Members such as the hon. Member for Gedling (Mr. Mitchell) will find that their authorities are also placed in a low position. They should be pressing for higher funding and for the alteration of the formula rather than seeking to defend what is taking place.

8.55 pm

Mr. Martin M. Brandon-Bravo (Nottingham, South) : None of us tries to argue that the standard spending assessment is a perfect system, but, having lived through the old rate support grant mechanism, I do not believe that there is some magic formula, given the diversity throughout the country, that will meet with universal acclaim. I believe that the SSA is a legitimate and reasonable stab at establishing what each local authority needs, or needs to spend. The hon. Member for Dagenham (Mr. Gould), in his opening remarks, specifically targeted his comments on shire districts. Believe it or not, the city of Nottingham is only a shire district, although I hope that that will not obtain for long after the next general election. Its adult population is just under 200,000 and its total population around 270,000--so it is hardly a shire district in that sense. In debates of this kind, Opposition Members only ever mention the amount of money districts such as the city of Nottingham get under the grant that flows from SSA or under the old rate support grant. This year the Government have given, I believe, just under £6 million direct targeted grant because we have inner-city problems. I was delighted that the city of Nottingham was successful in the city challenge. That is another £37 million over a five-year period. Those grants are in addition to the grants that arise as a result of the normal annual announcement about standard spending assessments. As they all form part of a local authority's income, which it is entitled to spend, it is wrong that those factors are ignored when we debate local government finance.

I am dismayed by the attitude of the Labour-controlled Nottinghamshire county council which, having supported the city council in its first successful bid for city grants, has now decided not to support the city council's bid for the second tranche. As the population of the city of Nottingham is almost 30 per cent. of the county's population, my colleagues and I cannot wait for the present Secretary of State to introduce, after the general election, the necessary mechanism to give us our independence once again. My county is almost identical to other shires in that just 13 per cent. of its total net expenditure is handled by the districts and 87 per cent. is handled by the county council. In cash terms, that total represents expenditure of some £750 million, only £96 million of which is spent by the districts. Given that so much money is spent, I can understand why my constituents constantly ask where on earth it all goes. That is another reason why I wish the Bill that is currently in Committee speedy progress. It will give us the mechanism for doing away with our county council, which is the wrong structure for local government in my area.

Because local people pay such a tiny percentage of the total amount spent, there is a gearing effect if a local authority spends more than its SSA. If, for example, it

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spends £114 or £115 instead of £100, the charge that people will receive through letter boxes will almost double. That is a real worry. The Government are absolutely right to recognise that gearing effect and to build into the legislation a protection for the people who must pay the local bills. They are right to limit spending through their capping proposals. It is significant that, in the face of all the evidence of the adverse effect on people who cannot afford to pay extraordinarily high bills, both the Labour party and the Liberal Democrats oppose any limit on spending. Indeed, the hon. Member for Dagenham said that he can conceive of no circumstances in which the House would limit local government spending.

Another problem that worries me is local businesses, particularly small businesses. From the available figures, there is no doubt that, in my county, businesses pay 35 per cent. of the total bill through the unified business rate which, with all its faults, at least protects our local businesses from the predations of what would otherwise be an insatiable, spending Labour authority. Nationally at least, businesses have benefited from some £2 billion as a result of changing from the old system to the current one. The Labour party now says that it wants local businesses to pay a greater share of the total bill. Businesses large and small pay enough and they should beware of an incoming Labour Government--heaven forbid--because the hon. Member for Dagenham has said unequivocally that they will pay a higher ratio. That would be a disaster for all my constituents. 9.2 pm

Mr. Peter Kilfoyle (Liverpool, Walton) : I shall be brief, because I am aware of the time limit, and parochial because I was taken by some of the comments made by Conservative Members, who dragged up the hoary old myths about Liverpool. I understand that many Conservative Members are ignorant of the history of local government finance in Liverpool. I certainly understand the attitude of the hon. Member for Lancashire, West (Mr. Hind). He reminds me of a child going down a country lane, whistling in the dark and looking for the bogeyman. The bogeyman who is coming is the electorate, because they will tumble the Conservative party.

The history of local government finance in Liverpool is simple. When the Government changed the formula for the rate support grant in 1979-80, the rate was artificially depressed thanks to a combination of opportunistic Liberals and equally opportunistic Tories on the local council who, for electoral purposes, kept the rate down. The objective authorities agree that Liverpool was deprived of hundreds of millions of pounds in rate support grant. The words of Professor Michael Parkinson of Liverpool university are my evidence for that. Nevertheless, the unseemly local political problem of the mid-1980s occurred because of the obduracy of the then Prime Minister, the right hon. Member for Finchley (Mrs. Thatcher), and the equal obduracy of Militant Tendency in Liverpool, which meant that the whole city was plagued with financial hardship that we feel to this day.

I am sorry that the Secretary of State is not here, because at one time he was the Minister for Merseyside. I am told that he had a soft spot for Merseyside, but I have never heard him criticise Ministers in his Department who have abused Merseyside recently and who have maligned the good city of Liverpool.

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While the authority in Liverpool has no time for the poll tax, it has struggled to stay within the law. At every stage, it has had to struggle to carry out its responsibilities, for several reasons. First, it has respect for the law if not for the actual poll tax legislation. Secondly, the authority did not intend to fall into the trap of being used as Tory propaganda and as an example of what a Labour council would do with laws that it did not like. Thirdly, the authority has a commitment to local people and local services, and it intends to defend their interests within the law.

All through the late 1980s and into the 1990s, the leaders of the council suffered tremendously--personally, politically and financially--because they upheld the law. They were attacked, physically on occasion, and maligned by people in the city with ulterior political motives and by Ministers for electoral purposes. Nevertheless, they have stayed within the law, and the authority has never been capped.

Today I got the city treasurer's report faxed to me. What does it all mean for Liverpool? In 1992-93, there will be a grand total of £16.9 million in cuts in jobs and in services. As services deteriorate, those who suffer will be the old people, the children and those least able to protect themselves--the poor, the unemployed and single parents.

I should like members of the Government to come with me to Arnot street school in my constituency, where there are two schools in one building. I have seen coping stones blown down on the floor. The money to repair the schools is not there. The council does everything it can to stay within the law and provide decent services. All it gets for its pains is abuse from the Government. Of course, the district auditor does not view the council in the same way. He sees it as a model of probity in running a public authority. Again, there is not a word from the ex-Minister for Merseyside to say, "Well done, " to Liverpool city council.

Tory Members think that they can use Liverpool for their own electoral purposes, but let me remind them that, in 1979, Labour did not control Wirral council or Sefton council. There were far more Tory councillors on Liverpool council then than the miserable two Tories now. The experience of those years has been an education. Liverpool put its house in order. It does not believe the lies and propaganda being put out by the Tory party from a position of advantage in government. Mark my words : that will show in seats in the general election in Merseyside and across the north-west. The moral is that Labour councils look after the people and that a Labour Government will look after Labour councils.

9.7 pm

Mr. Gerald Howarth (Cannock and Burntwood) : In Staffordshire, the council has had an increase in SSA over the last two years of no less than 25.5 per cent. By any stretch of the imagination, that is a significant increase. It comes at a time of economic difficulty throughout the country, when most businesses and households would be delighted to have had such a large increase in their income over a similar period.

Despite that massive increase in SSA to £625 million, Staffordshire claims that it cannot make ends meet. It claims that it is being treated less favourably than other counties, so the speech of the hon. Member for Derbyshire, North-East (Mr. Barnes) will be helpful to me

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because I can show it to the county council to let it see that it is not the worst off in the country. At £808 per adult, the SSA takes Staffordshire well ahead of Sussex, Surrey, Avon and many other counties in the south of England.

Members of Parliament in Staffordshire have always sought to make the case for Staffordshire to the Government when the case is good. Notwithstanding the fact that the county council is Labour-controlled, Conservative Members of Parliament have always been prepared to join in to support a good case.

However, with regard to the allocation of budgets, local democracy is alive and at work. When deciding on their budgets, local authorities--whatever the constraints imposed on them by external factors--must decide where their priorities lie. Staffordshire county council has deliberately chosen to make a saving of £7 million in the education budget so as to inflict the maximum pain on my constituents and those of the hon. Member for Stoke-on-Trent, North (Ms. Walley), who I see is in her place.

The council claims that it needs a massive 10 per cent. increase in the education budget to provide the services, when we know that inflation is about 4.5 per cent. Even if one takes the highest inflation factor-- teachers' pay--we are only talking about 6.5 per cent.

Like the hon. Lady, I have a child in a Staffordshire school, and my family are affected as a household. The parents in my constituency are up in arms at the decision of Staffordshire council deliberately to inflict damage on their children.

Ms. Walley : Will the hon. Gentleman give way?

Mr. Howarth : No, I only have a couple of minutes--I was granted less time than the hon. Lady.

The cuts have not been in education spending, but reductions in the increase that the county council would like to spend. But parents do not care who is to blame ; they want quality education for their children. I understand that, but when the county council chooses to increase its social services budget by 20 per cent. in cash terms, it deliberately chooses to increase social services expenditure at the expense of our children's education, which is wrong.

Ms. Walley : Will the hon. Gentleman give way ?

Mr. Howarth : No, I am sorry.

Staffordshire council has £20 million in its reserves and could use some of that money. It could make hard decisions about social services budgets. My hon. Friend the Minister of State has to make hard decisions, as do county councils, district councils, businesses and families up and down the country.

It may be that, thanks to local mangement of schools, some schools may have funds within their own budgets. However, it would be wrong were a county council to raid savings that a school had made through efficient management brought about by this Government. It would be wrong to penalise a school for being efficient.

I hope that I have been able to show my hon. Friend the Minister the deep sense of anger felt by parents in my constituency and myself as a parent of a child in a

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Staffordshire school at what the council is doing. It has failed to make a case to Members of Parliament to show why it should be given special treatment.

We have heard throughout today's debate from various hon. Members that some parts of the country should be given special treatment. If all those demands were to be met, my right hon. Friend the Chancellor of the Exchequer would have to come to the Dispatch Box to announce a massive increase in taxation.

I hope that my hon. Friend the Minister will be able to add to the points that I have made about the treatment that Staffordshire county council has received from central Government.

9.13 pm

Mr. David Blunkett (Sheffield, Brightside) : The ill news is that the cup game between Sheffield Wednesday and Middlesbrough is currently drawn. If anyone can bring me better news, it will cheer my spirits and lift my speech.

Today's debate has very much been a mirror of the one that we had exactly a year ago on revenue support grant and standard spending ass�essments, even down to the oldest of all tricks--Conservative Members rightly stating that their districts have specific problems or needs and recognising that there are hard decisions to be taken by a hard Minister who positively enjoys being hard. Most people wring their hands in despair while saying no.

Conservative Members say--as they have repeated this afternoon--that Warwickshire is in a terrible plight. Last year there were even more hon. Members from Warwickshire present ; perhaps some of them are out canvassing at this very moment, persuading the electorate that the Government are not responsible for the poll tax or service cuts--contradicting the county council leader and his colleagues in Warwickshire. Tonight we heard more pleading for Warwickshire, which is always followed by an assertion that that county is so needy, whereas counties under Labour control are unpleasant and unneedy--despite the fact that they find themselves in the same circumstances and confronted by the same problems.

We heard also tonight pleading for the importance of investing in Norfolk's coastal defences to prevent the sea from washing over the Norfolk countryside. We all sympathise with the hon. Member for Great Yarmouth (Mr. Carttiss), who evidently feels that the tide is coming in on him, and probably agree that the necessary expenditure should be free from capping. Of course coastal defences are important, but every authority has a good argument for not being capped in respect of long-term expenditure to meet essential needs.

We understood from the hon. Member for Great Yarmouth that the right hon. Member for Suffolk, Coastal (Mr. Gummer) is responsible for encouraging such expenditure and providing--through the Ministry of Agriculture, Fisheries and Food--the funds that are to be capped in the coming year, but which will then be reimbursed. The Minister of Agriculture, Fisheries and Food probably knows something about the sea washing over the coastal defences in Suffolk.

The right hon. Member for Suffolk, Coastal once held the ministerial post now occupied by the hon. Member for Enfield, Southgate (Mr. Portillo), but did absolutely nothing other than to pretend that the only way to achieve

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ministerial preferment was to be as nasty as possible about every Labour authority going, and as unpleasant as possible about those who need public services.

The right hon. Member for Suffolk, Coastal was one of the eight present members of the Cabinet responsible for the poll tax. They did not just vote for it in Cabinet but had a hand in progressing that legislation through its Committee stage and implementing it. The hon. Member for Cambridgeshire, South-East (Mr. Paice) found it necessary to defend his county against the view held by Warwickshire and Norfolk that Cambridgeshire has been given far too good a deal. He felt that Cambridgeshire has not done too badly, but that it could have done better. In any event, the hon. Gentleman had got it wrong because he said that my hon. Friend the Member for Dagenham (Mr. Gould) would abolish the poll tax the moment that Labour returns to power.

I hate to disabuse the hon. Member for Cambridgeshire, South-East, but we proposed that the poll tax should be abolished this April. The Government refused to join us in making that possible. Under another of our proposals, the 20 per cent. contribution would already have been abolished.

Dame Elaine Kellett-Bowman (Lancaster) : Labour Members did not vote for that proposal.

Mr. Blunkett : The hon. Member for Lancaster (Dame E. Kellett- Bowman), who has emerged from under one of the stones that she was examining at the time--

Mr. Gould : It was her political gravestone.

Mr. Blunkett : I would not wish anything as unpleasant as that on the hon. Lady--just mere defeat. The hon. Lady's memory is so short that she does not remember that we did vote on that proposal.

Dame Elaine Kellett-Bowman : I remember the Opposition tabling the amendment in question, and that I spoke to it--and that the Opposition did not press it to a vote.

Mr. Blunkett : I refer to the Report stage of the Local Government Finance Bill. We remember being here, and we all remember voting on that amendment. The hon. Member for Lancaster clearly nodded off at the time

Mr. George Howarth (Knowsley, North) : There must have been a full moon.

Mr. Blunkett : --but presumably she tells her electorate that she was not responsible for maintaining the 20 per cent. contribution rule.

My hon. Friend the Member for Knowsley, North (Mr. Howarth) says that there must have been a full moon on the night in question, but obviously it was not bright enough for the hon. Lady to find her way through the Ayes Lobby. Whatever the reason, she missed the Division. As a consequence, we are left with the 20 per cent. contribution--for, as we know, the hon. Lady's vote would have made all the difference. Let me make it clear to the hon. Member for Cambridgeshire, South-East that we cannot now abolish the poll tax, technically and practically, before April 1993. In the week running up to what will presumably be a 9 April election, everyone will receive a reminder of that on the doorstep--a bill that says, "Vote Labour in the general election." That will be the legacy of Conservative inaction.

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It is, however, the hon. Member for Cannock and Burntwood (Mr. Howarth) who most needs to be reminded why we are here tonight. It is not about technical arguments concerning the intricacies of absurd indices of social need--that is, the twisted standard spending assessments ; it is not even about the way in which revenue support grant has been successively reduced. It was reduced from 61 per cent. in 1979 to 49.5 per cent. in 1981, and thence to only 26.6 per cent. in the current financial year. In spending terms--in real terms--the grant is now lower than the 1981-82 allocation, even when we include the £140 reduction which, along with a £4.3 billion VAT increase, went towards trying to placate those who had suffered under the poll tax.

No ; the real reason why we are here tonight is this. We are discussing how to meet the crying need that exists in our communities. The hon. Member for Cannock and Burntwood made a comment about the increase in Staffordshire county council's social service spending for the coming year ; it seemed that he had missed what his hon. Friend the Minister for Health had said about the need to spend money on solving the problem--it was agreed that there was a problem--that had arisen from the pindown affair.

Ms. Walley : Is it not wholly unacceptable that Staffordshire county council should have to find £7 million from its education budget, and an equal amount from other budgets--including its social services budget, which is now so much greater as a result of the pindown problems of the preceding financial year?

Mr. Blunkett : I agree. Successive cuts have meant that a number of authorities--including Staffordshire and Hereford and Worcester--have had to increase social service spending.

Mr. Gerald Howarth : As the hon. Gentleman may appreciate, I had to cut short my speech--partly because the hon. Member for Newham, North-West (Mr. Banks) had spoken for 20 minutes.

It is true that a substantial flaw in Staffordshire's social services department was identified ; but I have never called for the resignation of the chairman of the social services committee, because I recognise that the committee had a very difficult job to do. I do not consider that it has addressed the problem of delinquent children in Staffordshire, but I am certain of one thing : we all have to make hard decisions in life, and Staffordshire county council is not exempt from that. If the council is faced with the difficult choice between dealing with delinquent children and dealing with my children and those of the hon. Member for Stoke-on- Trent, North (Ms. Walley), it must get its priorities right--and I believe that it has got them wrong.

Mr. Blunkett : I, for one, am sick of hard decisions being made about the care of children in social services, or the education of children in schools. It is time for some hard decisions to be made about the country's top 5 per cent. of earners, who have made a cool £30,000 in tax cuts since the 1988 Budget. It is time to make some hard decisions about those who can afford to pay, rather than making them on the backs of those who cannot. It is time to make some hard decisions about spending on home helps. It is time to compare those who spend money on meeting needs with those who spend money on civic binges.

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Dame Elaine Kellett-Bowman : On a point of order, Madam Deputy Speaker. May I draw your attention to column 22 of Hansard of 16 December 1991? We were discussing the 20 per cent. contribution for students and the Labour party did not put it to the vote.

Madam Deputy Speaker (Miss Betty Boothroyd) : That is interesting, but it is hardly a point of order for the Chair. It has nothing to do with me.

Mr. Blunkett : On the following day, 17 December, we voted on the abolition of the 20 per cent. contribution for everybody on nil or low income. I am afraid that the hon. Member for Lancaster has scored another own goal, something that I hope that Middlesbrough will be doing right now. I remember that well, because I moved the motion and called the vote on it. I shall not argue about that any more because the facts speak for themselves.

Madam Deputy Speaker : I remember that, too.

Mr. Blunkett : Thank you, Madam Deputy Speaker. We both remember it well.

The debate should be about home helps and the authorities that are spending most on home help services. We should be talking about Newham, Sunderland, Sheffield, Lambeth, Derbyshire, Leeds, Gateshead, Islington, Newcastle and Salford. Those are the top 10 Labour authorities meeting the need for home help services. The 10 lowest spenders on home help services are Surrey, East Sussex, Hampshire, West Sussex, Shropshire, Dorset, Gloucester, Isle of Wight, Bexley and Hereford.

Mr. Robert G. Hughes : The hon. Gentleman is saying that there should be extra spending on those services. If there were a Labour Government, how much extra spending would there be, how quickly would it take place and where would it come from?

Mr. Blunkett : Those authorities have decided on their priorities and have not allowed them to be decided by the Government's capping system. It is clear that the Government have shifted the burden of providing services from a partnership between central and local government to the backs of ratepayers and now poll tax payers. As my hon. Friend the Member for Dagenham made clear, the standard spending assessment and the revenue support grant are of the Government's making. The Government also decided to withdraw the area protection grant next year and the year after from key marginal seats such as Pendle, Hyndburn, Rossendale, York and Blackpool. The Government's decision also resulted in the £25 that will be added to the poll tax bills in those marginal seats. The Government decide the uniform business rate and are responsible for the level of non-collection and the additions that people will have to face in the coming year.

Those additions have been made worse by the delay in taking action on the problems experienced in using computer records in court. It was a deliberate action to delay action in order to be able to blame Labour councils for continuing non-collection problems. That was revealed earlier today, when the Secretary of State had the cheek to blame a hiccup in the parliamentary timetable last week for a failure to introduce a Bill that would be carried through with the Opposition's co-operation.

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There are also the problems of gearing. That means that, for every 1 per cent. that an authority has to raise above the Government's standard spending criteria, it has to find 8 per cent. on its local bills.

To cap it all, we have universal capping. In the coming year, for the first time, every authority will be capped by the Government. They have capped key authorities for the past seven years and they have determined the expenditure and the raising of revenue in those authorities, but they still blame those authorities for so-called profligacy and high poll tax bills. The Government want it all ways. They blame the Labour authorities which have been capped for spending too much and then they have the cheek to claim credit for the expenditure on education and social services when they are pressed on whether the Government are interested in maintaining spending on public services.

The Secretary of State for Education and Science bangs his chest--or the nearest thing he can come to it--and says that he favours expenditure on schools. He says, "Look how much the Conservative Government have spent on education in the past 13 years." In fact, it is the Labour authorities which have spent that money and the Conservative Government who have successfully tried to prevent them spending it.

On social services, the Secretary of State for the Environment and his Minister of State are constantly bleating that they have increased the SSAs. As the hon. Member for Eastbourne (Mr. Bellotti) said this afternoon, they failed to tell people that SSA increases this year were not matched by revenue support grant increases. While 23 per cent. went on SSAs on average for personal social services in the current financial year, only 1.9 per cent. went on revenue support grant increases from central Government. It is the biggest con trick that the Conservatives have ever attempted to perpetrate on the British electorate--to deceive them into believing that the Government believe in spending, while they are cutting it, and to apologise for not spending on essential need--as we have heard hon. Members do this evening--while revelling in the prospect of universal capping and blaming authorities for the consequences.

In the months ahead we shall be faced with the challenge not merely of how much the bills will be--important as that is at the beginning of April when the election takes place--but with the challenge in Conservative, Liberal and Labour-controlled authorities of trying to maintain a semblance of service for those who need it most. We shall face the challenge of ensuring that children such as mine get a fair deal in schools and for ensuring that in future--

Mr. George Howarth : The hon. Member for Lancaster (Dame E. Kellett- Bowman) raised the canard that the Labour party had not voted for the 20 per cent. reduction during the various stages of the Local Government Finance Bill. I refer my hon. Friend the Member for Sheffield, Brightside (Mr. Blunkett) to column 187 in Hansard of 17 December when we debated clause 1. Two hundred and thirty-five of my hon. Friends--including my hon. Friends the Members for Brightside and for Dagenham (Mr. Gould)--myself and the hon. Member for Lancaster voted on that subject.

Dame Elaine Kellett-Bowman : On a point of order, Mr. Speaker. May I correct that? I have been challenged and the truth must out. On 16 December we debated new

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clause 17 tabled by Labour. It was entitled "Abolition of 20 per cent. community charge contribution and extension of community charge rebates to students from April 1992". I was prepared to vote for that, but the Opposition did not have the guts to press the issue to a vote.

Mr. Blunkett : The hon. Lady compounds foolishness with farce. I said a few moments ago that the day after that to which the hon. Lady referred, we had a vote on the substantive motion of the abolition of the 20 per cent. contribution. My hon. Friend the Member for Knowsley, North mentioned that.

Mr. Andrew Mitchell : Oh, where is chivalry?

Mr. Blunkett : Where is chivalry? I am in favour of treating ladies with respect, but not of patronising them when they are being so foolish. Perhaps we could put an end to the silliness once and for all.

The Conservatives are responsible for their own actions. They are supposed to be responsible for knowing what they voted for. They ask the electorate to take them seriously on 9 April or on 7 May. They try to pretend that they were not responsible for the poll tax and for the £14 billion which it cost us. They try to pretend that they were not responsible for the 2.5 per cent. increase in VAT, and they try to avoid being held responsible for the misery that the poll tax has brought and for the cuts in services it has inflicted on people. They try to pretend that they do not know what cuts are taking place in education, in social services, in libraries, in transport, and in leisure. They then have the cheek to say that they did not know that a vote had taken place on the 20 per cent. contribution rule. That is compounding absolute stupidity with culpability.

If that is the level of Conservative Members, we shall have no difficulty in sweeping them aside in the general election so that we can bring common sense back to local government, sense back into services and Labour back into government.

9.35 pm

The Minister for Local Government and Inner Cities (Mr. Michael Portillo) : The hon. Member for Liverpool, Walton (Mr. Kilfoyle) decided to launch an attack on the Government for not being supportive of Liverpool. He did so at the very time when my hon. Friend the Member for Salisbury (Mr. Key), the Under-Secretary of State, is with the leader of Liverpool council and the leader of the Merseyside development corporation in the United States trying to drum up investment for Liverpool and Merseyside. The Government believe in working in partnership. We are sorry if the hon. Gentleman wishes to remain outside the partnership.

During the debate, we have heard complaints about the inadequacies of the standard spending assessment in Newham, in Shropshire, in Wolverhampton, in Wigan, in Eastbourne, in Northumberland, in Calderdale, in the Isle of Wight, in Warwickshire, in Staffordshire, in Barnsley, in Langbaurgh, in Middlesbrough, in North-East Derbyshire--[H on. Members :-- "And Norfolk."]--and in Norfolk. That does not imply that there is any question of political bias. The question we face is how we arrive at a fair method of distribution and what the country can afford. How right my hon. Friend the Member for Harrow, West (Mr. Hughes) was to draw attention to the question of affordability. How pitiful it was to hear not a mention

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from Labour Members, once again, of what the country might be able to afford. From them, we heard only that more money should be paid out here or there, with no reference to how that money should be found.

It was easy for the hon. Member for Dagenham (Mr. Gould) to say that nobody was in favour of the standard spending assessment. The criticisms that we have heard today reflect opposite views. Some believe that we should have a larger area cost adjustment whereas others believe that we should abolish the area cost adjustment. Some believe that we put too much emphasis on the social index, whereas others believe that the social index does not fully represent the needs of a place such as Newham, in London.

The Government have made an honest, well researched and reasoned attempt to distribute the moneys available to local authorities fairly. Let it be clear that the moneys that we distribute always need to be within an envelope--a total figure--which is what the Government deem to be affordable. Given the present circumstances, how right was my hon. Friend the Member for Lancashire, West (Mr. Hind) to point out some of the remarkable increases that have been possible. The metropolitan police authorities, for example, are getting an increase of 15.6 per cent. For education SSAs in general, the increase is 7.1 per cent. For personal social services, the increase is 7.2 per cent.

The hon. Member for Sheffield, Brightside (Mr. Blunkett) was in some danger of misleading us in talking about the revenue support grant quantity which was increased. The amount of aggregate external finance--the amount that is made available from Government to local authorities--has risen by the same amount as the increase in the standard spending assessments.

We had welcomes for the settlement from my hon. Friends the Members for Gedling (Mr. Mitchell), for Cambridgeshire, South-West (Sir A. Grant) and for Cambridgeshire, South-East (Mr. Paice). I can assure my hon. Friend the Member for Cambridgeshire, South-West that we do not penalise police authorities for civilianising. If authorities indulge in civilianisation, the money that they receive can be used to provide more effective policing because, although the money is distributed among police authorities on the basis of their establishment numbers, it is there for all purposes and to cover all the work to be done by police authorities--by uniformed officers and civilians alike.

All three Newham Members spoke in the debate, and it is worth spending time replying to some of the points that they raised. Let me put the matter in context. For Newham, the increase in SSA is 11 per cent. per adult, and Newham will be able to spend £20 million above this year's budget. That represents an increase of 8.3 per cent. I understand, however, that Newham has a particular problem with the late rating adjustment.

Local authorities have always known that they would need to repay some general rates as a result of successful appeals against the 1973 list rateable values. Such repayments were a long-standing feature of the old system and, year in, year out, authorities had to budget for the repayments that they would have to make in the coming year. The amount to be repaid varied from year to year, but not usually dramatically and, by looking at the number of outstanding appeals as the old system came to an end, authorities could make a reasonable guess at the amount that they could expect to repay in 1990-91 and in succeeding years.

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Most authorities have made provision for those repayments and now have no difficulty in meeting them. Evidently, Newham did not make such provision. We allowed that local authorities would be able to capitalise such late rating payments, but I understand that Newham has no capital receipts or credit approvals from which to cover them, so that provision is not helpful to it.

The three Newham Members came to see me yesterday and put some more arguments to me. It would be absolutely wrong of me to raise their expectations or hopes, but I will consider their arguments carefully.

My hon. Friend the Member for Great Yarmouth (Mr. Carttiss) talked about his disappointment at a difference of nearly £500,000 between the first figure that his authority was given and the final figure. I sympathise, if only because my own authority--Enfield--had a shock when it discovered a difference between the provisional figure and the final figure of £1.6 million. Whereas, for my hon. Friend's authority, the decrease represented 0.1 per cent., for my own authority it represented 0.8 per cent. I would, suggest, however that a reduction of 0.1 per cent. on a budget of more than £400 million, although disappointing, is manageable. My hon. Friend also knows that the money spent on sea defences is recoverable in the subsequent year.

Mr. Carttiss : The whole point is that the capping level can be met within this year, even though, next year, the money will be recoverable. That is the absurd state of affairs that I sought to draw to the attention of the House.

Mr. Portillo : My hon. Friend is absolutely right that the capping will bite on this year's budget, and his local authority will have to make allowances for that.

The hon. Member for Langbaurgh (Dr. Kumar) mentioned the problems of both Middlesbrough and Langbaurgh, two authorities that are overspending considerably. In the case of Middlesbrough, the capped limit is 17.3 per cent. above SSA and, in the case of Langbaurgh, it is 28.3 per cent. above SSA.

We had interesting observations on the question of

Staffordshire--first from the hon. Member for Stoke-on-Trent, North (Ms. Walley) and then from my hon. Friend the Member for Cannock and Burntwood (Mr. Howarth), who, I suggest, had much the better of the argument. Staffordshire county council has been allowed to spend £39 million more. Its standard spending assessment has increased by 7.6 per cent. per adult.

In contrast to the rest of her party, the hon. Lady said that she did not think that there was anything wrong with the overall amount that was being made available to local authorities, but that she was bothered about the distribution. I believe that the overall amount that we are making available to local authorities is what the country can afford and that the distribution is fair. The amount that has been allocated to Staffordshire allows the county to make considerable increases, even if those increases fall some way short of what it had hoped, which was my hon. Friend's point.

Ms. Walley rose --

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