House of Commons Hansard Debates for 12 Feb 1992

Mr. Jones : I shall give way once only. I am trying to be brief.

Mr. Edwards : Does the hon. Gentleman realise that, in the past 10 years, £741 million has accrued to local authorities in Wales through capital receipts, and that 25 per cent. is still supposed to be spent, according to the Under-Secretary of State? Is he convinced that 25 per cent. of capital receipts in Cardiff is being spent?

Mr. Jones : The hon. Gentleman walks into the same pitfall as the hon. Member for Brecon and Radnor. I invite him, too, to identify one bank account in Wales in which moneys are lying, not being used. The moneys are being used to redeem debt, and rightly so.

I shall pick up the theme pursued by my hon. Friend the Member for Cardiff, Central (Mr. Grist). It may be superficially tempting to say what a good deal a community charge represents. As my right hon. Friend the Secretary of State has said, the average for Wales should be £85--only 7 per cent. of the total that local councils spend. My arithmetic tells me that, for every average community charge of £85, some £1,214 is being contributed from sources outside the local council.

However, as the hon. Member for Cardiff, West (Mr. Morgan) tried to say on one of his frequent visits to the Chamber, nothing is for free. It is we, the taxpayers, who have to pay all that money--from whatever source it comes. It therefore behoves us as Members of Parliament--indeed, it behoves every citizen--carefully to consider all the implications of local council spending.

The reports before the House are good ones. As my right hon. Friend has said, they again put us in a position superior to that of England. They provide an increase of 8.5 per cent. over the comparable figure for last year, and even a 5.1 per cent. increase over the budgets of local councils in Wales. No one could suggest that that is not an increase in real terms, however, those real terms are calculated.

The aggregate external finance has increased by a massive 24 per cent. As my right hon. Friend said today, and in his statement on 13 January, he expects local councils to rise to the challenge. He was wise to remind us of his capping powers. It would be desirable if we could continue not to use those powers, but I do not believe for one moment that we should flinch from using them should that be necessary.

I am particularly pleased that the uniform business rate has gone up by less than the rate of inflation. That is most important at a time when we want to complete the recovery from the recession. That business rate is a great relief to local companies in comparison with the situation they faced not so long ago, when they were at the mercy of local councils. In the past, Cardiff has been subject to some horrendous rate increases--for example, 97.5 per cent. one year and 54 per cent. another.

In the first year in which the community charge operated, it was reliably estimated that it should have been

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set at £150, but we ended up with a charge of £250. Thanks to the Government, relief from community charge payments has been extended to all community charge payers in Cardiff. The reduction of £140 halved that community charge.

If prudent financial practices had been followed from the beginning by South Glamorgan council, the community charge of Cardiff could have been set at the same level as that for Wandsworth. We could have had a zero community charge.

If I was a member of the Opposition, perhaps I would now be talking about the hidden agenda. Such a discussion about Cardiff is not necessary, because South Glamorgan council, in advance of its community charge debate tomorrow afternoon, has published its plans for extra spending that it would like to undertake. They amount to another £25 million on top of the SSA.

I have been warned by Councillor Bernard Rees, the leader of the Conservative group on South Glamorgan council, that if, heaven forbid, there was a Labour Government, the community charge for everyone in Cardiff would double overnight. My right hon. Friend has already pointed out that even worse might befall those of us in Cardiff, because he told us how the hon. Member for Dagenham (Mr. Gould) envisaged that the community charge in Wales would treble. Instead of the current charge of £140, every charge payer in Cardiff might have to find a minimum of £450. It is conspicuous that, when my right hon. Friend raised that matter in the Welsh Grand Committee earlier and in the Chamber tonight, there was no answer from those sitting on the Labour Front Bench.

What have we got to show in Cardiff for the extortionate demands placed upon the charge payers? My hon. Friend the Member for Cardiff, Central has already referred to some peculiar commercial developments that the council has insisted upon. He reminded us of the tennis centre at Sully, and about the Gardenhurst centre for old people in Penarth. I will not comment on them, because they are outside my constituency, but I understand that they are being forced through in the teeth of great local opposition with complete disregard for local people's feelings.

My hon. Friend also referred to Corpus Christi high school, in which I have an interest because there are plans to relocate it at a green field site in my constituency. My local residents and councillors are just as fiercely opposed to that, and I shall continue to support them.

The most notorious of the controversial proposals is to build a medicentre- -a commercial development--on one of the few open spaces of the University hospital of Wales. Why on earth is the council going in for that commercial development, especially as it is on a national health service site? Have we any confidence that the council could make those commercial developments work? I have little confidence, and I certainly would not entrust any commercial developments to it. What else have we got to show for the high demands placed upon charge payers? We spent a lot of time today in Committee talking about education. Unfortunately, South Glamorgan council is one of the lowest spenders per head on education. Local citizens would immediately want to ask about the roads. By local repute, we have some of the worst roads in Wales. I recently called on a constituent,

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Mr. Full, who is trying to get one solitary extra light in Rhiwbina. He has received exactly the same correspondence from the council for the past 10 years. In fact, he has ended up with a more depressing reply than the one he first received 10 years ago. I listened intently to the hon. Member for Alyn and Deeside (Mr. Jones), but I listened in vain for something substantial. I heard some hypocrisy about the RECHAR money, and I feel strongly about that. It is our money, because Britain is a net contributor to the Common Market. At best, it is an example of the problems with which the Government are trying to deal. The Common Market should be a collection of equal sovereign states and money should not be withheld at the whim of bureaucrats.

At worst, it is a case of party politics, because the Commissioner who seeks to thwart our desire for that money is a Labour nominee. I should be more than curious to know what the hon. Member for Alyn and Deeside has been doing to persuade his Labour colleague to stop blocking that money for Britain.

I also listened in vain to the hon. Gentleman's speech for a clear-cut answer about how much he would give local councils in Wales. His speech was full of criticism of the Government, but he had no positive proposals to make.

Devolution has been mentioned by more than one hon. Member. I am sure that the hon. Member for Caernarfon (Mr. Wigley) is striving to speak, but before he does so, may I say this : hands off Cardiff city hall. Cardiff city hall is the much-loved headquarters of our local council. For as long as any citizen of Cardiff can remember, it has been the home of Cardiff's local council. I hope that, after the reform of local government in Wales, we shall make that city hall once again the headquarters of a much more local, relevant and loved local council. I accept that we can allow visitors in, but we should never let the city hall be taken over by a remote quango. The hon. Member for Caernarfon is right to be concerned about the form and geographical convenience of a regional assembly for Wales, but it should be in the style of a slatted shed usually preferred by DIY distributors. Moreover, I am sure that the overwhelming majority of Welsh people would prefer it to be sited in Aberystwyth. 9.31 pm

Mr. Dafydd Wigley (Caernarfon) : It is interesting that, of the four Conservative Back Benchers from Wales, two have spoken in favour of an elected all-Wales body, albeit their viewpoints differ from mine. I advocate strongly that there should be a national parliament but the need for democracy on a all-Wales level is now becoming an accepted factor. In considering the future of the government of Wales, the future of local government or the structure of financing, the all-Wales aspect must be taken into account. We cannot continue as we are, possibly into another Parliament. If the Government win the election and return for the fourth time as a Conservative Government, perhaps with even fewer seats in Wales-- of the 38 seats, the Conservatives hold only six--a democratic deficit will have to be met.

Another problem is how to achieve a proper strategic body if we move to a local government structure as proposed by the Secretary of State in his consultation document. All those questions must be taken on board.

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Many hon. Members have referred tonight to the nonsense into which local government finance has now entered. No one could argue that the proportions coming from the centre are probably too high. The methods of raising money at local government level worry all of us. The poll tax is a nonsense and its residual elements are still grotesquely unfair, as the hon. Member for Merthyr Tydfil and Rhymney (Mr. Rowlands) said. However, no one could argue that, if we are to have local democracy, the need to raise money locally should not be taken on board. The question is how that should be done fairly and how we can achieve a proper balance between central and local

responsibility.

One of the problems is that, in so many ways, local government acts as an agency for central Government. It cannot control so many of its responsibilities and it cannot decide what it does because it is constrained by legislation.

Mr. Anderson : There is very little discretion.

Mr. Wigley : I agree with the hon. Gentleman. In the coming year we shall face more responsibility falling on local government in Wales. In 12 months time, the community care package will land. My local authority of Gwynedd faces a bill of some £750,000 and has asked the Secretary of State for help with that money in order to tackle care in the community. As more responsibilty is placed on local government, it will inevitably look to the centre for funding. Clearly, somebody has to pay for those activities, and we must have care in the community. It is not a cut-price option and must be paid for. We must introduce a mechanism to do so in an equitable manner so that those who can afford to shoulder a greater proportion of the burden do so. My party and I favour a local income tax, but we could argue about the exact way of going about it. However, if local democracy is to mean something, there must be a fund-raising mechanism. I accept that that is equally true on the all-Wales level. If there is to be a meaningful all-Wales tier of government, that must have financial responsibility, which means the ability to raise funds. That could possibly be done by transfer to that organisation of some of the taxes currently raised--for example, value added tax.

I asked a question of the Secretary of State that has still not been answered. The hon. Member for Rhondda (Mr. Rogers) mentioned the Mid- Glamorgan equivalent of the issue that I raised in the context of Gwynedd, where we have a £500,000 shortfall in relation to the teachers' pay settlement, which has implications. If, as Gwynedd people have told me today, the implications involve either the sacking of a significant number of teachers or a significant increase in the poll tax, I hope that the Secretary of State will be prepared to look at the figures that Gwynedd proposes and show where they are wrong, if they are. If they are right, I hope that he will face up to the implications of that.

We face a housing crisis. One half, or even two thirds, of the cases that come up in surgery after surgery involve people who cannot find a place to live. The Secretary of State cannot avoid the fact that there is a crisis. Since 1979, the number of rented accommodation units available from local authorities has dropped from 308,000 to 226,000--a reduction of 82,000 in the number of council houses in Wales due to the Government's policy of selling them off.

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Those houses are no longer available and, as the cycle revolves, with people dying off or moving away, their houses are not available for letting to people on the list.

In the same period, the number of private rented accommodation units in Wales has dropped from 114,000 to 80,000--a reduction of 34, 000. We have to counter balance against that an increase of only 14, 000 in housing association units. Therefore, although we have lost 116,000 units, we have gained just 14,000--a net loss of 102,000. Those problems would not be as bad if the people involved were in a financial position to buy their own houses, but they are not. They are out of work or, if they are in work, they have the insecurity of seeing redundancies and closures all around them.

In the Dwyfor district of my constituency, 400 people are on the waiting list for housing and cannot get houses, 20 per cent. of the housing stock are second homes which are empty for large proportions of the year and there are 800 houses on the market that people cannot sell. They are for sale at prices that people cannot afford to buy, and the local authority does not have the resources to buy the houses to rent them to those who want them. That is mismanagement. We must crack the problem because we are creating social problems. What I have described in Dwyfor is as bad or even worse in the Arfon district, where it is compounded by the growth of University College of North Wales, Bangor. We welcome the fact that that institution is enjoying such a successful period, but, as the Minister of State knows full well, the availability of housing in Bangor is chronically low. Some 1,500 people in the Arfon district are on the waiting list. People are sleeping out and sleeping in cars, while families are having to split up, with some members living with the father and some with the mother as they have nowhere to live. That problem must be tackled.

I urge the Secretary of State to look at the financial mechanisms available to local authorities in the coming year to find a way to enable them--in one way or another--to get housing moving again so that it is available for rent to those who need it. There is a desperate need, and we must tackle the problem as a matter of urgency. 9.38 pm

Mr. Paul Flynn (Newport, West) : The most telling part of tonight's debate was the Secretary of State's confession that he considered the English system for the reduction in the charge to be superior--he nodded earlier. He had considered changing the system, but he decided against it. He was told many times in the Chamber last year and received many letters from my constituents and those of other hon. Members urging him to change the system. The reason he gave for not doing so was that he did not want people to fill out a form. My constituents in Rogerstone in Newport will be paying £158 in poll tax this year, rather than the £117 that people in other parts of the town will be paying. I am sure that everyone in Rogerstone will be happy to fill out the form if it will save £41--

Mr. David Hunt : In many ways the English system is superior--after all, I devised it when I was the Minister responsible for local government, but I recognised that what local authorities in Wales had proposed was a simple, direct system that did not involve the administrative costs

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of the English system. So it is not just a question of filling out a form ; it is also a question of administrative costs that would greatly reduce the amount of money available in the first place.

Mr. Flynn : The scheme in Newport, West is uniquely demented, as I have told the right hon. Gentleman before. Every poll tax payer there will pay an average extra £17. That has nothing to do with local authorities , or with the right hon. Members for Finchley (Mrs. Thatcher) or for Worcester (Mr. Walker)--the £17 extra this year is due to the Secretary of State. My constituents accept that. What they will not accept is the reason why they pay more in Rogerstone than in Wentloog which, extraordinarily enough, has nothing to do with the fact that one area is deprived and the other prosperous, that one contains many people on income support and the other does not. The reason is that one area has more farms than the other.

Under this crude system, the old rates were looked at. Some areas containing a large number of farms which paid little or no rates--I refer to Wentloog and Nash--pay rates that are artificially low, but deprived areas containing people on low incomes pay high rates. That extraordinary anomaly applies to Newport but not to Rhondda and many other constituencies in Wales. The Secretary of State has been told about this. I invite him to Rogerstone community centre and to the other areas paying the Hunt levy, which amounts to about £41 extra--and it is not due to additional council charges. It is due to decisions taken by the Secretary of State, who could have changed his mind but did not. My constituents will have to pay this levy because of a blunder by the Secretary of State.

9.41 pm

Mr. Peter Hain (Neath) : Listening to the mumbo-jumbo of the Secretary of State's speech, it seemed to me that he was relying far too heavily on the teenage scribblers in the Welsh Office who tell him that all his financial increases mean that local authorities are doing well. At the end of it all, however, West Glamorgan's education budget for the teachers' pay settlement is underfunded by £1 million. That in turn has led to the education budget having to be cut by £2.1 million this year. When the Under-Secretary replies, perhaps he will tell us whether he agrees with that cut, on which he has insisted. Meanwhile, the poll tax continues in place. According to the Local Government Information Unit, it has cost the people of Wales £1 billion : two years of £140 subsidy, collection losses estimated by the Audit Commission, the cost of the community charge reduction scheme, the cost of transitional relief and the cost of setting up and administering the poll tax.

The unfair and oppressive 20 per cent. rule is still in place ; every £6 collected under it costs local authorities £15 to collect. Leaving aside questions of equity, how can it make sense to maintain the 20 per cent. rule on grounds of efficiency? The oppressive unfairness of the tax continues. On Saturday morning I saw in my surgery a pensioner whose husband had died in December and who had received a poll tax arrears bill for £1.95 even though she and he had paid their bills to the borough council on the dot, week in, week out. We all know of similar examples, and the poll tax will continue to be a major issue in the general election.

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Another issue that continues to dog the people of Neath is the discriminatory system of transitional relief that the Welsh Office operates. For example, the community area of Blaehonddan is getting no transitional relief this coming year, just as it got none in the year 1991-92. How can it be right that a pensioner couple, with a small miner's pension that takes them above the income support level, should be receiving no transitional relief, while I, with a Member of Parliament's salary, in the area of Resolven am receiving £68 transitional relief? There is no equity in that. We both depend on the same services and we both pay for those services, and we do not get anything more or less for that contribution. I ask the Secretary of State to look again at the way that this system is worked. I have another point, about gearing and the enormous centralisation of financing of local government that has taken place under this Conservative Government. The position is worse than was suggested by the hon. Member for Delyn (Mr. Raffan). Because only 7 per cent. of a local authority's revenue is raised locally, for every 1 per cent. increase in revenue, the poll tax has to go up by 14 per cent. That is an enormous centralisation. It is not local accountability--it is local strangulation.

After 13 years of destructive rule by the Conservative Government, Wales at last has the opportunity to regenerate local democracy, to empower local communities and give them the right to have a say over their destiny. We shall get that right from a Labour Government. 9.46 pm

Mr. Huw Edwards (Monmouth) : Some of my colleagues have already talked about the housing crisis in their authorities. The difference between the authority that I represent and those that my hon. Friends represent is that I represent the only Conservative district authority in Wales. No Government policy has been more incompetent and inhumane than their housing policy.

A written answer to a question that I put to the Secretary of State shows that £741 million has accrued to local authorities from the sale of council houses in the past 10 years. My authority of Monmouth has accrued £24 million, of which £10 million has been accumulated in the past three years. Brecknock, the authority of the hon. Member for Brecon and Radnor (Mr. Livsey), has accumulated £24 million, of which £15 million has come in the past three years. In Cardiff, the figures are £79 million in the past 10 years, of which £29 million has come in the past three years. This has happened since the Housing Acts of 1988 and 1989 which effectively put an end to the development of housing by local authorities.

The Government's theory is that local authorities should be enabling people to buy housing, so we have to ask how the Secretary of State and his policies have enabled people on the waiting list in my constituency to get into housing. Those who cannot afford to buy find that there is nothing to rent. The Government introduced legislation that was intended to stimulate the private sector, but we have seen from the figures mentioned by the hon. Member for Caernarfon (Mr. Wigley) that the number of private rented units in Wales has declined. Even in the Government's terms, their policies have failed miserably.

In Monmouth there are 2,500 households on the council house waiting list. There is rising homelessness and

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no purpose-built accommodation for homeless people. Despite that, the housing revenue subsidy has been cut this year. It is £200,000 short of expenditure on housing benefit. That confirms what people have been saying for years, since the Local Government and Housing Act 1989, that those on low incomes in council houses are subsidising those on the lowest income who are dependent on housing benefit. Council rents in Monmouth are due to go up by £5.25 across the board. That is a 19 per cent. increase, which is far higher than the increase in the rate of inflation. Officials and councillors are highly embarrassed about the way in which they have to implement those policies in the only Conservative-controlled authority in Wales. In the housing department, three posts are being frozen at a time when it is trying to decentralise its services.

If Monmouth borough council has been able to spend 25 per cent. of its revenue from the sale of council houses in the past three years, why has not one house been built this year? Where has that 25 per cent. of £10 million gone? There is widespread concern in my constituency that that money is being put aside to build new council headquarters on land partly owned by the leader of Monmouth borough council. That was suggested on an HTV Wales television documentary just before Christmas. I hope that it can be confirmed that that is not the case, but there is no support for the building of new council headquarters at Portskewett on the edge of my constituency and the borough.

Even if we accept the Government's argument that money is going into housing associations, only 108 houses are under construction by housing associations in the current year according to a reply to me from the Under- Secretary of State during Welsh questions two weeks ago. How on earth will those 108 houses enable the 2,500 households on the council house waiting list to be rehoused? I can only conclude that, as I said at the beginning of my speech, the Government have no policy which is more incompetent and which even in their own terms has failed more than their housing policy. We need a Labour Government to rectify that.

9.51 pm

Mr. Win Griffiths (Bridgend) : I want to return to the question of the funding of the teachers' pay award, because the Secretary of State, in his answer to my earlier intervention, showed that he knew the answer to my question but was hiding under the hypothecation halo of the Treasury. He told us at the beginning that, in drawing up his plans for local government spending and the Government's contribution towards it, he had estimated what the teachers' pay award would be. He admitted that he had underestimated, and so had made a further contribution.

Therefore, I plainly asked the right hon. Gentleman what the difference was that the local authorities would have to find, and I hope that the Under- Secretary will tell us when he replies. In Mid-Glamorgan, the difference is about £1 million, and in West Glamorgan it is a similar figure. In South Glamorgan it is not far short of that. The Minister must be able to give the figure that the local authorities are expected to find by way of efficiency savings to make up that shortfall.

How does the Welsh Office estimate the efficiency savings that local authorities can make when it draws up

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its funding proposals for local government? Year by year, it has assumed that there is scope for such efficiency savings. Can it give us an estimate of the likely efficiency savings in local government for the coming financial year? At the same time, will the Minister tell us what the efficiency savings for the Welsh Office will be for the forthcoming year?

Is it not true that central Government spending has risen massively during the Government's lifetime? They have the audacity to accuse local government of overspending and to turn the screw on it while not accepting the blame for their own profligacy, of which the poll tax is the outstanding example. If Ministers had been any body of councillors in the United Kingdom, they would have been surcharged and prevented from serving on any elected body for the rest of their lives.

Local authorities are having to struggle desperately to maintain services. That struggle resulted in appalling decisions having to be taken. The Secretary of State pointed out that my own authority is in the top four for poll tax collection in Wales. There are stories of human hardship and misery behind the accumulation of that money. In the last two months of this year, Ogwr, which has a good record for poll tax collection, will stop the adaptation of properties for the disabled. That is an outrage, but the money has run out. The provision of central heating for people having medical priorities has been stopped because the authority does not have the money for that either.

The Welsh Office says that it is the provider of largesse beyond the dreams of any local government leader, yet there is example after example of difficult decisions being made by local authorities as to which services can be provided, and which must be cut back. The Government and Welsh Office Ministers will not have the opportunity to bring about their threats of poll tax capping, because after 9 April they will not be in office. It will again be left to a Labour Government to pick up the pieces of the disaster that Tory rule has brought to Wales. Local government spending priorities will have to be reordered to ensure that the people who really need help will get it in the coming financial year.

9.56 pm

Mr. Rhodri Morgan (Cardiff, West) : I want to say one word to the Secretary of State or the Under-Secretary, and that is "increments". It is a little like a scene in "The Graduate", in which one of the characters says to Ben, "I just want to say one word to you--plastics." I am sure that you, Madam Deputy Speaker, remember that scene from "The Graduate", which I am sure you saw several times--unless you went to see "The Sound of Music" instead. The word "increments" is critical. County treasurers say, "If only the Welsh Office would accept the impact of increments on the total cost of teachers' pay next year, compared with this year, there would be no need for 90 per cent. of the hassle and haggling involved in arguing, as we are now, whether or not the rate support grant settlement is fair."

I was disappointed by the Secretary of State's reply to my earlier intervention, when I asked whether local government finance experts in the Welsh Office had reached agreement with county council treasurers' departments on the total cost of providing next year the

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same basket of local government services, and the percentage increase required to meet it--known as a service standstill budget. South Glamorgan has a no-growth budget, but that is not the same as a service standstill budget. It is much less than that. It involves genuine cuts, which have already been announced, and have created the same sort of crisis in South Glamorgan that my hon. Friend the Member for Bridgend (Mr. Griffiths) mentioned have arisen in respect of education cutbacks in Mid-Glamorgan.

In future years, I would like to see local government finance civil servants and county and district treasurers get together and give evidence to the Select Committee on Welsh Affairs or some other suitable body, with assistance from the Chartered Institute of Public Finance and Accountancy and other local government finance experts. Right hon. and hon. Members could still engage in arguments about politics, but not about figures. It ought to be possible for finance experts to agree between themselves the expected cost in 1992 of providing the same services available in 1991. Then we as politicians have only to come in and put the cream on the coffee. We can say that if an authority wants to expand services in certain areas it will cost a certain amount extra, on top of the 8.5 or the 7.9 or the 9.8 or whatever figure the finance experts tell us will give us the same basket of services next year as we are already getting this year, our base line which we all know about.

At the moment we are wasting time on a colossal scale in the House every year by going through this charade and being unable to agree because, as the Secretary of State has confirmed, he cannot agree with the county councils and their treasurers and with the district councils and their treasurers on whether we can accurately say what the cost will be, allowing for inflation and also for the particular way in which increments in teachers' pay and so on impact on a labour-intensive service such as local government. We could then reduce our argument to the politics of the situation, whether the public really wanted to pay for extra services, the same services, or lower services. That is what we should be arguing about. I would like the Under-Secretary of State to give some attention to that in his reply.

9.59 pm

Mr. Alun Michael (Cardiff, South and Penarth) : The best thing about this settlement is that it is the last from a Conservative Secretary of State for a long time to come. It has been memorable for the way in which the "demob happy" Tory twins of Clwyd launched their devastating attacks on 13 years of Conservative rule and what the Conservatives have done to undermine local democracy in Wales. It is ironic that the two Conservative Members who are standing down at the election now appear to support the policies of the Welsh Labour party.

For 13 years the Conservatives have used their position to lay waste local government and public services in Wales. They have underfunded local government. They have put 70,000 on the waiting lists, and condemned families to the horrors of homelessness. They have created a crisis in social services, with the Parliamentary Under-Secretary pontificating on what others should do while neglecting to offer real help and encouragement to those who have to

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work with the most neglected and difficult children in our society. While cutting the real value of pensions, they have transferred the responsibility for the care of the elderly from central to local government. They have paid scant regard to the increasing number of elderly people in Wales and have simply failed to provide the resources to match the need.

They have left us a heritage of crumbling schools, stolen our colleges from us and undermined the development of tertiary colleges in Wales in a callous and cavalier manner which has shocked the dedicated councillors and teachers who have shown love and care for our places of education--the Parliamentary Under-Secretary appears to be laughing at the education of children in Wales--and for the young people who need them so desperately.

That is the record, and the settlement that we are debating today is no different. The districts needed 11 per cent. to maintain vital services ; they are being given just over 5 per cent. The Government's SSAs for the Welsh districts amount to £7 million below this year's budgets, and that with councils using £17 million of their own reserves. For 13 years the Government have imposed new duties on Welsh councils without giving them enough money to carry out those duties.

My hon. Friend the Member for Alyn and Deeside (Mr. Jones) gave the example of the Environmental Protection Act 1990. It is a fine thing to want better standards of refuse disposal, street cleaning, pest control and so on, but the shortage of cash is causing problems and distortions. Anyone who has examined the problems of waste disposal in south Wales knows that we have a crisis on our hands which needs a partnership between the Welsh Office and local government, not a diktat from on high or simple percentages on the previous year. I agree with the hon. Member for Caernarfon (Mr. Wigley) that care in the community is not a cheap option. We have a terrible shortage of day care facilities for the mentally ill, for adults with learning difficulties, for people with Alzheimer's disease and for their carers, who shoulder such an enormous and painful burden. How can councils pick up that burden when the Government have slashed the proportion that they give towards the cost of local services? Where is the cash needed to create facilities, training for employment and job opportunities for the mentally disabled?

In my own county of South Glamorgan I have great sympathy for councillors who have had to slash £4 million to get within the Minister's unrealistic limits. The cuts have been painful. For instance, they have had to cut money for part-time youth centres. There is a proven link, which I would have thought the Secretary of State himself, in view of his past, would be concerned about, between youth provision and success in combating the rise in crime among young people.

I accuse Welsh Office Ministers of creating conditions in which crime can flourish in many of our communities, which already have pain enough to bear. I cannot fault the local councillors, who have had to give priority to keeping the schools budget intact, but I can condemn the Welsh Office Ministers who have confronted them with such a painful dilemma.

During the years of the oil revenue bonanza, the Government have failed to provide the cash that is needed to bring our schools up to standard. Our councillors have tried desperately to keep up with the need. This year, South Glamorgan has had to cut the building maintenance

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programme for schools by 40 per cent.-- £1.5 million--to meet the Government's unrealistic target and I know that other authorities throughout Wales have experienced the same problem. The Welsh Office Ministers must carry the can for that pain, too.

As several of my hon. Friends have mentioned, the Secretary of State came out with a further devastating announcement this week to add to all that pain. He announced bad news as if he were Father Christmas or the tooth fairy. Let me spell it out. After the news of the teachers' settlement, the Secretary of State has refined his figures and has tried to say that he is being generous. That is a cruel hoax, which might be described outside this place--without fear of legal action--as misrepresentation.

In South Glamorgan, the cost of the teachers' pay award is £1.09 million, but the Secretary of State has increased the SSA by only £540,000. The extra cash that he has provided is even less--only £531, 000. My hon. Friend the Member for Merthyr Tydfil and Rhymney (Mr. Rowlands) and others have given the equivalent figures for their local authorities.

That means that councillors who have spent months struggling to get within their SSA suddenly have to find an extra £459,000 in cash terms, and £450,000 in terms of cuts, just to stay within that SSA. Until this week, they were succeeding ; now, only 24 hours ahead of the rate-setting meeting, the Secretary of State has told them to pull another £450,000 out of thin air. That is absurd and it is irresponsible of the Secretary of State.

I want the Minister to give three undertakings to all the hon. Members who have raised that point tonight. I want him, first, to promise to reconsider the cash allocation ; secondly, to promise to reconsider the SSAs and set a reasonable level ; and, thirdly, to promise to discount the new cash gap when considering whether to impose a poll tax cap. Only a cynical and irresponsible Minister would fail to give a positive response to all three requests. Even before that piece of news, councils were plagued by the complexity, rigidity and plain unfairness of the grant system--the so- called SSAs. This is a lottery without sense or logic. Six districts have been allowed increases that would plunge them into financial difficulties. My hon. Friend the Member for Torfaen (Mr. Murphy) says that his council would suffer a decrease in real terms, and the Council of Welsh Districts has begged the Welsh Office for a safety net or loss limiter to guard against such wild variations. As the place names show, the effect of the Government's system fall most heavily on our most needy areas, particularly in the valleys. The Government boast about home improvement grants, yet they are reducing the contribution to councils from 90 to 75 per cent., which means an impact on poll tax bills that one estimate puts at some £2 or £3. That is a hidden and dishonest cut for local authorities to bear.

A number of hon. Members have referred to the money provided for economic development, which has suffered a 30 per cent. cut in two years. A number of our local authorities have an outstanding record in securing inward investment. A Secretary of State who seeks praise for his own efforts in that regard should not only acknowledge their success but give them the tools for the job along with the generous praise.

The shadow of the poll tax falls over this settlement. Unlike the Government, the Minister who will wind up the debate still supports the poll tax : I understand from

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sedentary remarks that he made earlier that he would like to retain it. Will he be honest with the House and the people of Wales tonight?

We have had £100 million wasted and lost to Wales. There have been massive collection problems, the amount uncollected being £17 million. The number of summonses issued is 500,000, and there has been an enormous waste of time and effort for the very people who told the Conservative party that the poll tax would not work. Even after all the furore of the poll tax, the Government are providing inadequate funds to provide for their new and unfair council tax. The amount being provided for capital costs is inadequate, and for revenue expenditure the provision is £6 million instead of the necessary £8 million. Why, in the name of fair play, should Welsh councils and the people who live in their areas have to pay yet again for the Conservative party's blunders and for the refusal of Ministers to listen to common sense from Opposition Members, who understand and have practical experience of local government finance? Not only have the Government failed to grapple with the whole question of local government finance in Wales but Conservative Ministers have plunged our councils into chaos and wasted millions of pounds, and have then had the cheek to lecture us about tax.

In contrast, Welsh councils have yet again this year proved responsible, spending 1.8 per cent. less than their English counterparts despite 13 years' grievous suffering under the Government. But even now the Conservatives plan more obstacles and burdens for the people of Wales. Those of us who were working until five o'clock this morning in the Committee dealing with the Local Government Bill know that only too well. In a few months' time, thank goodness, a Labour Government will give new meaning to local government in Wales and fresh help to local councils and to those who rely on and enjoy their services.

10.11 pm

The Parliamentary Under-Secretary of State for Wales (Mr. Nicholas Bennett) : Anyone listening to the hon. Member for Cardiff, South anPenarth (Mr. Michael) would find it hard to believe that the Government are increasing by 8.7 per cent. the total spending assessment for next year and that the provision will be 23 per cent. more than it was in 1990-91. Before the implementation of the £140 general reduction, the increase over two years was 35 per cent. Anyone listening to the hon. Gentleman would find it hard to believe that the average SSA increases of 8.7 per cent. for district and 8.1 per cent. for counties in the coming year will mean that assessments have increased by one quarter in just two years. Nor would anyone know that the Labour party, when it was in power, far from increasing local government expenditure in Wales, reduced it year after year. In 1976-77 provision went down by 4 per cent., the following year the reduction was 8 per cent., the year after it was 4 per cent., and then the party was thrown out of office.

This is the sort of nonsense that we are getting from the Labour party. A party that reduced local government spending complains that the present Government have increased spending by more than the rate of inflation and have made sure that the charge payers in Wales will pay

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only 7 per cent. of the total bill for local government services across the board. Anyone listening to Opposition Members would not know that.

Nor have the Opposition made clear their policies on spending. The hon. Member for Alyn and Deeside (Mr. Jones), in a speech lasting about 25 minutes, did not once tell the House what level of local government spending would be acceptable to Labour. All we heard from the hon. Gentleman was how his party would spend more every year. Every year at this time the hon. Gentleman makes the same speech about how his party would spend more, about how the local authorities in Wales are hard done by. Not once has he told the House how much more he would allow those local authorities to spend if he were the Secretary of State. He has not said what level of community charge would be acceptable to a Labour Government. We never hear from the Labour party what its real plans are. Those of us who watch the shadow Secretary of State's progress round Wales know that every day another spending promise is made in the Welsh press and on Welsh television. Not once have we been given the prices to go with the menu. That is the Labour party when it comes to local government expenditure in Wales.

We should spend some time warning the people of Wales what the Labour party, if it ever came to power, would mean for local government. First, it would mean higher spending by local authorities. The hon. Member for Dagenham (Mr. Gould) said that his party planned to increase the proportion of council spending met by the community charge payers in England from 14 per cent. to 20 per cent. If the same figures applied in Wales, that would result in a jump from 7 per cent. to 20 per cent. The Labour party has never told us what its figures would be.

Only a few weeks ago the deputy leader of the Labour party said in the Local Government Chronicle :

"I promise that when Labour is back in government you will certainly get more than you receive now."

Again we were not told by the deputy leader what the promises would mean. The simple fact is that we do not get any honesty whatsover from the Labour party about its spending plans or its policies, or what its policies would be for raising the necessary taxation. In 1980 the Labour party said that the rates were unjust. In 1985 the leader of the Labour-controlled Association of London Authorities said :

"Rates over the years have become widely detested both by those who have to pay them and those who have to defend raising them." In 1990 the hon. Member for Sheffield, Brightside (Mr. Blunkett) said that

"Labour agrees that the rates system was flawed."

But now we hear that the Labour party would bring back the rating system. The people of Wales need to know that. [Interruption.] The hon. Member for Bridgend (Mr. Griffiths) says that they would be fair. The word "fair" has the same connotation, when talking about fair rates, as the word "democratic" had in the German Democratic Republic, or that "people" has in people's republics. It is a weasel word that has no connection whatsoever with its true meaning. The Labour party is already committed to bringing back the rating system with knobs on it. The Labour party would introduce four different factors for assessing rates : market price, rebuilding costs, maintenance and repair

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costs, and private rents. Of course, the Labour party has told nobody what sort of weighting factors there would be on any one of those four. In addition, the Labour party is committed to an annual rolling revaluation for every one of the 22 million domestic properties. When asked at a press conference about the cost of revaluing 20 million properties four times over, the hon. Member for Dagenham said, "I do not know." That is what we are getting from the Labour party time and time again. The hon. Member for Alyn and Deeside--

Mr. Alan W. Williams (Carmarthen) : Will the hon. Gentleman give way?

Mr. Bennett : No. The hon. Member for Alyn and Deeside--

Mr. Alan W. Williams rose --

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