---

Column 413

debt. That is another special factor affecting the Western Isles council which the Government must take into account.

I am grateful that the Government have accepted the recommendations of Touche Ross to maintain the special islands needs allowance. It is absolutely essential for the Western Isles and for the communities of Orkney and Shetland. I should be grateful if the Minister could say that he has a long-standing commitment to that allowance and that he recognises the recommendation of an independent report that it is a much needed supplement to the revenue that central Government otherwise provide to the islands authority. I am sure that such a commitment would also be welcomed by the hon. Member for Orkney and Shetland.

Finally, I shall deal with water and sewerage costs. For the Western Isles, such costs represent a great financial burden. As the Minister will know, the problem is that the costs are supposed to be self-financing. In addition, the money raised from individuals within the communities is not subject to any rebate. Therefore, in an area such as the Western Isles, which has high water rates and is expected to have even higher rates in the future, the poorest members of the community face the most crippling bills. Will the Minister seriously consider that issue? He may not be willing to countenance the prospect of providing additional resources for the islands' authorities to deal with their particular water and sewage costs, but will he accept the case for introducing into the water rate a rebate similar to that available under the council tax to the poorest members of the community? I look forward to his reply.

9.54 pm

Mr. Henry McLeish (Fife, Central) : As is usual when we are dealing with such matters, this has been an interesting debate, and it has served to point up the differences between Opposition Members and Conservative Members. The Conservative Government believe in spending on local services ; we believe in investing in the people for whom the services are provided. That is the essential difference. The Government will not accept that these services are legitimately provided by local authorities and that they are an investment in the community, an investment in people. I am reminded of remarks that were made a few weeks ago by the hon. Member for Eastwood (Mr. Stewart), the Parliamentary Under-Secretary of State for Scotland, who, in a blinding flash of characteristic honesty, indicated that he wanted to sell everything. If that served to entertain the members of the Scottish Grand Committee, it also showed ultimate contempt for services that reach out to every family and every community the length and breadth of Scotland. Many hon. Members have indicated a similar attitude today by speaking grudgingly about the quality of local government services. Conservative Members find it difficult to manifest empathy with or sympathy for quality service.

One characteristic of the debate has not yet been mentioned. Even if the Government wanted to spend more money on local government--and I do not believe that they do--the real issue would continue to be the public sector borrowing requirement of £50 billion towards which the Government are heading. Let us forget for a

---

Column 414

moment whether they care about local government. The real issue is the financial mess in which we find ourselves as a consequence of 14 years of economic failure and incompetence. The Chief Secretary to the Treasury said recently :

"Over the course of the Parliament we shall be looking at the direction spending on every programme is taking and whether its purpose remains right for the 1990s. We shall be seeking to identify areas where better targeting can be achieved, or from which the public sector can withdraw completely."

Does not that show that we have a problem with the Conservatives? This settlement reflects the poverty of Conservative thinking, but it reflects also the deep anguish of Opposition Members, who believe that much deeper cuts will be foisted upon the people of Scotland in the next two to three years.

Another feature of the debate has been the central hypocrisy of the Government's argument. Let us remember that, despite record levels of unemployment and record manufacturing bankruptcies, the Government will not intervene. But what happens when they are let loose on a local authority that spends slightly more than its budget figure? We have rate capping, interference in education, and so on. The Government are determined to shape the social agenda, regardless of their commitment to the freedom of local authorities. It is indeed a central hypocrisy. How does the Minister square that attitude with the Government's total idleness in respect of the key issues of the economy--jobs, and so on?

As many of my hon. Friends have said, one of the reasons for the level of local authority expenditure is related to the economic collapse that we face. Tomorrow we shall see a rise in unemployment. I can tell the Minister that the figure in Scotland may rise by 9, 000--2,500 people thrown on the scrap heap every week under this regime. That fact must be taken on board. It is not possible to continue to create such levels of unemployment without expecting the regional and district services to pick up the bill for the community initiatives that are necessary to help the unemployed. Does the Minister think that that is a reasonable proposition? Or does he want us to return to the attitude adopted in the early days of this century, when a distinction was drawn between the deserving poor and the undeserving poor? I believe firmly that the Scottish local authorities have done a magnificent job by picking up the pieces left by the Government in applying their disastrous policies.

The Government always miss the importance to Scotland of local authorities. We have heard that those authorities provide excellent services--flagship services, I would argue. They need not be compared with any private sector organisation. They are efficient, value-for-money bodies and, more important, they are accountable. Is not that the essence of democracy? Is not that another of the Government's central contradictions?

Even apart from services, one in six of the Scottish work force is employed by the regions and the districts--300,000 people. Let us imagine what would happen if this evening the Strangers Gallery were packed with people who worked in those services, and they heard the grudging Conservative concessions on the caring services--the police, the fire service, the community care services and investment in jobs and training, whereby young people are given training and an education. Those people would be

---

Column 415

appalled by the indifference which the Government continue to show and which, of course, is reflected in the settlement.

We have heard the Government say many times that the settlement is adequate, with pay rises below 1.5 per cent. and

inflation--temporarily--at 1.7 per cent. We are all supposed to rejoice and hope that local authorities will be able to survive. But the reality is different from the Government's window dressing. The council tax, which will be imposed in April, is likely to be £100 higher for every household in the country because of the Government's meanness and sleight of hand over the estimates that they first discussed publicly in the press. Will the Minister explain why the council tax bills will be so much higher, adding another burden for households at a time when we are hoping for a consumer-led recovery? What hypocrisy. The Minister must answer that question. There was much about community care in the statement. Community care is more than an emotive issue. We all support it--health boards, local authorities and everyone in the House. The tragedy is that, in April, people who leave care or psychiatric hospitals will not have the resources to lead the independent lives and have the dignity that community care was set up to create. What about the lack of funding for community care? Sixty million pounds or so will not even start to measure up to the problems.

In England we see hospitals being emptied far too quickly and local authorities being underfunded to deal with the problem. We shall not tolerate any attempt by Scottish Office Ministers to replicate those problems in Scotland. I hope that when the Minister replies to the debate he will respond to that statement.

Capping has already been mentioned. We have exposed the central hypocrisy and the contradiction in the Government's philosophy--their selective interventions. Why can we not have genuine democracy that allows local authorities to be reasonable and responsible and to provide for the needs in their areas? The Government will have none of that. The settlement is about the sum to be given in revenue support, but it is also about the reason why the Government have taken draconian steps to impose punitive capping on local authorities. Why have they done that? The answer is simple. They abhor what local authorities do and they will not countenance increases in the levels of council tax that they are trying to impose. Of course, they care little for the quality of services and jobs that may be sacrificed.

I said earlier that we shall see tomorrow that unemployment has risen steeply. Is the Minister at all concerned about the crisis in jobs and services that will ensue? One of his close friends in local government-- Councillor Charles Gray--is quoted in an article under the heading :

"Councils warn jobs may be casualty of spending cuts".

I am glad to see that the Minister is awake--although his response to my jibe was slow.

I ask the Minister how many jobs will be sacrificed as a result of the settlement. Will it be 10,000, 20,000 or 30,000? More importantly for the people who receive the services, what services will be cut? Will the Minister answer? Will he intervene now and tell us what the poverty of the settlement will mean for jobs and services? Those are crucial issues, which we take seriously. The Minister is an

---

Column 416

understanding fellow, but he must take those issues seriously. For many, services and jobs mean life and death and they depend on what the Minister does.

We have talked about Government philosophy in the settlement and about the wider aspects of community care. There is another appalling prospect behind the figures that have been announced. What will the Government do about crime? Why are three crimes committed every minute in Scotland? Local government provides excellent services. The police force in Scotland does an excellent job, but it is under-resourced. The Government have given up on crime. They have created record levels, so what do they do? They walk away. They blame the police. It is the scapegoat philosophy which permeates everything they do.

Crime is a cancer in Scottish society. More than 1 million crimes were committed in the last year for which we have figures. There has been a 20 per cent. increase in four years. What will the settlement do to put another policeman on the beat to ensure that people are safe in their houses and on the streets?

The local government settlement is also about the quality of life in our communities. Why were 100,000 Scots homeless last year? We have record homelessness and record crime. Yet the Government pretend that Opposition parties should be satisfied with the settlement. We are not satisfied, either with the amount or with the complacency of some of the comments that we have heard in the debate.

After 14 years of the selfishness and greed of the Government, masquerading as a caring Government, Britain must return to a position where individuals see their future through the community. That is the sensible way forward. If we needed a potent symbol of how the community works, it is the quality, efficiency and value for money provided by Scottish local authorities. That is community in action. It means children being allowed to have the education opportunities that they would never have under the regime which the Government would impose on them. It means people knowing that they can rely on decent services, including the fire service and consumer protection measures which the Tories would like to dismantle. Can the Minister defend the settlement and promise Scots that they will continue to have the best local government in Europe? Can he guarantee that employment levels will be maintained? More importantly, will he give a commitment to defend the notion of community which has served us well and which is under serious threat?

The Labour party does not want any more contracting out, resulting in shabby services, second-rate facilities and mass unemployment. The challenge to the Minister is to put all that nonsense behind him and to give us a settlement of which we can be proud and which will defend jobs and protect services.

10.7 pm

Mr. Stewart : I do not want to make a personal criticism of the hon. Member for Monklands, West (Mr. Clarke) ; one can safely leave that to his hon. Friends who do so at daily intervals in the Scottish press. However, he was somewhat ungracious about my right hon. Friend the Secretary of State. My right hon. Friend explained to him in a note that he was occupied with forestry interests in his capacity as the United Kindom's forestry Minister.

---

Column 417

Mr. Tom Clarke : I had not expected to intervene so soon. I said in my speech that I had received the note, but since the Minister raises the point, I must say that when I am Secretary of State for Scotland, if I am asked to be in the House for two important debates or to attend a dinner with the Forestry Commission, I will be here.

Mr. Stewart : I understand that the betting is that the hon. Gentleman will not be shadow Secretary of State for Scotland for long, never mind Secretary of State for Scotland in the future. It was interesting that the hon. Member for Fife, Central (Mr. McLeish) did not refer once in his winding-up speech to the speech by his hon. Friend the Member for Monklands, West. Perhaps that was a bid for the Scottish leadership.

The speech by the hon. Member for Angus, East (Mr. Welsh) had the great merit of stirring up Labour Members. He got them very worried when he referred to the most interesting speech in Bournemouth by the Leader of the Opposition. Unfortunately, that speech was obviously not communicated to Scottish Labour Members in good time. A number of points made by the hon. Member for Fife, Central were not in line with the new philosophy as spelt out by the right hon. and learned Member for Monklands, East (Mr. Smith).

As always, there were a number of constructive constituency points from Opposition Members, especially from the hon. Member for Western Isles (Mr. Macdonald). I hope that I shall have time to respond to those points. If I cannot do so, I shall be happy to have a discussion with him afterwards.

The hon. Member for Fife, Central praised the excellent services of Scottish local authorities.

Mr. McLeish indicated assent.

Mr. Stewart : I see that the hon. Gentleman nods. He then said that those authorities had been massively underfunded over the past 14 years. He can hardly have it both ways. If the authorities are providing excellent services, they can hardly have been massively underfunded over a long period.

The hon. Member for Fife, Central asked about the reality. I shall tell Opposition Members what the reality is. The reality is that local authority expenditure per head of population in Scotland is 30 per cent. higher than it is in England and 30 per cent. higher than it is in Wales. Aggregate external finance--specific grants, business rates and revenue support grant --is 47 per cent. higher per head in Scotland than it is in England and 25 per cent. higher than it is in Wales, which is a similar country.

Let us hear no more nonsense from Opposition Members about the Government not giving adequate support to Scottish local government. The facts simply do not show that. In the past five years, there has been a real increase in central Government support to local authorities, after allowing for inflation.

Mr. Hood : Two weeks ago, the Minister received a letter from the Auchlochan Trust, a Christian charitable trust in my constituency. The trust pleaded for the Scottish Office to guarantee the money for providing community care for hundreds of geriatrics. The trust told the Minister that if it was not given that guarantee, it would have to throw elderly people out into the street and pay off some of its many workers. Has the Minister given that guarantee to the trust?

---

Column 418

Mr. Stewart : The community care figures have been mentioned by a number of hon. Members. The hon. Gentleman knows perfectly well that individual decisions are for councils. I shall give him the overall figures for Government support for care in the community. The total figure for care in the community from 1 April is £63.4 million. Some £40.6 million will be transferred from the Department of Social Security, there will be £20 million in respect of additional costs incurred by local authorities next year, and there will be £2.8 million in recognition of the independent living fund successor arrangements.

I emphasise that the amount transferred exceeds the present level of relevant Department of Social Security spending in Scotland by £4 million. In addition, we have allocated more than £20 million to authorities in recognition of community care preparation costs. I entirely refute any claim that local authorities are being underfunded for community care responsibilities. The Government have taken the additional step of disregarding local authority expenditure on community care for capping purposes. That relates to the point made by my hon. Friend the Member for Ayr (Mr. Gallie).

Mr. Hood : Will the Minister give way?

Mr. Stewart : I have already given way to the hon. Gentleman. I can assure my hon. Friend the Member for Ayr that the resources will not be ring-fenced but will be spent in full by local authorities without their being required to consider the impact of capping. My hon. Friend the Member for Ayr rightly paid tribute to the achievements of Kyle and Carrick since the change in administration there. In emphasising the excellent record of his authority, my hon. Friend the Member for Kincardine and Deeside (Mr. Kynoch) rightly said that, if the authorities in central Scotland held by the Labour party over the years had followed the policies of Kincardine and Deeside, we should not have the burden of extra business taxation to which the hon. Member for Angus, East referred. I emphasise that the reason why we have that extra burden is that, fundamentally, local authority spending in Scotland has for a long time been higher than that in England and Wales.

Mr. Brian Wilson (Cunninghame, North) : Will the Minister give way?

Mr. Stewart : Hon. Members have also suggested that there have been great cuts in manpower in Scottish local authorities in recent years.

Mr. Wilson : Will the Minister give way?

Mr. Stewart : I should point out that, in each of the past five years, the number of people employed by local authorities in Scotland has increased. So much for all this talk of savage cuts and threats to jobs and services. The number of people employed--

Mr. Wilson : Will the Minister give way?

Mr. Stewart : The number of people employed--

Mr. Wilson : Will the Minister give way?

Madam Speaker : Order. The Minister is not giving way. The hon. Member for Cunninghame, North (Mr. Wilson) should not persist. Mr. Stewart rose --

---

Column 419

Mr. Nigel Griffiths (Edinburgh, South) : Will the Minister give way to me, then?

Mr. Stewart : No, but I finally give way to the hon. Member for Cunninghame, North.

Mr. Wilson : I am grateful to the Minister, who can be very helpful on occasion. He spoke in praise of small low-spending authorities. I draw his attention to the concern felt in parts of my constituency at reports of an attempt to incorporate Largs into a greater Eastwood. The Minister should be aware of the damage that such territorial ambitions do elsewhere in the world. Will he kindly take the opportunity to say that he has no such ambitions towards the people of my constituency?

Mr. Stewart : I do not think that, on this occasion, I should spell out the whole range of ambitions that the people of Eastwood have. I assure the hon. Gentleman that that particular suggestion did not come from anyone who lives in the Eastwood constituency--although my right hon. Friend and I will consider most carefully all the representations that we receive in relation to the reform of Scottish local government.

Hon. Members refer to cuts in manpower. There have not been cuts but increases in manpower. Hon. Members referred to cuts in Strathclyde : in fact, Strathclyde will have the scope to increase its budget next year by some £55 million--an increase of 2.9 per cent. By no means can that be described as a cut. The alleged cuts of which we hear from Opposition Members are cuts in unrealistic spending aspirations. They are not real cuts.

A number of hon. Members have made specific points. My hon. Friend the Member for Tayside, North (Mr. Walker) rightly referred to the problems of flooding that have been faced by his constituency and its local authorities. He asked for sympathetic consideration to be given to the representations, in particular with regard to capital allocations. My hon. Friend will not expect a commitment from me tonight but I can confirm that we will consider such representations most sympathetically.

The hon. Members for Orkney and Shetland (Mr. Wallace) and for Western Isles raised the issue of the special islands needs allowance and asked me for an assurance that it will continue. I can confirm to both hon. Members that we have no plans to end the allowance, having just received a consultants' report. Inevitably, we will have to examine it once single- tier authorities are introduced on the mainland. I can give an assurance that the Government recognise the problems of the islands' authorities.

I can confirm that we have decided that the special funds to which the hon. Member for Orkney and Shetland referred should not be taken into account in determining the distribution of the special islands needs allowance. That was recommended by the consultants, and we have accepted it.

Opposition Members allege that Lothian is unfairly treated. I remind them yet again that the special funds are distributed formally or by a distribution committee which consists of members from the Convention of Scottish Local Authorities as well as the Scottish Office. Lothian has a lower number of assessed needs for several obvious reasons--the low proportion of people in education authority schools and it is relatively prosperous and small.

Mr. Nigel Griffiths : Will the Minister give way?

---

Column 420

Mr. Stewart : I do not have the time : I apologise to the hon. Gentleman.

In the past five years, the level of Government support in real terms has increased for Scottish local authorities. The settlement is realistic and fair.

All that we have heard from Opposition Members are the usual allegations about cuts which are not real cuts and demands for much more money to be spent on everything in sight without any attempt to allocate costs or to indicate how the money will be provided. The Government are increasing the funds available to Scottish local authorities by 3.5 per cent. at a time when inflation is 1.7 per cent. and 60 per cent. of the costs are wages. As my hon. Friend the Member for Kincardine and Deeside said, the settlement is fair and reasonable.

It being three hours after the commencement of proceedings on the motion, Madam Speaker-- proceeded to put forthwith the Question necessary to dispose of them, pursuant to order [12 February]. The House divided : Ayes 303, Noes 251.

Division No. 157] [10.22 pm

AYES

Adley, Robert

Ainsworth, Peter (East Surrey)

Alexander, Richard

Alison, Rt Hon Michael (Selby)

Allason, Rupert (Torbay)

Amess, David

Ancram, Michael

Arbuthnot, James

Arnold, Jacques (Gravesham)

Arnold, Sir Thomas (Hazel Grv)

Ashby, David

Aspinwall, Jack

Atkins, Robert

Atkinson, David (Bour'mouth E)

Atkinson, Peter (Hexham)

Baker, Nicholas (Dorset North)

Baldry, Tony

Banks, Matthew (Southport)

Banks, Robert (Harrogate)

Bates, Michael

Batiste, Spencer

Bellingham, Henry

Bendall, Vivian

Beresford, Sir Paul

Biffen, Rt Hon John

Blackburn, Dr John G.

Body, Sir Richard

Booth, Hartley

Boswell, Tim

Bottomley, Peter (Eltham)

Bottomley, Rt Hon Virginia

Bowden, Andrew

Bowis, John

Boyson, Rt Hon Sir Rhodes

Brandreth, Gyles

Brazier, Julian

Bright, Graham

Brooke, Rt Hon Peter

Brown, M. (Brigg & Cl'thorpes)

Browning, Mrs. Angela

Bruce, Ian (S Dorset)

Budgen, Nicholas

Burns, Simon

Butcher, John

Butler, Peter

Butterfill, John

Carlisle, John (Luton North)

Carlisle, Kenneth (Lincoln)

Carrington, Matthew

Carttiss, Michael

Cash, William

Channon, Rt Hon Paul

Clappison, James

Clark, Dr Michael (Rochford)

Clifton-Brown, Geoffrey

Coe, Sebastian

Congdon, David

Conway, Derek

Coombs, Anthony (Wyre For'st)

Coombs, Simon (Swindon)

Cope, Rt Hon Sir John

Couchman, James

Cran, James

Currie, Mrs Edwina (S D'by'ire)

Curry, David (Skipton & Ripon)

Davies, Quentin (Stamford)

Day, Stephen

Deva, Nirj Joseph

Devlin, Tim

Dickens, Geoffrey

Dicks, Terry

Dorrell, Stephen

Douglas-Hamilton, Lord James

Dover, Den

Duncan, Alan

Duncan-Smith, Iain

Durant, Sir Anthony

Dykes, Hugh

Elletson, Harold

Emery, Rt Hon Sir Peter

Evans, David (Welwyn Hatfield)

Evans, Jonathan (Brecon)

Evans, Nigel (Ribble Valley)

Evans, Roger (Monmouth)

Evennett, David

Faber, David

Fabricant, Michael

Fenner, Dame Peggy

Field, Barry (Isle of Wight)

Fishburn, Dudley

Forman, Nigel

Forsyth, Michael (Stirling)

Forth, Eric

Fowler, Rt Hon Sir Norman

Fox, Dr Liam (Woodspring)

Fox, Sir Marcus (Shipley)

Freeman, Roger

French, Douglas

Fry, Peter

Gale, Roger

Gallie, Phil

Gardiner, Sir George

Garel-Jones, Rt Hon Tristan

Garnier, Edward

---