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Mr. Coe : I am grateful for my hon. Friend's response. He spoke of the solid benefits of compulsory competitive tendering. Is he also aware of the hidden benefits to a local authority department that chooses to bid for a service : perhaps for the first time it has to look afresh and self- critically at the costs and true resources of that department, to the benefit not only of the smooth running of the department but of the charge payer?
Mr. Baldry : Yes, competitive tendering has brought substantial benefits. Independent research has shown that it has reduced costs on average by 7 per cent. and on some services by up to 20 per cent. Those savings have been made to the benefit of local taxpayers and can be applied to other services in the local authority area. In addition, competitive tendering has improved contract specification, standards have risen, staff morale has improved and scrutiny has improved. All those have been brought about by competitive tendering.
Mr. Denham : Is the Minister aware of the great contribution to the quality of the built environment made by local authority architects' departments? Last week, for example, I attended a meeting with the Royal Institute of British Architects in Hampshire to celebrate a Hampshire school winning the national RIBA award for public design
Column 884and on Friday I attended the opening of the Tauntons college in Southampton, the design of which was completed by local authority architects.
Is not the Minister aware that the extension of CCT threatens to undermine the enormous contribution that local authority architects have made to the quality of the built environment and that many of our cities, towns and villages will be despoiled by cheap off-the-shelf design in place of the high-quality public architecture that we have enjoyed in recent years?
Mr. Baldry : Even by the Labour party's terms, I can see no possible ideological reason why architecture has to be designed in-house. A few of us could think without too much difficulty of some fairly horrific examples of 1960s and 1970s buildings by municipal architects.
Mr. Oppenheim : Will my hon. Friend, in his customary big-hearted way, extend warm congratulations to Geoff Lennox, who was a committee chairman and later a senior officer at Derbyshire county council and dedicated his career firmly to fighting against contracting out local services--
Mr. Oppenheim : --but who recently took a job on a large salary with a private sector company dedicated to selling contracted-out services to local government institutions? Does this show that at least parts of the Labour party are making progress, or is it just the usual mixture of hypocrisy and opportunism?
Mr. Baldry : My hon. Friend is absolutely right. A number of people in the Labour movement are seeing the light. My hon. Friend mentioned one ; let me mention another. At a recent meeting of the Association of Direct Labour Organisations, Jack Dromey, the national secretary of the Transport and General Workers Union, warned that there could be no return to the 1970s, when, he acknowledged, the interests of producers had dominated those of customers. He said :
"The managers, councillors and unions made arrangements which suited them, not the community as a whole. I can't put forward any ideological reasons why refuse collection has to be done in-house." As usual, the parliamentary Labour party is somewhat behind the rest of the Labour movement.
Mr. Pike : Will not the Minister halt the extension of CCT to housing management, recognising the failure last week in Tory-controlled Wandsworth to introduce and privatise the management of some 8,000 houses in Putney and Battersea? Does he not recognise that that failed and abortive exercise has cost the tenants and residents there some £750,000 in trying to meet Tory policy?
Mr. Baldry : There is absolutely no reason why competitive tendering should not also extend to housing management. As to the hon. Gentleman's point about privatising, most of it is extending to council tenants a considerable choice, to which the Labour party seems opposed.
Sir Paul Beresford : Does my hon. Friend agree that the whole point of competitive tendering is that it allows the in-house team to prove its ability, if it has it? Significantly, it has been proved in Tory boroughs, whereas Labour boroughs consistently fail, when they do not fudge the figures.
Mr. Baldry : Local authorities will increasingly have to demonstrate that they are giving good quality to local people for the vast sums of money that they spend. One of the best ways that local authorities can demonstrate that is to expose their services to competitive tendering. I find it amazing that the Labour party still has difficulty with that concept.
Sir George Young : My right hon. Friend is increasing council rent guidelines for 1994-95 by an average of £2.20 a week. The average council rent guideline for subsidy purposes next year will be £31.60, which is both moderate and reasonable.
Mr. Clelland : At a time when owner-occupiers--I count myself among their number--are benefiting not only from tax relief on mortgage interest payments but from significant reductions in housing costs because of the fall in interest rates, how can the Minister justify the fact that, in the forthcoming financial year, local authorities will receive no net subsidy for housing and will have to find £66 million to support housing benefit, which will have to come from rents? Why are the Government so vindictive towards council housing and council tenants?
Sir George Young : To get the figures straight, there will be some £4 billion in housing revenue account subsidy next year. Local authority tenants who are on benefit will, of course, be insulated against any increase. Those tenants who are not on benefit have the option of the rent-to-mortgage scheme, which was put through the House by the Government. I hope that the hon. Gentleman will promote, with vigour and enthusisasm, the rent-to-mortgage scheme to his tenants who are paying the rent in full.
Sir Anthony Durant : Will my right hon. Friend look at councils that are increasing the costs of running their housing departments, which they are passing on to their tenants on an increasing scale? They are doing that to bring in more revenue for the council and are hiding the real costs of running their department.
Sir George Young : My hon. Friend will be pleased to hear that housing management will be put out to compulsory competitive tender. The benefits from the reduced cost that that will bring will be fed into the housing revenue account and will feed through in lower rents for his constituents. That is a powerful reason for the Government's pressing ahead with their policy, on which we were urged a few moments ago to hold back.
Mr. Raynsford : Does the Minister recall the answer that he gave me on 1 December, which showed that in the previous four years, when the retail prices index increased by 28 per cent., average council rents in London had been pushed up to 89 per cent? His own local authority, Tory- controlled Ealing council, led the way with a massive and disgraceful increase of 201 per cent. Does he recognise that his own authority has the record of the highest local authority rent in the country followed by Tory Redbridge, Tory Westminster, Tory Kensington and Tory Harrow? Will he now admit that it is Tory councils, often inefficient and corrupt, which hold the record for the highest rents?
Sir George Young : As the hon. Gentleman may know, I take some interest in local authority rents in Ealing. He may be aware that rents in Ealing had to go up by such a substantial amount because of some creative accounting by a Labour-controlled Ealing council, which was thrown out of office three years ago. It was the only gain that we made from the Labour party and we achieved it because local people recognised that creative accounting by Labour-controlled councils was highly expensive.
The hon. Member is aware that we are progressively moving towards capital value rents. Next year's guideline increase is lower than that of this year.
Mr. Baldry : Details of annual savings are not held centrally, but the results of independent studies by the university of Birmingham show that compulsory competitive tendering has reduced costs by an average of 7 per cent. between 1989 and 1992 and up to 20 per cent. for some services, and also improved services.
Mr. Duncan Smith : In the light of my hon. Friend's answer, will he look carefully at my local council, Waltham Forest, and join me in condemning it for dragging its feet on the application of CCT? As a result of that delay, the council has now started to lay off managers as well as workers in the direct works organisation, which could have been avoided had it applied CCT. Does that not demonstrate that yet another socialist council is failing to work for the people?
Mr. Baldry : Waltham Forest's record on competitive tendering is pretty miserable. We have had to give two directions to it in respect of financial failure of its direct labour organisations, one for failure on building maintenance work and one for failure on ground maintenance work. That meant that Waltham Forest's direct labour organisations were making losses, which were inevitably passed to local tax payers as higher local taxes or reduced services, or both. We are determined that such losses should not continue.
Mr. Gerrard : When the Minister is attacking Waltham Forest council by suggesting that it should be more efficient and producing savings, will he also consider what is happening to the housing action trust in Waltham Forest? It seems that the local authority is expected to make savings by putting services out to tender, whereas the housing action trust, which spends millions of pounds of
Column 887public money, is allowed, unilaterally, to dispense with contracts with the local authority and to set up its own direct management, without any tendering process. Is not that a case of one rule for the local authority and another for the quango?
Mr. Baldry : It is very sad that the hon. Member should seek to attack the Waltham housing action trust, because he knows, as other hon. Members know, that local tenants voted for it because they saw that it would bring considerable benefits to them. It is clear from the exchanges in the House this afternoon that the Labour party does not like tenants voting for their own management or local authorities providing better services through competitive tendering.
Mr. Matthew Banks : My hon. Friend has drawn attention to the benefits of CCT. He is also aware that his Department had to issue an instruction recently to close the contract services department of Sefton metropolitan borough council, which holds sway over my constituency, at least until we recapture our unitary authority status in Southport. Will he join me in expressing regret that it was necessary for the Government to step in to look after the genuine interests of the council tax payer instead of being able to leave the matter to the local authority leaders concerned?
Mr. Baldry : I very much regret it when it is necessary for Ministers to issue statutory notices and directions. I hope that we can achieve a situation in which Ministers are no longer concerned with CCT, because I would hope that every local authority, be it controlled by Labour, the Conservatives or others, would appreciate the virtues and benefits of exposing their services competitively to the marketplace, and the benefits that that brings to local people. It is clear from this afternoon's exchanges that Labour still has a real ideological hang-up about competition. It seems that for the foreseeable future, Ministers will have to continue introducing statutory notices and directions to ensure that local authorities behave properly.
Mr. Skinner : Is the Minister aware that one person who hopes to benefit from compulsory competitive tendering is none other than the person mentioned by the hon. Member for Amber Valley (Mr. Oppenheim)--Geoff Lennox, the ex-director of education with Derbyshire education authority? He used the Labour movement and tried to close schools in my constituency, until I stopped him. I smelt a rat seven or eight years ago and warned my Labour colleagues that he would desert them in the end--and now they all agree with me.
Mr. Baldry : As always, my hon. Friend the Member for Amber Valley scored a palpable hit. It is clear that the gentleman concerned was only appointed by the Labour party because he was a socialist--and for no other reason of merit.
Sir Thomas Arnold : Can my right hon. Friend confirm that Great Britain has now ratified the climate change convention? Which European countries have not ratified, and will he take steps to see that they do?
Mr. Gummer : We have ratified and are followed in that by a number of other European Community countries. All have said that they will ratify, and we expect the remaining member states to do so. The Community itself ratifies, of course. I am pleased that we shall together help to guard against climate change, which would be so damaging to this and other countries.
Mrs. Dunwoody : Is it the Minister's intention to explain to his colleagues why the Government are privatising the parts of the civil service that specifically provide protection against pollution in this country by making a high level of scientific input into investigations of instances of environmental pollution? Will the right hon. Gentleman do all that he can to ensure that those functions remain within the Government service and are not privatised for the benefit of private industry?
Mr. Gummer : I want the highest possible standards of pollution control services. If they can be improved through the use of private organisations or by privatisation, I shall hurry on with that. The measurement is not whether the services are public or private but whether they deliver the goods that we want--the highest standards of pollution control.
Mr. Nicholas Winterton : Does my right hon. Friend accept that the opening of an opencast mine in a sensitive area between the village of Poynton in my constituency and the Greater Manchester boundary might be described as a form of pollution? If he does, and if my constituents are unhappy with the decision taken by Cheshire county council--which has responsibility for deciding mineral extraction planning applications--is there any way that my constituents can take their case to Europe?
Mr. Gummer : As you, Madam Speaker, did not stop my hon. Friend asking his question, it must be possible for it to be infiltrated into the subject of pollution. I will go no further in answering the first part of my hon. Friend's question.
As to the second part, this country has proper planning procedures that meet the democratic balance between differing sides in trying to reach a decision of that kind. In normal circumstances, those procedures are British procedures and adequately meet the needs of the United Kingdom. I thought that my hon. Friend upheld that position in every other circumstance.
Mr. George Howarth : Is the Secretary of State not ashamed of the fact that in this day and age people who use our beaches and waters for sport and pleasure often find themselves surrounded by raw sewage? Why does he not direct his energies, and those of his colleagues, to cleaning up our bathing waters--instead of seeking to dodge out of the EC bathing water directive?
Mr. Gummer : What I am ashamed of is the fact that, for many years, the nationalised water undertakings did not spend the money that they should have spent on ensuring proper discharges. That is why we privatised the system, in
Column 889the teeth of opposition from the Opposition ; it is why we are spending-- [Interruption.] --I hope, Madam Speaker, that you will want to hear this figure. We are spending £3,000 million a year on improving the infrastructure of the water system in Britain. The Labour party tried to deny the system that money, because it voted day in, day out against privatisation. The hon. Gentleman is another Labour Member who should be ashamed of himself.
Mr. Atkins : The promotion of energy efficiency to reduce carbon dioxide emissions remains a key Government priority, as demonstrated by the further increases in the Energy Efficiency Office's budget for 1994-95 to over £100 million. Energy efficiency measures
Column 890will play a significant part in the United Kingdom's climate change programme which will be published later this month.
Mr. Thomason : When undertaking their recent inquiry into energy efficiency, some members of the Select Committee noted widely differing standards of energy efficiency among local authorities. Will my hon. Friend endeavour to encourage local government to pursue energy-efficient schemes as widely as possible?
Mr. Atkins : My hon. Friend, with his great experience of local government, is right to pick on this area as one which can be developed even faster. Certainly, my hon. Friend the Minister for Local Government and Planning and I are prepared to spend as much time as necessary encouraging local authorities to recognise that their expenditure and, hence, their costs to local charge and taxpayers, can be reduced by energy efficiency.
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