House of Commons Hansard Debates for 3 Feb 1994

Mr. Newton : I well understand my hon. Friend's concerns. I am not in a position to promise a debate on that matter, but I am sure that my colleagues will examine his remarks.

Mr. Paul Flynn (Newport, West) : Before Friday will the Leader of the House reconsider the subject of tobacco advertising, which is covered in early-day motion 1, signed by 165 hon. Members? [That this House calls for a ban on tobacco advertising.] The tobacco industry has told me that it has given inducements to the Conservative party to ensure that such a ban is not introduced. Will the Leader of the House confirm that Conservative Members will have a free vote next week and be able to support what the evidence cries out for--a total ban on tobacco advertising, not the half-hearted half-ban that his party intends to introduce?

Mr. Newton : As the hon. Gentleman knows, following earlier documents the Government will shortly be publishing an action plan describing in detail the measures that they propose in order to reduce even further the prevalence of smoking. That document will describe the Government's plans for the control of tobacco advertising. I think that the hon. Gentleman had better await that document.

Mr. Michael Bates (Langbaurgh) : Has my right hon. Friend had any representations or requests from the Opposition to change the subject of next week's Opposition day to debate early-day motion 457, which deals with taxation and social renewal, and which has been signed by 36 members of the Labour party?

[That this House, noting the grossly unfair distribution of wealth in Britain under capitalism and the widening gap between rich and poor that has taken place over the last 15 years and recalling that the present Budget deficit is entirely attributable to tax reductions given to the richest taxpayers, and the cost of unemployment that was deliberately created, is convinced that the burden of military expenditure is far higher than can be justified and that other Government policies have been wasteful and inefficient ; believes that the imposition of higher levels of VAT and its extension to fuel imposes a heavy burden on those least able to pay, as do other increases in taxation imposed in the recent Budget ; rejects arguments that all reductions in taxation are

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necessarily desirable regardless of the purpose for which the tax is raised and the social consequences that would follow ; affirms that the recovery of full employment, planned defence diversification, the rebuilding of our infrastructure, the extension of essential public services and the regeneration of British industry will require massive public investment, the harnessing of the nation's savings and taxation fairly shared and assessed on the ability to pay ; and calls for a clear socialist commitment to be made now, about future economic, fiscal, industrial and social policies to secure these objectives.]

It calls for massive public investment and for a clear socialist commitment to be made now on future economic, fiscal and industrial policies. Does my right hon. Friend agree that such a debate would prove enlightening and terrifying for the House, and especially for the hon. Member for Dunfermline, East (Mr. Brown)?

Mr. Newton : My hon. Friend has made some telling points, which I shall certainly bear in mind when looking ahead to the business of the House.

Dr. Tony Wright (Cannock and Burntwood) : Will the Leader of the House reconsider what he said earlier about the Public Accounts Committee's report? Does he understand that it was a special report and said some damaging and worrying things about the conduct of public business? He seemed to say just now that the Government had some proposals to clean up public bodies. If so, will he arrange for a debate next week so that he can tell us about them?

Mr. Newton : I made it clear that the Government would take appropriate action in the individual cases. The action varies ; for example, in the case of the Wessex and West Midlands health authorities, it has already been set in hand. In other cases, reports are still awaiting Treasury minutes or other responses, but the Government will take appropriate action in every instance.

Mr. John Whittingdale (Colchester, South and Maldon) : Will my right hon. Friend find time for a debate on a matter in which I know he has a close interest--the politically motivated campaign being waged by the Labour and Liberal administration of Essex county council against grant- maintained schools?

Mr. Newton : As a fellow member of Parliament for Essex, I am of course well aware of the concern about this matter. My hon. Friend might perhaps be one of those who find an opportunity to raise the issue in the forthcoming debate on local government.

Dr. Kim Howells (Pontypridd) : The Leader of the House will know that hardly a week passes without a fresh scandal involving a quango in Wales. Is he aware that my colleagues are fearful that corruption is starting to take a grip on some of these public bodies, and that it may be a result of the Welsh Office's incompetence in monitoring them, a role which it is supposed to undertake on a day-to-day basis? Will the Leader of the House set aside time for a debate on this critical issue, and on the future of the Welsh Office and quangos in Wales?

Mr. Newton : I do not accept for a moment the hon. Gentleman's suggestions, but I draw his attention to the fact that the Secretary of State for Wales will be answering questions in the House on 14 February.

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Mr. Jacques Arnold (Gravesham) : Bearing in mind the enthusiasm of the hon. Member for Workington (Mr. Campbell-Savours) for municipal gutters, could we have a debate next week on the Labour-controlled borough of Tameside and the manner in which it contracts out its homes that care for the elderly, a matter recently described so well on Radio 4?

Mr. Newton : It seems to me that that is yet another matter that could be in order in the forthcoming debate.

Mr. Andrew Miller (Ellesmere Port and Neston) : Bearing in mind the fact that the interim report from the Health and Safety Executive about the Associated Octel disaster, or potential disaster, may be published in the next few days, if it is, will the Leader of the House make arrangements for his right hon. Friend the Secretary of State for Employment to make a statement on that, and on its broader implications for emergency and emergency planning services?

Mr. Newton : I will bring that request to my right hon. Friend's attention.

Mr. Simon Burns (Chelmsford) : In backing up my hon. Friend the Member for Colchester, South and Maldon (Mr. Whittingdale), I ask my right hon. Friend to reconsider whether there is any possibility, in the business next week or the following week, of having a specific debate about education policy, geared towards the vicious, nasty and vindictive policies that are being adopted by Essex education authority and other county council education authorities? Those policies penalise parents with children who attend grant-maintained schools, or who may want to hold a ballot for grant-maintained status.

Mr. Newton : I do not think that I can add to what I said to my hon. Friend the Member for Colchester, South and Maldon (Mr. Whittingdale), but, as my constituency is the space between the constituencies of my hon. Friend the Member for Chelmsford (Mr. Burns) and my hon. Friend the Member for Colchester, South and Maldon, my hon. Friends can perhaps understand that I recognise their concern.

Mr. Thomas Graham (Renfrew, West and Inverclyde) : Will the Leader of the House arrange for the Secretary of State for Scotland to make a statement about the situation at the Royal Alexandra trust hospital? Constituents of mine are still waiting for months--five months approximately--to see a urologist there, and months and months to have operations there. The trust system in Scotland is falling so sadly down that there is a crisis in my constituency. The morale of our people waiting for health treatment is so bad that it is an indictment of the Government.

Mr. Newton : I know of no basis for the general description of the trust system that the hon. Gentleman gives, but obviously I am not informed about the special problems to which he adverts, and I will bring them to my right hon. Friend's attention.

Sir Peter Emery (Honiton) : Further to the question of the hon. Gentleman the Member for Newport, West (Mr. Flynn), will my right hon. Friend next week, for the debate on Friday, try to ensure that, whatever the Government's long-term view may be, they will allow the Tobacco Advertising Bill to get into Committee, so that the effect of

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cigarette smoking and especially the effect on asthma could be fully debated, rather than just on the Floor of the House, even if the Government have to take action at another time?

Mr. Newton : I think that my right hon. Friend, in his capacity as Chairman of the Procedure Committee, will acknowledge that in the end the decision as to what happens to a private Member's Bill is a matter for the House and not the Government.

Mr. Roland Boyes (Houghton and Washington) : In the week that the Rover car company was swallowed up, will the Lord President refer to the President of the Board of Trade for a statement that there is still a major car company in the United Kingdom--the Nissan Motor Company in my constituency, Washington, Sunderland, which was the biggest United Kingdom car exporter in 1993? It has exported 182,000 cars, worth £1 billion. In addition, the Micra and Primera cars are built by British workers and British management, and we are proud of that car company in our region.

Mr. Newton : I am genuinely grateful to the hon. Gentleman. He knows of the long-standing interest that I have had in industrial matters in the north-east, not least in the year that I was a Trade and Industry Minister and visited Nissan. It is a considerable credit to that company, and to the work force in the north-east, that we have the gathering success in what is a resurgent British car industry.

Mr. Rupert Allason (Torbay) : Bearing in mind the undoubted but regrettable propaganda coup scored by Gerry Adams in the United States this week, will my right hon. Friend ask his colleague the Home Secretary to come

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to the House to give a statement about the future of the broadcasting ban, which at the moment is widely abused and circumvented by all the television companies? I am certain that that would be a recognition of the tremendous unnecessary mileage that was given to a man who is a terrorist and whose brother has been convicted of terrorist offences.

Mr. Newton : My hon. Friend may find that that is a matter for my right hon. Friend the Secretary of State for National Heritage, who is due to answer questions in the House on Monday. However, I shall draw his question to my right hon. Friend's attention.

Mr. Cynog Dafis (Ceredigion and Pembroke) : Bearing in mind the fact that old-style economic recovery cannot possibly solve the problem of unemployment, and that high unemployment, especially among the young, is likely to have incalculable costs as a result of social alienation and conflict, could we have a debate on that matter, and specifically on European Union proposals that we should aim to shift the burden of taxation so as to encourage the use of labour--that is, people--and discourage or reduce the use of natural resources, because natural resources are the capital on which our future prosperity depends?

Mr. Newton : If the hon. Gentleman considers what has happened to employers' national insurance contributions, which constitute an important cost involved in employing labour, and which the Government are now in the process of reducing again as part of a package of measures taken together, and if he examines what has been done to reduce the contributions paid in respect of less well-paid workers over the past few years, he will realise that the Government have directed much attention to that problem, with the sort of success that is now attracting companies to come here rather than going to places where they incur much higher social costs.

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Points of Order

4.10 pm

Mr. Tony Banks (Newham, North-West) : On a point of order, Madam Speaker. Are you aware that from the Terrace--and indeed, so far as I can tell, from the Speaker's Apartments--it is possible to look across the river and see the Japanese flag flying over county hall? Personally, I find that offensive, and I suspect that many other Londoners do, too. Are there not regulations and restrictions prohibiting the flying of a foreign flag from a building other than an embassy which is the property of the country concerned?

Madam Speaker : That is hardly a point of order for me, but if what the hon. Gentleman says is true, I am interested to hear that he has seen that flag from the Terrace of the House of Commons. I must say that I have been rather too busy to notice it from my apartment.

Mr. Peter Luff (Worcester) : On a point of order, Madam Speaker. I should be grateful for your guidance in telling me whether it is in order for the hon. Member for Workington (Mr. Campbell-Savours) to continue his vicious and spiteful vendetta against another Member of the House on the basis of inaccurate information, under the cloak of parliamentary privilege? Madam Speaker : Had the comments made by the hon. Member for Workington (Mr. Campbell-Savours) been out of order, I would of course have intervened. However, I caution all Members that we should have courteous language here, so that we can conduct our debates in good order and with respect for one another.

Mr. D. N. Campbell-Savours (Workington) : Further to that point of order, Madam Speaker. Will you confirm that the matters that I have raised are matters of public policy?

Madam Speaker : I think that, when the hon. Gentleman raised the matter the day before yesterday, he was somewhat out of order, and I refer him to the remarks that I have just made. I am sure that there will be other opportunities for him to put his case in a proper manner.

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Orders of the Day

Local Government Finance

[Relevant document : the First Report of the Environment Committee on Standard Spending Assessments (House of Commons Paper No. 90).] 4.12 pm

The Secretary of State for the Environment (Mr. John Selwyn Gummer) : I beg to move

That the Local Government Finance Report (England) 1994-95 (House of Commons Paper No. 179), which was laid before this House on 27th January, be approved.

I understand that with this it will be convenient to discuss at the same time the following motions :

That the Limitation of Council Tax and Precepts (Relevant Notional Amounts) Report (England) 1994-95 (House of Commons Paper No. 181), which was laid before this House on 27th January, be approved. That the Special Grant Report (No. 9) (House of Commons Paper No. 180), which was laid before this House on 27th January, be approved. The debate enables us to reach the culmination of the local government finance settlement for 1994-95. The process began a full 12 months ago, almost before the ink was dry on the previous settlement. During that time we have held extensive discussions with local government about the cost of local services, the need for Government support and how that support is to be distributed.

Dame Elaine Kellett-Bowman (Lancaster) : I am sure that my right hon. Friend gets substantially more kicks than ha'pence in his job, so I am sure that he will be delighted to know that my city council has written to say how delighted it was with the settlement that he has given it. Provided that Lancashire county council does not go berserk, it should enable our citizens to pay less council tax. On a sadder note, I hope that my right hon. Friend will join me in regretting the storm damage in Lancaster, which has ripped the roof off one of the university college buildings, caused a chimney stack to fall over--fortunately, with no loss of life--and the whole of Castle hill to be shut because of falling tiles and roofs. Will he also commend the emergency services for doing a superb job?

Mr. Gummer : I am sure that the whole House would want to commend my hon. Friend for her perfectly proper ingenuity in being able to say publicly what we all feel and to support the emergency services for their work in the particular unpleasant storm damage. I hope that it will be repaired as rapidly as possible.

I certainly got more than ha'pence out of that intervention in terms of compliments, though I do not know whether one can be absolutely sure that Lancashire county council will not go berserk--but no doubt we shall see.

We carried out considerable discussions because we thought that it was necessary to try to improve the method of sharing the money out among local authorities. That was a proposal from the local authority organisations. Whatever else may come between us, most agree that the report has been carried out in a thorough way. They may

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not be entirely happy about the results and they may disagree among themselves, but it was carried out with us in a thorough way. At the start of December I announced my proposals for the coming year. Since then my colleagues and I have met 58 delegations from local authorities and received 148 written representations. We carefully considered all the points that were raised with us during consultation. My final decisions are embodied in the reports before the House.

From the outset, we have made it clear to local government that this would not be an easy year. We knew that we needed to establish a sound basis for future economic growth. That meant cutting the public sector borrowing requirement, and we expect local government to play its part. Local government accounts for about a quarter of spending. It therefore cannot be immune from the pressures that all of us face.

Tough action to sort out public finances will help to ensure that the economic recovery is sustainable. It is already true that the economic recovery in this country is much more favourable than for most, if not all, members of the European Community. We must ensure that that continues. Inflation has been below 2 per cent. for the longest period since 1960. Interest rates are among the lowest in Europe. Unemployment has fallen by more than 225,000 since January last year. Other countries are looking to see how they can even begin to copy that.

United Kingdom industry is in an excellent competitive position. Good cost and productivity gains are providing exporters with the opportunities that they need. At this point in the recovery, nothing would be more damaging than a loss of confidence in our ability or willingness to control public spending. We do not intend to make that mistake.

Mr. Richard Tracey (Surbiton) : I am grateful to my right hon. Friend for giving way at this early stage. My point is important. Surely the Government must take steps to ensure that local authorities collect the council tax. Figures that have been made available to us show that a number of local councils are not even starting to do the job properly. Some have collected only 25 per cent. of the 1993 figure. Unfortunately, many of them are Labour authorities. Surely the Government can do something about that and thus assist in the recovery that my right hon. Friend is talking about.

Mr. Gummer : My hon. Friend is right. If one does not collect the council tax, one can hardly complain about not having the money to provide services. He is also right to say that those who are least good at collecting the council tax are, almost without exception, Labour councils. However, there is likely to be an improvement. I heard today that Southwark council--about the fourth worst in the country, I believe--has decided to discuss the possibility of contracted-out collection of its council tax, so unhappy is it with the system that it has at present. One can imagine why the council is so unhappy about the matter. It was unable to collect much of its council tax last year because of considerable difficulties with the collecting staff. I hope very much that other local authorities will take that example and that we shall see a better answer in future.

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In a difficult period, I am still able to say that I am increasing the provisions we make for local authority spending next year by 2.3 per cent., after allowing for changes in local authority functions. Total provision next year will be £42.7 billion. That is equivalent to £880 for every man, woman and child in the country. It represents a massive commitment to public services--a commitment that we are making even in this most difficult of years.

Sir Anthony Grant (Cambridgeshire, South-West) : My point follows the point made by my hon. Friend the Member for Lancaster (Dame E. Kellett- Bowman). It is one thing for a local authority to get a good standard spending assessment settlement ; it is quite another for it to use it sensibly. I give an example. Cambridgeshire needed 68 extra police officers, as everyone agreed. We had an excellent police SSA of £1.5 million, but the Liberal Democrat-Labour coalition on the county council spent only £100,000 of that. That tells us something about the commitment of a Liberal Democrat-Labour coalition to the police and to law and order, and about having a Liberal Democrat-Labour coalition anyway.

Mr. Gummer : My hon. Friend makes an important point. There is only one party that is committed to law and order--the Conservative party. If there is an advantage to be got from the most recent county council election results, it is that they show just how soft the Liberal Democrats in particular are on any law and order matter. It is very noticeable all over the country ; Cambridgeshire is a particular example.

Government support for local authority spending next year will be £34.3 billion--an increase of 1.7 per cent. over 1993-94. That should enable authorities to provide local services at a cost that their council tax payers can afford. The level of council tax is, of course, a decision for each authority and will depend on, among other things, the services that it chooses to provide, how efficiently it can deliver them and how well it collects what it is owed--the point that my hon. Friend the Member for Lancaster (Dame E. Kellett-Bowman) made. I am therefore not about to start predicting council tax levels. When taxes are set, local people will be able to judge the performance of their councils.

Mr. Harry Greenway (Ealing, North) : My right hon. Friend knows about the position in Ealing. The Conservative council there has succeeded in reducing council tax by an average of £100, and for band D it has been reduced by £122. I ask my right hon. Friend to compare that with the spend, spend, spend policies of the loony Labour council in Ealing between 1986 and 1990. When Labour took over in 1986, there were huge reserve balances. When Labour left office in 1990, having trebled the rates, it left a debt of £2,000 on every man, woman and child in Ealing.

Mr. Gummer : I feel that I should declare an interest here. During the week, I live in the London borough of Ealing. Everything that my hon. Friend the Member for Ealing, North (Mr. Greenway) says is true.

I give my hon. Friend an additional piece of information which I am sure that he would like to know. I have had occasion to make some points about Birmingham council in the past. After a long meeting with Councillor Stewart, she has, I am pleased to say, taken my advice. The council has announced that it is likely to reduce its council tax,

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admittedly by only £22 or £23 for a band C property. At least that authority has seen that it is possible, within this settlement, to do that. I am sure that my hon. Friend agrees that that says something clear about the settlement which has been made at so difficult a time.

Mr. Nigel Spearing (Newham, South) : Despite the increase in funding that the Minister announced in his statement before Christmas, the London borough of Newham received a reduction of 2 per cent. Is the Minister not aware that our homeless expenditure in the borough is £12 million a year? His trumpeted new formula, about which he was so confident a few moments ago, provides only £2 million of that amount, so £10 million has to be taken from the standard level of services that even his Government think is necessary. Is that the partnership about which he lectured us for 40 minutes at West Ham town hall?

Mr. Gummer : I am sorry that the hon. Gentleman was unhappy with my speech on that occasion. A number of his Labour colleagues said how pleased they were with my speech and how pleased they were with the partnership part of it. Partnership is exactly the word. The SSA in Newham, which has been established on the basis of objective criteria, is reduced by 0.8 per cent. To help Newham, it is receiving a damping grant of £13.3 million to help it over that difficult period. Reminding the public of that £13.3 million does not seem to enter into the hon. Gentleman's definition of partnership.

Already, the SSA per head in Newham £1,143--well above the average for outer London, which is £782--and it is the fifth highest in England. Before we go to town on the local pressures of Newham and attack all the hon. Gentleman's local government colleagues who have worked hard and before we refuse to accept that they have been careful, we should remember that their SSA is the fifth highest in England. Many other hon. Members who are representatives of councils may argue with the hon. Gentleman, at least on that.

Mr. Jeff Rooker (Birmingham, Perry Barr) : I want briefly to thank the Secretary of State for what he has said about the decisions that we expect in Birmingham and the £22 reduction in band C council tax. That is coupled with an extra expenditure of some £40 million on education, which for the first time will take us above the standard spending assessment, which has been reduced. We are extremely grateful for that and we make no bones about it. The day Councillor Stewart was elected leader, three days before the Prime Minister made his speech at the Tory party conference, she uttered the words that in Birmingham we are going "back to basics"--and she meant what she said.

Mr. Gummer : I do not wish to enter into the painful situation of Birmingham city council, where the present leader thinks that the policies of the previous leader were all wrong, as both leaders are of the same party. When one wants to find divisions, one usually finds them in the Labour party, at least between those two. It was convenient that Councillor Sir Richard Knowles was in charge of the Labour party in Birmingham for a long time--

Mr. Robert N. Wareing (Liverpool, West Derby) : Not two minutes like George Gardiner.

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Mr. Gummer : It was not two minutes. He carried out policies which have been entirely thrown out by Councillor Stewart. I am pleased that Councillor Stewart has taken my advice and I hope to have further meetings with her. Perhaps we can do even better than the £22 reduction.

Mrs. Marion Roe (Broxbourne) : I welcome the revenue support grant settlement for 1994-95 as it affects local authorities in my constituency, and especially the significant increases in the standard spending assessments for Broxbourne, East Hertfordshire and Welwyn Hatfield. May I therefore congratulate my right hon. Friend on his decision to base the SSA formulae on more up-to-date expenditure data and to incorporate information from the 1991 census? That has certainly significantly benefited the local authorities in my constituency.

Mr. Gummer : I thank my hon. Friend for her comments, which were supported by the Select Committee on the Environment in its recent report. It is also clear from that report that Newham would have done worse under the Labour party than for the reasons for which the hon. Member for Newham, South (Mr. Spearing) thinks that he ought to attack me. I notice that Labour Members supported an amendment which would have meant that Newham, like the rest of London, would not have benefited from the area costs allowance. I hope that the hon. Member for Newham, South will ask his colleagues why they voted for that amendment. I should like to know whether Opposition Front-Bench spokemen also support that view.

I wonder whether the hon. Member for Newham, South has noticed that the proposal would remove about £54 million from Newham and would involve nearly £1,000 million for the whole of London. When people talk about money for London, I hope that everyone will notice that Labour Members on the Select Committee on the Environment wanted to take action which would have affected £1,000 million of money for London.

Mr. D. N. Campbell-Savours (Workington) : Where do you get all this?

Mr. Gummer : I get it from the record of the Select Committee and that is a very suitable place to get it from. No doubt the hon. Member for Workington (Mr. Campbell-Savours) will wish to speak to his colleagues. The proposal might help Workington, but it certainly will not help London.

Mr. Tony Banks (Newham, North-West) : The Secretary of State is providing information of which I was not aware. I will go away and study it assiduously as soon as possible. However, does he not accept that there are still many people, including some of my hon. Friends, who feel that London receives far too much by way of resources? That is absolutely wrong. Will the Secretary of State confirm that, according to the latest indices for urban and local authority deprivation, Newham is number one? London is not studded with meat pies. There are areas of deprivation in London that are as bad as, if not worse than, any other place in the United Kingdom.

Mr. Gummer : In a spirit of cross-party support, I agree entirely with the hon. Gentleman. It is perfectly true that London has particularly difficult circumstances. That is why the area cost adjustment is there and why it is not, as the hon. Member for Denton and Reddish (Mr. Bennett) suggested,

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"the result of political judgment rather than statistical fact." As the Minister responsible for London, perhaps I may ask the hon. Member for Newham, North-West (Mr. Banks) to have a word with the hon. Member for Denton and Reddish and make it clear that we are talking about an objective effort. When the area cost adjustment was queried last year, we took a great deal of trouble when we examined the statistical base. The statistics suggested that the figures had been underestimated rather than overestimated in the past, so the new statistics have been taken into account.

I am sure that the hon. Member for Newham, North-West would want to press that case very strongly. When we consider the figures, it is clear that interference would involve £26 million in Haringey, £35 million in Camden, £45 million in Hackney, £37 million in Islington and £53 million in Lambeth.

Mr. Campbell-Savours : You have got it wrong.

Mr. Gummer : The facts are clear. According to the Select Committee report and the hon. Member for Denton and Reddish,

"the Area Cost Adjustment is the result of political judgment rather than statistical fact."

I thought that the Labour party wanted statistical fact rather than political judgment. No doubt Labour would be happy for Tower Hamlets to lose £45 million on that basis.

Sir Anthony Grant : I apologise for interrupting my right hon. Friend again. With regard to the area cost adjustment, I make no comment about London. However, it produces very peculiar results. The most peculiar result of all is that Cambridgeshire receives no benefit from the area cost adjustment while Bedfordshire, which is right next door, does. That is quite absurd.

Mr. Gummer : One of the problems is that those who win are fond of it, and those who do not win are not fond of it. We have taken the most extensive statistical efforts to discover the facts. I went into all this thinking that the hon. Member for Denton and Reddish and some of my hon. Friends might be right. After all, Suffolk receives no benefit from the area cost adjustment. However, when I examined the facts, and when the figures were examined with great care, we concluded that the figures supported the case.

I realise that these matters are difficult and I am sure that they are not easy for the constituents of my hon. Friend the Member for Cambridgeshire, South-West (Sir A. Grant) to understand. However, when the work has been carried out so assiduously and in company with the now Labour-dominated local authority associations it is unsuitable and odd for Opposition Members to suggest that as the proposal does not suit their constituencies it must be the result of a political judgment.

Mr. Andrew F. Bennett (Denton and Reddish) : Can the right hon. Gentleman explain why it is that in most areas the allocation per primary pupil is more than £3,000, whereas in places like Tameside and Stockport the corresponding figure is less than £2,000? Given that teachers are paid on a national scale and that those in London receive a small additional allowance, it is remarkable that certain London boroughs need to spend twice as much on a pupil as do many areas in the

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north-west of England. Can the right hon. Gentleman claim that the situation is based on statistical fact rather than on political judgement?

Mr. Gummer : I can not only claim it--I can state that it is utterly true. We are dealing here with statistical fact. This is not just my claim. People from all political parties have gone through the facts in detail in an effort to demonstrate that the situation is different. I understand the hon. Gentleman's concern, but as the hon. Member for Newham, North-West will no doubt agree, there are very clear reasons, in terms of total employment costs, ethnic mix, and so on, for the differences.

When facts relating to a matter of concern to all parties are trawled and they all come to the same conclusion, it is nonsense for the hon. Gentleman to suggest that everybody--including members of his own party--is engaging in some sort of plot to prevent his constituents from receiving money to which they are entitled. We must all try very hard to ensure that the public are not outrageously misled on a matter of this sort. I hope that the hon. Gentleman will think about that.

Mr. Colin Pickthall (Lancashire, West) : Will the right hon. Gentleman give way?

Mr. Gummer : I must try to make some progress, as I am sure you, Madam Deputy Speaker, will agree. I shall try at a later stage to facilitate hon. Members who have been trying to intervene. We must look closely at the spending priorities of local government and take any opportunities to improve its efficiency. In particular, pay accounts for about 70 per cent. of local authority

budgets--teachers' pay alone accounts for about 25 per cent.--so we expect pay awards and pay bills to be kept within what is affordable. We have just received the 1994 report of the school teachers' pay review body, along with those of other review bodies, and my right hon. Friend the Prime Minister has announced the Government's response. For the teachers, we propose to accept the recommendation for a 2.9 per cent. increase. I believe that that award will be affordable provided that local authorities are realistic and sensible in their budgeting.

Of course pay increases have to be paid for, and this must be achieved through improved efficiency and increased productivity. There will be no extra money. We cannot go on putting more and more taxpayers' money into local authority budgets to cover pay increases that simply cannot be afforded. That is the challenge that everyone in the public sector has to face, and I believe that sensible, efficient local authorities will be able to rise to it.

Mr. Jack Straw (Blackburn) : The right hon. Gentleman has just announced that the teachers' pay award will be 2.9 per cent. That exceeds by far what local authority budgets provide for. The right hon. Gentleman has said that the settlement will have to be paid for by improved efficiency and increased productivity. As the principal way in which schools can increase their efficiency is by increasing class sizes and cutting numbers of teachers, may we take it that this salary increase will be paid for by job cuts?

Mr. Gummer : The hon. Gentleman fails to remember the explanation that he himself gave in "The Walden Interview" of 14 October 1990, which was before the last general election, when he said :

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"The most challenging issue in education is not so much the issue of resources but how you manage the service."

The hon. Gentleman was quite right. It is perfectly possible to manage the service through efficient use of teaching, back-up and administration staff. Account must be taken of the way in which, in the case of many Labour-controlled areas, central administration costs so much.

In all these areas it is possible to achieve the efficiency by means of which many costs can be met. The hon. Gentleman tried this year when he was shadow Minister of Education. Every year, he claimed that the only way to meet the teachers' pay bill was to reduce the number of teachers, and he put forward figures which in the event turned out not to be so. What I look for are local authorities which start not by reducing jobs but by reducing bureaucracy and inefficiency, and which look to ways of saving money rather than-- Several Hon. Members rose--

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