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9.17 pm
Mr. Ken Purchase (Wolverhampton, North-East): Disappointingly, part of the debate has been marked by an attack on public servants in local government. It is surprising to hear former leaders of local authorities going to town about slush funds. Earlier, we heard of a county which allegedly had very high reserves that were referred to as a "slush fund". That council, which I understand is a coalition of interests, has nothing to fear and nothing to hide when compared with the Conservative sleaze that we more properly associate with the term "slush fund". It is more appropriate for Conservative Members to apply that term to themselves than to any other party in the House.
I wish to defend people who have worked for a long time in local government. I hear talk, not about council members, but about some professional officers who have served in local authorities for many years. They certainly are professional officers, no matter how much Conservative Members shake their heads. Those officers are properly qualified in their professions and they give a proper, good, efficient and effective service to their communities.
The House has heard complaints that rate increases vary from district to district, from borough to borough and from county to county. Of course they do: that is local government reflecting the needs of each area. People have been blamed for voting for people other than Conservatives, but that is the nature of local democracy--words which do not frequently pass the lips of Conservative Members, and when they do they are usually employed as marks of hypocrisy and cant.
It is unfortunate that we have had to listen to an attack on the integrity of local government which, by and large, has a proud record of serving the interests of its communities. In so doing it will almost certainly continue, as long as it is allowed, to have rate demands set at different levels for different purposes for different services serving different communities. And long may those arrangements continue, for they are entirely admirable.
Many of us who served in local government remember when an uptight grocer's daughter stamped her foot and decided to put an end to the rating system. She charged several of her Ministers to find ways in which the powers of local government and hence its spending could be curbed. My hon. Friend the Member for North-East Derbyshire (Mr. Barnes) mentioned the methodology. The first method employed by the Government was simple, straightforward and crude: it was to ensure that
Labour-controlled authorities would be punished. The Deputy Prime Minister, who at that time was Secretary of State for the Environment, contrived a formula so complex in its application that no computer installation in western Europe could cope with the calculation: it had to be sent to Texas in the USA where the calculation was worked out authority by authority. As Robert Burns said,
I apologise to Burns if I did not quite get that right, but I am sure that hon. Members know exactly what I mean.
That exercise by the then Secretary of State for the Environment was followed by what was probably the greatest debacle in the history of local government: the poll tax. That was the uptight grocer girl's next attempt, and it was a total, miserable and utter failure. By golly, there was a price to be paid and it is still being paid. My hon. Friends have referred to the difficulty of collecting huge unpaid poll tax bills going back many years simply because people did not have the money to pay an outrageous tax which was levied on them to satisfy political incompetence on the back of political malevolence, for that is the only way in which it can be described.
Now we have a council tax system which relies on banding. The hon. Member for Newbury (Mr. Rendel) spoke of the awfulness of the present system and, of course, he is right. Eventually, the Conservatives may hit on a big idea for local government. They might think about calling it the rating system under which there is a rateable value for every property and those who can afford it will pay and those who cannot afford to do so will get help by way of a rebate. That would be a revolution. People would be grateful to get back to those happy, far-off days.
Under an exceedingly high gearing, 80 per cent. of local government finance is not collected by local government. That means that only 20 per cent. is collected, but in those far-off happy days we provided over 33 per cent. of locally funded schemes and paid far less for our services. My borough now has £30 million less to spend in real terms than it spent in those far-off happy days when there was a rating system and the method of disbursing central Government grant was fair and reasonable. Those are the differences.
In the early 1980s, when the late Sir Keith Joseph was Secretary of State for Education, my borough brought forward a plan to reduce school places. It is expensive to keep school places empty and we intended to reduce them to the level suggested by the then Department of Education. What happened? Sir Keith could not see his way clear to agree to our plan. We asked whether we could bring forward a modified plan. We were told that we could, but that we would have to go through exactly the same procedure to come to the table with the Secretary of State with a plan. We have been implored to reduce places in schools, but when authorities have come forward with viable plans which have not suited the Tories, they have been turned down--thus adding to the overall burden of local government expenditure.
My authority is a good example of what is happening now. This year, my authority has a growth figure of 1 per cent. in real terms in education, which seems to me to be
a considerable achievement; in fact, it is exemplary in my borough, considering that under a Conservative ideology it delegates 90 per cent. of the entire budget to schools. In that sense, my borough does everything that has been asked. However, over the years the cuts have been very hurtful--many teachers have had to leave the service by one route or another and the pupil-teacher ratio has increased.
My borough experiences severe deprivation; yet this year the social services budget has been cut by £250,000 in relation to services for the disabled--and many other cuts have been made in the social services area. The economic development function has been diminished in a borough with an unemployment rate well above average--there is up to 30 per cent. unemployment among young people in some areas. It is incumbent on the Government to recognise what is being done in local government, to recognise the varying conditions which exist and to fund their part of it properly.
Unfortunately, the council tax in Wolverhampton hasincreased by 15 per cent. this year--despite sending90 per cent. down to schools and despite making major cuts in some of the services. We are a good example of having to pay more but getting less--that is what has been happening in Wolverhampton. It is a good authority, and it has been recognised as such for 30 years or more, under both Labour and Conservative control.
We have taken it on the chin in Wolverhampton when Labour has lost control of the council--we have recognised that the local population has said, "Labour, you are not doing the job that we want you to do", and it has voted us out and put in Conservatives--often in coalition with the Liberals, which is a bit of a change-around. However, they have then voted Labour back in again.
Mr. Robert G. Hughes (Harrow, West):
Tonight the Labour party has referred to something that it thinks will wash with the electorate until the next election--that if only the formula could be got right, we could have more money to spend in our areas. I have listened to Labour Members and I am worried because I think that some of them actually believe it. It is not true and it does not mean anything. A number of Labour Members have said, "If the formula were different, there would be more to spend in my constituency and my council would have more". They forget that they would merely be robbing other councils--often Labour controlled--in a system which simply would not work.
If one wants more money for services--as, no doubt, the Labour party will pretend that it will provide--one has to increase the amount of money produced in taxation. What must be most worrying, certainly for my constituents and, indeed, for people throughout the country, is what the Labour party would do with the return to business rates. We all remember--certainly those of us who served in local government remember--that the Labour party in local government regarded business rates
as a milch cow. Businesses did not have a vote, so Labour went through the process of consulting them and then ignored them. The result, certainly in London, was that people moved their businesses. They voted with their feet and moved out of Labour-controlled areas into Conservative-controlled areas.
Mr. Hughes:
It is all very well for the hon. Member for Holborn and St. Pancras (Mr. Dobson) to swear, using unparliamentary language to describe what I said, but I represented Croydon on the Greater London council until 10 years yesterday, and businesses were moving out of Lambeth and into Croydon to avoid Lambeth's business rates.
"O what a tangled web we weave, When first we practise to deceive."
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