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Mr. Ken Purchase (Wolverhampton, North-East): Hon. Members welcome the assistance given to rural shops, and the hon. Gentleman has made a splendid case, but does he accept that urban shopping centres also have considerable problems? The closure of one shop often leads to other closures due to the continual failure of urban renewal policies. Although we welcome the assistance provided to rural shops, does the hon. Gentleman accept that there is also a strong case for reducing the liabilities of small shops and shopping parades in urban areas, as so many of those shops are under great pressure?

Mr. Smith: Of course I accept that there are problems in urban areas. That is undeniable. However, they are the problems of success. We have had huge success in retailing. British retailing is among the best in the world. In food retailing, for example, the consumer has benefited hugely from the quality now available from our superstores. Many retailers, such as Marks and Spencer,

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which published its results yesterday, are developing outstanding retailing all over the world. The difficulty is that people drive to those shops because they get good value for money. Small shops in urban and rural areas suffer the consequences of that huge change in the pattern of retailing and we must consider the extent to which it is right to ask the taxpayer to support such shops.

The hon. Member for Sheffield, Hillsborough (Mrs. Jackson) said that, according to the Local Government Chronicle, trying to keep the village shop open would somehow be supporting the middle classes. That is clearly not the case. The people who cannot get to other shops are those who do not have cars--the old, the young and the unemployed. They will clearly benefit from the measure. I welcome that, because it is sensible to intervene to help those who have not been able to benefit from the changes that I have described. However, we must limit such help or we shall start to interfere with the operation of the market. We are limiting that help to £15 million of highly targeted relief, which will help people who are greatly in need. That is why I welcome the Bill.

7.51 pm

Mr. Dafydd Wigley (Caernarfon): I, too, welcome the Bill as far as it goes and to the extent that it is comprehensible. It is supposed to be the fruit of the rural White Papers for England, for Scotland and for Wales. The Bill was trailed in that context in the Queen's Speech. There has been no debate in Parliament on the White Paper for Wales, and we are moving forward to some parts of the legislation without identifying the priorities. Many important provisions in the rural White Papers are not covered by the Bill and need to be addressed.

The White Paper "A Working Countryside for Wales" referred to rural housing, rural schools, rural youth services, the health service in rural areas, employment problems in rural areas, tourism in rural areas and the range of environmental action that is needed. Considerable attention has rightly been paid in response to the White Paper to the need to help small farmers by providing considerable assistance for agriculture in these difficult times. Agriculture is the backbone of rural life. Most of our farmers work on small farms in Wales and are often on the breadline. If they collapse under the strains they currently face, the whole rural fabric will go down with them.

We need a new all-Wales agri-environmental scheme, but there is no provision for that in the Bill. I hope that other Bills will be introduced to deal with the other aspects of the White Papers that are not covered by this Bill.

The Bill's scope is restricted. It deals with village shops and post offices, which are certainly important. There are 93 villages in my constituency and, goodness only knows, I understand the importance of sustaining the village shop and post office.

Mr. Gerald Bermingham (St. Helens, South): Perhaps the hon. Gentleman can settle a point which is worrying me. I have read the Bill carefully, particularly schedule 1, which refers to "settlements". What is a settlement? Is it a village? Is it a street of houses? Is it a groupage?

Mr. Wigley: The hon. Gentleman is right to ask that. Hon. Members on both sides of the House have been

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probing for an answer. Clearly a settlement does not refer just to a community council or parish area. In my community of Llanwnda, there are the discrete villages of Rhosgadfan, Rhostryfan, Dinas and Llanwnda. There are shops in those different areas. One would not expect villagers from Rhosgadfan, up the hillside, to have to come down to Llanwnda every time that they want a stamp or their pension. One imagines that the community will have to be split into discrete areas; otherwise, the rule that only one post office or general store will be sustained in any community will cause immense difficulties. We shall undoubtedly return to that problem in Committee.

The Bill also deals with the strengthening of community councils, which we definitely support. It provides for car-sharing schemes, bus services for elderly and disabled people, concessionary transport schemes and traffic-calming schemes--an issue on which my hon. Friend the Member for Ceredigion and Pembroke, North (Mr. Dafis) has been pressing hard for a long time.

All those provisions are worth while, as are the much-needed provisions on crime prevention, but they are only a small part of the rural agenda. I regret that the long title of the Bill is restrictive. We shall not be able to move amendments in Committee to address the many matters that have been left out.

I welcome the Bill as a small step in the right direction and I am grateful to the Secretary of State for responding positively to my representations on the application of the Bill to my constituency, but I am a little disturbed that there are no Welsh Office Ministers present today. We have not seen one, apart from for a brief period during the opening speech. When I raise technical questions about Wales, I hope that the Ministers present can respond in detail, because the House has a right to such answers.

The problem with the Bill is that the devil is in the detail. Numerous difficulties arise in implementation. The first problem, which I raised with the Secretary of State earlier, concerns the applicability of the Bill, particularly part II--clauses 9 to 25. Clause 35(2) says:

That must be a misprint. I should be glad of some clarification. Clause 25 says that part II applies to England only. Presumably something has gone wrong.

I imagine that some of part II must be already applicable in Wales through the Local Government (Wales) Act 1994. Clause 21 seems to reflect a considerable amount of section 14 of the 1994 Act, but the words are different, so it is questionable whether some of the provisions in part II will apply to Wales.

I suspect that the provisions in clauses 9 to 25 not covered by the 1994 Act will not apply to Wales. What is the Government's rationale in establishing those measures for England but not necessarily for Wales? We have a right to an answer. I do not know whether the Minister wants to intervene now. I suspect that he would rather a colleague came back to it in the closing speech-- I understand that, in the circumstances. I hope that they can dig out a Welsh Office Minister in the meantime to give them a lead. The issues of applicability are vital. We need to know which provisions in the Bill apply to Wales. We should be glad of an answer.

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I welcome the measures on the relief of business rates for rural shops and post offices in Wales. There is immense pressure on rural shops in Wales, as in other parts of these islands. We have seen closure after closure over the past few years as patterns change and the viability of businesses is hit by falling demand. Obviously, that has a bad effect on those members of the community who cannot drive to supermarkets. The elderly, those who do not drive and disabled people will be harmed, as will the tourism industry. The base population of a village may not be able to sustain a shop in winter, although it may be necessary in summer to provide for tourists.

The burden of the uniform business rate falls not just on general stores and post offices, but on other rural businesses, such as village butcher's shops, hairdressing salons, cafes, chip shops, pharmacies and garages. It is not good enough to give discretionary powers to local government when we know full well that the squeeze on the financial resources of local government in the coming year means that local authorities will not have a brass farthing to spend in this way. As a result, many businesses that should receive assistance will not get it.

Secondly, in recent years, shops and small businesses have gone under not only in rural areas but in small towns and, as has been said, in urban areas. In the three towns in my constituency--Caernarfon, Pwllheli and Porthmadog--there are numerous empty shops and, to a significant extent, that is a direct result of the impact of the uniform business rate.

My hon. Friends the Members for Ceredigion and Pembroke, North and for Meirionnydd Nant Conwy (Mr. Llwyd) have pointed out in the Chamber that our policy as a party is that we want to do away with the UBR. Conservative Members have challenged the Liberal Democrats on this matter, but we have gone into it in some detail and we want to see a local income tax. That was the evidence that we gave to the Layfield commission in 1976 and, incidentally, was recommended by the commission. Even then, it was thought possible and practical to have a local income tax system.

I believe that, if businesses had to pay a local income tax--or, if they were incorporated, an added element to their corporation tax--as the means of funding local government, it would not become a burden or an overhead that might pull them down when their turnover was falling. It is variable--if a business is doing well, it pays more; but if it is doing poorly, it pays less. That makes it easier for businesses to survive when there are factors undermining their viability.

The existing provisions in law for relief for businesses going through difficult periods are applied so unevenly that it is difficult to see the basis on which they are applied. A couple of years ago, some £2 million of relief was given in England but only £900 in Wales. I have no doubt that there are many deserving businesses in Wales, and I know that some Welsh councils, such as Taff Ely--which no longer exists--applied the relief, while others will not contemplate it, and that causes a problem. There must be a rethink on local government finance, particularly on the uniform business rate.

There are real problems of definition which must be addressed in Committee, and I wish to flag up some so that we start to think about them. First, what is a rural area? We are told that it is a settlement with fewer than

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3,000 people, but that is an inadequate definition, as it does not relate to density. The Minister of State told us that he recognised that a different formula applied in Wales, but nothing in the Bill refers to that formula. Apparently there are two ways of defining a rural area, neither of which is mentioned in detail in the Bill. We will have to deal with that in Committee, or the Bill will be open to challenges in the courts and elsewhere. There is also the question of one community covering more than one settlement, which I have raised.

Secondly, what is a business? The Bill allows the Secretary of State to include any shop or business by order, but how will the order be used? We must discuss whether there should be a limiting factor with regard to the size of a business. During the consultation in Wales, such a limiting figure was given--£5,000 of rateable value--but that seems to have dropped out of the Bill. Or has it? Perhaps we do not know it yet, and it will be covered by orders which have not yet been clarified.

What is the definition of a general store? For example, does a cafe that sells soap qualify as a general store, as it sells food as well as household items? I do not believe that the definition we have is watertight, and it will be inoperable. What is the qualification for a post office? Would a post office counter in an out-of-town supermarket--more and more supermarkets are trying to get such counters--qualify automatically for relief from the rates for the entire business? These matters have not been thought through, and more thought is needed.

I wish to refer to the powers of community councils, which are vital. I have 28 community councils in my constituency, and I try to visit them all on a rota basis. I have never been to a single community council meeting where I have not learnt something. These councils are valuable, but they have precious few powers and it is right to give them more. I am not satisfied that the powers to strengthen community councils in the Local Government (Wales) Act 1994 are adequate. My hon. Friend the Member for Meirionnydd Nant Conwy tabled amendments to that legislation in Committee, but we did not get the result we wanted. Commitments were given that guidelines would be issued by the Welsh Office, but they have not been adequate. The Government may be relying on the effectiveness of the words in the 1994 Act as a basis for the application of the scheme in England, but that has not happened in Wales as yet. I want more powers to go down to community councils than do currently.

Several aspects of the Bill need to be clarified. For example, does any legal liability fall on community councils for car-sharing schemes or traffic-calming works? Frankly, community councils do not have the expertise to be handling questions if there is legal liability. Are community councils to be allowed to build bus shelters, given that the Bill restricts them from doing anything of a capital nature with regard to bus services?

The Bill states that community councils

What does that mean? Will community councils be allowed to put the stocks on the village greens? [Hon. Members: "Hear, hear."] I hear "Hear, hear" from Conservative Members. That may well be what the Government have in mind, and I would be interested to hear that spelled out. My local authority has considered

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installing closed circuit television. Although it can face the capital costs, there will be immense revenue implications if it is to monitor everything on the CCTV systems.

On taxi fares, clause 28 allows community councils to enter arrangements for fare concessions for

in the council's area. That sounds discriminatory--councils can choose who to help, and may not do so on an objective basis. There are specific provisions in legislation on water rates to prevent discrimination, but it appears that we are deliberately providing for it in the Bill. That needs clarification.

I should like to touch on omissions relating to the working of town and country planning law, particularly in rural areas. I have plenty of examples of nonsense in town and county planning law and how they impact on communities. My area has an old planning permission that dates back to 1965. It has been kept alive by way of a few yards of tarmac that were put down for betterment levy purposes in the late 1960s, but that has meant that the planning permission is alive in perpetuity for 800 holiday homes in the village of Morfa Bychan. It is a site of special scientific interest and needs protection. Planning law should be changed to deal with such nonsense. We have heard of opencast schemes that would desecrate rural areas, but existing provisions to cope with such problems are inadequate.

I should be glad if the Government would clarify whether a new rural business class use will be added to the planning process, as was mentioned on page 35 of the English White Paper. Consultation is proceeding on this matter and we need to know whether it will move forward, because it is important for the operation of our community councils and for planning to protect our rural areas. Small developments can proliferate, because the size threshold enables them to avoid the development control procedures.

As other hon. Members have said, we give two cheers for the Bill. We need to strengthen and clarify it in Committee and we need other Bills to cover the rural matters that have not been covered. More than anything, we need a coherent strategy towards rural Wales and that has not, as yet, been developed. The White Paper tried to move in that direction, but it was not adequate. Financing and the way in which grant formulae for local government deal with the sparsity of population and the additional costs that it causes have not yet been addressed. I hope that the Government are aware that rural areas have many needs and that they will be willing to accept amendments tabled in Committee. I also hope that we will hear more in the winding-up speeches. It is vital to get such legislation right and to make it applicable to, and effective for, our rural areas.

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