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Agenda 2000: Structural and Cohesion Funds

Question agreed to.

Mr. Peter L. Pike (Burnley): On a point of order, Mr. Deputy Speaker. Is it not the advice and view of the Speaker of the House of Commons that, when a Division is called, Tellers should be provided? On numerous occasions, has not Madam Speaker frowned on the type of practice that we have seen in the past half hour?

Mr. Deputy Speaker (Mr. Michael J. Martin): I can say only that the Chair has observed the rules of the House. I will leave it at that.

Mr. Nick St. Aubyn (Guildford): On a point of order, Mr. Deputy Speaker. I believe that I have witnessed a serious infringement of hon. Members' rights to bring their constituents' concerns to the attention of the senior member of the Government. Earlier this evening, in the Lobby, my hon. Friend the Member for North Shropshire (Mr. Paterson) tried to approach the Prime Minister and was physically restrained by Labour Members. He was trying to perform his duty as a Member of Parliament. Will you please bring the matter to the attention of Madam Speaker?

Mr. Douglas Hogg (Sleaford and North Hykeham): Further to that point of order, Mr. Deputy Speaker.

Mr. Deputy Speaker: Order. Please be seated, as I have not yet dealt with the point of order raised by the hon. Member for Guildford (Mr. St. Aubyn)--which was not a matter for the Chair. I am also quite sure that the

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hon. Member for North Shropshire (Mr. Paterson) is capable of raising issues affecting his constituents in other ways.

Mr. Hogg: Further to that point of order, Mr. Deputy Speaker.

Mr. Deputy Speaker: Order. The right hon. and learned Gentleman said, "Further to that point of order," but it was not a point of order. I therefore hope that he will not continue.

Mr. Hogg: Mr. Deputy Speaker, there is a further point of order. If what my hon. Friend the Member for Guildford (Mr. St. Aubyn) said is correct, there has been an assault by Labour Members on another hon. Member. That is a matter not only for Madam Speaker but for the Serjeant at Arms, because a criminal offence has been committed in the House. I therefore ask you urgently to refer the matter to the Serjeant at Arms.

Mr. Deputy Speaker: That was not a point of order.

Mr. Gerald Howarth (Aldershot): Further to that point of order, Mr. Deputy Speaker. I was in the Lobby with my hon. Friend the Member for North Shropshire (Mr. Paterson), and I ask you--

Mr. Deputy Speaker: Order. I will take no further points of order on that matter. I control what happens in the Chamber. I call the hon. Member for New Forest, West (Mr. Swayne) to present his petition.

Mr. Howarth: On a point of order, Mr. Deputy Speaker.

Mr. Deputy Speaker: I hope that it is not a repeat of what we have already had.

Mr. Howarth: Madam Speaker is always telling hon. Members that she believes that her duty, first and foremost, is to protect the rights of hon. Members, and especially the rights of Back Benchers. I urge you, Mr. Deputy Speaker--

Mr. Deputy Speaker: Order. I am in control of the situation in the Chamber. I have given a ruling on the matter that was raised, and it was a good ruling.

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Mr. George Atkinson

12.37 am

Mr. Desmond Swayne (New Forest, West): I seek leave to present a petition from Mrs. Helene Atkinson, whose husband, Mr. George Atkinson, has been imprisoned without charge in Dubai for nine months. The 2,909 petitioners are not satisfied that enough is being done to secure Mr. Atkinson's release. Wherefore, the petitioners pray that this honourable House urges the Secretary of State for Foreign and Commonwealth Affairs to work for the release of Mr. George Atkinson.

To lie upon the Table.

University College (Cornwall)

12.38 am

Mr. Andrew George (St. Ives): I wish to present a petition from the people of Cornwall--in response to an overwhelming demand, on both academic and economic grounds--for a university college in Cornwall. Cornwall once had its own university college, and it now demands that that need be met, not through distance learning but through a properly resourced university campus.

The petition states:

In the past few weeks, the petition has been signed by 3,158 people in west Cornwall.

To lie upon the Table.

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Local Government Finance (Dorset)

n made, and Question proposed, That this House do now adjourn.--[Mr. Clelland.]

12.39 am

Mr. Christopher Chope (Christchurch): I am grateful for the opportunity to raise the issue of the local government grant settlement as it affects Dorset and, in particular, council tax payers living in the borough of Christchurch and the East Dorset district in my constituency. I am delighted that my hon. Friends the Members for North Dorset (Mr. Walter), for Mid-Dorset and North Poole (Mr. Fraser), for Poole (Mr. Syms) and for West Dorset (Mr. Letwin) are here to support me because these issues affect their constituents as well as mine.

I shall go into the detailed figures later. The headline figures mean that unless a miracle happens and the Government alter their provisional grant announcement, a band D council tax payer in Christchurch will pay £100.25 more council tax next year--an increase of more than 15 per cent. A council tax payer in East Dorset will pay £98.72 more--an increase of 14.5 per cent. Those are truly staggering increases and they will require householders to make deep cuts in their other expenditure. Increases at five times the rate of inflation are totally unacceptable. This is obviously the real face of new Labour. The extra burdens are coupled with what we now know to be the highest mortgage interest rates for five years.

If the increases in council tax were intended to pay for a locally determined commensurate increase in services, they might be defended by those who support local accountability, but the increases result from a 1.5 per cent. increase in the budgets of East Dorset district and Christchurch borough, a 3.5 per cent. increase in county council expenditure and a 4.2 per cent. increase in police expenditure. It is no wonder that the Government are convicted on the charge of forcing council tax payers to pay more for less.

It is impossible in a short Adjournment debate to go into all the detail that councillors and others would wish. In recognition of that, I am grateful that the Minister has agreed that he will meet a deputation of my constituents in East Dorset and Christchurch and representatives from Dorset county council to go into more detail on the issues I am raising. In recognition of his courtesy, I shall try to ensure that all the groups come to see him at the same time.

In seeking to understand this year's local government grant settlement, the expression "pork barrel" comes very much to mind. "Pork barrel" is an American term applied to legislators who give to their political friends and take away from their political enemies to maintain popularity with their own party. What other explanation can there be for the fact that East Dorset district council suffers the largest percentage reduction in grant of any district council as a result of changes in the formula for allocation, otherwise known as the methodology, while the Prime Minister's district council of Sedgefield gains 14.6 per cent., the second highest gain in the country?

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I could not agree--my constituents could not agree either--with the Deputy Prime Minister when he said that the

They are not a clear improvement. From talking to the Minister earlier, I am not sure that they are even clear.

I hope that the Minister will explain the Government's decision to allocate East Dorset only £68.25 per head grant next year, which is the fourth lowest grant per head of resident population in the country. The year after, the situation will be even worse as the full impact of the change in methodology bites, forcing the council tax up a further 10 per cent. for only 1.5 per cent. in increased expenditure.

If the Minister visited Dorset and drove from Verwood in my constituency to Blandford Forum in the constituency of my hon. Friend the Member for North Dorset, I would defy him to justify how it could be fair that a resident in Blandford Forum received 26 per cent. more grant per head than a resident in Verwood. If, instead of travelling to North Dorset, the Minister travelled to Christchurch, he would find that the Standard spending assessment per head was 28 per cent. higher than in East Dorset.

There is something peculiar about that. I hope that the Minister will concede that, on any objective basis, the differences are anomalous and indefensible. Councils comprising urban fringes with large rural hinterlands seem to be losing out particularly under the methodology. The consequence is that if East Dorset increases its budget by 1.5 per cent., its council tax will go up by 13.76 per cent.

My constituents in Christchurch have also been dealt a cruel blow. Christchurch's SSA per head is going down by 2.8 per cent., from £90 to £88, as a result of changes to the methodology. The consequences of that are dire. The council has already implemented £100,000 of savings for this year and approved £257,000 of savings for next year. It will have to make £130,000 of additional savings to keep within its cap, which permits an increase of only 1.5 per cent. in budgeted expenditure--just £57,000. The Government's settlement will result in band D council tax in Christchurch going up by 17.37 per cent. next year, from £71.67 to £84.12, for a 1.5 per cent. budget increase.

In comparison with East Dorset and Christchurch, Dorset county council has done well. Its adjusted SSA has gone up by 3 per cent.--£6.167 million--to £224.031 million. As the population has also increased by 0.8 per cent., the SSA per head has gone up by only 2.2 per cent. and is still £40 per head lower than the average for English counties.

Dorset county council has also suffered a 50 per cent. greater blow than the shire county average, losing 1.3 per cent. of its SSA because of methodology changes. Dorset is most unfairly hit by the Government's fiddle to the SSA for capital financing. If, as spendthrift, debt-ridden Labour councils have long hoped, the Government are intent on bailing them out of the consequences of their profligacy by giving them extra grant towards the cost of those debts, that should not be at the expense of prudent authorities. However, that is what is happening. The reduction in the control total and the scaling factor from 85 to 78 per cent. will result in Dorset county council losing £855,000--£5.70 per band D council tax payer.

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The consequence of the settlement for Dorset county council is that increasing its budget by 3.6 per cent. to the capping limit will necessitate a band D council tax increase of about 10 per cent., from £556 to £610. However, that is not the end of the story. This year, all Dorset council tax payers benefit from a special reorganisation grant worth £26 at band D. The additional costs for Dorset resulting from Bournemouth and Poole becoming unitary are £78 per head at band D. That burden has not disappeared. It should have been reduced by the county council, but it is still significant.

The Government could give immediate and direct help to Dorset council tax payers by paying the transitional grant for a second year, as all the group leaders and my hon. Friends have argued in letters to the Secretary of State. The Minister shakes his head, but we have taken encouragement from the Deputy Prime Minister's statement that £130 million will be allocated for the transitional costs of local government reorganisation. On the basis of the present plans, he thinks it possible that less provision will be needed for that purpose. The Deputy Prime Minister said that any surplus would be added to the total of revenue support grant. I submit that it would be fairer to give £4 million of that to Dorset.

That brings me to the area cost adjustment. During the latter days of the general election campaign in April, the current Prime Minister--then the Leader of the Opposition--was asked whether he would reform the area cost adjustment. He told the Cambridge Evening News:

The right hon. Gentleman added that, in relation to Cambridgeshire,

    "changes in line with the recent Elliot review would bring the county an extra £10 million."

The right hon. Gentleman, by those words, raised expectations and led people to believe in Cambridge and elsewhere that were a Labour Government to be elected, the Elliot review of the area cost adjustment would be implemented this year. If the Elliot review recommendations had been implemented this year, Dorset would have benefited by about £4 million, about £25 per charge payer. It will not have escaped the notice of the House that that is a similar sum to the transitional reduction grant that the Government are proposing to withdraw from Dorset this year. That grant was given by the Conservative Government in response to representations that were made in Dorset.

Honour could be satisfied by keeping the grant for one more year in the expectation that the Government would then honour their pre-election pledge to implement the results of the Elliot review.

The final element in the council tax bill for my constituents is the precept from the Dorset police. The maximum spending power permitted by the Government for next year is £73.720 million, increased from an equivalent figure of £70.771 million for the current year. The police think that even expenditure at that cap will not be enough, so there is a fear that the precept will be raised from £63.59 to £71.37, an increase of more than 12 per cent., with only a 4.17 per cent. increase in expenditure.

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The Government's confidence trick of forcing up council tax is clear from the figures for the Dorset police authority. Raising the expenditure to the cap would cost £2.949 million, and only 27 per cent. of that would be funded by the national exchequer, the other 73 per cent. coming from local taxpayers. That is why, for a modest increase in contribution from the Government, local taxpayers are being expected to pay £3 for every £1 that the Government pay.

The Deputy Prime Minister said when introducing the grant settlement for next year that when Labour was elected on 1 May it was declared that it was time to bury the hatchet. The right hon. Gentleman did not say where he was going to bury it. I hope that tonight the Minister will allay the fears of Dorset people that the Deputy Prime Minister's hatchet is targeted at Dorset in a vindictive vendetta against Dorset people who did not vote Labour in the general election.

I am conscious that in my constituency there was the second lowest Labour vote in the country. It was less than 7 per cent., and significantly less than in 1992. If we have a Government who are handing out money to their friends and withdrawing it from their enemies, we have exposed an example tonight. I hope that the Minister will be able to allay our concerns. From the examples that I have given, it is clear that charge payers in my constituency are being condemned to pay 15 per cent. more council tax next year for worse services.

Earlier this month, the Minister for Local Government and Housing told Radio Kent that if council tax increases by more than 7 per cent., the council concerned will be failing in its duty. I shall be interested to hear from the Minister whether he is prepared to make the same statement in respect of Dorset. If the council tax increases in Dorset by more than 7 per cent., will the hon. Gentleman consider that the county council and the district councils have failed in their duty? I hope that he will answer that question.

In announcing this year's settlement, the Government were guilty of a cruel confidence trick on my constituents. The Deputy Prime Minister promised that standard spending assessments would be fairer, and that spending could increase by 3.5 per cent., leading to a council tax increase of only 7 per cent. Yet SSA per head in East Dorset has fallen by 6.7 per cent. and in Christchurch by 2.8 per cent., and even for the county council it has increased by only 2.2 per cent.

We are getting mixed messages from the Government. The Secretary of State for Education and Employment has told me in a letter that I should demand that Dorset county council pass on its full SSA increase to schools, despite the fact that it is already spending 6 per cent. above its SSA. The Deputy Prime Minister, however, says that the changes in the SSAs will have a large impact on council tax levels in some authorities if they do not adjust their spending accordingly.

In other words, the Secretary of State for Education and Employment is saying that the SSAs must go towards additional spending by the council, whereas the Deputy Prime Minister is saying that because grant has been taken away from Dorset, the council's expenditure should be reduced accordingly. Those two messages are incompatible.

It seems that the Government recognise that local authorities need to spend more money, but they do not have the courage to provide the money themselves.

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Instead they are transferring the burden to council tax payers. This is a massive council tax increase--a tax increase by another name--and my constituents feel that they are being unfairly punished. I hope that the consultation is a real one, and that when it is over we shall find that there is more grant for Dorset than it is to receive under the present proposals.

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