| Previous Section | Index | Home Page |
Ms Armstrong: How does the hon. Gentleman reconcile what he has just said with the CBI's statement that--
Mr. Edward Leigh (Gainsborough): They are a bunch of socialists.
Ms Armstrong: I see. Perhaps I should not be intervening.
The CBI says that CCT has really had its day. It says:
Mr. Jenkin:
No, I do not. I did not agree with the CBI when, for example, it supported the closed shop. It was wrong about that, and even the Labour party has accepted that. The Institute of Directors, in a survey of its members, found that 49 per cent. of them do not think that replacing CCT with best value will improve services for local council tax payers, and only 33 per cent. think that it will.
It is difficult, however, to argue about the merits of best value on the basis of a Bill that contains virtually nothing other than a raft of extra powers for the Government. It is on that basis that we should discuss the legislation.
Mrs. Teresa Gorman (Billericay):
Does my hon. Friend agree with the leader of the Conservative members on Basildon council--with whom I have consulted on the Bill this afternoon--who describes the Bill as going backwards into the future? Basically, all the consultation flummery and best value is simply a smokescreen behind which Labour councils will be able to take back control of the services that the Conservative Government so successfully privatised.
Mr. Jenkin:
That is certainly one of the dangers of the Bill. But it all depends on how the Secretary of State chooses to exercise his powers. Of course, CCT was not perfect--
Mr. Eric Illsley (Barnsley, Central)
rose--
Mr. Jenkin:
I should make progress. I owe the hon. Member for Bethnal Green and Bow (Ms King) an intervention at some stage, but I shall give way to the hon. Gentleman.
Mr. Illsley:
Does the hon. Gentleman agree with the hon. Member for Billericay (Mrs. Gorman) who has just referred to the successful privatisation of local government
Mr. Jenkin:
Apart from the Bank of England--and even that example might be questionable--can the hon. Gentleman give an example of a business which has been successfully nationalised? Of course CCT was not perfect: the sustained policy of non-co-operation pursued by Labour councils meant that tight regulations had to be introduced to ensure compliance with the spirit of competitive tendering, and we acknowledge that even that failed with the worst Labour councils. One of the great ironies of politics is that the pride which Labour councils express in their direct labour organisations is matched only by their reluctance to expose the performance of those organisations to competition.
The unions hope that best value will reward that reluctance; they hate the discipline of CCT, and hope that best value will protect them from the rigour of competition, at the expense of council tax payers. Is that the intention of the Bill, as my hon. Friend the Member for Billericay (Mrs. Gorman) suggested? Alternatively, is best value, like the lager, intended to reach the parts that CCT could not reach?
Dr. Lynne Jones:
The hon. Gentleman talks about best value as though it were not supported by his Conservative colleagues. Do not Conservative local authorities support the move to best value?
Mr. Jenkin:
Many authorities will support best value if it is implemented in the way that they expect, but the Bill provides no certainty about how best value will be implemented.
Compulsory competitive tendering provides a concrete framework to ensure competitive local council services. The White Paper stated that best value reviews will be required to
What are we to believe? Will the Secretary of State bring the full rigour of competition to bear on recalcitrant, inefficient councils, or will the Bill achieve what many councils hope and allow them to escape the discipline of competition? The Bill provides no discipline for the Secretary of State in the exercise of his powers, and that is its fundamental problem.
The Bill creates no obligation for the Secretary of State to treat similar councils in a similar way. He can discriminate in favour of some councils and against others. The Bill is an invitation to cronyism of the
worst kind, which is already endemic in Labour councils. Today, The Birmingham Post reported:
The Conservatives want what best value sets out to achieve: to get the benefits of competition and to increase local discretion. Good councils are already pursuing best value, but the Bill will dilute competition and hugely increase central control, making local councils more answerable than ever to Whitehall. The emphasis on flexibility, which we hear so much about, encourages the expectation that councils will be able to take their own decisions, but, in reality, the final word on flexibility will rest with the Secretary of State. The onus will be solely on him to challenge the corruption in the party that he represents in Parliament.
As with the proposals for best value, the Government's changes to the capping regime face both ways. Capping started as a way of protecting ratepayers from the excesses of Labour-run councils in places such as Lambeth and Liverpool, but no one can feel easy about the way in which it has grown. Councils need more freedom of manoeuvre in their financial affairs, but, equally, the council tax payer needs protection from excessive local tax demands. As the Government now recognise, central Government have an interest in how much is spent by local councils. Perhaps that new-found caution is behind the Deputy Prime Minister's rapprochement with the Chancellor of the Exchequer. Rate capping is not being abolished; it is being modernised.
Taken in isolation from any review of accountability or structures, the measures in the Bill move in the wrong direction. The refusal to publish provisional capping limits, the use of following-year capping, the taking into account of previous years' budgets and the potential clawback of central Government funds for council tax benefit do nothing to address the fundamental problem.
As the Local Government Association points out, the proposed council tax benefit subsidy limitation will hit the poorest areas hardest. In its briefing, the association says:
Mr. Jenkin:
This is a novel concept in regardto accountability in politics. Whatever the former Opposition's policies were, when they become a
Local people have too small a stake in the budget decisions made by their local councils. Councils are not properly accountable to the communities that they serve, and the Bill represents a missed opportunity to deal with that.
If we are to have capping, the system needs to be clear. Universal capping may have been crude, but it was transparent, and councils knew where they stood. Under the Government's proposals, councils and officials will be confused and uncertain, and local communities will be even more so. Crude and universal capping--the target of the Labour manifesto--is to be replaced by capping that is secretive and retrospective. The Bill makes capping personal: it will be a matter of choice for Ministers, and I assure the hon. Member for Northampton, North (Ms Keeble) that they will find it no easier to exercise their powers on that basis than to exercise them on the present basis.
Once again, the Government have achieved the worst of both worlds, which is the essence of what we are discovering their "third way" to be. They have produced more apparent latitude for councils to tax and spend, with none of the reforms that are necessary to ensure that such freedoms are exercised in a responsible manner. The fact is that the Government have no real interest in improving accountability, because they know that the true cost of Labour in local government is very high. The most outrageous council taxes are charged by Labour; the worst-indebted councils are Labour. Labour councillors have been gaoled, investigated by police or subject to allegations in Doncaster, Wakefield--[Hon. Members: "Westminster."] I hear the name of one local authority from Labour Members, but I can mention a few more.
In Hull, Labour does not trust its local members to select candidates. Then there is Slough, and Birmingham--where a Labour party member has called for an inquiry into sleaze and intimidation. There is Welwyn Hatfield, and Reading--where a fraud squad investigation of the conduct of the direct service organisation was passed to the Crown Prosecution Service. There are Hackney--as we well know--Islington and Coventry. Those are just the top 10. In many parts of the country, Labour remains a byword for mismanagement, incompetence and downright corruption.
We welcome the idea of beacon councils--we are in favour of excellence in local government--but nothing in the Bill defines the criteria for such status, which will be yet another favour for the Secretary of State to bestow or withhold. Once again, he is taking the power to treat similar councils differently, and that will be yet another incentive for councils to curry favour from Whitehall rather than standing up for the interests of their electors.
Either the Bill threatens to let bad councils get away with inefficiency and excessive taxation, or it will open ever more opportunities for Ministers to crack down, which was not quite the expectation of many people who voted for the Government. The Bill represents a sweeping increase in the powers of central Government. It is a further step towards complete control from the centre--the nationalisation of local government. Under the Bill,
there is a new panoply of discretionary controls. Although they go in name to the Secretary of State, it will be the Treasury that holds the purse strings ever more securely.
"Best value must retain the competitive principles of CCT,"
but
"remove its fundamentally adversarial nature and replace this with consultation and shared objectives."
Does the hon. Gentleman not agree with that?
"embrace fair competition as a means of securing efficient and effective services."
I have just made the same point to the hon. Member for Birmingham, Selly Oak (Dr. Jones). The Bill gives no indication of how competition will be provided for. The White Paper offers a range of options, including benchmarking; contracting out all, or part, of a service; joint ventures; competitive tendering of various kinds; or even full privatisation--yes, that, too, is in best value. However, there is virtually nothing about the discipline of competition in the Bill, and nothing to suggest how it will be applied.
"Union leaders were secretly recorded urging a Labour councillor to secure work for party activists in a 'jobs for the boys' row in a Midland council."
The Labour councillor who blew the whistle deserves to be congratulated on showing such courage, but what he revealed was deeply disturbing. He said:
"They were saying co-operate in finding jobs for these people or all hell will break loose and the whole service will be in dispute. It was an arrangement they have had for years in the past and the Labour group knows about it but doesn't do anything."
That is Labour in local government and, if best value is to succeed, that is what Labour must confront.
"the guideline increases could be seen as a direct substitute for crude and universal capping."
Ms Sally Keeble (Northampton, North):
The capping measure is, in principle, very similar to measures introduced by the hon. Gentleman's party in government to limit the amount of housing benefit that was paid, and to make councils pay an element of that benefit when private rent levels exceeded market value.
| Next Section
| Index | Home Page |