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Mr. Lansley: Will the hon. Gentleman give way?

Mr. Twigg: I am sorry--I have finished.

6.24 pm

Mr. Tony Baldry (Banbury): The hon. Member for Halton (Mr. Twigg) says that this is a good settlement. He might like to come and explain that to people in Oxfordshire where, as a consequence of this year's settlement, families on income support who have children with learning difficulties will have to pay for day-care provision.

At the last general election, I predicted that if there were a Labour Government, counties such as Oxfordshire would be hard hit. If one examines this year's settlement, one sees that local authorities in the south have been hit, shire counties have been hit, and rural areas have been

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hit; so a shire county in the south that is predominantly rural, like Oxfordshire, is triply hit. The proof is there. Even the shire county SSA average increase is 5.2 per cent. this year. Oxfordshire simply has 3.8 per cent.--one of the lowest awards in the country.

This year, social services have £1 million more, but last year they had £1 million less. So in cash terms this coming year Oxfordshire will have to cope with what it had way back in 1997. In Oxfordshire, we face the possible closure of a number of day centres for the elderly and respite care centres for those with learning difficulties, and massive reductions in social service provision. The social service provision will be decimated.

Immediately after the settlement, the Minister for Local Government and Housing said on Radio 4 that no council should have to raise its council tax by more than 4.5 per cent. The Labour budget proposed for Oxfordshire county council would see a council tax rise of 12.5 per cent. Even that would not enable Oxfordshire county council to spend its SSA on education, and there would still be substantial cuts in social services. The Labour budget would see a council tax increase of some £285.

The Conservatives have sought to table an indicative budget, which they branded Blair's budget, which the county council would have to introduce if it tried to stick as close as possible to the Government's pronouncement of a council tax increase of 4.5 per cent. That would mean that spending on education was still below SSA, but social services provision would be decimated, like other budgets.

In Oxfordshire, families on income support now have to pay for basic services and the county surveyor has told parish councils that the budget cuts effectively mean that the minor road network will not be resurfaced for at least 50 years. A number of villages are now surrounded by failed road signs. The village of Piddington outside Bicester now has a number of failed road signs.

As a consequence of this year's settlement, hundreds of the most vulnerable people in Oxfordshire will suffer, and throughout the county the infrastructure will increasingly crumble. Most people will find it difficult to understand how the Minister for Employment, Welfare to Work and Equal Opportunities could say, the day after the settlement, that the people in Oxford and the rest of the county could expect steadily improving services. They clearly will not be able to.

When I intervened on the Deputy Prime Minister on the day that the announcement was made, he said that this year's settlement represented the best deal that Oxfordshire has had for years. I suspect that that will be emblazoned above the door of every closed day and respite care centre and every failing old people's home. Never before in the history of Oxfordshire county council has that come about.

This settlement for shire counties such as Oxfordshire means higher taxes and fewer services. It is a unique combination of the tax and the axe. Labour's settlement is an attack on the most vulnerable people in Oxfordshire. We shall see a substantial hike in our council tax bills and at the same time basic services in Oxfordshire will be decimated.

The settlement is a disgrace to the Government. I suspect that many people in Oxfordshire who voted Labour at the last general election will now be regretting it; that will be clearly demonstrated in the local government elections later this year. There can be no

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justification for this settlement, and no justification for its impact on Oxfordshire. I therefore hope that hon. Members, and many people, will vote against this monstrous settlement.

6.30 pm

Mr. Tony Clarke (Northampton, South): I will be brief, not because of the time limit, but because I would not be making such a contribution were I as satisfied as some of my hon. Friends in respect of their settlements. I also believe that, the longer I am on my feet, the greater the chance of my saying something that I might regret at a later date. The Minister would expect a certain amount of criticism. It has been, is and always will be the case that those who receive the lowest settlements will plead their case, but I will try to be constructive and balanced in that criticism.

I of course recognise that this is probably one of the best settlements for a long time--for seven years, the Deputy Prime Minister said--and that the 5.5 per cent. average increase is to be welcomed. However, those at the lower end of that average--the losers--start to feel a little like someone at a party who is stone cold sober, and wondering what all the fun is about, when everyone else is drunk.

Northampton borough council, whose area is in my constituency, has been treated particularly badly and has a paltry 1.1 per cent. increase. The Department of the Environment, Transport and the Regions says that the average council tax increase should be 4.5 per cent., if councils were spending to the average increase in their standard spending assessment. There would be a doubling effect in Northampton. Not only do we have one of the lowest settlements, but we would probably have had to levy a higher council tax because of the problem of continual cutback over a number of years and our inability to deliver to the people of Northampton the services that they expect.

I acknowledge that Northamptonshire county council and South Northamptonshire council, whose areas are in my constituency, have done a little bit better, but that makes it even harder to accept that Northampton borough council has been left in such a position. Northampton has been badly treated for four reasons; two are directly related to the formula and the way that the figures have been calculated, and two are broader, but equally significant.

I have told the Minister on a number of occasions that I believe that Northampton continues to suffer, as the largest non-unitary district council in England. A population of 200,000 means that we are simply in the wrong club, and we should not be there with our district council colleagues. Northampton should have achieved unitary status when its neighbours--Milton Keynes, Leicester, Derby and Nottingham--achieved it; because of that, the town aspires to unitary status but has to accept, at the moment, that its budget of £19.1 million is not enough to meet the aspirations of its people.

Some may say that economies of scale could be made, but that would not work in Northampton because the population data used by the Department is not only outdated, but continually out of date. Northampton is still the third-fastest growing town in Europe. The DETR figure for the population is 194,000. The council accepts the figure of 198,000, but the population is already probably more than 200,000.

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Each year, between 2,000 and 2,500 homes are constructed in Northampton. Each year, they bring with them additional burdens for the council, which has to provide additional services. I give an example of that effect. On this year's settlement, we will be paid only for the 194,000 people who the Department recognise as living in the town, but we will have to provide services for the 198,000 or more people who live there. We will also have to find, in the next 12 months, an additional £135,000, simply for refuse collection and street cleaning, for the 3,000 people who will move on to new estates and into new areas between now and next year's settlement.

In respect of the changes to the methodology on capital financing, I also believe that Northampton has been particularly hard hit: 5 per cent. of our £19.1 million budget--£545,000--has disappeared, because of that one change. We pleaded with the Minister that a council such as Northampton, which has been hit so badly by one factor, should be able to phase the change in. We should be able to manage that transition over a longer period, so that it will not have such devastating effect on the budget.

I make no excuse for mentioning the impact that the Easter floods of last year had on Northampton. Even after the money provided by the Bellwin scheme and the insurance costs that were paid, the council faces£300,000 in costs that it knows it cannot recover. Because 2,500 homes were flooded, it was impossible to collect council tax from homes that were uninhabitable. That alone has cost us £500,000.

Given the time, I must cut short my comments. Let me simply ask my hon. Friend the Minister to understand Northampton's difficulties better, and to understand my continuing disquiet, both as a constituency MP and as one who is still a member of Northampton borough council, about the fact that, given that paltry 1.1 per cent., we may be unable to deliver the services that she would want us to deliver. I am sure that, if she understands that, she will understand why I cannot support the settlement until I feel that it is fairer to Northampton and its council tax payers.

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