Local Government Finance (England) Special Grant Report (No. 83) (HC No. 88) On Maintenance of Roads Grants 2001-2002

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The Chairman: This Chairman has noted over many Committee sittings and hearings that the hon. Gentleman always suffers vicissitude with valour.

Mr. Foster: I am grateful for that high praise.

I agree with at least the introductory remarks of the hon. Member for East Worthing and Shoreham (Tim Loughton) about some of the special grant reports being further examples of centralisation from the Labour Government. I remind him that we saw significant moves towards centralisation during the Conservative Government of 1979 to 1997; nevertheless, I agree with him that there is general concern about the approach that has been adopted.

Although I would not wish to get involved in issues of private grief, the example given by the hon. Member for Tooting (Mr. Cox) illustrates a growing tendency in the multiplicity of grant schemes brought forward by the Government. They address the Government's agenda and focus on what they wish to achieve, rather than addressing need and the Government's role in redistributing wealth to support councils that seek to deliver services to people who are least well off.

I entirely understood your intervention, Mr. Gale, about the way in which we have chosen to deliberate the four orders, and you are correct to say that the Committee agreed to consider the orders together. The Committee should be aware that initially there was an opportunity for a number of the measures to be discussed in separate Committee sittings, each of which would have allowed for one and a half hours of debate. I understand that the Conservative party requested that the orders be put together in a single session. Whether we then chose to deal with them together or to seriate them is, of course, a matter for the Committee.

The Chairman: Order. In the interests of clarity I tell the hon. Gentleman that one dissenting voice would have meant that the orders would have had to be debated separately.

Mr. Foster: I appreciate that, but given that many hon. Members have already sorted out their diaries to get the orders passed, a dissenting voice at that time may have led to us not getting through some of them, and we may have been in difficulty. My point is that we could have had more time to debate the orders.

I turn to the matters in turn—hopefully a little more briefly than the hon. Member for East Worthing and Shoreham. I shall be speeded up because I agree with a number of the points and questions that he raised and I will listen with interest to the Minister's response. However, I intervened to raise a particular concern about special grant report No. 82. All 20 authorities will receive exactly the same money: £1 million for pump-priming grants and £50,000 for the administrative grant. It is odd that all the authorities will be given identical sums for widely differing projects when there is another special grant report with, as the hon. Member for East Worthing and Shoreham pointed out, different sums attached. Interestingly, in that case, there is no separate identification of the administration costs.

I have a general concern about the Government's approach to PSAs. According to the Government, PSAs will free up local authorities to allow them to do more of what they wish. The sad truth is that the only way in which authorities can achieve that is by agreeing to PSAs that are based on doing what the Government tell them to do. That is evidence of further centralisation. Will the Minister explain precisely how the monitoring will take place? We know that it is specifically within documentation and it is planned that outcomes that are expected to exceed what may otherwise have been achieved will be within the areas that will be considered. What action will the Government take against authorities that do not achieve the outcomes to which they have agreed?

I wish to speak about special grant report No. 83 in respect of de-trunking. Although I do not have an interest to declare, it may benefit the Committee to use a specific example to illustrate my concern. My local authority, Bath and North-East Somerset county council, has been informed by the Government, despite being unhappy with the decision, that the A46 and A36 are both to be de-trunked. The council is in negotiations with the Government about the amount of money that will be forthcoming and, because of the pressure that will be placed on it and the surrounding area, it is asking for Government assistance to carry out a wide-scale survey of traffic flows, with the possibility of taking consultants' advice on how to solve the problems. I understand that the Government Office for the South West and the Highways Agency, after prompting from his Department, have shown willingness to come forward with money. I should be grateful if the Minister would pursue that to speed up the unlocking of the money, so that we can get on with the project.

The Minister said clearly--this was specifically stated in the documentation--that de-trunking would go ahead only with the agreement of the local authority, despite the fact that the Government have already announced their intentions. I look forward to his answers to the questions raised by the hon. Member for East Worthing and Shoreham about how the calculations have been made. I note with particular interest that the documentation states that the Local Government Association has supported the methodology. I hope that that will not be taken by the Minister to mean that the LGA supports the direction and thrust of the Government action.

Although we have heard nothing from the Minister about this, I believe that the Government are saying that the mechanism for handing over the money is a short-term solution until a general review into local government finance is completed. Will the Minister clarify the situation and the Government's intentions in subsequent years for payments? Is the system an interim measure until changes are made to the local government finance settlement arrangement?

The Minister made it clear in his introductory remarks, and it is also stated in the documentation, that the awarded money will not necessarily be spent exclusively on the routine maintenance of de-trunked roads but can be used on the routine maintenance of other roads. I welcome that flexibility, but how does the Minister expect a local authority to comply with the requirement that an external auditor appointed by the Audit Commission must demonstrate that the money was spent exclusively on routine maintenance? That local authority would have a large pot of money to spend on routine maintenance, so how does he expect the independent auditor to separate the two different pots in a way that satisfies the Government? Will the Government or the local authority fund the independent auditor, who will have a difficult task?

As the money is for routine maintenance, what plans do the Government have to provide assistance to local authorities with de-trunked roads that then suffer a landslip, for example? The A36, to which I referred earlier, goes through the Lympley Stoke valley just outside my constituency and is particularly prone to that problem. Repairs would not be defined as routine maintenance, so do the Government intend to make money available regularly to cover such eventualities or will local authorities have to request special funding?

I shall deal briefly with the two remaining reports. Regarding special grant report No. 85, I understand that the hon. Member for Liverpool, Walton is not a keen user of pagers and is still used to receiving information on paper. I gather from some newspapers that the hon. Gentleman is thinking of having a pager, but I am sure that he will continue to read paper versions of documentation. I therefore thank the Minister for providing more detailed information about the Liverpool scheme than the hon. Gentleman appears to be aware of.

I can tell the hon. Member for East Worthing and Shoreham that I do not have the foggiest notion why Kingston received the large sum of money to which he referred. I would also be interested to find out why such an amount was awarded. Given the origin of the bid and the political composition of the council that made it, it would have been a particularly solid bid. I fully appreciate the need for more information about the bids, especially those that were successful in earlier rounds. What plans does the Minister's Department—or perhaps the Treasury, because it is a Treasury-inspired scheme—have to ensure that examples of best practice from earlier rounds will be passed on to other local authorities? If the Minister cannot answer the specific question of the hon. Member for East Worthing and Shoreham, will he tell us how many bids were unsuccessful?

A common theme runs through the Government's handling of ring-fenced grants. In the vast majority of cases there are infinitely more unsuccessful than successful bids, which leads to many local authorities spending vast amounts in preparation, but ending in failure. As a result of the multiplicity of schemes, each with different requirements, the sad truth is that the vast majority of schemes are underspent at the end of the financial year. The large sums of money for which the Government gain credit for announcing end up not being spent on improving services for people most in need. It would be helpful to know how much bureaucracy and time is spent by officers and members in preparing lists for unsuccessful schemes.

I shall move on to consider the scheme for rate relief. The hon. Member for East Worthing and Shoreham rightly drew our attention to the concern that any scheme that draws boundaries will inevitably be a blunt instrument. Some local authorities are worried about rural areas—even those strictly outside the authority's boundaries—affected by foot and mouth disease that are not benefiting from the scheme. The list of 151 rural authorities is not an exhaustive list of all the affected local authorities.

I am delighted that the scheme has been extended to include properties with a £50,000 rateable value and that there has been an increase from a 95 per cent. to a 98 per cent. return, but what plans does the Minister have to re-examine the list of authorities eligible for consideration under the scheme? Under existing legislation, authorities not covered by the scheme are able to provide support for other schemes and are entitled to a 75 per cent. return on money invested as opposed to the 98 per cent. return accorded to those within the scheme. Many authorities receiving only the 75 per cent. return believe that they are being let down. What plans does the Minister have to widen the scheme?

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