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14 Nov 2002 : Column 259—continued

Judy Mallaber: May I at least tempt my hon. Friend to say that we will not carry on with the ever increasing proportion that is going into the ACA, and at the very least, that the trend will come down rather than continue to go up?

Mr. Leslie: My hon. Friend may tempt me in that regard—but whether she succeeds is another matter, and I am afraid that I cannot give any announcements or decisions on that. We must take these matters in the proper order.

My hon. Friend mentioned that introducing higher council tax bands might be part of a solution for authorities if they wished to expand their tax base. The matter obviously relates to the revaluation of council tax banding and whether it should start in 2005, with bills then issued for the financial year 2007 based on that revaluation. The Government are concerned about the fairness of the tax system, but we are also listening to the views of taxpayers and local government about council tax bands. The matter may well have an impact on finance, but I should mention that dwellings in band H account for less than 1 per cent. of the total number of dwellings in England, so increasing the number of bands above that would not necessarily result in significant increases in the local tax base.

Mr. Barnes: Might not an additional approach be to make the difference between the amounts that people in different bands are expected to pay more progressive? The property value in the top band is eight times that in the bottom band, but the highest resulting payment is

14 Nov 2002 : Column 260

only three times what people in the lowest band pay. If the range was greater, more money could be drawn from the top and less from the bottom.

Mr. Leslie: These are interesting debates. They are separate from the formula grant review, I might add, but they are issues of significance and we will come to them when we address the question of revaluation and council tax banding.

I want briefly to touch on some of the overall issues. It would not be right to look at Derbyshire in isolation from the bigger issues of local government funding. This year we have seen an 8.8 per cent. increase in resources for education. Resources for social services have risen by more than 3 per cent. in real terms each year since we took office. This year, expenditure on policing has increased by 6.1 per cent.

There is better to come over the next three years. For social services, there will be an average increase over the next three years of 6 per cent. in real terms. Spending on education will rise by 6 per cent. for the next three years. For policing there will be an extra #1.5 billion, more than in the financial year 2002–03. There will also be more money for the environmental, protective and cultural services area of expenditure.

Derbyshire has also benefited significantly from extra money under this Administration. Whereas it received a 1.8 per cent. increase in the last four years of the previous Administration, under this Government we have typically seen 5.1 per cent. increases. The increase in spending on education in the past five years has been 37 per cent. Whereas in 1997 the capital increase was #4 million, in 2001–02 it was #50 million, this year it was #37 million, and next year it will be #27 million. Significant sums have also been made available to Derbyshire for social services.

Judy Mallaber: Will my hon. Friend give way?

Mr. Leslie: I am afraid that I do not have much time. I want to make a couple more points. We have consulted at length. We have considered all the issues carefully. There is a guarantee that no authority will lose out. We want a transparent system that ensures that authorities get a fair grant. That is the intention and the approach that the Government wish to take.

Question put and agreed to.

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