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5.37 pm
Mr. Jim Marshall (Leicester, South) (Lab): May I tell my right hon. Friend that I am not criticising him when I point out that in a debate of less than two hours, only 20 minutes is provided for Back-Bench Members? Surely we would all, including my right hon. Friend, agree that that is totally unacceptable. I suggest that my right hon. Friend and other Front-Bench Members make representations to the appropriate quarters so that in future years we can have a fuller and more representative debate than we are having this evening.
I did not participate last year, but usually in these debates I have a go at the Government for failing to provide sufficient resources for the city of Leicester. The Minister will be pleased to hear that that is not my intention tonight; indeed, I intend to put the boot into the city of Leicester. As the Minister knows, the Labour party lost control of Leicester last year and a Lib-Dem/Tory council took its place. In recent weeks, we have seen the consequences of the Leicester electorate's decision. Despite a reasonable settlement—higher than 5.5 per cent.; lower than 6 per cent.—which will safeguard social services and education, the people of
Leicester are now threatened with a council tax increase of 14 per cent. and savage cuts in voluntary sector provision.
Mr. Streeter: I am following the hon. Gentleman's remarks closely. I am glad that the people of Leicester have had a fair and reasonable settlement this year. However, for the past two years fair settlements like that have been paid for largely by people in the south of the country. Why should the people of Plymouth—a deprived and challenged community itself—pay for the people of Leicester?
Mr. Marshall: If the hon. Gentleman had listened to my speeches in recent years, he would have heard me complain that Leicester had not received sufficient funds. I am making an exception this evening, for the reasons that I gave earlier.
The people of Leicester are now being threatened with a 14 per cent. increase in council tax, and savage reductions in the provision of services by the voluntary sector. If it is imposed, the increase in council tax will be totally unacceptable. It will adversely affect social cohesion and increase social exclusion in the city, and have an adverse impact on Leicester's good race relations record.
The new leaders of Leicester city council cite two reasons for the proposed increase. The first will not surprise anyone, especially those who listened to the speech by the hon. Member for Kingston and Surbiton (Mr. Davey), the Liberal Democrat spokesman. The leaders claim that the financial situation left by the previous Labour administration rendered such an increase inevitable.
Anyone who has looked at the books will accept that that is simply untrue. The leader of the Labour group on the city council will set out an alternative budget in the next few weeks that would achieve a substantial reduction in the proposed level of council tax but without the swingeing cuts in the voluntary sector.
I have some sympathy with the second claim made by the new leaders of Leicester city council. They argue, as I have argued in the past, that Leicester has been historically underfunded ever since it returned to unitary status. That underfunding has been exacerbated every year. The city council now claims that the city is owed £20 million. I have been asked—as have my right hon. Friend the Member for Leicester, West (Ms Hewitt), the Secretary of State for Trade and Industry, and my hon. Friend the Member for Leicester, East (Keith Vaz)—to speak to Ministers to try and get that money returned.
I do not have any great faith that the money will be returned, but I should be grateful for an assurance from Ministers that they will look into that claim again. I hope that, in future years, assessments can be made to take account of that historical underfunding.
I do not believe that the difficulties faced by Leicester city council this year are an order of magnitude different from those faced in previous years. In discussions that I have had with the council's leaders, it has become clear that there are legitimate questions to be asked about proposed levels of financial provision for certain
services. There are big arguments about whether the proposed level of reserves, the allocation of millions of pounds to parks for unspecified reasons, and the proposed level of expenditure on maintenance, are necessary.That is not an exhaustive list of the questions being asked, but it is illustrative: it shows that, if there is political will in the new city council leadership, proposals can emerge that would be acceptable to council tax payers in Leicester, and lead to a substantial reduction in the proposed level of council tax. I urge the city council to follow that lead.
What concerns me most of all, however, is the proposal to cut expenditure in the voluntary sector from £11 million at present to £9 million over the next two years. If that £2 million reduction is carried out, it will impact on the whole city and all groups in the city, and no section of the community in Leicester will be unaffected: women's groups will be affected; children's groups will be affected; mental health organisations will be affected; and ethnic minority groups will also be affected.
In my view, the reduction is a mindless attack on those groups which have done so much in Leicester to improve social cohesion, tackle social exclusion and improve race relations. To be parochial, the closure of Goldhill adventure playground and Braunstone adventure playground in Leicester, West will inevitably lead to more young people on the streets, with a possible attendant increase in social problems. The threatened closure of the Saffron resources centre will remove one of the key players in improving the life chances of the people who live on Saffron Lane estate in the outer city of Leicester.
The biggest cuts will be made in Highfields, which is the crucible of the multi-racial, multi-ethnic population of the city. If the cuts are carried out, one must fear for the continuing development of Leicester as a good multi-ethnic community. The cuts are short-sighted and fail to recognise the value for money provided by the voluntary sector in Leicester. The damage done to our city and its development as a multicultural city will be irreparable. I hope that the cuts can be stopped and that the new leadership of the city council eventually sees the light and realises the futility and stupidity of its current proposals.
5.47 pm
Mr. Eric Pickles (Brentwood and Ongar) (Con): At this point, I would normally comment on speeches by Back Benchers, and it is a matter of some regret that I cannot comment on speeches by my hon. Friends because they have been denied an opportunity to speak—they have, however, made a number of telling interventions.
I can also say to the usual channels that Her Majesty's Opposition take the view that half a day is sorely inadequate to debate one quarter of public expenditure, and I hope that we will now see—
Mr. Michael Foster (Worcester) (Lab): Will the hon. Gentleman give way?
Mr. Pickles: Yes, of course. We have plenty of time.
Mr. Foster: I know that the hon. Gentleman cannot comment on contributions by Conservative Back Benchers, but perhaps I can help him. A leading Conservative Front Bencher told a group of Worcestershire head teachers that he believed that the area cost adjustment should be scrapped. Does he agree with that position?
Mr. Pickles: Why did I take the intervention? I must have been mad.
We must restore confidence in the system by which the grant is allocated, because the system is shot. The speech by the hon. Member for Kingston and Surbiton (Mr. Davey) was immensely naive on one point: he asked whether central Government would take over education; they have. They absolutely control education and passporting is the final straw. It is the final measure that gives them complete control over education. Education authorities receive a sum of money which they pass over to schools, and sometimes they must find extra money because the Government have not allocated sufficient funds. The nature of passporting has completely skewed the organisation of local government finance. It means that there is practically nothing left in many authorities for care for the elderly, children in need, cleaning, or even for mundane things such as dustbins. Nor is there anything left for rodent control, about which the Prime Minister talked with such knowledge and passion yesterday.
We heard from the Minister his usual honeyed words about how adequate the whole settlement is, but we have been there before. As early as November, he said how generous the settlement was and that there was no reason why councils could not continue to improve services while sticking to a reasonable council tax increase. However, within a couple of weeks, the Chancellor of the Exchequer found it necessary to put in the additional sum of £340,000—[Interruption.] I am sorry—I mean £340 million.
Perhaps we should not be surprised, because the Minister said the same things last year. But we now know that last year council tax went through the roof. The average council tax rose by 12.9 per cent. on band D properties, which was the biggest increase in the history of the council tax. Previously law-abiding citizens refused to pay the council tax increases and old-age pensioners were dragged before magistrates courts for non-payment. Senior police officers warned of a breakdown in law and order.
The same formula that distributed the grant will also be used to distribute the extra top-up. My right hon. Friend the Member for Skipton and Ripon (Mr. Curry) made great play of the mere £6,000 that will be given to West Sussex. Put into context, that means that the good folk of West Sussex whose property is in band D will receive the princely sum of 2p off their council tax bills. By any stretch of the imagination, that is penny-pinching.
My right hon. Friend was also right to point out the discrepancy between Conservative and Labour authorities. After passporting is taken into consideration, Labour authorities have received, on average, an increase of £6.6 million, but Conservative authorities have received an average of £2.5 million. We
all know who will get the blame. Last year, most people blamed the councils, but this year we know from ICM that the people blame the Government. The independent Audit Commission blames the Government. The blame lies firmly on the shoulders of the Government.
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