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Mr. Raynsford: I am grateful to the hon. Gentleman for giving way. As he heard me say earlier, Hampshire had only one inspection last year—a voluntary one—compared with nine over the previous two years. I could give him many similar examples. He should understand that some excellent authorities are not excellent in education. We always made it clear that there would be a continued role for the inspection of authorities where education did not achieve the highest standard, because education is such an important service. On good authorities, our latest figures suggest that the volume of inspection is about 22 per cent. less than last year, so we are very, very near that 25 per cent. target.

Mr. Davey: I can accept what the Minister says, but I will talk to the local authorities that have been contacting us. The odd example, such as Hampshire, may meet his criteria, but other authorities are still being over-inspected, despite the Government's promises. The Government need to go much further; they must adopt a much more strategic approach to minimising the impact of inspection.

The hon. Member for Runnymede and Weybridge told us what such an approach would mean for district councils. I was going to read the same page, but I will not detain the House by reading it again. All I will say is that he did not do the Local Government Association analysis justice because, at the end of the list that he read out, it said that it was looking forward to a comprehensive performance assessment peer review the following February and that there were more than 10 different inspections in six months. As the hon. Gentleman also said, a whole list of Acts of Parliament will affect councils and increase the regulatory burden, with a series of specific new burdens, such as the work force reform.

I happily admit to the Minister that it is not that one is against some of those proposals. Some of them are very sensible, such as those on freedom of information. Of course the Liberal Democrats are in favour of that sort of approach, but we need, first, to ensure that there is a more co-ordinated approach if regulation is increased and, secondly, to give local authorities far more support than has been the case hitherto.

I touched on the new burdens paper in an intervention, when I said that we would like the Audit Commission—a totally independent body—to be responsible for assessing the costs of those new burdens. That paper, which was published last month, also concerns me because the Government will not make their proposals retrospective in any way. The Government have placed a lot of burdens on local authorities in the past seven years, and we have been analysing those burdens in today's debate. No proposal in that paper suggests that the Office of the Deputy Prime Minister and other Departments will reconsider and say, "We gave you that cost. We didn't give you the resources. We are now going to put that right." If the
 
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Minister made such a commitment today, he would get support from both sides of the House and, particularly, from those in local government.

Mr. Mole: I wonder whether the hon. Gentleman is suggesting that, on the conclusion of such an analysis, the Liberal Democrat Treasury team would commit themselves to making such a pledge. Although I entirely understand the point that he makes, there is, of course, a financial burden of some significance to the national Exchequer in what he is saying.

Mr. Davey: I would certainly support the Government if they were prepared to make that commitment.

The new burden rules paper, which bears re-reading, is also interesting because it does not apply to all new burdens. Paragraph b says:

Despite the way that the Government spin all the increases that they say they are providing to local authorities, it is very clear that they will not take into account those extra burdens, so we consider their rhetoric and say, "You're not delivering on the things that you promised."

I now wish to move from the inspection regimes and extra burdens to the plan requirements. The Government said in the freedoms and flexibilities paper that they would reduce the number of plans that they require of local authorities in all respects—education, social services, housing, civil contingencies and so on. To be fair to the Government, they published a paper in July 2003, wrote to all chief executives and said that they would reduce the number of plans. The problem is that local authorities have had no update since July 2003, and there is huge uncertainty about whether the proposals consulted on last July will be implemented and, if so, when and how.

Even if the Government were to tell local authorities today that they will press ahead with the reforms described in the July 2003 paper, some local authorities are probably engaged in drafting the plans and strategies and meeting the Government's bureaucratic demands, so money has been wasted already. Even if we read that paper and say that it represents a good attempt at deregulation, we are left with the impression that it is a bit of a numbers exercise.

I should like to ask the Minister—perhaps his junior Minister can answer during his winding-up speech—how many of the plan requirements in the July 2003 paper will result in the abolition of documentary requirements. To any objective reader of that document, it looks as though many of those documents, plans, strategies and requirements are being merged. They are simply being subsumed into one large service plan, so that the amount of work, bureaucracy and cost imposed on local government is not being reduced. There is simply a numbers exercise to reduce the statutory requirement for plans.

Moreover, the Government are now trying to make out in that paper that they are reducing the number of plans to 16, but that is still a huge number of plans for
 
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small authorities, such as district councils, to draft, and most of those plans must be submitted to central Government, so the Government are still looking at local authorities' every action.

I shall finish by considering the Government's failure to produce financial freedoms for local authorities. In their 1997 and 2001 manifestos they promised greater reforms, but they have not delivered on all those promises. The Minister was right to say that they have delivered on the prudential capital framework. He knows that we supported and campaigned for that framework, and he continues to have our support. There are already signs in local government that that policy is beginning to tackle some of the investment backlog that the Tories bequeathed in things such as roads.

The Government promised other things such as trading powers—it is all in the Local Government Act 2003, which received its Royal Assent in September, yet the order has still not been considered in the House so that its provisions can be brought into effect. The Government also promised in their 1997 manifesto the relocalisation of business rates. They said that they had been campaigning and consulting on that before 1997, yet that pledge has still not been met. Perhaps that will be done in the balance of funding review, but that will be seven years after the Government's 1997 pledge.

Even where the Government have introduced some of the financial freedoms that they promised—for example, on the charging regime—they have very carefully restricted them. The Minister looks puzzled, but he will know that the Local Government Act 2003 restricts the charging regimes to just pure cost recovery. The Local Government Association, which is cross-party, says that that is far too restrictive.

Mr. Raynsford: Surely the hon. Gentleman understands the difference between trading—where authorities have an opportunity to make a profit, but where they are required to operate in a company structure, on which consultation has taken place, which is why we have not yet introduced the order—and charging, where it is not appropriate, without protection, for authorities to be able to trade essentially against the private sector from a privileged position. That difference between charging and trading is well understood, and I should have thought that the Liberal Democrats supported it.

Mr. Davey: The Local Government Association certainly argues against the removal of cost recovery. The right hon. Gentleman will remember that the debates on those clauses of the Local Government Bill were truncated, partly because of a lot of time wasting by Conservative Members. I very much regret that, because we could have had some detailed arguments about the charging and trading regime. I wonder whether there will be a chance to return to that because there are concerns in local government that the charging and trading regime is not working as originally envisaged.

The hon. Member for Runnymede and Weybridge talked about a new set of cost pressures that have been placed on local government, particularly in respect of inflation. Local authorities provide labour-intensive
 
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services. Their wage bills are increasing by 4 or 5 per cent., partly because of national arrangements, and they have absolutely no control over that. It is incumbent on the Minister to ensure that local government gets a good deal in the forthcoming spending review, so that those cost pressures, which local authorities cannot control, are met under the grant agreement.

The motion is good in so far as it goes. It is right to point out that the financial burdens have increased under this Government, and I find it bizarre that the Minister is not even prepared to admit that. In fact, a lot of his programmes are intended to try to row back, which suggests that there is some recognition in the Office of the Deputy Prime Minister that the Government's programmes have been burdensome and part of the reason why council tax has increased.

The motion fails, however, in one major respect: if we are to tackle some of the financial burdens, yes we must cut inspections, reduce the number of plans and remove the ring fences around many of the grants, but we must also deal with the fundamental, underlying issue—financial autonomy for local authorities.

As we debated last week, we believe that there is a clear case—whether in terms of accountability or the gearing effect—for local authorities to have much more control of their financial future. Until we get reform of local government finances, which should include local income tax and a relocalisation of the business rate, we will not be able to deal with that.

I have a final question for the Minister. He spent a long time last week attacking the Liberal Democrats' local income tax proposals, but we know that the Chartered Institute of Public Finance and Accountancy put forward a paper to the balance of funding review. The paper does not represent Liberal Democrats' policy; it represents CIPFA's view of the local income tax. Is the Minister prepared to consider that proposal and to consider local income tax in a different form from the one that we are proposing, and possibly in combination with the council tax? We need to know, and this is a good chance for him to clarify the situation. We look forward to hearing the Under-Secretary of State, Office of the Deputy Prime Minister, the hon. Member for Corby (Phil Hope), answer that question.

2.10 pm


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