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Sir Teddy Taylor: I welcome what my hon. Friend said about the 2001 census. Is he aware that if the size of Southend's elderly population, which showed a massive increase in the 2001 census, had been taken into account, we would have been entitled to an extra £1.5 million? Is it not desperately unfair and unreasonable that Southend should lose that money because the main figure was included, but not the breakdown?

Mr. Pickles: The fate of Southend is a good example of where the Government have got this wrong. Its location is central to the economic interests of the Government with regard to the Thames gateway. It is a major provider of education, and it endures some of the problems that are common to most seaside towns, with a high proportion of asylum seekers and a great deal of social pressure relating to the elderly. The Government have not recognised that.

Mr. Edward Davey: Bringing the hon. Gentleman back to his attack on the Government's failure to go forward with the localist agenda, can he explain why the Conservatives want to take control of education out of the hands of local authorities and run it from Whitehall? Where does that fit in with his party's supposed commitment to local government?

Mr. Pickles: The hon. Gentleman has not grasped the localist agenda. We would not take education out of the hands of local government and run it from Whitehall, but give teachers and parents more power to run their local schools. The previous Government moved towards per capita funding for schools, and this Government sensibly continued with that. Is it not more honest to give the people who know how to run education better—teachers, head teachers and parents—the opportunity to do so?

Mr. Kevan Jones: How would Southend fare in the context of the article that appeared in last week's edition of the Local Government Chronicle under the headline, "Tories promise grant distribution with a rural twist", in which the leader of the Conservative group in the Local Government Association announced that the Tories would redistribute funding away from towns and urban areas to rural areas? Surely a place such as Southend
 
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would suffer, unlike, as my right hon. Friend the Minister said, areas such as Wiltshire that are gaining under this Government.

Mr. Pickles: We promised to do away with fiddling and ensure fairness in the grant distribution system.

Let us consider what the Government have in store next. It is not the incoming Conservative Government's intention to use the revaluation process to increase taxation or make a significant shift in banding in the form of a stealth tax. The Government have been clear about their aims. The Minister is on record as saying:

Any council tax system inevitably requires some form of revaluation, but the recent revaluation in Wales, two years ahead of England, highlights how the system has been abused. One in three houses have moved up a band and only 8 per cent. of houses have moved down a band. In wards in Cardiff, Wrexham and Flintshire, more than nine in 10 houses have moved up a band.

A re-elected Labour Government will use revaluation further to increase tax by stealth and transfer funds from specific parts of England. If the Welsh experience were repeated in England, 21 million households would be liable for local tax. Seven million homes in England would be moved up a band but only 1.5 million would be moved down a band.

The tax on a band C home that moved to band D would increase by £128 a year. The tax bill for a band F home that moved to band G would increase to almost £2,000 a year. Areas where house prices have risen above the national average since the previous revaluation in 1991 run the greatest risk of soaring bills. As the Minister conceded:

That means a double whammy, because the Government grant to those areas would be cut as a result of the change. As figures that were released by the Halifax over the weekend suggest, London, the south-west, East Anglia and the south-east are likely to bear the brunt of revaluation.

There will be many other towns in property hot-spot areas in England. They include Knutsford, Altrincham, Ilkley and Chepstow. They will all be hit by Labour's new redistribution tax. Surely the Daily Mail was right when it described it as:

Matthew Green (Ludlow) (LD): Will the hon. Gentleman confirm that it is Conservative party policy to retain the council tax system?

Mr. Pickles: I am glad that the hon. Gentleman intervened, because I was about to say that rebanding is not only the Labour Government's scheme but Liberal Democrat policy. On two separate occasions, Liberal Democrats could have stopped the process but decided to vote with the Government. When Liberal Democrats knock on the doors in the election campaign and try to
 
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warn people about increasing revaluation, the electorate will ask, "If you think that's the case, why is it Liberal Democrat policy?"

Mr. Raynsford: Does the hon. Gentleman accept that I have made it clear on many occasions that there is no read-across from Wales to England? We are not committed, like the Welsh, to increasing a band at the top of the scale with no adjustments at the bottom. There is therefore no parallel to be drawn. Secondly, we have given an absolute undertaking that there will be no increase in yield through revaluation. Adjustments, based on bands, will be made for individual council tax payers because there is no logic in using figures that date back to 1991 as a basis for valuation. The hon. Gentleman made a point about census data. I hope that he accepts that revaluation is necessary, but that the Government have made it clear that it will not result in an increased yield and that there is no plan to increase the overall take from council tax through revaluation.

Mr. Pickles: Much as I like the Minister, I would find that easier to accept without the experience of non-domestic rates revaluation. We would also take it better if we had not read several quotations from him about the need for council tax to be more progressive,

In plain, simple language, he has made the case very well that this settlement is going to be used as a method of social redistribution, to soak the rich, and to make middle-class people squeak to the point at which their pips pop out.

Mr. Edward Davey: Will the hon. Gentleman give way?

Mr. Pickles: No.

Frankly, this settlement has as much long-term viability as the Deputy Prime Minister's desire to build uninsured houses on flood plains. It stands about as much chance as the possibility of seeing a popular regional assembly in the north-east. While it might try to repair the damage of eight years of Labour, it will store up massive increases for the future. Thankfully, however, it will be the last one before the people deliver their verdict.

Mr. Deputy Speaker (Sir Michael Lord): May I just remind the House that there is a 12-minute limit on Back-Bench speeches, and that that will apply from now on?

5.55 pm

Mr. Clive Betts (Sheffield, Attercliffe) (Lab): This is an excellent settlement for local government. As I said in an earlier intervention, on the morning on which my right hon. Friend the Minister made his initial statement, the Local Government Association asked for an extra £1 billion to keep council taxes down and to keep improving services. That is precisely what my right hon. Friend has delivered. I do not know whether he has yet received a letter from Sir Sandy Bruce-Lockhart saying,
 
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"You've given me precisely what I asked for. I'm very grateful indeed." Perhaps not. That is probably borne out by the response of the Conservatives.

My right hon. Friend probably knows that I am not a great fan of the capping process. I believe that local authorities should be left to set their own tax levels, and that the electorate should then make it clear what they think of them. That should be part of the local democratic process. Capping orders were introduced after the last settlement, and that was one of the very few occasions on which I found myself unable to support the Government in this House. However, I see no need for capping orders to be introduced on this occasion, for the simple reason that I see no need for excessive council tax increases. Local authorities have the funds to enable them to keep increases down and to maintain their services.

It was interesting to listen to the Conservatives. I could not understand where they were coming from at all. They are committed to making £4 billion of cuts to local government funding, yet they offer no description of how they would operate if, by some mischance, they were on this side of the Chamber. For all their moaning about the poverty and dire straits that some Tory authorities in the south find themselves in, we were never given a clear explanation as to whether they were asking for more funds to rectify that, or precisely where that money was to come from. Is the hon. Member for Brentwood and Ongar (Mr. Pickles) proposing that local authorities such as mine, in Sheffield, should give up money so that Tory authorities in the south can have more?


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