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Phil Hope: Let me remind the hon. Gentleman before he stands up that we have had interventions from Tories such as the hon. Members for Altrincham and Sale, West (Mr. Brady), for Rochford and Southend, East (Sir Teddy Taylor), for Beckenham (Mrs. Lait), for Runnymede and Weybridge (Mr. Hammond) and for Upminster (Angela Watkinson), the right hon. Member for Skipton and Ripon, the hon. Members for East Devon (Mr. Swire) and for Southend, West (Mr. Amess), all of whom have complained about insufficient funds for their local councils. It is entirely acceptable for right hon. and hon. Members to champion the councils in their constituencies, but they cannot do so while at the same time supporting a manifesto commitment that would clearly cut funding to their own councils.
Mr. Pickles: The Minister must be clear about Conservative policies. We are saying, clearly and unambiguously, that we will protect education, health and the police service. In addition, we guarantee that local authorities will get, at the very minimum, an increase that will protect them against inflation. On top of that, we have identified £1 billion in savings that local authorities will be free to use as they choose. Councils will be removed from the shackles of control that the Government impose on them.
Phil Hope: We have just heard an Alice in Wonderland contribution from the hon. Gentleman. His fantasy world will not be tolerated in this House. My hon. Friend the Member for Sheffield, Attercliffe specifically asked about waste and housing. The Opposition are proposing cuts of £35 billion in public services, part of which is a cut of £1 billion in housing.
Mr. Swire: I am grateful to the Minister, as he mentioned me in his list of Opposition Members. Does he understand that if the Government stopped insisting that local councils must meet so many targets, and if they also abandoned their policy of taking 75 per cent. of capital receipts from the sale of remaining housing stock, East Devon district council would not need any more money?
Phil Hope: I may be wrong, but I think that it is the Conservative party's policy to sell off housing association stock under the right-to-buy scheme. That would strip out all affordable housing for people on low incomes. The hon. Gentleman cannot make an intervention like that and think that he can get away with it.
The Opposition ask for money and then whinge about council tax rises. I remind the House that, on average, Tory councils raised council tax last year by 5.4 per cent. That is in sharp contrast to the rises imposed by Labour councils of an average of 4.7 per cent. For far too long, Tory councils have hiked council tax and then sent their local MPs to Parliament to blame the Government. Neither we nor the electorate are fooled. Opposition Members would be better advised to use their time persuading their authorities to keep council tax levels down.
I turn now to the Liberal Democrats. I was interested to hear the hon. Member for Kingston and Surbiton (Mr. Davey) say that the Labour Government have made Britain a fairer society. I am grateful for that generous recognition of what we have done over the past eight years to support our poorest people. After that welcome contribution, however, he then trotted out more details of the Liberal Democrats' proposals to replace council tax with their uncosted, unworkable and unfair local income tax.
My hon. Friend the Member for Sheffield, Attercliffe reminded the House about the loophole in the Liberal Democrats' schemes that means that the very wealthy would pay no local income tax at all. My hon. Friend the Member for Normanton pointed out that, when challenged, the Liberal Democrats refuse to define their policies, which do not stand up to scrutiny. They do not want to be reminded of the policies that they would pursue because they do not want us to remind the electorate of the record increases in local government funding that this Government have made. In addition, they want to distract attention away from the record of Liberal Democrat councils, which last year raised council tax by the largest amount5.8 per cent. on average.
The Liberal Democrats were challenged too by my hon. Friend the Member for North Durham (Mr. Jones), who said that they had announced, during the Brent, East by-election, that they would give pensioners vouchers worth £100. Those of us who worked the streets in that election remember that promise. However, as soon as the election was over the £100 voucher disappeared. Moreover, I remind the House that this Labour Government have made available £100 for every household with a pensioner over 70. That money is in pensioners' pockets now, and is helping pay the cost of local council tax.
The Liberal Democrats then described their daft proposals, which would remove the need for council tax revaluation. Their so-called research has created
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headlines that are factually wrongludicrously so. Those headlines, in newspapers such as the Daily Mail and the Evening Standard, reveal how ill informed, ignorant and, frankly, how stupid the Liberal Democrats really are.
Let me repeat what I and my right hon. Friend the Minister have said many times in this House. The revaluation does not mean that individuals will pay more council tax just because their house has gone up in value. The council tax for their house will depend largely on how much their property has increased in value compared with the average. If their property has increased in value in line with the average, it will not go up a band. Even properties that have increased in value by more than the average will not necessarily move up a band if they are currently valued towards the bottom of an existing band. Yes, some properties may go into a higher band, but many will stay in the same band and some will go into a lower band and pay less council tax.
The crucial point is that the revaluation will not increase the amount of money raised overall from council tax, because we have made that commitment. Ignorant speculation like today's that a fairer council tax system will lead to huge increases in council tax is simply untrue. The hon. Member for Kingston and Surbiton quotes the example of Wales, but it has been made clear that it is not a parallel model and cannot be read across to England. Interestingly, by the way, it was Conservative and Liberal Democrat Assembly Members in Wales who voted in favour of the banding system that Wales has introduced.
We have had contributions from various individual Members and I shall make a few comments in response. My hon. Friend the Member for Normanton emphasised the importance of spending on liveability, and he was right to do so. As MPs, we know from our surgeries that people are concerned about how clean, how safe and how green their communities are. We are doing much to support local government to provide better services in their areas. The Clean Neighbourhoods and Environment Bill, in particular, contains measures to increase the liveability of local communities. A recent MORI poll pointed out that the track record has greatly improved in recent years.
My hon. Friends the Members for Chorley and for Pendle (Mr. Prentice) asked us to look again at how the floors operate. I wish to emphasise that no money has been withheldmy hon. Friend the Member for Pendle was right to say thatbecause the money has been distributed to pay for the floor to help councils such as Preston. We understand the concerns that my hon. Friends raised. The formula is being reviewed and we will want to look at those questions, but stability in local government funding is also important. We have to get that right.
My hon. Friend the Member for Birmingham, Northfield (Richard Burden) welcomed the generous settlement that Birmingham is to receive, but he made the clear point that it is only good money if it is spent well. He has been a real champion for his constituency in standing up for youth and play facilities. I hope that
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the Conservative-Liberal Democrat coalition that runs the council in Birmingham gets the decision right, to ensure that facilities are protected for young people.
My hon. Friend the Member for Worcester (Mr. Foster), whom I have met on many occasions to discuss the particular issue that he raised[Hon. Members: "Oh!"] I should emphasise that the meetings were not about this particular settlement. We are not making any changes to the way in which we calculate the area cost adjustment during this formula freeze, but we will listen carefully to my hon. Friend's representations, and those from other hon. Members, about the ACA in the future.
The hon. Member for East Devon made a point about what appeared to be a regional plot and then mentioned the James review. As he knows, the James review is not about savings, but about savage cuts to local government.
There will never be a local government settlement that is universally welcomed, but if there were to be such a mythical beast, it would look pretty much like this year's settlement. It includes an increase in formula grant of £2.6 billion, or 5.6 per cent. All councils will receive a formula grant increase at least in line with inflation, with extra on top from specific grants. As my hon. Friend the Member for Northampton, South (Mr. Clarke) said, the settlement builds on sustained grant increases over the years since 1997. The choice is clear. Do people want massive Conservative cuts in grants to councils, followed by the inevitably huge increases in council tax, an uncosted, unworkable and unfair local tax system that would mean a massive increase in income tax, or this settlement, which is a good deal for local government and for the council tax payer?
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