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Mr. Woolas: I really must move on. As I have already said, the more interventions that I take, the fewer the opportunities for hon. Members to contribute to the debate.

The hon. Member for Brent, East made her point clearly. To be fair—something that I am always in favour of—my own party's manifesto, on which we fought the election, included the point that a limited capping regime was our policy. It is the case that, three years ago, council tax increased by 12.9 per cent. on average, before the capping regime, yet this year the average increase was 4.1 per cent. Those two statistics are not coincidental.

In laying this order, we are keeping our promise to act on excessive council tax increases. That promise was made in our manifesto. Opposition Members are too easily dismissive of another important point—the Government have provided all authorities with grant increases in line with or above inflation in all of the last three years. Overall, the funding that we have provided for local government has increased in real terms by 33 per cent. since 1997—a real-terms increase of a third in the Government grant to local authorities. That compares favourably with what came before us, Mr. Deputy Speaker, although I do not want to say that all the evil was done under the last Conservative Government—just most of it. It compares with a cut in
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real terms of 7 per cent. in the four years before 1997. The financial regime and the financial climate for local authorities has changed substantially. In that context, local authorities have to look long and hard before proposing significant council tax increases. If central Government were to propose significant or, indeed, any increases in other taxation policy, Opposition Members would not be—[Interruption.] The hon. Member for Brentwood and Ongar says from a sedentary position that we have proposed other increases—

Mr. Pickles: Through the council tax.

Mr. Woolas: The hon. Gentleman may say that, but that is the very issue that I am addressing. People cannot have their cake and eat it—in that regard or any other.

Given the Government's substantial investment in local government, there is simply no justification for authorities setting excessive council tax increases. We have shown over the past two years that we will take action to deal with that. No authority should assume that it is somehow immune to or exempt from possible capping action in the future.

As I said, our general election manifesto reaffirmed our commitment to use these powers if necessary and as a last resort. It is up to authorities to take that message on board.

Those hon. Members minded to oppose this order must answer the following questions. Do they support percentage council tax increases that go well into double figures? Do they feel that the Government should take no action on increases of up to 100 per cent.? Will they go out and defend such increases to their constituents?

Mr. Philip Hammond : I will.

Mr. Woolas: Well, that is for each hon. Member to decide. We must not forget the public in this debate, and they have made their views clear. They are not prepared to accept excuses for excessive council tax increases—

Mr. Djanogly : Will the Minister give way?

Mr. Woolas: The hon. Gentleman is getting very excited, so I will give way to him.

Mr. Djanogly: The Minister says that he is responding to what residents and constituents have said, but that is not the case in Huntingdonshire. At the polls, people elected a Conservative administration based on the budget that he is now capping.

Mr. Woolas: I thank the hon. Gentleman for that intervention and I take it that, if he gets a chance to speak in the debate, he will make it clear that he—like the hon. Member for Brent, East—is opposed to any capping regime. I look forward to his contribution on that matter. I can assure the House that my folder is brimming with contrary reactions from people in respect of the council tax levels that have been set.

As I said, the public have made their views clear: they are not prepared to accept excuses for excessive council tax increases, either this year or in the future. The Government will not accept such excuses either. I therefore urge hon. Members to support the order.
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2.11 pm

Mr. Eric Pickles (Brentwood and Ongar) (Con): The Minister said that his folder is brimming with correspondence from people in the various capped authorities making it clear that they want the capping regime. He would do the House an enormous service by publishing those letters in the Library. I suspect that the folder must be very thin.

The Minister has my sympathy. I have responded to capping orders such as this for some years, and I have never seen a Minister more uncomfortable or embarrassed. He has been given a dreadful task for his first major appearance in this role, and he is diminished in his office as a result. Those above him have sent him to the Dispatch Box like Captain Ahab in search of the great white whale, but all he has done is harpoon a handful of minnows.

Residents in Labour authorities have seen their council tax go through the roof year after year, while the Government have stood idly by. Now, the Government have sprung into action to cap eight Conservative authorities, and the weekly savings of all eight in total amount to less than a packet of crisps per council tax payer. The Local Government Association, at its press conference of 7 July, rightly called the capping decision "stupid". It expressed its dismay at the decision and said that it would leave local people short changed.

The LGA's Labour group leader is Sir Jeremy Beecham, a man much respected in this House. He said:

So let us be clear: the eight councils involved would not have been capped if they had imposed the same increases in council tax last year. I can go further, and say that no capping regime under any previous Labour or Conservative Government would have caught these eight councils. They have been capped only because, close to a general election, the Government devised a set of rules to catch Conservative authorities.

The decision is not an administrative one, but represents political vindictiveness at its most base. All the authorities being capped are low-tax authorities. Compared to neighbouring authorities, they all charge residents less in council tax, even after original proposed increases for this year have been taken into account. These eight authorities charge low council tax, and yet they deliver high-quality public services.

Dr. Phyllis Starkey (Milton Keynes, South-West) (Lab): That is debatable.

Mr. Pickles: The hon. Lady says that that is debatable, but that is what Government statistics show. Is she disagreeing with her own Government? The Government's comprehensive performance assessment regime rated three of the eight authorities—Hambleton, Huntingdonshire and Runnymede—as excellent. Aylesbury Vale was rated good, and only one of the eight was rated below fair. If the hon. Lady wants to engage in a debate about the performance of those authorities, she ought to know that Opposition Members would be very happy to oblige her. We recognise a good council when we see one.

When the Government introduced the CPA inspection regime they made it clear that councils rated as excellent or good would not be subject to capping.
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The order before us today shows that to be yet another broken promise. Nearly all the authorities being capped are rural based. It can cost to provide the same services in rural communities as are provided in towns and cities but, despite that, the authorities covered by the order provide good services for their residents at low cost.

Only one authority—Sedgemoor district council—has escaped capping this year. I wondered about that, and decided to have a close look. It has escaped because it did not impose much of an increase in the first place. However, a town council within Sedgemoor district council area is controlled by the Labour party. It was decided that that town council should put a significant amount into this year's increase, whereas the sensible thing to do would have been to spread that amount around. Perhaps the Minister could not bring himself to cap an authority whose increases were caused by fellow Labour party members. There is clearly one rule for the Conservative party, and another rule for Labour.

Mr. Betts: Will the hon. Gentleman give way?

Mr. Pickles: After what he said about crude and universal capping, how could I refuse the hon. Gentleman?

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