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Mr. Brian Binley (Northampton, South) (Con): Does the hon. Gentleman not think the same thing about the Labour party now that it is in office?

Mr. Betts: What I have to say very simply—I was going to come on to this point—is that the Government have done many things that have carried through from opposition to government the promises that they made in respect of local authority resources, borrowing, prudential guidelines and the right to trade. A number of rights and powers have been given to local authorities in contradiction to the policy of the Conservative party, which constantly took away rights and powers. I just happen to believe that the capping order today is not one of the good things that the Government have done.

Mr. Pickles: The hon. Gentleman stands before us a paragon of virtue, but I recall his period of distinguished service in the Whips Office during which he forced several of his colleagues to take some pretty anti-local government decisions. Does he regret that? Does he wish to recant now? He has a sympathetic audience; we will be kind to him.

Mr. Betts: I do not think that I ever forced anyone to do anything when I was a Whip. I might have used my powers of persuasion on occasion, but I am always open to persuasion myself.

I shall not engage in argument over whether the budgets and council tax set by any of the councils in question are right, because I do not know whether they are right or excessive, or whether the councils are efficient or inefficient, and I do not believe that it is my job or that of any Member of Parliament to second-guess decisions that are the responsibility and the role of locally elected councils, which should be accountable to their electorate. That is how such decisions should be made. I honestly believe that when they troop into the Lobby, most Members of this House will not have a clue what they are doing—what impact the order will have
 
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on local services in the areas affected by it. That is why it is important to leave those decisions to local councillors and the electorate to whom they are responsible.

In the 1980s, many Labour Members, I among them, stood in solidarity against the capping regimes of the then Conservative Government. We stood with local councillors, local councils, council workers and local voters. We were not arguing about the correctness or otherwise of the spending level that any of the councils had determined; we were supporting the basic principle of local democracy and local determination of levels of spending and tax. We did not call it subsidiarity back then, but that, in effect, was what we were championing.

The Government are rightly worried about voter turnout at both general and local elections, but capping is not only about central control of local councils; it is about removing the democratic rights of local residents, removing voter choice and devaluing local elections. In my view, capping is a fundamental challenge to the very basis of local democracy. To quote again:

"The capping system is patently undemocratic. It serves no wider economic purpose in the control of public expenditure."—[Official Report, 9 June 1993; Vol. 226, c. 387.]

That was my right hon. Friend the Member for Blackburn. His statement is just as true now as it was in 1993.

2.32 pm

Sarah Teather (Brent, East) (LD): It is a great pleasure to follow the hon. Member for Sheffield, Attercliffe (Mr. Betts), who so eloquently stated the case against capping and the principles behind this debate.

For me, the order is without doubt the most extraordinary, absurd and vindictive measure that I have seen since entering Parliament. Labour's historic third term has produced legislation—with all the civil service manpower that such legislation entails, with all the ministerial time and the meetings with councils—for what? It is to save taxpayers in eight authorities as little as 4p a week—£2 a year—enough to buy perhaps two packets of Polos. In the House of Commons Strangers Bar, it might just buy a pint of Guinness. I cannot help wondering whether the Minister should just save us all time and trouble by popping down to Aylesbury Vale and buying all the good voters a pint; then we could all go home. That would be a lot cheaper than going through the rigmarole of laying an order, voting on it and asking councils to re-bill. We seem to be engaged in the most ridiculous process that I have ever seen, and I hope that I do not see anything more ridiculous in my time as an MP. [Hon. Members: "You'll be lucky."] Hon. Members should not get too excited.

As the hon. Member for Sheffield, Attercliffe said, capping is an affront to local democracy. It undermines local people's right to decide what services they want and what they are willing to pay for, and it completely undermines local government's authority to plan, prioritise and make decisions. As he so eloquently pointed out, not so long ago Labour Members who are now Ministers were making precisely the same point.
 
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Surely the final arbiter of choice must always be the ballot box: it is for local electors to decide what they are willing to pay for and when it is time to get rid of a council that has set excessive council tax increases.

It is no good the Conservatives bleating on about whales and minnows, because it was they who 20 years ago invented rate capping; consequently, they have only themselves to blame. It seems that their policy is to oppose capping when it involves Conservative councils, but they need to oppose capping in principle if they want to be taken seriously.

Alistair Burt: Will the hon. Lady give way?

Sarah Teather: I shall do so willingly in the hope that the hon. Gentleman will join me in opposing capping in principle.

Alistair Burt: I shall ask the hon. Lady the question I wanted to ask rather than follow her lead. I am listening to her speech with great interest; as the rest of us intend to do, she is making a perfectly sensible case against rate capping. Before criticising the Conservatives, will she be good enough to send a copy of her wonderful speech to Councillor Neil Cliff, leader of the Liberal Democrats on Mid Bedfordshire district council, who has found a way to support the Government's decision to rate cap the council?

Sarah Teather: I am sure that the hon. Gentleman will send a copy of my speech. I cannot comment on the details of his local council. I am not divinely all-knowing—at least not yet.

Even if we accepted the principle of capping, as some people do although my party does not, the execution of the exercise defies logic. As the hon. Member for Brentwood and Ongar (Mr. Pickles) pointed out, the proposed council tax increases are tiny in cash terms. The councils concerned are among the lowest-taxing councils in the country: Hambleton has the third lowest council tax of any district and all the councils are in the lower quartile of council taxes, with the exception of South Cambridgeshire district council, which is still in the bottom half of the council tax table. It is mathematically ludicrous and meaningless to cap on the basis of percentage increases in such small tax bases. The Minister claims that the low taxes have been taken into account, but that is patent nonsense. As the Conservative Front-Bench spokesman pointed out, Oldham will have a very large council tax increase—£53.75 on the band D rate has been proposed—compared with the increases of about £12 that have been set by the councils affected by the order. Capping them seems utterly ridiculous. Far be it from me to accuse the Minister of macho posturing when he is not much taller than me—[Laughter.] I simply cannot see the purpose of going though such a fuss and performance in the newspapers to secure such tiny savings for taxpayers.

Mr. Woolas: I shall not respond to the hon. Lady's sizeist comment, although my right hon. Friend the Member for Makerfield (Mr. McCartney) would have something to say if he were here.
 
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Does the hon. Lady accept my point that the capping regime affects all councils and that the 98 per cent. of councils that did not impose excessive increases must also be taken into account?

Sarah Teather: I do not understand the Minister's point. The capping process is wholly arbitrary. I am entirely opposed to capping on principle and I see no reason to except the councils affected by the order.

Notwithstanding the taxpayers' money wasted debating the order in Parliament, the cost to the councils concerned will be enormous. Hambleton, which is proposing a £12 a year band D increase, estimates that re-billing will cost £50,000. The cost in Daventry will be twice that—about £100,000. In a final Kafka-esque twist, the councils must find savings to cover the cost of rebilling at the same time as they have to find the savings imposed by capping. That makes the whole situation even worse. The order is not about prudential financial planning; it is absurd centralisation gone completely mad.

It is worth considering the background to the increases. Many of the district councils in question had among the smallest percentage increases in grant five years in succession—indeed, Runnymede had the second-lowest increase in the country over that period. This mad order goes against all the warm and fluffy noises that the Government have been making about new localism and valuing local government. Where are the supposed freedoms and flexibilities for the three councils that have been judged excellent by the stringent standards of the Government's own comprehensive performance assessment?

This is not about whether or not a council is judged excellent or whether or not its grant rise is higher than another council's. It is about the principle of local democracy, as the hon. Member for Sheffield, Attercliffe pointed out. It is about local people being able to decide what should be spent on their services and being able to kick out a council if they are not happy with it, or vote it back in if they are happy with its priorities. If the Government seriously wish to tackle council tax rises, they must deal with the balance of funding crisis, and give more power to councils to raise more money themselves. They could start by relocalising business rates. If they seriously wish to end public angst about council tax rises they could scrap the tax, not cap the tax. They could introduce a tax based on people's ability to pay so that yearly rises would not fall so heavily on the elderly and the low-paid.

This is another piece of centralising nonsense from an uninterested Government who are antagonistic towards local democracy. I urge all hon. Members of sound mind to vote against the motion.

2.40 pm

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