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David Howarth (Cambridge) (LD):
The hon. Gentleman is making an interesting speech, but is he saying that he would never favour a revaluation? Would he support a revaluation if property prices were to diverge?
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Mr. Pickles: I could not make it clearer that the Conservative party would support the abandonment of the revaluation. It is absurd to pursue revaluation when there is no divergence in the property market and the Government propose to postpone it. Why spend millions of pounds on a revaluation for no purpose? Would not that money be better spent in our schools, on teachers and children? Would the hon. Gentleman prefer that money to be spent on computer programmes?
The Minister for Local Government (Mr. Phil Woolas): In which case, why did the hon. Gentleman tell the House that
"Any council tax system inevitably requires some form of revaluation."—[Official Report, 2 February 2005; Vol. 430, c. 929.]
Mr. Pickles: That does not work. The Minister may recall the last opportunity we had to debate this issue, when I stood like a supplicant before the inquisition, confessed that I had made a mistake and apologised to the House. Where is the gracious response from the Minister? He should encourage such forthright confession. I admit that I was fooled, but I have realised that the emperor is naked and a revaluation would be pointless. People should be prepared to admit when situations have changed. The Minister presumably wishes to try to persuade me that the emperor is wearing a handsome suit.
Mr. Nick Raynsford (Greenwich and Woolwich) (Lab): As it appears that hon. Members on both sides of the House are making a virtue of making U-turns, can the hon. Gentleman tell us why he is not prepared to take his logic further? When a property changes hands it is subject to revaluation, so why does he not propose that that should also cease?
Mr. Pickles: Because that falls within the existing rules and, over a period of time, there would naturally be a change. I understand why the right hon. Gentleman wants to pursue the original policy. Indeed, in my mind's eye, I can see the great handover between him and the Minister of Communities and Local Government. There may have been a glass of sherry. Pleasantries were uttered and, to be helpful, the former Minister handed the new Minister an envelope—[Interruption.] The Minister says that it was a six-course dinner. How very new Labour. No doubt there was a choice of wines.
To be helpful in a time of trouble, the right hon. Member for Greenwich and Woolwich told the Minister, "I'll leave you some advice. I'll leave you three envelopes." The Minister made the mistake of opening the first two envelopes, which said, "Blame me", and "Send things to a restructuring committee." The Minister has only one envelope left, and he knows what it says—"Prepare three envelopes".
Dr. Alan Whitehead (Southampton, Test) (Lab):
I have listened to the hon. Gentleman's arguments carefully both today and in previous debates. Is he saying that he stands by everything in the Conservative Government's introduction of council tax, including the consultative paper, "A New Tax for Local Government", which certainly mentioned rebanding
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and revaluation? Does he stand entirely by that, except for revaluation, or is he suggesting that there should be a new council tax or a completely new tax? If so, it would be interesting to hear what it is.
Mr. Pickles: I think that I can rely on the assessment of the incoming new Labour Government. Perhaps I may be permitted to quote from their document "Modern local government: in touch with local people", which states:
"The council tax is working well as a local tax. It has been widely accepted and is generally very well understood. This has been borne out by the responses received to the consultation paper."
We have established that the same level of valuation has existed in Northern Ireland for 30 years. Scotland will have none of it, while Wales has seen the effect of revaluation, which I suspect played a part in the Government's decision to make a U-turn. However, the full effects of revaluation in Wales have yet to be felt. In 2005–06, initial bills were kept down by transitional relief to limit sharp increases, yet most of that relief is for only one year, meaning further automatic tax hikes next year. Relief is to be phased out completely within three years. Why should the Welsh have to suffer when the English are temporarily spared? When the postponement Bill is debated, we shall move amendments to retain transitional relief for Welsh revaluations until decisions in England have finally been made.
David T.C. Davies (Monmouth) (Con): I thank my hon. Friend for pointing out that people in Wales are being treated as second-class citizens in the United Kingdom. Over the past few years, they have been confronted with council tax rises of up to 130 per cent. as a result of the Labour Administration in the Welsh Assembly. Will he do everything possible to ensure that our motion is carried and that Wales is treated fairly, in line with the rest of the UK?
Mr. Pickles: My hon. Friend makes a powerful point. What happened in Wales demonstrates clearly what would happen in England. The Conservatives are determined not to abandon the Welsh people.
Mrs. Maria Miller (Basingstoke) (Con): Is not the simple truth that council tax rebanding is just another stealth tax? In my constituency, there will be a double whammy. House price increases are up to 13 per cent. higher than the regional average over the past year and all those houses will face rebanding, with bills soaring by more than £300 a household. At the same time, Hampshire county council is warning of an inflation-busting council tax rise next year because it received one of the lowest grants in the country. Is not it time to scrap rebanding?
Mr. Pickles: My hon. Friend is right and makes a powerful point. Given the announcement of the postponement of that stealth tax, we might say that the stealth tax has fallen to a stealth axe.
Julie Morgan (Cardiff, North) (Lab):
Is the hon. Gentleman aware that in Wales all political parties supported revaluation for this year, including the Conservatives and the Liberal Democrats? The measure had all-party support in the Assembly.
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Mr. Pickles: I am certainly aware that, in the hon. Lady's constituency, council tax has gone up by eight times the rate of inflation, but there was a constitutional settlement in Wales—we had a devolved settlement—[Interruption.] The Under-Secretary of State, the hon. Member for Poplar and Canning Town (Jim Fitzpatrick), says from a sedentary position that that was not in our motion, but he will recognise that the House set up the National Assembly for Wales, so we should not shirk our responsibilities. It is a pitiful sight when Labour Members of Parliament and Assembly Members try to blame each other for those savage rises.
Lembit Öpik (Montgomeryshire) (LD): Although I accept that all parties recognised the principle of revaluation, does the hon. Gentleman agree that the real issue is Labour's inability to implement that process in anything that resembles a just and fair settlement? As a result, council tax has not only become random, but it hits the people—often the elderly—who can least afford to pay the increases.
Mr. Pickles: I shall certainly come to those points. The relationship between revaluation and its effects on total tax take and resource equalisation is something that I could go on about for hours, but I know that Welsh Members will want to make those points.
The costs of revaluation were spiralling out of control. In 2004, the Government estimated that revaluation would cost £108 million, but by 2005 the figure was £178 million, an increase of almost two thirds. Millions of pounds were lost before postponement and it is a criminal waste to continue the process and spend more.
As I demonstrated in my quotation from the Government White Paper, council tax was working well before Labour took over. It was well understood and was popular—if that is possible for a tax. Under the Labour Government, council tax has become deeply unpopular. That is hardly surprising with increases of 76 per cent., or when the Government cap councils that increase council tax by a few pence a week yet ignore others where the increase is in pounds, or when pensioners are being thrown into prison—[Interruption.] The hon. Member for Rhondda (Chris Bryant) may find the spectacle of pensioners with a previously unvarnished record languishing in our jails amusing, but I do not. It is little short of a disgrace that he and his hon. Friends forced pensioners into that position.
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