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Anne Main (St. Albans) (Con): I am pleased to follow the hon. Member for Hastings and Rye (Michael Jabez Foster), who drew on the nub of my argument, which is that it is possible to have areas of relative deprivation in places such as St. Albans, and it is hard for people in those areas to pay high council taxes.
St. Albans is a constituency that is stereotyped as being wealthy, but it has areas that are characterised by having poor housing, poor health outcomes and poor future prospects. We endure high housing costs. I stress "endure" because many young people are struggling to get on to the high housing costs ladder. As a result, we have long waiting lists for social rented housing, significant levels of homelessness and overcrowding. For many, the council tax is an enormous growing burden that they struggle to pay.
As we know, the council tax is divided into four categories: parish, police, district and county. The residents, however, do not see it like that. They make no distinction and just see the final figure that lands on their doormat. Since 1997, council tax bills in St. Albans have increased by 96 per cent. A standard band D household could expect to pay £634 in 1997. The same household would now expect to pay £1,242.
What is the major cause of this grief? I talked to both county and district councillors, and the main holes are in their county, district and policing costs. A constant complaint is that a huge number of extra responsibilities and duties have been placed on authorities in each sector, but the funding does not reflect that. A person might ask, "Do I have a profligate county council?" Labour Members implied that some Conservative county councils either keep money to themselves or throw it away.
Conservative-controlled Hertfordshire county council is rated as excellent. It is one of the best in the country and has received a four-star rating for the fourth successive year. Hon. Members should accept that it knows what it is talking about. Hertfordshire county council is on the grant floor, so any rise is 2 per cent., which nowhere near reflects the costs and demands placed on its services. The leader of the Conservative county council, Robert Ellis, tells me that to keep costs down, it has doubled the efficiency savings that the Government required it to make. It is being very prudent. However, the margins are now tight.
Hertfordshire has pressed the Government—I am sure that the Minister is aware of this—for a realistic level of funding. The headline statistics make worrying
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reading. In the financial year 2006–07, the formula grant is nearly £150 million—an increase of just 2 per cent. Hertfordshire is one of five authorities with the lowest increase out of 14 other comparable shire counties that also have fire responsibilities. The average of all authorities in England is 3 per cent. For 2007–08, the formula grant is a little over £151 million—an increase of 2.7 per cent, but lagging well behind the rest of England, which will get an average of 3.8 per cent.
What do those different figures mean for my constituents? I am told that with a grant floor it will be very difficult for Hertfordshire to invest in new capital projects, such as schools and transport. That comes at a time when the building schools for the future programme and local transport plans mean that there will be a high expectation of local authorities delivering significant new investment. However, Hertfordshire believes that it will have to cut key front-line services.
Hertfordshire has one of the highest incidences of people with learning disabilities in local authority-supported residential care. The demand for that service is one of the main reasons for the council spending above its funding limits for personal and social services. However, the calculations take no account of the relative needs of people with learning difficulties, so yet another funding expense will land on the taxpayers' doorstep.
The recent Buncefield disaster will have a major cost implication of £2.5 million for the authority, despite the Bellwin formula settlement. That disaster alone will equate to an extra 0.65 per cent. increase in council tax. My district council will also have an ongoing cost as a result of Buncefield. Talking to it today, it said that it will have to monitor the water and environmental impact for years to come and there will be no additional funding. As I said, council tax bills have risen by 96 per cent.
It would be easy to add fuel to this particular roaring fire because we have a Liberal Democrat-run district council. On top of all the other woes for my constituents, it felt it necessary to appoint an additional diary secretary, at £33,500 extra per annum, and a new chief executive, who we have always managed without, at an additional £100,000-plus per annum. On top of that, the councillors have just awarded themselves a pay rise of 33 per cent. I do not want to get carried away with or distracted by those figures. There are serious issues of additional Government-imposed responsibilities that are not funded adequately.
One particular extra duty that the Government have placed on the district council is a higher recycling target. We all welcome the push to encourage greater recycling, and to be fair the Government have supplied capital funding to acquire new wheelie bins, public service vehicles and so on, but no extra funding has been provided to run the additional recycling rounds. That means an extra £100,000 burden. The head of finance at St. Albans district council today told me that he estimates conservatively that that will cost the council £400,000 in addition to the standard refuge collections.
I am also told by officers in the licensing department—I have mentioned in the House before the fact that St. Albans is supposed to be one of the towns with the most licensed premises in Europe—that the Licensing Act 2003 has meant that additional staff are
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needed to deal with inspections and to man a noise nuisance helpline, which the council feels obliged to run 24 hours a day. That means an additional £80,000 net of the fee in extra costs to the council.
Another area of concern is the disabled facilities grant. I am told by my council that year on year it has had its contributions cut. I would welcome the Minister's response to that, but that is what I have been told. This year the council will receive a £25,000 real-terms cut. Demographics are changing. In St. Albans, more and more elderly and disabled people are staying in their own homes, and we welcome that. Rightly, the council wishes to try to help them to stay in their homes and to live valuable, long lives. However, the Government have also increased the eligibility criteria, which will come into effect from 1 April. That will give additional responsibilities to the local council at additional costs. More people will be eligible for help. One thing that has come through is that families of disabled children will no longer be means-tested. That can be welcomed, but the effect of it and other changes is that the budget will need to rise in St. Albans from £250,000 to £1 million in 2006–07. How are we to fund that? My council says that it will use the proceeds of the sale of council houses.
To return to the early part of my speech, I have massive lists of people and full surgeries of those who want houses in the social rented sector. Perhaps there is not the reinvestment that the Government would like, but the council is having to fund this budget deficit. Instead of money from council house sales being ploughed back into providing much needed accommodation, it will have to be diverted into building extensions and adapting housing for disabled people who qualify for grants. As more and more elderly and disabled people are living in their own homes—private homes, I might add—the majority of grants from the public sector will be diverted to residents, who I accept are needy, in the private sector. A rather perverse and, I would imagine, unforeseen method of wealth distribution is happening in St. Albans.
The Government give a per capitation figure for the eastern region to deliver disability grants, but as has been said, there are certain cost implications in certain areas. With the high cost of building and employing staff in St. Albans, that figure will not go anywhere near to covering the cost of allowing elderly and disabled people to have their homes extended to facilitate their living at home. My council is very worried, and to quote the words of one officer today:
I do not have time to address the £5 million year-on-year, real-terms deficit that my chief constable told me and other Hertfordshire MPs only last month he has had cut from his budget, or the £17 million rebranding exercise that may happen as a result of police amalgamations, which will also land on the tax payers' doorstep. Needless to say, that will all add to high bills for my constituents.
My council is calling on the Minister for support for capital investment delivered through capital grants. That is exactly what it has written to him about. It wants a fairer and more transparent grant system that recognises the true cost of extra demands on services and which, more to the point, the person in the street can understand and see as reasonable and fair.
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9.49 pm
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