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John Healey: These are reserve powers. The decision to cap is not one that the Government take lightly. I am the Minister for Local Government, and I hear that argument from local government all the time—it is almost a canon of the case that it makes to Government. In past years, where there has been no threat of the use of council tax capping, there have been average rises of
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up to 12.9 per cent. It is not fair on local council tax payers if authorities set excessive increases. It is right that we have a reserve power and that we use it carefully and in a considered way, which is precisely how we have used it in the circumstances that we face this year.

Lembit Öpik: I do not want to pursue a dialogue with the Minister, but he cannot have it both ways. Either he is saying that capping is an acceptable principle, in which case Labour would have been wrong to oppose it in the Conservative years, or alternatively he must accept the case that I have made, which is that it is wrong in principle, whatever one thinks about the 79 per cent. increase, for central intervention to squeeze out local democratic control.

John Healey: I am interested that the hon. Gentleman is saying that the Liberal Democrats would abolish council tax capping. I mentioned earlier the risk that that poses to many council tax payers in local authority areas. It may not be desirable, but my argument is that it is necessary, which is why we have those powers in legislation. It is necessary in the particular case of Lincolnshire police authority this year. We are using those powers, and I have explained to the House and set out in the order precisely how and at what level we propose to do so.

Parliamentary procedure is required to consider and approve the order in relation to Lincolnshire police authority for this year. Parliamentary procedure will be required for the three authorities that we propose to designate and restrict to a 3 per cent. increase next year and the following year. No parliamentary procedure is involved in setting notional budget requirements, as we have done for the other four nominated authorities.

As I have said, the Government do not make decisions lightly about capping and the use of the powers. However, there is no excuse for setting an excessive council tax increase, and we remain ready to use the powers when necessary. I hope and believe that many people—particularly those on fixed incomes, such as pensioners—will welcome our determination to reduce the council tax burden in Lincolnshire this year. That will also help to protect residents in other authorities against excessive increases in future years.

The reduction in Lincolnshire on the average band D property this year as a result of the action that I am proposing this afternoon will be more than £69. That, of course, will require rebilling in Lincolnshire. The extra costs will fall on the police authority, but it can have no complaints about that. Rebilling is an inevitable consequence of setting an excessive increase and of being capped in-year. All authorities know that, and the best way to avoid rebilling is not to set an excessive increase in the first place.

Robert Neill (Bromley and Chislehurst) (Con): I do not intend to interrupt the Minister again. Simply for information, may I ask him whether any calculation has been made in the discussions with Lincolnshire about the costs of rebilling, which, as he says, will fall on the police authority?

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John Healey: Lincolnshire proposed some costs for the likely rebilling exercise. In its press release responding to my statement of 26 June, the Association of Police Authorities confirmed that the cost would be approximately £500,000.

Mr. Quentin Davies (Grantham and Stamford) (Lab): Will my hon. Friend state the saving to a band D householder in Lincolnshire as a result of the measures that the Government are implementing this afternoon, compared with the costs that would have arisen had the precept that the Lincolnshire police authority proposed been accepted?

John Healey: That is an important question; it is the question that many people in Lincolnshire will ask. The answer is £69.56.

People are not prepared to accept excuses for high council tax increases, either this year or in future; nor are the Government. I put all authorities on notice that we will not tolerate excessive increases in future years and that we are prepared to use our capping powers to protect council tax payers. I commend the order to the House.

5.22 pm

Robert Neill (Bromley and Chislehurst) (Con): I thank the Minister for the careful and courteous way in which he has introduced the order. I am sure that the House will appreciate that. I understand that, technically, the order relates simply to the situation in Lincolnshire, and I certainly want to respect the terms of the debate. But however careful and measured the tone that the Minister has adopted in introducing the order, he cannot escape the fact that what we are discussing today is a symptom of a wider malaise, for which the Government have to take responsibility.

That wider malaise is made up, first, of the consistent and remorseless upward pressure on council tax. That affects not only people in Lincolnshire and the other authorities that were originally considered, but people right across the country. The malaise also consists of the tight financial settlement under which those authorities and others across the country find themselves. We must not forget that the Government cannot say that they are seeking to protect council tax payers in Lincolnshire while escaping the responsibility, which has to lie with them, for that underlying malaise.

The increase in council tax is down to Government policy. The tightness of the financial settlement that affects those authorities is, again, the direct result of Government policy. It is worth reminding the House that for all the Minister’s words about the protection of council tax payers, his Government have seen council tax double in the past 10 years. The tightness of the financial settlement, described by the Association of Chief Police Officers as the tightest settlement for police authorities in years, was, as my hon. Friend the Member for Bury St. Edmunds (Mr. Ruffley) pointed out when the matter was first debated in the House, the direct consequence of a macro-economic problem—the borrowing problem—that the Government have got themselves into.

The simple fact is that the Government wasted money when it was available. They borrowed too much, and now they have to tighten up on the funding that is
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available to local authorities. Local authorities are feeling the pinch, and that means reductions in budgets or pressure on council tax. The Government are introducing this order because of a situation that is ultimately of their creation and their responsibility. That needs to be set in context.

I know that several right hon. and hon. Members from Lincolnshire want to participate in the debate, so I will not go into much local detail. However, it clearly cannot be justified to say that Lincolnshire is historically a particularly profligate authority; indeed, the evidence suggests that police funding in Lincolnshire, in terms of spend per head and so on, is comparatively low.

Mr. Hogg: I think that my hon. Friend will find that our hon. Friends will say that there is a structural problem with the grant in Lincolnshire that needs to be addressed. I do not expect him to give a guarantee today of what we will do when we get into government, but I hope that if and when that happens, we will look urgently at the grant to see whether it is truly unfair to Lincolnshire. If, as I believe, that is the case, we will alter it to make more resources available to the county and to the police force in particular.

Robert Neill: I am grateful to my right hon. and learned Friend for making that point, which he raised when the funding settlement was originally discussed in this House. In that debate, he said that it seemed pretty clear to many local people that there is a problem with the operation of the national grant in relation to Lincolnshire, as well as in Leicestershire, which also figured in the discussions. It was clear that several authorities in that part of England were suffering from this.

Mark Simmonds: I want to make my hon. Friend aware that the operation of the funding formula is so penal in its impact on Lincolnshire that in the financial year 2003-04 its police authority was the only one in England and Wales to have its per capita funding cut.

Robert Neill: My hon. Friend has reinforced the point. In the earlier debate, the Government were put on notice of this situation. It was clearly flagged up that, in addition to the other pressures that I have mentioned, the financial risk as regards the financing of the police service had in effect been transferred away from the Government on to the citizens of Lincolnshire. A perverse situation has developed.

This is yet another example of the situation whereby, first, we are reaching a stage where the capping regime in this form has gone beyond its useful lifespan, and secondly, it is demonstrably clear that the way in which the formula works is not transparent or seen to be fair. That applies not only to police authorities but to local authorities generally. There are problems with the national police funding formula and with the formula for the revenue support grant. People do not have faith in how these settlements are calculated. As my right hon. and learned Friend the Member for Sleaford and North Hykeham (Mr. Higg) has said, in due course an incoming Conservative Government will need to take some fundamental action on how we allocate and distribute grant.

The Government are trying to shift and shuffle responsibility. I see that the Minister for Security, Counter-Terrorism, Crime and Policing is here. He is very good
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at shifting and shuffling responsibility— [ Interruption ]—and making sedentary comments as he goes. That is a speciality of his; we are all used to it now, and he may as well know that it goes straight over my head, so he can save his breath.

The reality is that the Government created this situation by their own economic incompetence and made it worse by a lack of transparency and honesty in how they have dealt with local government. Despite having been given early notice of the problem by right hon. and hon. Members representing the areas concerned, they did nothing to address the structural problems; instead, they are applying a sticking plaster, in the form of the capping power, far too late.

At the end of the day, of course, the official Opposition will not oppose this order, but we have to set the record straight and say that it is not entirely fair to point the finger at Lincolnshire and the police authority. The Government should turn the mirror on themselves and accept that this is the consequence of their policy and their failure. Sadly, it is the people of Lincolnshire who have to face the consequences.

5.29 pm

Keith Vaz (Leicester, East) (Lab): It is always a pleasure to follow the hon. Member for Bromley and Chislehurst (Robert Neill). We served together on the Select Committee on Justice. He did not blame the Government quite as much in that Committee as he did tonight. I have to differ from him; it is not the Government’s fault that they have to cap Lincolnshire. As we heard from the Minister, the Government have been generous to the extent that they allowed an increase well above that they allowed other authorities.

I do not claim to know everything about the way in which policing operates in Lincolnshire, but as the House knows, Leicestershire was one of the police authorities originally proposed for capping, and following representations made to the Minister and my right hon. Friend the Minister for Security, Counter-Terrorism, Crime and Policing, who is on the Front Bench today, the Government decided not to cap it, but may do so next year. Hence my intervention on the Minister to ensure that there will be an opportunity before that process begins for authorities that were not capped this year to make representations.

Members representing constituencies in Lincolnshire, on both sides of the House, will want to make specific points about what the Opposition spokesperson described as structural problems affecting policing in that area, which they feel justify—or not—the proposed increase put to the Government. I shall confine my remarks to concern about the number of police authorities that were originally proposed for capping, which will also be of interest to those in Lincolnshire. It is a worry because a problem that is developing may develop further in future. It means that the Government and police authorities will have to take a closer look at a situation where for the first time—perhaps the Minister will correct me if I am wrong—seven of the eight authorities that would have been affected were police authorities.

Next week, the Government will publish their response to Sir Ronnie Flanagan’s report, which looks at the issue of a more efficient, more effective police force. I do not expect either of the Ministers here today to tell
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us what is in that response, but during the past six months, as we conducted our review into policing, I and my colleagues in the Select Committee found that the issue of police funding came up in all our discussions. It was raised by almost all the chief constables we spoke to—I think that we took evidence from 15 of the 42 chief constables in England and Wales, but unfortunately not the chief constable of Lincolnshire. Each one of them raised the issue of funding.

I shall raise three issues that I hope will be of benefit not just to the Lincolnshire police authority, but to other police authorities that may face such action next year. The first concerns new technology. It is a mystery to me why each different police authority is able to purchase its own equipment separately at whatever cost it negotiates. Surely procurement for all our police forces, including Lincolnshire, would ensure that the cost to all of them would be less. That may have meant that Lincolnshire would not have had to ask for such a rise.

In Leicestershire, new technology—hand-held computers —was purchased from a different company to the one that I discovered was used by Staffordshire when I visited Staffordshire constabulary last Friday. It purchases from a different company from Greater Manchester police authority, which the Select Committee visited on Monday. More central guidance, with all police forces procuring equipment from the same company, would save a great deal of money and make it relatively easy for police authorities to communicate with each other. That applies to other computers and technology as well as hand-held computers.

Different authorities may buy different computer systems from different companies, thus making it difficult in some cases to transfer data from one to another. We already know that there is a problem with, for example, Lincolnshire’s ability to provide information through Europol to police authorities in Europe, because it operates a different computer system.

I am sure that the Government have made the right decision, because I know that both Ministers will have examined the representations carefully. However, we should consider such matters, because police authorities generally could benefit.

Mr. Hogg: The right hon. Gentleman said that the Home Affairs Committee had received many comments from chief constables to the effect that there are problems with the formula. He is Chairman of the Select Committee, and it might be in its remit, and a useful exercise, to undertake a study of the formula’s operation, with particular though not exclusive regard to the interests of some of the shire counties—Lincolnshire is one—where it is believed that the formula does not work fairly.

Keith Vaz: Clearly, the Select Committee may examine that subject in future. We are reaching the end of our six-month inquiry into policing in the 21st century. The choreography has been slightly out of synch with the Government’s timetable, because the Green Paper will be published after our last evidence session, which is with the Mayor of London next Tuesday. However, we may revert to the subject in future. If the police Minister decides that it should feature in the Green Paper, or if
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the Government want us to re-examine amalgamations, which the newspapers suggested today—we do not know, because the statement will be made next week, and I am simply repeating what I have read—the Select Committee will clearly want to consider the formula.

The formula causes me concern because, as I said, seven authorities are police authorities. At a time when we need to put as many resources as possible into policing, it is worrying that so many authorities, including Lincolnshire, are police authorities. I have not examined in the same great detail as Ministers the case that each police authority has made, but we need to consider the way in which they operate if we are to be helpful in future.

Secondly, let me consider police efficiencies. Again, I do not want to prejudge the Green Paper that the police Minister will publish next week, but I am sure that he will refer to Sir Ronnie Flanagan’s proposed efficiencies. We have taken evidence from Sir Ronnie Flanagan. Of course, efficiencies should occur in the police service in Lincolnshire, Leicestershire and all the other areas, but it is essential that that does not detract from visible policing.

Last Friday, I went to Burton on Trent, where I met the divisional commander with the local Member of Parliament, who is a member of the Select Committee, and we examined Staffordshire’s innovative approach to reducing bureaucracy and red tape. It had reduced casework files from 16 pages to one page. I do not know whether that has happened in Lincolnshire; nor am I sure whether it has occurred in Leicestershire, because I have not asked our chief constable. [Interruption.] The police Minister claims that that has happened. It is another example of good practice that should be rolled out in other parts of the country, thus releasing, in the words of Sir Ronnie Flanagan, a great deal of police time. Some say that the reduction of red tape can release up to 50 minutes of a police officer’s time. If one compares that with the number of police officers in Lincolnshire, it will mean a huge saving in hours. It would be interesting to know whether other authorities do that.

Mr. Hayes: The right hon. Gentleman makes an interesting point, but would he differentiate between the burden on police officers as a result of bureaucracy, much of which, although not all, comes from this Government, and the efficiency of the authority? The Government commissioned an investigation of the authority by PricewaterhouseCoopers that found only minimal room for savings, which would have made little difference to the fundamental funding crisis that we are discussing today.

Keith Vaz: As I said at the start, the hon. Gentleman knows much more about what is happening in Lincolnshire than I do. However, the reduction in a case file from 16 pages to one page makes a huge time-saving difference for police officers, as do hand-held computers.

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