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Mr. Denham:
No, because I am just going to make the point- [ Interruption. ] The hon. Lady had the opportunity to answer, so I shall make some progress on the statement- [ Interruption. ] She had an opportunity
to explain what she cannot explain, which is how council tax revaluation would be paid for. I shall carry on, because we need to deal with more aspects of the settlement.
Mr. Pelling: Will the right hon. Gentleman give way?
Mr. Denham: I shall give way to the hon. Gentleman, because he has been asking for some time.
Mr. Pelling: The Secretary of State is clearly hitting the target as regards the Conservative party's rather soft position on those issues, but, nevertheless, are not his comments a real comment themselves on the relationship between central and local government? This Government have not released local government to pursue its own financial affairs. The fact that national parties are talking about advertising in specific councils shows that local government is still far too dependent for its finances on national Government.
Mr. Denham: The hon. Gentleman might have welcomed the extra £20 million in all grants that his local authority will receive next year. The fact is that over several years there has been a process of devolving power to local government, of reducing ring-fencing and targets and of transferring responsibilities to local government-and we will continue to make progress in that direction. I shall say more about that in a moment.
Paddy Tipping (Sherwood) (Lab): Will my right hon. Friend give way?
Mr. Denham: I shall, but then I must make some progress, because I know that a number of hon. Members wish to speak.
Paddy Tipping: What advice would the Secretary of State give to Tory-run Nottinghamshire county council, which is determined not to increase its council tax and told me that it could do so because it was going to receive an increased grant from a forthcoming Tory Government-if there were one?
Mr. Denham: I would say to that county council that there is clearly no source of money to pay for the promises, which are being made throughout the country, of a council tax freeze. We saw the same situation with married man's tax allowance at the weekend with spending-
Madam Deputy Speaker: Order. Perhaps the Secretary of State could now concentrate on the proposals that the Government are putting forward.
Mr. Denham: You have been characteristically generous, Madam Deputy Speaker, and I shall make progress.
We are happy to be judged on our record of steadily increasing investment and greater freedoms. This settlement, which underpins our ambitious vision for local government, is how we will not only protect but continue to improve local public services, despite the tighter financial climate. Local government has a good record on making efficiency savings, but the truth is that the really hard challenges have still not been tackled consistently in every council and in every area. Local people will rightly be intolerant if they are told by their council that front-line services
will be cut when it has not taken the tough decisions to introduce shared services, sharing senior staff with other authorities, primary care trusts or other providers, or made the best use of public assets.
The new taskforce that I have established, led by Steve Bullock, the mayor of Lewisham, and Richard Leese, the leader of Manchester city council, will report by the end of the month on how well-led authorities can protect and improve services while meeting the new demands for greater efficiency.
Mr. Mark Field (Cities of London and Westminster) (Con): The Secretary of State will realise that for many local authorities one of the biggest clouds on the horizon is the census in 2011. Many of us, particularly those of us in inner-city boroughs, recognise that there are great concerns about the rigour with which the census is being put in place, and that that will have a major impact on the grants that are made not just this year but for some years to come. The issue applies to hon. Members from all parts of the House. Will he explain what the Department is doing to ensure that the census is as rigorous as possible in order that there is a fair division of the spoils for many years to come?
Mr. Denham: The hon. Gentleman makes a perfectly fair point. Usually in this annual debate, the concern is that population figures are out of date, rather than about to be updated. The census is therefore enormously important, as is the ongoing work, on which the Office for National Statistics is consulting, about better ways of capturing more rapid short-term changes in population of the sort that we saw in the middle of the last decade. His point is well taken and well made, but I assure him that everybody concerned with the census is working enormously hard to ensure that it produces the accurate basis on which future local government projections can be carried out.
Ms Karen Buck (Regent's Park and Kensington, North) (Lab): Will my right hon. Friend join me in encouraging the hon. Member for Cities of London and Westminster (Mr. Field) to join the London Regional Select Committee, because we are engaging in an in-depth study on the census, working with various Departments, and we are missing representation from the Opposition Benches?
Madam Deputy Speaker: Order. We are certainly not straying into the subject of Regional Select Committees.
Mr. Denham: Having set out the challenge to local government, whereby we need to ensure that every taxpayer's pound works as hard it can, I should say that it is obviously important that the Government support local councils in making the necessary changes. That is why, with local authorities, this Labour Government have pioneered the Total Place initiative, which looks at all public service spending in each area and how it can best be used, together with local council and councils, with their democratic mandate, to ensure that local services respond to local needs.
I welcome the Opposition's recent belated recognition that the extension of further scrutiny of health and other public services is needed to equip councils with
the powers that they need to act decisively on behalf of local residents, including the powers to scrutinise, influence and shape other services. In future, this means that local government will not just be overseeing its own services; in addition, councillors will be able to challenge how all local services are delivered, regardless of the provider. As the pre-Budget report confirmed, Total Place is not just a direction of travel but the future of local government and local public services under a Labour Government. The Opposition may make a rhetorical commitment to Total Place, but we have shown in past debates where their polices will lead: a postcode lottery as entitlements and inspection are abandoned, and two-tier "Ryanair" councils providing a most basic service and leaving only those who can afford to pay able to access a decent service. That is not the kind of localism that I want to see.
This is a good funding settlement. We have delivered average increases of 4 per cent., giving councils scope not only to keep council tax down but to deliver the crucial services on which local residents rely. I think I have shown that some of the promises being made by the Conservatives are unfunded and cannot be believed, and they need to be exposed as such.
Madam Deputy Speaker: I now have to announce the results of Divisions deferred from a previous day. On the motion relating to EU enlargement strategy, the Ayes were 403 and the Noes were 20, so the Question was agreed to. On the motion relating to infrastructure planning, the Ayes were 231 and the Noes were 196, so the Question was agreed to. On the motion relating to financial management, the Ayes were 230 and the Noes were 202, so the Question was agreed to.
[The Division lists are published at the end of today's debates.]
4.58 pm
Justine Greening (Putney) (Con): I thank the Secretary of State for outlining the Government's proposals on local government finance. I think that we all accept that the formula as it stands is extremely complicated. When the Under-Secretary of State for Communities and Local Government, the hon. Member for Stevenage (Barbara Follett), outlined it in this Chamber at the end of last year, there was some humour in the fact that the guide that now goes with the formula claims to replace the previous plain-English-speaking guide. Local councils find themselves having to deal with an incredibly complicated formula.
The three-year local government finance settlement has been important for councils, and we recognise that it is important for them to be able to plan ahead. However, this is the last of the three years, and the Government have effectively delayed-many people would suspect cancelled-the comprehensive spending review, which could have given councils the framework for the next three years and an idea of what funding there may be. We now seem unlikely to get that before the election. If I am wrong about that, I am sure that the Secretary of State will intervene. [Interruption.] He indicates that it is not in his hands; it will be worrying for local government to know that he is not pressing to have more certainty in future.
This is an important matter. It is not just councils that need to understand the funding regime under which they will be operating. As the Secretary of State clearly
demonstrated, it is important for families and local communities to understand the level of council tax and how the local government finance settlement could mean changes in their council tax bills, particularly as we are possibly still in the deepest, longest recession in many years.
Hazel Blears (Salford) (Lab): The hon. Lady has started her contribution with a lot of talk about certainty. I am sure that she would welcome my excellent Labour council's decision to give our community certainty with a council tax freeze. She is right that certainty is important for families and councils, so will she tell us here and now when her council tax freeze will start, when it will end and how it will be paid for? The country and the public have a right to know.
Justine Greening: We have already published all those data. I am sure that it is wonderful for Ministers to try to pick holes in them, but in fact they seem to be taking some of our suggestions on clamping down on waste. Having only a few months ago challenged us by saying that it was a case of investment versus cuts, they now seem to accept that we need to trim back public expenditure.
Mr. Adrian Bailey (West Bromwich, West) (Lab/Co-op): Will the hon. Lady give way?
Justine Greening: I will not, actually. I have not even quite finished dealing with the intervention by the right hon. Member for Salford (Hazel Blears). As she said, there is a genuine appetite for a council tax freeze. It is just a shame that her party's Government cannot recognise that. We want to help local government deliver that, but her party wants to undermine it.
There was one question that I did not get to put to the Secretary of State. He would not rule out the revaluation that is coming down the track and could mean families paying hundreds of pounds extra. [Interruption.] Is he ruling it out? He says that there are no plans, but we have all heard the statement "There are currently no plans" in the past when we have known that there were. Preparation for the revaluation is well under way, and the Secretary of State's own local government body, the Labour group of the Local Government Association, in its document "Putting Fairness First", does not just talk about a revaluation but states that on top of that:
"At the very least, the council tax needs rebanding. The addition of more bands at both the top and the bottom of the scale will help to make it a more genuinely progressive tax".
[Hon. Members: "Hear, hear.] We seem to be getting messages from Labour Back Benchers-perhaps the Secretary of State can confirm this-that Labour wants to continue adding bands and pushing up council tax for people across the country.
Mr. Denham: I repeat to the hon. Lady what I said earlier. We have no plans, and we have made no preparations, for a revaluation. With respect, she should really stop claiming that we have. We have said that often, and the constant repetition of something that is not true does not make it true.
Justine Greening:
People reading Hansard tomorrow will see from that response that there is no ruling out of a revaluation or of more bands. We all know exactly
what is going to happen if the British public are unlucky enough to face this Government being in power after the next election.
Dr. Starkey: Will the hon. Lady give way?
Justine Greening: No, I am not going to give way-not today, thank you.
What we need is a new approach to local government. We need an approach of localism that will move away from the trend that councils have seen under this Government, which is more micro-management, more reporting upwards, less ability to decide local priorities and more top-down diktat from Westminster. What people actually want in their local communities across Britain is the chance for their local council to spend money on their local priorities, not on the priorities that are so often set by the Secretary of State.
Ms Gisela Stuart: I would be grateful if the hon. Lady helped me. She said that the data on the council tax freeze have all been published, but I am at a loss as to when the freeze will start-I may have missed her telling us that. Will she say very simply, to help a simple person, when the promised Tory council tax freeze will start?
Justine Greening: We have always said that it would start in the first full financial year after the election.
Madam Deputy Speaker: Order. May I please bring the House back to order? We are discussing the Government's proposals.
Justine Greening: That is very helpful, Madam Deputy Speaker. It is interesting that Government Back Benchers are pressing the Opposition on when a policy will start, but will not admit when the next election will be. Pursuing that line of argument is disingenuous.
There is no doubt that council tax will be one of the most important things for people in today's debate. The bottom line is that whatever the Secretary of State says about funding for councils across the country, under Labour, council tax has doubled since 1998-99. In fact, people are being charged £14 billion a year more in council tax than when Labour came to power. That is real money taken out of people's pockets that they cannot spend on what they otherwise would have liked.
The Under-Secretary of State for Communities and Local Government, the hon. Member for Stevenage (Barbara Follett), came to the Chamber before Christmas and claimed that a 3 per cent. settlement-a 3 per cent. increase-was somehow reason for celebration among people who were, by and large, getting no pay rise in the private sector. If that 3 per cent. increase goes through, it will add £42 to the bill of an average band D home and push bills to more than £120 per month.
Ms Buck:
Does the hon. Lady share my concern that while she is focusing on council tax-I agree that nobody wants to pay more tax than they have to-there is a risk that we are missing the impact of charges? My local authority, Westminster, is in the process of raising an additional £7 million from parking charges alone, and it is putting up meals on wheels charges by 10 per cent. and introducing a new charge of £20 for the disposal of bulky items, which leads directly to fly-tipping. Of
course, those costs fall directly on people to whom no rebate is available, with all kinds of unintended consequences for their purses.
Justine Greening: The Housing Minister has left the Chamber, but I propose that the hon. Lady talks to him. Only last year he was saying that only one in five councils were actually charging for the services that they could charge for. The pressure for councils to charge is coming from her Government, not from councils. Councils across the country are being asked to pay for services and to fund more and more mandates from national Government without being given the money to do so. They have had one part-funded initiative after another.
I want to return to council tax, because there are people in this country who have been unable to afford council tax increases. A typical pensioner couple, for example, now pays £685 more a year on a band D property than they paid in 1997-98. In fact, only half of eligible pensioners claim the council tax benefit to which they are entitled. Ministers ought to focus on those issues. The Secretary of State was reluctant to answer any of my questions, but if we have another term of Labour in office, households across the country will see even more council tax increases coming down the track, because of more bands and a revaluation. Ministers never rule the latter out, because it is clearly going to happen, which is why we need a council tax freeze.
Julia Goldsworthy (Falmouth and Camborne) (LD): The hon. Lady is doing a good job of highlighting the problems with the council tax, which since its invention has increased at above inflation each year. How can she reconcile all these problems with the council tax while defending its existence to the hilt?
Justine Greening: I guess that we would all love to know whether the Liberal Democrats would go ahead with their local income tax policy-[Hon. Members: "Yes."] Well, it was not exactly popular at the last election, so that is probably good news for many hon. Members.
It is not only council tax rates that have been going through the roof under Labour. One of our biggest concerns is that this local government finance settlement is principally underpinned by receipts from business rates. The Government are about to press on with a business rate revaluation, which could fundamentally destabilise the main source of revenue for local councils and their services-
Mr. Denham: Will the hon. Lady give way?
Justine Greening: No, I wish to make some progress. That revaluation comes on top of the business rate rises that have been seen across the country, at a time when local companies can ill afford them-
Mr. Denham: Will the hon. Lady give way?
Justine Greening: No, I will not give way.
Dr. Alan Whitehead (Southampton, Test) (Lab): Will the hon. Lady give way to me?
Justine Greening: No, I really must make some progress-
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