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Ministry of Defence: Operational Allowance

The Parliamentary Under-Secretary of State, Ministry of Defence (Lord Drayson): My honourable friend the Parliamentary Under-Secretary of State for Defence (Derek Twigg) has made the following Written Ministerial Statement.

On 10 October 2006, the Secretary of State for Defence announced that a new, tax-free bonus payment would be introduced for service personnel. The bonus will be called the operational allowance and the regulations, including eligibility criteria, have now been finalised. I am now placing a copy of the regulations in the Library of the House.



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Parliamentary Questions

Lord McKenzie of Luton: My honourable friend the Financial Secretary to the Treasury (John Healey) has made the following Written Ministerial Statement.

The Treasury has completed its annual indexation of the average cost of answering Oral and Written Parliamentary Questions to reflect changes in Civil Service earnings and retail prices. The revised average costs, which will apply from 15 November 2006, are:

Oral Questions £385;

Written Questions £140.

The disproportionate cost threshold (DCT) relating to Written Parliamentary Questions was set at £600 in 2002. The DCT will be increased to £700, also with effect from 15 November 2006, and will apply across government.

Police: Grants

The Minister of State, Home Office (Baroness Scotland of Asthal): My honourable friend the Minister for Policing, Security and Community Safety (Tony McNulty) has made the following Written Ministerial Statement.

I have today placed in the Library a copy of the proposals of my right honourable friend the Home Secretary for allocation of police grant for England and Wales in 2007-08. My right honourable friend and I intend to implement the proposals subject to consideration of any representations and to the approval of the House.

The Government announced last year provisional funding totals for both 2006-07 and 2007-08. The introduction of multi-year settlements for the first time was widely welcomed by police authorities as a means of providing greater certainty and improving medium-term planning. We intend to implement the settlement for 2007-08 broadly unchanged from last year's announcement. It is our intention to move to three-year settlements with effect from 2008-09, which will allow authorities to plan more confidently.

The settlement for 2007-08 continues to build on unprecedented levels of investment in the police

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service in England and Wales. On a like-for-like basis, government grant and central spending on services for the police will have increased by over 62 per cent, or over £4.2 billion, between 2000-01 and 2007-08. Our investment in recent years has helped to expand local policing, reduce crime and help to make our communities safer. Since peaking in 1995, British Crime Survey (BCS) crime has fallen by 44 per cent, which represents 8.4 million fewer crimes, with domestic burglary and vehicle crime falling by over a half and violent crime falling by 43 per cent. The risk of becoming a victim of crime remains at the lowest level recorded since the BCS began in 1981. The Government continue to work with the police service to ensure that it has the right tools to tackle crime without being burdened by any unnecessary rules and paperwork.

Our ambitious police reform programme continues to produce real improvements, but there is still more to do. We will be publishing a vision for policing and a reform road map by the end of the year, following consultation with policing partners. A clear workforce strategy will ensure that the police service is well led, skilled, motivated and representative of the communities that it serves; this is also linked to initiatives to enhance performance and to improve efficiency and effectiveness from available resources. To improve the capability and capacity for protective services, forces are working regionally and individually to develop new initiatives in collaboration, shared services and other efficiencies.

The police grant settlement 2007-08

Total provision for policing grants and central spending in 2007-08 will be £11,043 million, an overall increase of 3.1 per cent. This includes a broadly flat rate increase of 3.6 per cent in general grant for all police authorities in England and Wales. All police authorities will have planned ahead on this basis. The increase is above inflation (forecast inflation is around 2.7 per cent) and will enable police authorities to set reasonable final budgets and sustainable precept increases. We propose to distribute the settlement as set out below. The table includes funding for both local and central spending.

Table 1: Police funding settlement for 2007-08 compared with 2006-07
2006-07 £m2007-08 £mChange £mYear-on-year increase

Total general formula grant

7,372

7,638

266

3.6%

Specific grants, special formula grant and transfers for pensions and DSPs

1,359

1,554

195

14.3%

One-year uplift to accelerate expansion of PCSOs

91

-91

-100.0%

Extra provision for counterterrorism

93

145

52

55.9%

Total specific grants, special formula grant and transfers1

1,543

1,699

156

10.1%

Capital grants and support2

363

295

-68

-18.7%

Central spending

1,433

1,411

-22

-1.5%

Grand total

10,711

11,043

332

3.1%

1 See table 3.
2 At the time of the 2006-07 settlement announcement, capital provision included £50 million in 2006-07 and £75 million in 2007-08 to cover restructuring costs. This provision is being considered as part of the review of all Home Office capital budgets. The capital figures have therefore been reduced accordingly until a final decision has been made.
The variance of £68 million between 2006-07 and 2007-08 reflects profiled planned expenditure (over the two years) on command control communication information (C3i) (-£20 million—Home Office grant ends in 2006-07); Airwave resilience (-£23 million); and the additional reduction in 2006-07 (-£25 million for restructuring).


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Police funding proposals within the local government finance system are being announced by my honourable friend the Member for Oldham East and Saddleworth today and by the Welsh Assembly Government.

Provisional general policing grants (i.e. Home Office police grant, revenue support grant and national non-domestic rates) for English and Welsh police authorities in 2007-08 compared with 2006-07 are given in table 2.

The settlement continues to take account of our commitment to improve efficiency and effectiveness in the police service. Authorities will be expected to deliver 1.5 per cent cashable efficiency savings and 1.5 per cent non-cashable savings in 2007-08. If police authorities deliver efficiency gains and exercise judicious financial planning, there remains no reason for them to set excessive increases in police precepts on council tax next year. The Government's policy in relation to average council tax increases of less than 5 per cent in England in 2007-08 has been clearly set out by my honourable friend the Minister for Local Government. The Government are prepared to take capping action if necessary to deal with excessive increases.

Welsh police authorities

In line with previous years, we have ensured that Welsh police authorities are treated in line with English police authorities with respect to the floor damping mechanism. My right honourable friend the Home Secretary has provided additional support of £12.9 million in 2007-08 to ensure that Dyfed-Powys Police Authority, Gwent Police Authority and North Wales Police Authority receive at least a minimum increase in grant in line with English authorities. The shortfalls are further funded by scaling police grant to South Wales Police Authority, which would otherwise have received a general grant increase of 5.7 per cent but now receives the equivalent increases to a police authority in England.

Metropolitan Police funding

The settlement provides for the Metropolitan Police Authority to receive £192 million in 2007-08 (+£5m over 2006-07) in general grant to reflect its unique national and international role as well as the functions that fall to it by virtue of London being a capital city.

Special formula grant

We made it clear in 2006-07 that we wanted to give police authorities more control over specific grants and consolidated four specific grants totalling £193 million into a single pot for each authority. We continue to expect authorities to honour commitments and agreed policy initiatives. Totals for each police authority are set out in the Police Grant Report 2007-08.

Specific grants for police authorities

Police authorities will continue to receive extra funding through a number of specific grants for particular schemes. Targeted grants were introduced as a direct response to what the police service and the public told us that they wanted. Total provision for specific grants in 2007-08 is £1,699 million (table 3).



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The main specific grants are:

Crime fighting fund: £277 million will again be made available to forces to continue to support the costs of officers recruited through the crime fighting fund. In 2007-08, there will be additional flexibility for forces selected by ACPO to be demonstration sites for workforce modernisation in order to improve the delivery of services to the public.

Police community support officers (PCSOs): for 2007-08 we will be providing £315 million in total towards the cost of 16,000 PCSOs, to have a dedicated neighbourhood policing team embedded in every area in England and Wales by 2008.

Basic command unit (BCU) fund: £50 million will again be provided for BCUs. In England, BCU commanders will again have discretion to pool their allocations locally in local area agreements where they exist or in the safer and stronger communities fund where they do not.

Initial police learning and development programme (IPLDP): we will provide the same level of funding for IPLDP in 2007-08.

Counterterrorism funding

In January 2006, the Government announced a single consolidated counterterrorism grant for the police service, enabling it to increase its counterterrorism capability and improve effectiveness. In order to achieve this, we pulled together resources from existing grants, including the provision for dedicated security posts formerly in general grant. For 2006-07, this totalled more than £460 million, including an extra £63 million for local and regional policing and £30 million for the MPS. In 2007-08, we will be increasing this extra funding to £100 million for local and regional policing and £45 million for the MPS. To enhance further the counterterrorism capability of police authorities, we have also made provision of £25 million within the increase in general grant to police authorities in 2007-08.

We have been working very closely with ACPO on this matter. We see an important role for ACPO in the management of this grant and for ensuring coherence, strategic direction and the provision of a nationally co-ordinated response. We have worked closely with ACPO to ensure that both this uplift and funding from the new consolidated counterterrorism grant are used to create a significant increase in the strength of the police’s counterterrorism capability. Both we and ACPO are committed to ensuring that the police service both nationally and regionally has a robust, resilient and effective counterterrorist capability.

Central spending on policing

Provision is made for the costs of organisations supporting policing such as the National Policing Improvement Agency (NPIA) and the Serious Organised Crime Agency (SOCA), as well as scientific and technical support. SOCA was successfully launched on 1 April 2006. It is a new type of law enforcement body with workforce strength of 4,200 staff and an initial budget of £415 million.

We intend to establish the NPIA on 1 April 2007. It will be a central resource to help police forces to improve how they work, and it will be committed to

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driving continuous improvement across policing as a whole in order to deliver better services to the public. It will be owned and led by the police and will introduce a radically different model of police service leadership, as well as producing greater efficiency, consistency and clarity of purpose in service delivery. The NPIA will replace the existing organisations of Centrex and the Police Information Technology Organisation (PITO). There will also be significant implications for the work of ACPO, the Home Office and the APA. Its budget will be announced by 31 January.



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Conclusion

We have delivered another fair settlement for all police authorities in England and Wales which will enable them to provide an effective and efficient policing service. We will expect forces to deliver further sustained improvements in performance and continue to make further efficiency gains. We will work closely with the police service over the coming months and listen carefully to its concerns as we consider the distribution of resources for the coming three years (2008-09 to 2010-11). Decisions will be announced next year.


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