HC Deb 20 June 1961 vol 642 cc1150-1
12. Mr. W. Hamilton

asked the Secretary of State for Scotland if he is aware of the increased and increasing financial difficulties of local authorities; and whether he will therefore initiate an official inquiry into the whole problem of local taxation, with particular reference to the feasibility of a local income tax.

Mr. Galbraith

No, Sir, my right hon. Friend does not accept that difficulties are imposed by the present system which would necessitate such an inquiry. The whole subject of local government finance was examined a few years ago, including the feasibility of a local income tax.

Mr. Hamilton

Is the hon. Gentleman as much in touch with local authorities as his Answer would seem to assume? Is he not aware that many of us, certainly on this side of the House, are getting letters from local authorities drawing attention to their financial difficulties? Why on earth cannot the Department set up some kind of investigation into this problem? The solution suggested in the Question was recommended some years ago by the Institute of Public Administration, a non-party organisation which took an objective view of the matter. Will not the hon. Gentleman consider looking into it again?

Mr. Galbraith

As a result of revaluation, where some values go up more than average, there is bound to be a reduction in the amount of equalisation grant which is given to the local authority. My right hon. Friend proposes, however, to review these grant arrangements at a later stage when he has full information of the effect of revaluation.

Mr. MacArthur

Would my hon. Friend not agree that the financial problems which may face some local authorities would be greatly eased if those local authorities were to introduce a sliding-scale system of rents?

Mr. Galbraith

I dare say that that might make some difference.

Mr. Manuel

In view of his reply to my hon. Friend the Member for Fife, West (Mr. W. Hamilton), will the Joint Under-Secretary tell the House just how many representations he has had from Scottish local authorities about their increased financial difficulties? I had a letter yesterday from a constituent who had taken up this very point.

Mr. Galbraith

I could not do that without notice, but I would be willing to look into the matter and write to the hon. Member.

Mr. Hamilton

Will not the hon. Gentleman take steps to relieve the local authorities by introducing rerating of agriculture in view of the fact that its subsidy total is higher than its wages bill?

Mr. Galbraith

That is another point.