HC Deb 12 November 1973 vol 864 cc15-6
12. Mr. Roderick

asked the Secretary of State for Wales what representations he has received on the proposals to change the level of rate support grant.

Mr. Peter Thomas

I have received representations about the possible effects on Welsh local authorities of proposals now under consideration for the establishment of a new rate support grant system from a number of hon. Members, the Welsh Counties Committee of the County Councils Association and one of the new Welsh counties.

Mr. Roderick

Will the right hon. and learned Gentleman accept that there are grave misgivings about the Local Government Bill, which is to be read a Second time today? Is he further aware that we expect him to hold urgent talks with the Secretary of State for the Environment, who has forecast as much as a 60 per cent. increase in rate contributions from electors and residents in Powys? Does he appreciate that we did not want Powys? He forced it upon us. Now he will not support it financially. Does the Secretary of State support the forecast made by his right hon. Friend?

Mr. Thomas

I can certainly tell the hon. Gentleman the position is that a new formula for the distribution of rate support grant is still under consideration. I do not expect that the figures he has mentioned for Powys will be anything like material.

Mr. Elystan Morgan

Does the right. hon. and learned Gentleman appreciate that the formula is spelled out in Schedule 2 of the Bill that we shall be discussing later today and that, using that formula, it is the calculation of the treasurers of the eight new counties in Wales that Wales will lose no less than £7.8 million in 1974–75? Has he made his own calculation? If so, does it tally with that calculation? If he accepts the calculation, is he not shocked by it? What does he intend to do about it?

Mr. Thomas

It is far too early to say what the precise effect of the new formula will be in different areas. What we have in mind is that the new grant distribution should be accompanied by measures to offset the effect of the rate burden in any areas which may lose grant. We intend to introduce a much improved rate rebate scheme to benefit the less-well-off domestic ratepayers. We propose increasing the rate of grant from 75 per cent., to 90 per cent., which will be of particular benefit in Wales.