Rates (Hansard, 14 April 1975)

§ 3. Mr.Gwynfor Evans
asked the Secretary of State for Wales what will be the percentage rise in the rates, including water and sewerage and the parish or community council precept, levied by local authorities in Wales as a whole in 1975–76 as compared with the total poundage of rates levied for the same services in 1973–74; and how this compares with the average rate levied by English authorities.

§ Mr. John Morris
First estimates indicate that the percentage rise in Wales for domestic ratepayers will be 63 per cent., compared with 66 per cent. in England, and for non-domestic ratepayers 102 per cent., compared with 86 per cent.

§ Mr. Evans
Is the Secretary of State aware that the traumatic reorganisation of local government in Wales not only lessened local democracy in Wales and increased inefficiency but was a significant contributory cause to the staggering rise in rates? Is he further aware that it was the Conservative Government which embodied this reorganisation in legislation but that the original scheme was the brain-child of the previous Labour Government, who outlined it in their White Paper? Therefore, will the Labour Government and the Labour Party accept their share of the responsibility for the consequences?

§ Mr. Morris
The hon. Gentleman is absolutely right to say that the present reorganisation is the result of the previous Conservative Government. A number of ideas were proposed and went out to consultation through the Labour Government, but it was a Conservative Government who brought to pass the present system. However, despite the cost of reorganisation—it is difficult to quantify—I think that the hon. Gentleman would not be right if he were to ignore the fact that inflation has played a substantial part, if not the lion's share, in the immense cost of local government. The Government have done a tremendous amount to bring support to local authorities. The rate support grant has been increased from 60½ per cent. to 66½per cent. For England and Wales, that comes to about £2,000 million a year in increased support for local government.

§ 10. Mr. Grist
asked the Secretary of State for Wales if he will now seek powers to enable Welsh local authorities to lessen the impact of the increases in rates which have recently been announced.

§ 11. Sir Raymond Gower
asked the Secretary of State for Wales, in view of the latest evidence of the scale of the proposals by Welsh local authorities to increase rates, water rate and sewerage charges, if he will seek powers to assist 6 the local authorities to lessen the proposed increases.

§ Mr. John Morris
No, Sir.

§ Mr. Grist
Is the Secretary of State aware that that is an appallingly smug answer? Is he also aware of the furious reaction that there is in Cardiff to the 94½ per cent. increase in rates this year? Will he comment on his hon. Friend's statement earlier that the new water and sewerage rates represent a correction of a gross distortion, bearing in mind that in Cardiff they have risen by 89 per cent. and 366 per cent., respectively? Will he make them rebatable for those in receipt of rate rebates, and will he comment on the effect that they will have on small businesses in Cardiff and other areas, especially in view of what the Chancellor of the Exchequer is expected to do tomorrow?

§ Mr. Morris
The hon. Gentleman finds it convenient to forget the lack of reaction on his part to the favourable proposals which I announced in March 1974 and to the very small increases in many parts of South Wales. Indeed, in Cardiff there was a diminution in the rate. I remind the hon. Gentleman that when I brought my measure to the House, all Conservative Members representing Welsh constituencies, including the hon. Gentleman himself, were absent from the Lobby that night. Wales has done very well in the proposals that we have brought forward. We have pumped into local government an extra £2,000 million for the forthcoming year. This is what the increase from 60.5 per cent. to 66 per cent. means. It represents an increase from £3,400 million to more than £5,000 million.

§ Mr. Roy Hughes
Does my right hon. and learned Friend agree that the responsibility for the present situation lies fairly and squarely on the last Conservative administration, for placing on the statute book one of the worst pieces of legislation that we have had this century? Now that the people of Britain are having to pay the bill for it, will my right hon. and learned Friend give serious consideration to undoing this legislation in the near future?

§ Mr. Morris
I am not sure to which legislation my hon. Friend is referring. There were several bad bits of legislation 7 by the Conservative Party. All I can tell him is that our priority has been massively to increase the amount of support for local authorities—I note the remarks of the hon. Member for Pembroke (Mr. Edwards)—and that has meant major demands on public expenditure.

§ Sir Raymond Gower
Is not the Secretary of State aware that this matter is much too serious for him to escape from the consternation and even anger of the public by references to the past? Is he aware that he has to take action to solve a problem whose effect on the public is now exceeding anything that I have seen in 20 years? I hope that he will not view it as a subject for party debate in the House, or for slinging retorts across the Floor. If he does not act, the anger being caused by the grotesque increases—

§ Mr. Speaker
Order. This is Question Time, not a time for making speeches.

§ Sir Raymond Gower
I have explained the point.

§ Mr. Morris
As for party warfare in the House, it is my recollection that it was the hon. Member for Cardiff, North (Mr. Grist) who castigated me for being smug. The hon. Member for Barry (Sir R. Gower) has put a supplementary question that is misconceived. I was referring not to the past but to the future. That is what the 66 per cent. increase in the rate support grant is about. Although Conservative Members are now wringing their hands about the rates position, they did nothing about it when in office. We have set up the Layfield Committee to investigate and to report on the whole subject of local government finance.

§ Mr. Roderick
Despite what Opposition Members have said, will my right hon. and learned Friend remind them that Wales received a massive increase in the domestic element of the rate support grant 'last year in order to compensate areas, such as mine, that had had large increases in water charges? Is it not only fair that areas such as Cardiff should help to equalise the load this year?

§ Mr. Morris
That was one of a number of reasons for the domestic relief, from which I succeeded in ensuring that the people of Wales should benefit, intro- 8 duced by our measures of last March. Perhaps that was why all Conservative Members from Wales were absent from the Division Lobby on that occasion.

§ Mr. Nicholas Edwards
I again put the emphasis on the need to reduce expenditure overall. Nevertheless, does not the right hon. and learned Gentleman agree that rather than waiting for a commission to report, which is bound to take some time, early action is required to give relief to ratepayers? Should not the Government consider the proposals that have been put to them by the Opposition to relieve local authorities by transferring some of their responsibilities to the Exchequer?

§ Mr. Morris
The hon. Member cannot have it both ways. He cannot, on the one hand, attack any increase in public expenditure and, on the other, ask for responsibility to be transferred from local authorities to the Government. The money must come from somewhere. We have made proposals to increase the amount of the rate support grant for Wales by £2,000 million next year. Is the hon. Gentleman suggesting that that amount should be increased?