PAYMENT OF NEEDS ELEMENT OF RATE SUPPORT GRANT TO DISTRICT COUNCILS (Hansard, 8 July 1977)

§ Mr. Wyn Roberts (Conway)
I beg to move, That the clause be read a Second time.
The clause deals with the payment to district councils of a proportion of the needs element of the rate support grant. The need for the clause is foreseen in the Explanatory and Financial Memorandum to the Bill, which provides that The Bill will require a transfer of resources from social services to housing authorities to meet the commitments hitherto met by the former for payment for hotel (bed and breakfast) accommodation and for providing and managing temporary accommodation. There is no argument between the Government and the Opposition about the need for this transfer of resources.
The first part of the clause provides that not later than the day on which this legislation comes into force the Secretary of State should make regulations under Section 2(4) of the Local Government Act 1974 providing for an appropriate proportion of the needs element of rate support grant to be payable to the councils of districts within a county instead of the council of the non-metropolitan county.
The second part of the clause provides that The appropriate proportion under subsection (1) … shall be of such an amount that in the opinion of the Secretary of State after consultation with the local authority associations reflects the transfer of responsibility for 1597 homeless persons from the councils of non-metropolitan counties to the districts within counties. We are not anxious to be hard on counties, but we know that a part of the needs element is intended to cover their duties in respect of the homeless. Now that that duty and obligation is to be transferred to the district councils, we think it only right and proper that the money to cover the expenditure should be transferred as well. At the same time, we know of the financial pressures faced by county authorities in the social services.
The fact is that the Government are not prepared to make extra financial provision to implement this Bill. Although the cost is not very great—about £16,000 per authority, as we were told in Committee—that money must be found from somewhere. It seemed appropriate that we should look for it in the needs element given to the counties.
The second part of the clause is important, since it lays a duty on the Minister to liaise with the local authority associations in deciding the appropriate amount to be transferred. In a sense, the Minister is being forced to meet the associations and to discuss the matter with them.

§ Mr. Armstrong
The needs element of rate support grant is at present paid only to London boroughs, non-metropolitan counties, and metropolitan districts. The Government have, however, already accepted in principle that it should be paid to the non-metropolitan districts, and are considering with the local authority associations how best this could be achieved. To date, however, no agreement between the associations has been reached, but when agreement is reached, no new legislation would be required to effect it. It would be inappropriate to take steps now, in this Bill, but I hope that this explanation will enable the hon. Gentlemen to ask leave to withdraw the motion.

§ Mr. George Younger (Ayr)
Perhaps I should tell the House that it is my fault that the clause as drafted does not cover the Scottish situation. I hope that the Minister's undertaking will apply also to Scottish local authorities, in the same way. Will he give an assurance on that point?

§ Mr. Armstrong
Yes. I am assured that that is so.

§ Sir Anthony Meyer (Flint, West)
I should like to press the point raised by my hon. Friend the Member for Conway (Mr. Roberts). Perhaps the Minister will enlighten me.
My hon. Friend said that the additional cost that would fall on housing authorities for assuming these extra responsibilities was £16,000 per authority. Is the Minister satisfied that in practice the burden will turn out to be as little as that? Such housing authorities as I have consulted on this matter are concerned that this commitment may turn out to be, if not open-ended, much less easily quantifiable than the figure quoted by my hon. Friend. In other words, they might find themselves involved in heavy expenditure —not so must because of extra staff as because of the elaborate verification procedures that will be required to ensure that applicants who claim to be homeless really are in that category within the definitions of the Bill.

§ Mr. Armstrong
I do not want to mislead the House. The figure of £16,000 was quoted by me, but it related to a statement by the Association of District Councils, which gave estimated figures of the extra staff and the obligations involved. I said in Committee that even if we accepted those figures—and one could argue about the matter—it would mean an average of £16,000, but I think I added that averages are not very relevant because the incidence of the obligations in the Bill will vary from place to place. We have had discussions about the allocation of resources and we believe that it is a matter of shifting resources from one priority to another rather than requiring any extra expenditure. I hope that that satisfies the hon. Gentleman.

§ Mr. Wyn Roberts
I am grateful to the Minister for his remarks. Clearly, he accepts the principle of the new clause and I am glad that we had his assurance. I am also glad to hear that discussions are taking place with the local authority associations. The House appreciates that the Government are following the recommendations of the Layfield Committee in this respect.