HC Deb 30 July 1980 vol 989 cc1489-91
2. Mr. Durant

asked the Secretary of State for the Environment what response he has received from local authorities to his request for revised budgets for 1980-81.

4. Mr. Anderson

asked the Secretary of State for the Environment whether he will make a statement on the response to his circular to local authorities of 13 June on their revised expenditure plans.

The Secretary of State for the Environment (Mr. Michael Heseltine)

We have asked the local authorities to return their revised, reduced expenditure plans by 1 August. Until my Department has analysed the revised plans, it will not be possible to say whether local government as a whole has made the reductions we requested.

Mr. Durant

Will my right hon. Friend not weaken in his resolve to deal with this matter, which is of great importance? Will he bear in mind those local authorities, mainly Conservative, which have cut back over the years at the request of the Labour Party? Will he deal firmly with those irresponsible authorities that have little regard for their ratepayers and financial prudence?

Mr. Heseltine

I welcome my hon. Friend's support. The provisions of the Bill will give to the Government, in their administration of the block grant, a more sophisticated method of allocating resources between those authorities which overspend and those which underspend. The problem goes a little wider than the difficulty facing Conservative authorities. It is clear that there are Labour as well as Conservative authorities that are complying with the Government's target. All that the authorities are doing by not complying with the Government's request is pre-empting resources from those that are. If there is to be a degree of fairness, it is important that all authorities understand that the burden must be spread equitably throughout the country.

Mr. Jim Marshall

When will the right hon. Gentleman realise that there is no more sophisticated way of allocating rate support grant resources? Secondly, when will he wake up and accept that local authorities are responsible bodies and that his actions represent an unwarranted intrusion into local democracy?

Mr. Heseltine

The hon. Gentleman knows that the traditional relationship between central and local government is that the Government set the guidelines for local government expenditure. It is sometimes necessary for the Government to ask for reductions to take place, as my predecessor did in 1976. I have not yet used the draconian measures that the previous Labour Government used to secure those ends. I have tried to rest on the voluntary basis, which hon. Members prefer as a first priority. If I am not able to secure the targets that the Government have set—we shall not know that until the next few weeks have passed—I shall have to consider a range of other measures, some of which the Labour Government used rather earlier than I have done in similar circumstances.

Dr. Mawhinney

In considering these revised budgets, will my right hon. Friend bear in mind that in some county and district councils that have high growth areas and new towns, one component of the increased spending is population growth? Will he bear that in mind when considering the revised budgets?

Mr. Heseltine

My hon. Friend has raised an important issue. We shall be able to consider factors such as that under the new grant-related expenditure parts of the block grant proposals. The Government have asked local authorities to reduce by only 2 per cent. what they spent in 1978-79. In view of the magnitude of the national economic difficulties, that is not an impossible target for any authority.

Mr. Hattersley

The Secretary of State has referred twice to the block grant, which will begin not this year but next year. Does he recall that on Monday Sir Gervas Walker urged him to postpone the introduction of the block grant for a year, as he believes that it cannot be operated fairly and equitably next year? Does the right hon. Gentleman believe that Sir Gervas was motivated by malice or ignorance in advocating that postponement?

Mr. Heseltine

I know Sir Gervas extremely well, and I know that he would not be motivated by either of those motives. It does not serve the right hon. Gentleman well to trivialise a debate of this sort. The leaders of the local government associations are right to express their legitimate concern about the Government's proposals. That is a vital part of the democratic process. It is the Government's view that the block grant proposals will answer many of the deep-seated criticisms that right hon. and hon. Members have expressed about the present basis of regression analysis. It is upon that basis, and in the light of the work that we have done so far, that we shall press ahead with the block grant in 1981-82.