HC Deb 11 November 1980 vol 992 cc304-23

Lords amendment: No. 56, in page 48, line 3, leave out from "authorities" to end of line 20 and insert— (4A) Except as provided by subsection (4C) below, the power—

  1. (a) may only be exercised—
    1. (i) in accordance with principles to be applied to all local authorities; or
    2. (ii) in accordance with principles to be applied to all local authorities belonging to the appropriate class; and
  2. (b) may only be exercised for any such purpose as is specified in paragraphs (a) to (d) of subsection (4B) below.
(4B) The purposes mentioned in subsection (4A) above are—
  1. (a) limiting the change in the amount of block grant payable to an authority for the year from the amount payable in the previous year;
  2. (b) taking account of less than the gross rateable value of an authority or group of authorities in calculating the amount of block grant payable;
  3. (c) reducing, whether in whole or in part, disparities in the rates levied in different rating areas of Greater London other than the Temples; and
  4. (d) any such other purpose as the Secretary of State may determine.
(4C) The power may also be exercised in accordance with principles to be applied to the councils of counties to whose police expenses section 57 of the Police Act 1964 applies (counties falling partly within the Metropolitan Police District).

Read a Second time.

Mr. Hattersley

I beg to move, as an amendment to the Lords amendment, to leave out paragraph (d).

Mr. Deputy Speaker

With this we may take Lords amendments Nos. 57 and 58.

Mr. Hattersley

I wish that the Minister had moved the Lords amendment first, because he would have had the task of describing the contents of the principal amendment. It concerns the complicated subject of multipliers. Out of respect and sympathy for the Government, I always point out that when they talk about multipliers they do not mean what John Maynard Keynes meant when he talked about multipliers. It is a term invented by the Government in the past year for what amount to index numbers—a figure that is used to adjust the amount of grant received by each group of local authorities.

When the block grant allocation has been made the multiplier allows the Secretary of State to change the actual receipts of a group of local authorities. The multiplier for one group may be more than one. If so, those authorities' receipts will increase. The multiplier may be less than one, in which case the receipts will diminish. It is essentially an arithmetical mechanism by which the Secretary of State can change the initial block grant receipt to authorities in a certain group or class.

I say "in a certain group or class" because that was the essential condition that the Minister described to us when we debated the matter in Committee. We were told that a multiplier could not apply to a single authority, but had to apply to a group. There is now some ambiguity about that, because the Lords amendment refers to "an authority". I hope that the Minister will make clear that the multiplier provision cannot be used by the Secretary of State to adjust the grant to an authority, but only to a group or class of authorities.

London is the example that is normally quoted, because it comprises the group of authorities that are said to have special problems. As we debated multipliers in Committee and on Report, London was almost always given as the example of how multipliers should be used.

Multipliers would be used to assist with what is called, in the jargon of the rate support grant, dampening—that is, averaging out the receipts from one year to another when the crude rate support grant distribution might mean that receipts so differed from one year to another that an authority's finances could be put in peril because it suddenly discovered that its receipts for one year were appreciably lower than receipts for the previous year. Multipliers, we were told, might be used for the safety net.

8.30 pm

This year, London, on the rate support grant system, had it been applied crudely and simply to London, would have lost more grant than even this Government were prepared to tolerate. A safety net provision was therefore introduced which said that London should get slightly more than the crude RSG distribution would have provided. Multipliers, we are told, could be used to accommodate that situation in future years. The entire London clawback to make adjustment for difference in needs and difference in standard expenditure was possible under the multiplier. It was for that sort of technical reason that the multiplier was necessary.

If you, Mr. Deputy Speaker, as I am sure was the case, were in the Chair during the long debates on the Bill, you will recall that the opposition constantly objected to those provisions which give the Secretary of State unfettered discretion and the right to use his own judgement about how an authority should behave, how an authority might be penalised and the level of grant it might receive. We mad:, clear that if a multiplier could be conjured out of the air by the Secretary of State for virtually any purpose and then multiplied by the grant to be received by a local authority or a group of local authorities, this would give the Secretary of State unfettered power to change a grant according to whim or prejudice.

We took the view that the use for multipliers should be stipulated in the Bill. So, I am happy to say, did the House of Lords. My noble Friend, Baroness Stedman, who, if I may say so without offence through suspicion of being patronising, made some of the most informed, authoritative and damaging speeches about the Bill that have been made on any political subject for a long time, described the three areas in which multipliers might be used and could properly be used and moved an amendment to limit the Secretary of State's discretion to those three areas. One was limiting grant changes from one year to the next, colloquially called dampening. One was to take account of less than actual gross rateable value for an authority or group of authorities—the special considerations of a special area. One was to give effect to the equalisation of resources in London—the special acknowledgement of the special needs of London.

The limitation of the multiplier to those three specific areas was a proposition that was put to the House of Lords not only by Baroness Stedman but by Viscount Ridley. It has already been mentioned in the House today that Viscount Ridley was leader of the delegation to the Secretary of State at the outset of the Lords consideration. The delegation was given information about what the rate support grant would be next year—information that the House of Commons, if it is lucky, will receive on or about 21 November. At the end of the conversations that the noble Lord Viscount Ridley had with the Secretary of State, he withdrew much of his opposition to the Bill. It has been said that the spirit of compromise was encouraged by the information that he received.

Mr. King

One understands that there is a certain latitude in debates of this kind. I would simply like to say that what the right hon. Gentleman says is totally untrue. I state that on behalf of the Government and on behalf of my right hon. Friend.

Mr. Hattersley

I shall remind the Minister of State of what I said. The right hon. Gentleman will tell me whether the facts as I recount them are incorrect. At the point when the right hon. Gentleman interrupted me, I had not drawn any conclusions, but four facts are undeniable. The first is that Viscount Ridley, on behalf of the Association of County Councils, began Lords consideration of the Bill in an almost bellicose mood about parts of the Bill. He did not like it. The second fact is that he met the Secretary of State before the Bill was debated. If the right hon. Gentleman wants me to write to him with dates and times I can do so. He does not need that information because he knows that it happened. The third fact is that Viscount Ridley and the association were given advance information about next year's rate support grant. A statement was put out by the Department of the Environment that he was not given advance information but given some projections. That appeared in the newspapers the following day. If the right hon. Gentleman wishes to contradict what I say, I shall sit down. I shall sit down for whatever he wants to say.

Mr. King

The right hon. Gentleman said that the noble viscount led a deputation to the Department at some time he did not specify. My right hon. Friend and I and other Ministers have met Viscount Ridley and leaders of the Opposition in the House of Lords. We discussed matters connected with the Bill. Delegations come to see Ministers on all sorts of matters. The suggestion that rate support grant was divulged to any visitors to the Department of the Environment by my right hon. Friend or by myself that has not been disclosed to the House—it will not be possible to disclose such information to the House or to local authorities before some weeks from now—is totally untrue.

I would be grateful if the right. hon. Gentleman would take that from me. What have been discussed with a number of local authorities as part of the consultative council are exemplifications—the right hon. Gentleman knows that this is normal practice—of possible grant distributions. This is the system that his own Government operated. This is the way that it works. They are shown exemplifications. No one in the local authorities knows which exemplifications are likely to be adopted. It is ultimately a matter for Government decision. Although the right hon. Gentleman wishes to make the best case that he can, the suggestion that people have received privileged information is untrue. I should be grateful if he would accept that.

Mr. Hattersley

It is my duty to accept what the right hon. Gentleman tells me and I do accept it. The difference between us is that I said that Lord Ridley was given projections of possible grant patterns and the Minister says—with some disapproval that I should have traduced his noble Friend—that that is not true because exemplifications of possible grant distribution were given. I accept that correction without a second's hesitation.

I must take a further step along the road and remind the Minister of what call the "Ridley meeting". The leaders of the other local authority associations were outraged that the county council representatives met the Secretary of State without them. The meeting was not a routine meeting of the consultative council. That was why it was peculiar and was featured prominently in the press. The meeting did not even represent the common conversations between the Government and the local authorities. The meeting was something special for the county councils. I am delighted that the Minister has drawn so much attention to that episode because it was only an aside in my speech.

The spirit of compromise, which seemed from that moment to characterise most of the actions by Lord Ridley, spilled over into the amendment that he tabled to limit—as was thought—the Secretary of State's discretion over the use of multipliers. That amendment was almost exactly identical to that proposed by my noble Friend, Baroness Stedman. However, Lord Ridley's amendment added an extra sentence. The original amendment was agreed by both sides in the Lords. It provided that the multiplier could be used only for three specific purposes, Lord Ridley added the immortal phrase: any such other purposes as the Secretary of State may determine. That totally destroys any limitation that the original amendment placed on the Secretary of State's actions.

Lord Ridley clearly recognises an elephant's trap when he sees one. When he moved the addition to the amendment he said: That might be thought to give the Secretary of State a total freedom to do anything he likes in the most dastardly way with the multiplier, and to use it for political purposes, which is what no doubt he would like to do from time to time. The noble Viscount is right. That is what is thought by my right hon. and and hon. Friends. That is why we wish to remove it from the Bill. Lord Ridley continued: No one really suspects that the Secretary of State wants to do that in the future. —[Official Report, House of Lords, 9 Oct 1980; Vol. 413, c.685] I make it clear that I have every suspicion that the Secretary of State would want to use it for that purpose. I have that suspicion for the simple reason that that is how he has behaved in the past.

I shall demonstrate why the Secretary of State's behaviour is not that which justifies such discretion being placed in his hands. We are utterly opposed to a Bill which contains clause after clause which amount to no more and no less than enabling powers. One of the most unhappy features of the Bill, to which the right hon. and learned Member for Hexham (Mr. Rippon) has drawn attention, is that where there is any doubt about how the Bill should be applied the parliamentary draftsmen are required to write in words such as "or whatever the Secretary of State shall provide", or "in whatever way the Secretary of State feels appropriate." Time after time the operation of the Bill is left to the Secretary of State. It is absurd to leave to him the ability to construct an index number which can be used to reduce or increase grant to a group of local authorities.

I return now to a subject about which I warned the House half an hour ago. The reason why the Secretary of State is patently an unsuitable person to be given this discretion concerns the way that he behaved with the 14 councils that he penalised during the transitional arrangements. I shall remind the House of what happened then.

On Second Reading the Secretary of State announced that he would be taking powers to penalise a group of authorities in a way that he would later stipulate. When pressed to tell us the offence for which they could be punished, he said that it would be if any authority exceeded a notional rate level that he would announce and determine. He then announced a notional rate level that 50 per cent. of councils had exceeded, or would exceed, leaving himself free to choose within that group those that he wished to pick on and penalise.

It is nonsense for the Minister to say that the criteria for punishment and penalisation were announced as early as possible out of courtesy to the Opposition. We asked for the criteria to be published before the House rose so that we could debate them. The Government refused to do that. Suddenly, in September—a few weeks before the Conservative Party conference—the Secretary of State announced that he had picked 14 councils for punishment. I am sure that the Minister is too honest to deny that until those 14 councils were picked for punishment they had no way of knowing the crime that they had committed. They did not know how to avoid committing that crime.

Fulham and Hammersmith council—the only council of the 14 not under Labour control—continues to insist that it was included in the list by mistake. It attempted to find out from the Secretary of State the criteria that it had to avoid. The Secretary of State could not tell the council the criteria, but led it to believe that it would not be punished. It was punished. That council is not controlled by the Labour Party, but it says that although it attempted to discover the crime that it might commit and thus be punished, no one was able to give it that information until the crime was announced and the punishment determined. That is an intolerable way for a Minister to behave.

It is equally intolerable that there should be weeks of discussion thereafter about whether the criterion eventually determined for judging the 14 malefactors was the most appropriate measure of overspending. I cannot go into the matter in any great detail, but some of the councils will test in the courts whether the Secretary of State used his discretion in a reasonable way, or whether he used it in a way that was both arbitrary and capricious. I do not believe that a widened discretion should be given to a Minister who put himself in a position where there appears to be a case to answer, because, on a previous occasion when he had wide powers he exercised them in a way that probably was not legally enforceable and had to be challenged.

There is no doubt about the reasons why 13 of the 14 councils were chosen for punishment, with the fourteenth being included by mistake. None had done anything remotely illegal. They had exercised their proper rights under the Local Government Acts and used the judgment of the elected councillors about what rate level and spending pattern was best for their areas. That is not only their right but, in successive Local Government Acts, it is the duty of councillors to make up their minds according to local circumstances. Having done that, they are now being punished.

For what reason are they being punished? They are being punished for applying Labour Party spending policy rather than Conservative Party spending policy. They are being punished because they do not accept the philosophy of, and the theory about, local authority expenditure which is the philosophy of the Secretary of State. That is why the 14 authorities were chosen to receive this severe punishment.

The House does not have to take my word, but it must take the opinion of every local authority association, every serious newspaper that has written on the subject, every informed commentator. The way in which the Secretary of State has exercised the discretion over financial matters during the past year has not one friend in the world. The Minister of State has the sad job of trying to justify it.

I shall not vote for the Secretary of State's discretion being extended an inch wider. Neither should any Conservative hon. Member who values local authority autonomy or the proper rights and responsibilities of this House.

8.45 pm
Mr. Cant

I should like to comment on what is a controversial issue. I have come to the conclusion, partly based on practical experience, that in this age of leaks one can rely with a fair degree of confidence on what on reads in the newspapers. I had never thought that I would stand up in a quasi-public place to make that sort of confession. Most of the leaks in the past few months have turned out to be quite correct.

The point that my right hon. Friend the Member for Birmingham, Sparkbrook (Mr. Hattersley) made about what amounts to a biasing of the distribution of the block grant in the direction of the shire counties is without doubt correct. Whatever the mechanism, the important thing is the fact.

At a county council meeting on 16 October, on the basis of what had been leaked in The Guardian, the Financial Times and other publications, I suggested that the county council was attempting to go far beyond what the Government required of it, in that it was making cuts not of 2 per cent. but of 5½ per cent., but that one might regard that with more moderation because the Government would be quite generous to the shire counties. The amazing thing was that this was not denied. Nobody on the Tory side of the county council said "We don't know."

There had been a meeting of the consultative committee on 15 October at which councillors had been shown various extrapolations and exemplifications. They were not prepared to deny that there had been this pattern of distribution but only made the counter-accusation "Your Government did the same for the inner cities."

I think that the Minister is being a little naive, or thinks that we are being a little naive. As was said in the Standing Committee, the whole apparatus of the distribution of the block grant lends itself to this kind of behaviour by the Secretary of State. It is a technique that he can use for the end that he desires. When we consider how much block grant an authority is to receive, we also consider expenditure, poundages and so forth. But the grant that the authority will receive in the last resort is a consequence of the fact that far beyond the threshold a marvellous tapering effect begins. Here is an element of uncertainty for local authorities, uncertainty that did not exist under the rate support grant. That would be bad enough if for some reason the Secretary of State decided to draw the line one way or another. This clearly will make a great difference to how much an authority receives. When we go further and at the end of the process say that the Secretary of State can multiply the amount that a group of authorities or an individual authority can get by a factor that he decides, the situation is completely transformed.

In Committee I quoted from an article in the Local Government Chronicle in which it was stated that the multiplier concept had been introduced because the Government had not the slightest idea how all these calculations would work out. Therefore, they had to have a reserve power which it was believed would be used in such a way that, having made all these changes in the block grant mechanism, at the end of the day the Secretary of State would say "I shall apply these multipliers so that the situation in respect of different authorities is not changed in any dramatic way."

This is an extremely important device. How the Secretary of State uses it can seriously affect the financial fortunes, or misfortunes, of different local authorities. Therefore, I support my right hon. Friend's amendment.

Mr. Ronald W. Brown

I support my right hon. Friend the Member for Birmingham, Sparkbrook (Mr. Hattersley) and my hon. Friend the Member for Stoke-on-Trent, Central (Mr. Cant). I have grave misgivings about the use of the multiplier.

I intervened earlier to point out how the Minister's decision that Hackney was an overspender arose. I referred to a base year. The Minister in reply—and I thank him for saying that he will look into the matter—said that it was nothing to do with base years. I should like to draw his attention to what he did. There were three different ways in which this attack on the hit list was made.

Mr. King

I said that it started not from any base year calculation, but from the notional uniform rate and something substantially in excess. I did not go on to explain about the waiver and the way in which the two work because one relates to the outturn expenditure in 1978–79.

Mr. Brown

On the first issue Hackney was determined as having overspent by £24 million. It was so obviously stupid that the Minister had to back off and produce another figure. He then produced a third one. The Municipal Journal refers in glowing terms to how stupid the whole exercise was. Indeed, it finished by saying: The result is that there are almost as many different answers to the question who is overspending as there are methods of assessment. Hackney came out in that first attempt to put it on the hit list as being £24 million overspent, and that was not correct. The decision then was to take a base year, and the base year taken for Hackney's multiplier was 1978–79. By taking that as a notional amount and reducing it by 2 per cent., the Minister said that Hackney on its actual expenditure in 1978–79, minus 2 per cent., was 21.5 per cent. overspent on its estimate for 1980–81. That is the basis upon which Hackney is being penalised. It is because of this notional overspending of 21.5 per cent. It is said to be the highest in the country, and it results from the difference between the 2 per cent. less of the actual expenditure of 1978–79 and the estimated expenditure for 1980–81.

In taking 1978–79, Ministers have taken a year when we had heavy industrial action in London. As a result, there was heavy under-expenditure. To take 2 per cent. less than that is not being reasonable in arguing that that is an average figure which people should take.

What is more, in 1979–80 and 1980–81, Hackney has been encouraged under its partnership scheme to go on spending its money under partnership with the help of the Government. As a result, the estimate for 1980 will be much higher because of the commitment, with the Government, for increased expenditure. As a result of co-operation with the Government, by their choice of a year to make it look bad, Hackney is on the hit list. Therefore, when we talk of a multiplier and the ability of the Secretary of State to choose how and against whom he will use it, the evidence of Hackney indicates the danger of that procedure. I shall want to see it dealt with very much more closely, first to determine exactly what the Secretary of State has in mind.

In the cases that I am identifying, there are a number of boroughs which can be found wanting. The London borough of Wandsworth, for example, under the same examination system that is being applied to Hackney, should be spending only 81 per cent. of its expenditure. Nothing has happened to Wandsworth. Of course, the sceptic will say that it is Tory controlled. I make no such accusation, but it takes a lot of explaining. The same is true of Southwark, which should be spending only 70 per cent. of its expenditure. Southwark is not on the hit list, either. However, one can go to other areas and consider Cambridge, Cornwall, the Isle of Wight, Lancashire, Northumberland, Salop, Somerset, West Sussex and, nearer home, the City of London. They are all overspent under that notional scheme, yet the Minister says that they are different. Of course, they are different. They are Tory controlled.

I know that the Minister feels a little irked when I make these points but, if asks that any Secretary of State be given carte blanche to use any form of system, he has to justify it.

There is now enough evidence to show that there are dangers in giving any Minister carte blanche. It may not be the present Secretary of State. It may be another Minister. It is unwise of the House to give carte blanche unless it is satisfied that it is under parliamentary control. I do not think what we are seeing today is right.

Mr. Bob Cryer (Keighley)

We are talking about a principle here and not about individuals. We know that the Secretary of State, who appears here so rarely, is given to sudden, furious aberrations. He is, after all, the man who twirled round the Mace for some extraordinary reason. It may be that he will have another rush of blood to the head in his Marsham Street office and produce some outlandish multiplier. We have seen the evidence.

I regard that as a trivial aside, of course, because, if the Secretary of State is successful and gets a genuine standing ovation at the Tory Party conference instead of the usual form, he will be shifted, as he was shifted from industry to the environment, the reason being that he was a threat to the Leader of the Tory Party.

Mr. Straw

My hon. Friend mentions the antics of the Secretary of State with the Mace. Does my hon. Friend agree that that is trivial compared with some of the right hon. Gentleman's other previous convictions such as his conduct in respect of answers on tracked hovercraft in 1973?

Mr. Deputy Speaker (Mr. Bryant Godman Irvine)

Order. Are they included in this amendment?

9 pm

Mr. Cryer

You are absolutely right, Mr. Deputy Speaker, not to take into account the replies on tracked hovercraft mentioned by my hon. Friend. However, the replies on the cost of selling off local authority houses did not exactly inspire the House with confidence in the estimates and ability of the Secretary of State for the Environment.

On the evidence presented to the House, it looks as if this device is a squalid and shoddy political manoeuvre in order to give the Secretary of State the opportunity of producing multipliers which he will use for political advantage and nothing else. We know that the Tory Party is deeply prejudiced against the urban areas. In sheer practicalities, it means that the urban areas will be deprived and that the money will go to the counties.

Labour-controlled local authorities are almost at their wits end in an endeavour to maintain decent local authority services, which by and large serve the worse off in the community. Educational and social services facilities are the sort of facilities which are most used and appreciated in the urban areas by those in the lower income brackets, yet they will be the people who will be most hit by this sort of potential shift of resources.

The Minister might well say "Of course, that is not what we have in mind". However, unless amendment No. 56 is approved and paragraph (d) deleted, it is possible for the Secretary of State to have virtually anything in mind, because it gives him absolute discretion. I should have thought that the Tories, who pride themselves on their concern for such notions as democracy, the power of Parliament and other such related items, even if they were determined to give the Secretary of State some discretion in the matter, might at some stage or other have thought of consulting Parliament. It would have been easy to have had the phrase any such other purpose as the Secretary of State may determine made subject to an order approved by both Houses of Parliament. It is not uncommon for such a procedure to take place, even though that procedure is not all that satisfactory. But at least it involves some sort of scrutiny, whereas amendment No. 56 as it stands does not. The decision is left entirely to the discretion of the Secretary of State for the Environment. That is completely unsatisfactory, especially in view of his background.

Quite apart from the personal characteristics of the present Secretary of State, any Secretary of State in a Conservative Government could be sufficiently prejudiced to move funds away from the urban areas in the way that has been outlined, because he will have the power to produce a multiplier, or any combination of multipliers, that will enable him to do so. It is scandalous that the Tory Government and the Tory Party, who make such play with democracy, are so much prone to trample on the rights of Parliament. That is precisely what they are doing, and they are doing it time after time.

I hope that our amendment will be supported. I do not suppose that we shall get a majority, but it will be something that we shall ram down the throats of those Tories who oppose it every time they open their mouths about democracy. If they support the amendment as it stands, they are voting for total and absolute discretion by the Secretary of State without any reference to Parliament, and that is a disgrace.

Mr. King

I am grateful to the hon. Member for Keighley (Mr. Cryer). If I understand him correctly, he feels that the further discretion contained in paragraph (d)— any such other purpose as the Secretary of State may determine"— would be outrageous if it remained a discretion of the Secretary of State. He feels that it is a matter that should come before Parliament.

Mr. Cryer

indicated assent.

Mr. King

I am glad to have that on the record. I can understand that the hon. Gentleman may have been misled by the comments of his right hon. Friend the Member for Birmingham, Sparkbrook (Mr. Hattersley) who referred to "anything that the Secretary of State might decide", or "anything that came into his mind".

I draw the attention of the House to the wording of the amendment. It refers to any such other purpose as the Secretary of State may determine. "Determine" is the word, not "decide", not "think for himself", and not "decide on a casual whim." In this respect, the word "determine" has a specific legal meaning. It means "to make a determination", a determination which has to be laid before Parliament. It therefore fits precisely within the criteria that the hon. Member for Keighley said could make it more acceptable to him. It is subject to the approval of Parliament. The Secretary of State must spell out the purpose in a formal determination in his annual report to Parliament, which must be subject to a vote in this House before it can take effect.

The right hon. Member for Sparkbrook introduced the dangerous new word "multipliers" and reflected for a moment on what would have been Keynes' interpretation of multipliers. The new block grant system has introduced a dangerous new concept. I do not think that many hon. Members are familiar with the present rate support grant system, and I do not blame them, because it is incredibly complex. I have with me a document containing about 15 pages of close print, and every page, line after line, contains separate multipliers. The hon. Member for Hackney, South and Shoreditch (Mr. Brown) is concerned about the multiplier. Did he know that last year his multiplier was 1.0800? Did he rise in his place and ask why the multiplier for Hammersmith and Fulham was 1.0259 and say that it was an outrage of constitutional dimensions that that factor was not revealed? This document is the rate support grant order for 1979, on which he voted.

I agree with the right hon. Member for Sparkbrook and with the hon. Member for Keighley that if there were an unfettered power and that if without the sight of Parliament and without the publication of that information the Secretary of State could do what he liked, that would be unacceptable. That is why the Lords amendment is so worded. It states that the Secretary of State "may determine", and I have sought to make clear to the House the determination.

The right hon. Member for Sparkbrook asked whether the amendments would apply to individual authorities. They could apply to local authorities, but they would be different for individual authorities for one good reason, which exists under the present system. For instance, there is a safety net. If it is determined by a general principle that there shall be a safety net at a certain level, it will need the calculation of different multipliers to determine what the multiplier should be for each authority to ensure that they do not go below the safety net. I think that the right hon. Gentleman will understand that example, although I appreciate that it may be complicated for hon. Members who have not been so involved in these matters. I took the inner London multiplier for last year. They are all different, but they are applied according to common principles, which have to be set out in the Order, and which have to be clearly specified. There are also certain single class authorities, such as the City of London and the Isles of Scilly.

I shall not go off into the highways and byways of the transitional arrangements. I made a moving address on that subject earlier, and hon. Members who missed it may care to reflect on it in Hansard. These amendments deal specifically with multipliers, and I hope that, even if I have not totally reassured the hon Member for Keighley—I do not think that that has been done in the last 10 years—I have at least made some slight contribution towards it. If he reflects on his remarks in Hansard, I think he will find that his points have been met completely.

There are two other technical amendments in this group. As one of the multipliers, one amendment merely limits the change in the amount of block grant payable, so that no authority will suffer too great a loss by a change. There has to be a technical adjustment every year to make sure that the comparison is fair. The other amendment is a technical restatement in the Bill.

Mr. Straw

Will the Minister explain whether the approval of the determination under the proposed subsection (4B) (d) is given separately in Parliament—in a separate debate lasting 1½ hours—or whether that is subsumed into all the other determinations that are contained within the single rate support grant order and its successors?

Mr. King

The rate support grant order and the multipliers have been done every year. It is done in a single report in which all the facts on the basis on which the RSG settlement has been made are laid before Parliament, on which Parliament votes. That is the way in which it has always been done before.

Mr. Hattersley

With the leave of the House, Mr Deputy Speaker, I should like to make a few remarks.

I do not think that any Opposition Member is disposed to argue with the technical point of determination that the Minister of State made. Indeed, those who spent much time with him in Committee will recall that every time we objected to the Secretary of State being given discretion, the Minister of State told us not to worry, because some time, either late at night or early in the morning towards the end of the Session, shortly after Prayers, the Secretary of State would have to have his decision ratified by the House.

I must tell the Minister, as I told him many times in Committee, that the idea that the Secretary of State, having used his arbitrary and capricious judgement, will be held in check by Conservative Members, acting with the objective interests of democracy close to their hearts, is a theory of the present Parliament which Opposition Members find wholly unconvincing. We do not believe for a moment that if the Secretary of State behaves as badly towards any authorities under these provisions as he is behaving towards the 14 penalised authorities under the transitional

arrangements, the "village Hampdens" opposite will rise up and smite him with their constitutional might. Indeed, I do not believe for a second that Conservative Members are likely to stop the Secretary of State from using his discretion in whatever political way he chooses, to prove which they will vote against my amendment tonight. I press my amendment to a Division.

Question put, That the amendment to the Lords amendment be made:—

The House divided: Ayes 126, Noes 170.

Division No. 495] AYES [9.15 p.m.
Allaun, Frank Foot, Rt Hon Michael Morris, Rt Hon Alfred (Wythenshaw)
Atkinson, Norman (H'gey, Tott'ham) Forrester, John Morris, Rt Hon Charles (Openshaw)
Barnett, Rt Hon Joel (Heywood) Foster, Derek Morris, Rt Hon John (Aberavon)
Beith, A. J. Foulkes, George Morton, George
Bennett, Andrew (Stockport N) Graham, Ted Oakes, Rt Hon Gordon
Bidwell, Sydney Grant, George (Morpeth) O'Neill, Martin
Booth, Rt Hon Albert Hamilton, W. W. (Central Fife) Orme, Rt Hon Stanley
Bradley, Tom Hardy, Peter Palmer, Arthur
Brown, Hugh D. (Provan) Harrison, Rt Hon Walter Park, George
Brown, Robert C. (Newcastle W) Hattersley, Rt Hon Roy Parry, Robert
Brown, Ronald W. (Hackney S) Haynes, Frank Penhaligon, David
Callaghan, Jim (Middleton & P) Heffer, Eric S. Powell, Rt Hon J. Enoch (S Down)
Campbell-Savours, Dale Hogg, Norman (E Dunbartonshire) Powell, Raymond (Ogmore)
Cant, R. B. Home Robertson, John Richardson, Jo
Carmichael, Neil Homewood, William Roberts, Albert (Normanton)
Carter-Jones, Lewis Hooley, Frank Roberts, Ernest (Hackney North)
Clark, Dr David (South Shields) Howells, Geraint Robinson, Geoffrey (Coventry NW)
Cocks, Rt Hon Michael (Bristol S) Hughes, Robert (Aberdeen North) Rooker, J. W.
Concannon, Rt Hon J. D. Jay, Rt Hon Douglas Roper, Jonn
Cook, Robin F. John, Brynmor Silkin, Rt Hon John (Deptford)
Craigen, J. M. (Glasgow, Maryhill) Johnson, James (Hull West) Silverman, Julius
Crowther, J. S. Johnston, Russell (Inverness) Soley, Clive
Cryer, Bob Jones, Rt Hon Alec (Rhondda) Spearing, Nigel
Cunliffe, Lawrence Jones, Barry (East Flint) Spriggs, Leslie
Cunningham, George (Islington S) Kaufman, Rt Hon Gerald Stallard, A. W.
Dean, Joseph (Leeds West) Kilfedder, James A. Steel, Rt Hon David
Dempsey, James Lamborn, Harry Stott, Roger
Dixon, Donald Leighton, Ronald Straw, Jack
Dobson, Frank Lewis, Ron (Carlisle) Thomas, Dafydd (Merioneth)
Dormand, Jack Litherland, Robert Thome, Stan (Preston South)
Douglas, Dick McDonald, Dr Oonagh Tilley, John
Dubs, Alfred McElhone, Frank Tinn, James
Duffy, A. E. P. McKelvey, William Wainwright, Edwin (Dearne Valley)
Dunn, James A. (Liverpool, Kirkdale) MacKenzie, Rt Hon Gregor Watkins, David
Dunwoody, Hon Mrs Gwyneth McNamara, Kevin Welsh, Michael
Eastham, Ken McTaggart, Robert Wigley, Dafydd
Ellis, Raymond (NE Derbyshire) Marshall, Dr Edmund (Goole) Wilson, Gordon (Dundee East)
Ennals, Rt Hon David Mason, Rt Hon Roy Winnick, David
Evans, Ioan (Aberdare) Maxton, John Woolmer, Kenneth
Evans, John (Newton) Maynard, Miss Joan
Ewing, Harry Millan, Rt Hon Bruce TELLERS FOR THE AYES:
Field, Frank Mitchell, R. C. (Soton, Itchen) Mr. Terry Davis and
Flannery, Martin Molyneaux, James Mr. James Hamilton.
Fletcher, Ted (Darlington)
Ancram, Michael Blackburn, John Carlisle, John (Luton West)
Arnold, Tom Boscawen, Hon Robert Carlisle, Kenneth (Lincoln)
Atkins, Robert (Preston North) Braine, Sir Bernard Chalker, Mrs. Lynda
Baker, Nicholas (North Dorset) Bright, Graham Chapman, Sydney
Bendall, Vivian Brinton, Tim Clark, Hon Alan (Plymouth, Sutton)
Benyon, Thomas (Abingdon) Brooke, Hon Peter Clarke, Kenneth (Rushcliffe)
Benyon, W. (Buckingham) Brown, Michael (Brigg & Sc'thorpe) Cockeram, Eric
Berry, Hon Anthony Bruce-Gardyne, John Colvin, Michael
Best, Keith Buhner, Esmond Costain, Sir Albert
Bevan, David Gilroy Butcher, John Cranborne, Viscount
Biggs-Davison, John Cadbury, Jocelyn Critchley, Julian
Crouch, David Lawrence, Ivan Rathbone, Tim
Dean, Paul (North Somerset) Lawson, Nigel Rees-Davies, W. R.
Dickens, Geoffrey Lee, John Rhodes James, Robert
Dorrell, Stephen Le Merchant, Spencer Rifkind, Malcolm
Dover, Denshore Lennox-Boyd, Hon Mark Roberts, Michael (Cardiff NW)
Dunn, Robert (Dartford) Lester, Jim (Beeston) Roberts, Wyn (Conway)
Eggar, Tim Lewis, Kenneth (Rutland) Rost, Peter
Emery, Peter Lloyd, Ian (Havant & Waterloo) Sainsbury, Hon Timothy
Fairgrieve, Russell Lloyd, peter (Fareham) Shaw, Giles (Pudsey)
Faith, Mrs Sheila Lyell, Nicholas Shaw, Michael (Scarborough)
Fenner, Mrs Peggy Macfarlane, Neil Shepherd, Colin (Hereford)
Fisher, Sir Nigel MacGregor, John Shersby, Michael
Fletcher-Cooke, Charles McNair-Wilson, Michael (Newbury) Sims, Roger
Fookes, Miss Janet McQuarrie, Albert Skeet, T. H. H.
Forman, Nigel Major, John Speed, Keith
Fox, Marcus Marlow, Tony Spence, John
Fraser, Peter (South Angus) Marten, Neil (Banbury) Squire, Robin
Gardiner, George (Reigate) Mather, Carol Stainton, Keith
Garol-Jones, Tristan Mawby, Ray Stanbrook, Ivor
Glyn, Dr Alan Mawhinney, Dr Brian Stewart, John (East Renfrewshire)
Goodlad, Alastair Mellor, David Stradling Thomas, J.
Gray, Hamish Meyer, Sir Anthony Taylor, Robert (Croydon NW)
Griffiths, Peter (Portsmouth N) Miller, Hal (Bromsgrove & Redditch) Tebbit, Norman
Grist, Ian Mills, Iain (Meriden) Thompson, Donald
Grylis, Michael Moate, Roger Thorne, Neil (Ilford South)
Hamilton, Hon Archie (Eps'm&Ew'll) Moote, John Townend, John (Bridlington)
Hamilton, Michael (Salisbury) Morris, Michael (Northampton, Sth) Townsend, Cyril D. (Bexleyheath)
Hampson, Dr Keith Morrison, Hon Charles (Devizes) Frippier, David
Hawkins, Paul Morrison, Hon Peter (City of Chester) Waddington, David
Hawksley, Warren Murphy, Christopher Walker, Bill (Perth & E Perthshire)
Hayhoe, Barney Myles, David Waller, Gary
Heddle, John Neale, Gerrard Ward, John
Henderson, Barry Needham, Richard Warren, Kenneth
Hicks, Robert Nelson, Anthony Watson, john
Hill, James Neubert, Michael Wells, John (Maidstone)
Hogg, Hon Douglas (Grantham) Newton, Tony Wells, Bowen (Hert'rd & Stev'nage)
Hooson, Tom Onslow, Cranley Wheeler, John
Hordern, Peter Page, Rt Hon Sir Graham (Crosby) Whitney, Raymond
Hum, John (Ravensbourne) Page, Richard (SW Hertfordshire) Wickendon, Keith
Hurd, Hon Douglas Parris, Matthew Wiggin, Jerry
Irving, Charles (Cheltenham) Patten, Christopher (Bath) Williams, Delwyn (Montgomery)
Jessel, Toby Pawsey, James Wolfson, Mark
Kershaw, Anthony Pink, R. Bonner Young, Sir George (Acton)
King, Rt Hon Tom Porter, Barry
Lamont, Norman Prentice, Rt Hon Reg TELLERS FOR THE NOES:
Lang, Ian Proctor, K. Harvey Mr. John Cope and
Latham, Michael Raison, Timothy Mr. John Wakeham.

Question accordingly negatived.

Lords amendment agreed to. [Special Entry.]

Lords amendments Nos. 57 to 59 agreed to. [Special Entry.]

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