§ 20. Mr. Norman Atkinsonasked the Secretary of State for the Environment if he is satisfied that the increased net cost to the Exchequer of cutting local authority staff is in line with the Chancellor's criteria for reducing the public sector borrowig requirement.
§ Mr. HeseltineUnder present policies on local authority current and capital expenditure, there will not be any net cost to the Exchequer of cutting local authority staff. On the contrary, there will be a net gain to public funds leading to a reduction in the PSBR in line with the Chancellor's objectives.
§ Mr. AtkinsonWill the Secretary of State reconsider that reply in the light of the experience of, say, the London borough of Haringey? If that council had carried out the 288 recommendations made by the Secretary of State, it would have sacked about 3,800 members of its work force, at a total cost of about £16½ million to the Exchequer, assuming that those displaced people would not get other employment. Is that not in excess of the saving for which he is looking from the London borough of Haringey? Would it not therefore be a net cost to the Chancellor of the Exchequer?
§ Mr. HeseltineThe hon. Member completely fails to take into account what the damage will be in terms of rising unemployment if that authority imposes on the private sector the level of rate increase that it characteristically imposes.
§ Mr. LathamIs my right hon. Friend aware that the county of Leicestershire, although it has had its rate support grant reduced this year, has nevertheless managed to restrain its proposed rate increase to only 4 per cent., and that this is a marvellous effort in the interests of business and other ratepayers.
§ Mr. HeseltineI am sure that the response from the private sector as a result will be totally different from that which is achieved in the London borough of Haringey.