§ 13. Dr. Edmund Marshallasked the Secretary of State for the Environment if he will introduce proposals simplifying the arrangements for rate support grant.
§ The Minister for Local Government and Environmental Services (Mr. Tom King)I share the hon. Gentleman's concern to simplify grant arrangements as far as is possible, given the large sums involved and the importance of ensuring the fairest distribution for the more than 400 authorities involved. I am currently considering several options for simplification of the assessments of grant-related expenditure for the 1983–84 RSG settlement.
§ Dr. MarshallAre not the present rate support grant arrangements, which even the Minister has said are shrouded in complication and, I would say, excessive jargon, being used as a deliberate smokescreen to pass on to local authorities the blame for cuts in local services that are really being imposed by the Government?
§ Mr. KingNo, Sir. The hon. Gentleman will recognise that the rate support grant has never been a simple matter. Substantial sums of money are involved and the formulae have always been complex. However, there is now a better understanding of the way in which the needs assessments are made for individual authorities and we should continue to simplify the system in that area.
§ Mr. Kenneth LewisIs my right hon. Friend aware that the increased imposition of rates upon industry year by year is becoming serious? It is creating financial and job losses. Will my right hon. Friend consider giving additional support to those local authorities that give special rate concessions to industry? That is important for jobs and for industry generally.
§ Mr. KingI endorse my hon. Friend's opening remarks. At a time of recession we should reinforce the importance of all authorities not adding to the burdens of industry and commerce. There seems to be an illusion fostered by some political parties that rate levels do not matter to industry. However, they are a matter of the greatest concern. While I cannot go along the particular line that my hon. Friend suggests, I can tell him that we are most concerned about the general theme that he has put forward.
§ Mr. FosterWill the Minister confirm—or deny—press statements to the effect that the Secretary of State intends to claw back from local authorities any benefits that might accrue from the reduction in interest rates? If that is the case, will he advise local authorities such as Wear Valley and Sedgefield district councils, which would dearly like to spend capital on land reclamation, how to do that without having some flexibility on revenue expenditure?
§ Mr. KingThe matter that has been referred to in the press, over which there has been some confusion, deals with the supplementary report, which is presently under discussion. It has been the practice of successive Governments to deal with what are called "variable items" at the supplementary report stage. If interest rates rise local authorities are compensated, and if they go down there is some clawback. That is the standard practice, which the hon. Gentleman will find was followed by the Labour Government.
§ Mrs. RumboldWill my hon. Friend assure the House that his simplified guidelines on the rate support grant will also provide some measure of equity to those authorities that have tried faithfully to follow the Government's guidelines but have so far seen little compensation for their efforts?
§ Mr. KingIf I were to answer that question fully I would incur your wrath, Mr. Speaker. It is my constant ambition to do what my hon. Friend suggests. When she fully analyses the proposals that we shall put before the House, I hope that she will see that justice has been done.