Rates (Hansard, 8 February 1984)

§ 7. Mr. Marlow
asked the Secretary of State for the Environment if he is considering any further reforms of the rating system.

§ 16. Mr. Hicks
asked the Secretary of State for the Environment whether he is currently considering any proposals for rating reform.

§ Mr. Patrick Jenkin
Part III of the Rates Bill contains a number of proposals to reform the rates to make local authorities more accountable to ratepayers, both business and household. I have no immediate plans for further legislative reforms.

§ Mr. Marlow
Will my right hon. Friend perhaps agree with me that local democracy will remain pretty meaningless until such time as a far greater proportion of those who actually enjoy local authority services pay for them out of their own money? Does he further agree that perhaps the most sinister defence of the present system comes from those who operate under the wholly antidemocratic slogan, "We vote, but you pay"?

§ Mr. Jenkin
We dwelt at some length on the declining nexus between rates and votes when I moved the Second Reading of the Rates Bill. I am not sure whether this is what my hon. Friend proposes, but if we were to seek to provide that rates should be paid by the substantial number of families who at present enjoy rate rebates, that would be difficult to justify in terms of equity.

§ Mr. Hicks
In the absence of any unanimity on introducing alternative systems of rating, does my right hon. Friend agree that it would be eminently sensible to transfer responsibility for teachers' salaries and funding of the police from local authorities to central Government? Would this not end the wrangling, confusion and, indeed, ill-feeling that occur every year at this time?

§ Mr. Jenkin
I am very well aware of the ill-feeling that has been caused in a number of areas, but I question whether what would be seen as a massive further centralisation of decision-taking across the whole range of local authority responsibilities would be a sensible step to take at this juncture.

§ Mr. Cartwright
As the Secretary of State has gone for rate capping instead of tackling the admittedly difficult problem of finding a much broader and fairer replacement for the existing rating system, can he tell the House what reductions in rate bills he expects will result from the principle of rate capping?

§ Mr. Jenkin
There is a later question on the Order Paper about that.

§ Mr. Chris Smith
Does the Secretary of State recall giving an oral answer to me last autumn when I raised with him the inequity of present rateable values, where similar or identical properties often have different rateable values? Does he recall answering that I should wait and see the legislation for the answer to this problem? Does he agree that in the legislation before the House he has totally failed to tackle this serious problem?

§ Mr. Jenkin
We have announced that we intend to hold a non-domestic revaluation to correct the distortions that have developed due to changed relative values of business property, and we are urgently considering the case for a domestic revaluation.

§ Mr. Peter Bruinvels
While obviously welcoming the Rates Bill, may I ask my right hon. Friend to look very carefully at the situation of industrialists, who at present get a very rough deal? I am told, and we all know, that they get a vote in their own homes. May I ask my right hon. Friend to look again at the possibility of their being given the opportunity to vote where they work?

§ Mr. Jenkin
There used to be a business vote, but throughout the country there were only about 150,000 registered business voters, because the entitlement applied only to small sole traders and partners. I doubt whether it would find much favour with the House to try to extend the vote to companies.

§ Mr. Straw
We all appreciate the Secretary of State's embarrassment at the Prime Minister's personal failure to meet her promise to abolish the domestic rating system, but will the right hon. Gentleman understand that concern about aspects of the rating system has not in any sense been resolved by the introduction of the Rates Bill, as evidenced by early-day motion 434, signed by 32 of his hon. Friends? Given the way in which the common agricultural policy's costs have been escalating out of control, and the buoyancy of farm incomes, particularly cereal farm incomes, does the Secretary of State agree that serious consideration should be given to the question of agricultural re-rating?

§ Mr. Jenkin
We considered the question of agricultural re-rating in our consideration of the whole of local government finance in the period before the general election, and we came to the conclusion that, because agricultural profits are very evenly balanced at present, it would be wrong to upset that balance by reintroducing a liability for rates, when agricultural property and buildings have not paid rates since the 1920s.