HC Deb 06 February 1985 vol 72 cc926-7
9. Mr. Pavitt

asked the Secretary of State for the Environment why the London borough of Brent has been forbidden to issue negotiable bonds to assist in its financial responsibilities and with the construction of new homes; and if he will make a statement.

Mr. Kenneth Baker

No such instructions have been issued, either by the Government or, I understand, by the Bank of England.

Mr. Pavitt

Does the Minister realise that the fact that the Conservative-controlled London borough of Brent is rate-capped means that, although the instructions have not been issued, there is no way in which negotiable bonds can now be put on the money market to deal with the crisis there of 17,000 on the housing waiting list and £30,000 a week being spent on the homeless? Is he aware that because of that taxpayers and ratepayers will have to pay an extra 0.5 per cent. if, after July, when we reach the top of the reserve list, the London borough of Brent is then able to borrow capital to deal with its problems? Does he realise that, as a result of the situation, taxpayers and ratepayers will have to pay an increased subvention, all because of the way in which the Government are looking after the money market first and homemakers second?

Mr. Baker

The hon. Gentleman has got hold of the wrong end of the stick. The list of authorities wishing to make bond issues is full until the beginning of April, but the Bank of England has accepted bookings for Brent bonds to be issued subsequent to that. The hon. Gentleman rightly says that Brent is under Conservative control. That is why it is one of the rate-capped authorities that will comply with the law. It has already shown the way to many other rate-capped authorities by making savings of up to £20 million without making one person redundant.

Mr. Simon Hughes

rose—

Mr. Speaker

Does the hon. Gentleman's supplementary question relate to Brent?

Mr. Hughes

Yes, Mr. Speaker. As the right hon. Gentleman will be aware, Brent council is a hung council, with the Tories only governing by agreement with the Liberals. Is he aware that the only way in which that authority will be able to meet the rate-capped limit—[Unterruption]—is if the £3 million of housing benefit repayment due is paid into its budget? What does the right hon. Gentleman propose to do to make sure that outstanding repayments of millions of pounds to that and other rate-capped authorities are paid so that they may be able to fix a rate? [Interruption.] May we also have an assurance that the money brokers will not charge extra interest just because they are rate-capped authorities.

Mr. Baker

I am delighted that the Conservative group in Brent has the support of the Liberal group there in implementing economies without Brent having to suffer. That is the policy that has been followed by the authority, which is conducting its affairs in a responsible and sensible way.