HC Deb 16 January 1985 vol 71 cc425-49 10.16 pm
The Secretary of State for Wales (Mr. Nicholas Edwards)

I beg to move, That the Welsh Rate Support Grant Report 1985–86 (House of Commons Paper No. 100), which was laid before this House on 12th December, be approved. I think that it would be for the convenience of the House to discuss also the second motion: That the Welsh Rate Support Grant Report 1985–86 (Amendment) Report (House of Commons Paper No. 147), which was laid before this House on 10th January, be approved.

Mr. Speaker

If the House agrees, so be it.

Mr. Edwards

The amendment report corrects minor errors in some of the expenditure guidance and associated figures in the main report which arose from a programming error. I am sorry that these errors occurred, but the changes involved are very small. The largest decrease in an expenditure target is only £4,000 in a target of over £200 million. However, it is only proper that, having been identified, these errors should be corrected.

This is the fifth main Welsh rate support grant report that I have put to the House. I will first examine briefly how far the Government's objectives for local authority expenditure in Wales have been achieved and the prospects for local government expenditure in the future.

I have to make the point that, despite all the assertions to the contrary, local authority current expenditure in Wales has certainly not been slashed. On the contrary, it has grown faster than the increase in costs in the economy as a whole.

I do not under-estimate the problems that local authorities face in trying to meet the many demands made on them. They have difficult choices to make. I acknowledge as well that many authorities in Wales have made considerable efforts to contain their spending. Although some authorities are overspending against targets, the general picture taking all local authorities in Wales together is one of current expenditure now broadly under control. I hope that we can build on this and continue to release resources for capital expenditure because of the relatively good performance on current account. Clearly local authorities, if they are to achieve that objective, must continue a vigorous search for improvements in efficiency, effectiveness and economy.

In circumstances where additional resources are not available, authorities are under an obligation continually to examine in a critical and searching way the services they provide, and to check whether the pattern of services developed in the past continues to be appropriate to present and anticipated conditions. This must involve authorities in a willingness to consider alternative ways of providing services, not least through utilising the competitive power of private enterprise.

A few authorities have avoided taking the hard decisions that are necessary and have taken the easy way out, using special funds to offset against expenditure—a method sometimes known as the creative accounting route. Using special funds in this way, of course, reduces an authority's total expenditure which counts against its expenditure target, but it is only a cosmetic adjustment. The use of these special funds only puts off the day when difficult decisions about expenditure have to be taken.

Dyfed is an example of an authority now facing unnecessarily severe difficulties because it has followed such a course and deferred necessary changes over a number of years. Individual schools in Dyfed now face constraints in resources and in some cases inadequate capitation because, during the period in which school numbers were falling by 5,000, the necessary rationalisation of services was not tackled and teacher numbers were actually allowed to increase. Expenditure on education in current price terms has varied very little in the county over seven or eight years of falling school rolls and if individual schools now find themselves short of resources it can only be because Dyfed has been putting off the necessary changes that would make the most effective use of its resources.

Mr. Geraint Howells (Ceredigion and Pembroke, North)

Is the Secretary of State saying that the education authority should have closed more small local schools than it has in the past four or five years?

Mr. Edwards

I am saying that, if there are 5,000 fewer pupils, about the same amount of money in real terms to spend and a capitation problem for individual schools, the authority should be making changes in the structure over a period of years to adjust to the new pattern. If it fails to do that, it will face quite unnecessary problems. Of course it will involve closing some very small village schools. In the part of Dyfed where I live, one school is down to 10 pupils. When pupil numbers decline very fast, there comes a moment when the education authority faces inevitable decisions about changing the pattern of education.

It cannot be argued that Dyfed has been particularly short of total resources. Its target per head is below that of super-sparse Powys, which has the same problem of village schools or the geographically difficult county of Gwynedd, which also has the problem of rural schools, but it is nearly 8 per cent. higher than that of Northumberland, 9 per cent. higher than that of Cumbria and 14 per cent. higher than the figures for north Yorkshire and Cornwall. Its target this year is 4.6 per cent. higher than its reported adjusted budget for 1984–85, so it cannot be said that Dyfed is a county starved of resources and the authority must take at least some share of responsibility for not having faced the necessary changes in the patterns of education.

Mr. Alex Carlile (Montgomery)

As the Secretary of State has now admitted what we all knew already—that he is in favour of closing very small schools—will he tell us what he regards as a very small school and which schools we should expect to be closed? Will he also give a commitment that in future when small schools are closed he will ensure that money is made available to pay for transport to the alternative schools, as that is not the case at the moment?

Mr. Edwards

Clearly there comes a point at which local education authorities must balance the choices before them — maintaining very small schools, changing the pattern of education or having inadequate capitation in existing schools. The authority must make those choices in the light of the situation that it faces. It must decide whether it wishes to allocate the available resources to transport or to maintaining the existing school premises.

With the aim of helping authorities in their forward planning and to avoid this kind of situation repeating itself, I have issued indicative expenditure targets for authorities for 1986–87 and 1987–88. These figures should provide helpful guidance at the individual authority level. In aggregate, they show that on average the cost reduction sought by 1987–88 is about 2 per cent. That would bring current expenditure back to the level reached in 1979–80. Authorities spending at or below target will have an easier task than others in securing these reductions.

If 1985–86 budgets show that authorities, both individually and collectively, are on course to spend in line with the Government's expenditure plans, I will be prepared to consider, with the local authority associations, whether an alternative means of containing expenditure and encouraging moderate rate increases is possible for future years, rather than continuing with the present regime of individual authority expenditure targets and grant holdback penalties.

I have made no secret of my hope that it will be possible to remove individual targets from the system. Notwithstanding that, no one should doubt my determination to retain guidance figures if it was likely that, if we abandoned them, expenditure would exceed our plans and one or two irresponsible authorities would be enabled to act in such a way that they unduly penalised others.

I turn now to the details of the 1985–86 settlement. Any unbiased observer would agree that the settlement is fair. Indeed, the Welsh office of the Association of District Councils goes a long way towards saying so in the document issued to hon. Members. After allowing for the abolition of the national insurance surcharge on local authority employers from next April and the greater role of the Manpower Services Commission in particular areas of further education, total relevant expenditure, at £1,514 million, is about 5 per cent. more than authorities' budgets for the current year. Within this, current expenditure is about £46 million, around 3.5 per cent. higher.

Aggregate Exchequer grant, at just over £1,014 million, is almost £50 million or 5 per cent. higher than the amount that authorities have included in their budgets for the present year, after once again making due allowance for the abolition of NIS and the MSC-related changes next year. It is the increase in the amount of grant from that assumed by local authorities in the current year that is the key element when councils consider what rate or precept they need to levy next year.

For the individual authority expenditure targets, I have retained the basic method used in previous years, although I have increased the weight given to GRE. As in previous years, I have tried to balance the need to give the maximum increase to low-spending authorities, against the need to provide higher-spending authorities with realistic expenditure targets that it would be possible for them to achieve. Thus, no authority has an increase in current expenditure of less than 2 per cent. or, generally, of more than 4 per cent., although authorities spending at or below target also have a 0.5 per cent. "bonus". In other words, a good number of authorities have been offered a 4.5 per cent. increase in current expenditure, which is in line with prospective inflation.

Deciding what the upper and lower limits should be involves difficult judgments. There is, of course, no way of satisfying everyone, but experience this year, when 31 of the 45 authorities have budgeted to meet their expenditure targets, suggests that we are not likely to be far out in our judgment.

The grant-withholding penalties have been increased for 1985–86, and at the same time the limit on grant holdback for low rateable resource authorities has been slackened. I make no apologies for these tougher measures. If an authority is an overspender in a particular year then, all other things being equal, it must be rating for the resources needed to cover the amount of grant withheld. If grant-withholding penalties were not increased, the incentive to such authorities to reduce expenditure or at least ensure that it is not increased in the coming year would be that much weaker. Authorities spending at or below target continue to be completely exempt from both grant holdback and close-ending. Such authorities have a good degree of grant certainty. and that is a very important aspect of the present grant arrangement in Wales.

Mr. D. E. Thomas (Meirionnydd Nant Conwy)

One matter of great importance to my own constituency is the supplementary grant for national parks. How did the right hon. Gentleman arrive at the figure of £2.7 million in respect of this expenditure?

Mr. Edwards

The amount that we have allocated to the parks this year is generous and above the average that has been allocated elsewhere. Perhaps I might respond to the hon. Gentleman's question in more detail later.

I should like to say something about rates. In recent years, Welsh authorities generally have kept their rate increases down, although there have, on occasions, been glaring exceptions. Between 1981–82, which was the first year of the separate Welsh rate support grant settlement, and the present year, the average general rate poundage in Wales has increased by 12.3 per cent. whereas the rate of inflation for the same period, as measured by the GDP deflator, is somewhat more at 16.6 per cent. Notwithstanding this record, Opposition Members have consistently predicted average rate increases that are very much higher than, in the event, they have turned out to be. The indications that I have previously given of likely rate increases have turned out to be pretty accurate, and much more in line with what has happened than what the Opposition suggested.

As to next year, I said in December that with an increase in grant and relevant expenditure of about 5 per cent. over this year's adjusted budgets, and the continued moderation of the great majority of authorities, it should be within their power to keep rates down to levels generally comparable with inflation. Indeed, the House will have noted from an answer that I gave on Monday to my hon. Friend the Member for Brecon and Radnor (Mr. Hooson), that if, in 1985–86, every authority were to spend in line with its expenditure target and apply, where it is able to do so, the same amount of balances as in the current year, the all-Wales average rate increase would be about 3 per cent.

Of course, there will be variations around the average. Indeed, rate reductions are possible in some authorities, particularly in the heavily rated county areas of Mid and West Glamorgan. There could well be increases above the level of inflation in other authorities, especially cases such as Dyfed where, as I have said, special funds have been applied in the past artificially to reduce total expenditure, and where such funds are no longer available. The general picture should be one of an average rate increase below the level of inflation, and I see no reason why I should not be reporting that to the House later in the year.

Mr. Allan Rogers (Rhondda)

Would the right hon. Gentleman like to outline, for the people of Wales, what effect his prescription will have on services that are provided for them rather than indulge in the money juggling to which his party is so accustomed?

Mr. Edwards

If the hon. Gentleman had been listening, he would have heard that local authorities are this year getting rather more than the rate of inflation. In setting out the targets and the reasonable expectations for rates that I have given, there is no reason to suggest that there should be such cuts in services as he envisages.

I repeat what I said when I announced the details of the settlement in December. I regard the settlement as very fair. That this is so reflects to an extent the restraint which has been exercised this year by most Welsh authorities. There need be no slashing cuts or horrendous reductions in services if authorities generally continue to act responsibly. They can maintain and improve key services and offer us a route away from expenditure targets. Not least important, the settlement offers the prospect of rate increases which, on average, should be below the likely level of inflation. That was never in prospect under the Labour Government. I commend my proposals for the 1985–86 Welsh rate support grant settlement to the House.

10.33 pm
Mr. Barry Jones (Alyn and Deeside)

The Secretary of State confessed to a blunder with regard to some of the inaccuracies in the report, and he is contrite. When the Welsh local authorities exceed their targets, the full majesty of the Secretary of State's penalty system crushes them. Welsh local authorities pay far too heavily for their errors on targets. I hope the right hon. Gentleman has not vented his spleen for this error upon his officials, because they operate a system of great complexity. Local authorities have consistently warned him of this. Surely with this system he is straining to the limit a Department which may be insufficiently staffed.

When I was thinking about how the error happened, I came across a press release entitled "Minister to meet brewers" which said that the Minister of State, Welsh Office would tour the Whitbread brewery in Gwent. It further said: He will also discuss the brewing industry's campaign for liberalisation of the licensing laws. Of course, the Minister of State is a very sober man, but we are perplexed as to how the error happened.

The right hon. Gentleman paid tribute to Welsh local authorities for restraining their expenditure. Nevertheless, an extremely harsh grant penalty regime has been introduced. The grant holdback scheme is to be twice as severe. The overall rate of Government grant is to be cut. The Government continue the policy of transferring the burden from the taxpayer to the ratepayer. Our local authorities are anxious about the allowances that may be made in next year's settlement with regard to the effect of pay awards. Some awards for last year, I believe, have still to be settled.

In regard to penalties, the right hon. Gentleman referred to the holdback limiter. To sharpen further the effect of penalties he has proposed to halve what is described as the limiter. As the House knows, this device modifies the penalty system for low resource authorities. It helps them because they need help. I have calculated that Mid-Glamorgan is one of the most disadvantaged local authorities in Wales. Its average rateable value is very low. Its share of grant-related expenditure has gone down. The authority is discontented. This initiative by the right hon. Gentleman will not help local authorities with economic and social problems such as Mid-Glamorgan has to contend with.

The Welsh districts have a good spending record. Only two overspent their targets in the last year. They seek stability. They are concerned at the large variations in targets and in grant-related expenditure figures. I ask the right hon. Gentleman to justify neighbouring authorities having such large differences in grant-related expenditure figures. I give as an example the county of Dyfed. South Pembrokeshire has an increase of 19.7 per cent. in grant-related expenditure, whereas neigbouring Carmarthen has only 2.8 per cent. increase. Again, I ask the right hon. Gentleman to justify neighbouring authorities having such differences in targets. In Gwent, Blaenau Gwent has a 19.2 per cent. increase, but Torfaen has a 10.5 per cent. decrease.

I also ask the right hon. Gentleman to commit himself to announce his intention to remove penalties and targets from the Welsh scene in 1986–87. There is no record in Wales of spendthrift, profligate local authorities. They do not deserve harsh treatment. They face major economic and social problems. Our councils have to tackle those problems. It is against this background that local government in Wales displays restrained responsibility. The councils are not irresponsible.

With regard to the quality of services in the counties, the Government have had five years in office, and this settlement and settlements preceding it have had an injurious effect on the quality of services provided by the shire counties. It is not simply a matter of social services being cut back; it is worse. Social service departments cannot expand to meet increasing demands caused by high unemployment and the pressure on the social fabric of our communities.

There is now demoralisation and bitterness. The shire counties find it increasingly difficult to meet their requirements. Having made a series of visits to authorities in north and south Wales, I can state categorically that as quangos such as the Arts Council and the Wales Tourist Board face financial problems, they look to the shire counties to compensate their central expenditure. It is not surprising that tensions have risen.

It is no exaggeration to say that councillors and officers are demoralised by the Government's financial policy towards local government in Wales. It is not a soft option to transfer the cost to ratepayers when the economy is so depressed. The prospect is that there will be increasing bitterness between the elected councils and the electorate. Central Government's policy introduces tension into the processes of local government.

It is perhaps in education that the counties face the most severe pressure. It is there that the greatest anxieties lie. I believe the right hon. Gentleman to understand that. Hence, his defensive series of remarks about the local education authority in his own county of Dyfed.

The Welsh counties tell me that they expect reductions in primary and secondary school numbers, in the number of temporary teachers, in capitation allowances, and in school swimming facilities. It is expected that the cost of school meals will go up; that the loyal army of school meals attendants will have lesser, revised terms of contract; that adult evening classes will be more costly; and that further education establishments will have to wait for the equipment needed to teach the new technology.

To make my point, I wish briefly to quote from an assessment by Her Majesty's Inspectorate — not a politically biased organisation — of the impact of financial stringency on education in Wales. under the heading "Premises", it states: this continues to be a cause of considerable concern in a majority of LEAs … The interval between redecoration is lengthening … The net effect is a slow but persistent decline in the quality of the learning environment". It continues: The replacement of damaged and broken furniture is unsatisfactory in many schools … Replacement tends to be piecemeal and in small quantities. The effect is further deterioration in pupils' general learning environment". Under the heading "Capitation", the report says: the replacement of worn and outdated stock is being postponed … pupils' learning experiences are impoverished as a result". It adds, in my view humiliatingly: As textbooks wear out there is increasing dependence on worksheets … Parents continue to make a substantial contribution through school funds to the purchase of a wide range of equipment and materials. In only a minority of schools are parental contributions any longer restricted to the purchase of additional rather than essential items. In some schools the sums contributed are very large, in many cases they are equivalent to a substantial proportion of the schools' capitation and they actually exceed it in some cases. This revealing document points a finger at the policy of the Department and the Government. It adds: the drab appearance of many buildings does little to enhance the learning of pupils in schools where pressure on resources has already led to some impoverishment of experience.

This settlement has missed a golden chance to quicken the pace of the economy and to tackle unemployment. If the Treasury had released its brutal hold on local government finance, we might now be planning to tackle rotten housing, the still awesome problems of environmental dereliction and the stubborn, long-term unemployment totals in Wales.

Would not it be better to fund our local councils more generously than to ladle out tax cuts to the better off? We could get our construction workers off the dole by a programme of house building and environmental renewal. We could better prepare the boys and girls in our schools for the challenge of the high-tech revolution. Even at this late stage, I urge the Government to think again because I believe that the Welsh people deserve a much better deal.

Several Hon. Members


Mr. Deputy Speaker (Mr. Harold Walker)

Order. There is but an hour's debating time left and I can see about 25 Welsh hon. Members, most of whom seem to want to take part in the debate. If many of them are not to be disappointed, speeches should be brief.

10.46 pm
Mr. Keith Raffan (Delyn)

In yesterday's debate on unemployment the right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley) said: To the Opposition, a reduction in unemployment is an objective towards which every aspect of economic policy should be directed."—[Official Report, 15 january 1985; Vol 71, c. 197.] If Opposition Members are true to that, they should welcome this settlement wholeheartedly. It is not only fair, representing as it does a 5 per cent. increase in expenditure grant, more than inflation; it is more much more than that. It will help keep the average rate increase below the inflation rate. Surely Opposition Members can welcome that. Surely they must welcome it if they are true to what the shadow Chancellor said.

Mr. Alex Carlile

In welcoming the settlement wholeheartedly, does the hon. Gentleman welcome Delyn district council facing a target reduction of 5.6 per cent.? Does he welcome all the cuts in services that will occur in his district as a result of the settlement?

Mr. Raffan

I am delighted to inform the hon. and learned Gentleman about my constituency. I spoke to the chief executive of Delyn borough council this afternoon and I can tell the hon. and learned Gentleman that no such cuts are expected. If he waits, he will be pleasantly surprised by the rate that is set for Delyn. I shall let him know when it is set. I have a good idea what it will be. No such cuts in services will be necessary. The hon. and learned Gentleman should concentrate on his own constituency instead of interfering in mine.

Opposition Members blithely speak about Britain being reduced to a one-commodity economy. They must therefore realise the importance of keeping local government expenditure under control so as not to increase the rate burden on industry. If we let local government spending rip, dramatic rate rises will greatly increase industry's costs. Indeed, industry's costs will soar. That will lead to either of two alternatives. Industry will have to reduce costs, including declaring redundancies — Opposition Members do not want that—or it will have to increase the price of products, which will give a further edge to foreign competition, increase imports and create jobs in foreign countries. Opposition Members do not want that.

I can do no better than to quote my right hon. Friend the Member for Old Bexley and Sidcup (Mr. Heath), who said yesterday: That must be plain even to the simplest mind."—[Official Report, 15 January 1985; Vol. 71, c. 227.] The labour party has made clear its desire for direct job creation. Surely it wants to avoid indirect job destruction, but that is exactly what would result from allowing local government spending to rip.

We do not really need the Opposition tonight because we know their reaction to this rate support grant settlement or to any rate support grant settlement. All that we need is a tape recording of their response to last year's settlement, or to the settlement the year before. Out come the same insipid clichés—"harsh treatment", "draconian measures", "slashing cuts in services", "putting local authorities under intolerable strain". They show scant respect for the English language, let alone the hard evidence. The Opposition always prefer wild rhetoric to the hard evidence.

The Welsh office of the Association of District Councils has caught that infectious disease. In its submission on the settlement it said: Unless certain councils are able to make substantial cuts in service costs … they will have to make substantial increases in their part of next year's rate bills. No doubt many county councils would take a similar view, but there is a real alternative — reordering priorities, streamlining administration and concentrating on statutory obligations.

We all know that the last people administrators will cut are themselves. That was brought out clearly in the Audit Commission's profile on Clywd county council for 1984–85. The section on staffing shows that as at March 1984 the number in the chief executive, legal and secretarial departments was 176; 108 more — 250 per cent. more than the average number of staff in similar departments in directly comparable authorities.

The architectural department numbered 163; 72 more, or more than 100 per cent. more than the same department in directly comparable authorities. No private architectural practice would survive financially relating that level of staff to the level of work undertaken. The capital projects that are the responsibility of Clwyd's architectural department average a value of between £6 million and £6.5 million. A well-known Liverpool architectural practice undertakes capital projects of £30 million with just half the staff of Clwyd—just 80 people.

Clwyd county council must get its priorities right. What does it think it is doing, buying and trying to develop Bodelwyddan castle as a tourist centre and a palace for culture? The educational part, TVEI, could easily be placed elsewhere. Why does it have to contribute £2,000 towards a sculpture in Mold bus station? It is not by a Welshman, the hon. Member for Rhondda (Mr. Rogers) will be sad to hear. It is not even by a Scotsman—it is by somebody from Sussex.

The council has no need for a dramatic cut in its services provided that it concentrates on its statutory obligations and streamlines its administration. To that end, earlier this year I and leading Conservative county councillors called for independent management consultants to be brought into the county council. The officers strongly opposed that, without giving any reason. If, as they said, their administration was devoid of waste and efficient, they should surely have welcomed independent management consultants with open arms, because they could have vindicated them.

The recent controversy over the education budget confirms my view that the sooner independent management consultants go into shire hall, the better. I am glad that I am supported in that view by the teachers union, NAS/UWT. I was also delighted to hear that at the education committee meeting on Tuesday 13 November Councillor Broderick—the vice chairman of the policy, finance and resources committee, and a Labour member — called for a detailed examination of Clwyd's base budget, something which I and Conservative county councillors have been continually calling for.

If Clwyd needs an excellent example of how to manage its affairs, it need look no further than from Mold to Flint. Delyn borough council — as the hon. and learned Member for Montgomery (Mr. Carlile) will be glad to hear —is currently examining its loss-making activities with a view to reducing the burden that they impose on the rates. It intends doing that by more effective management of resources and by trying to generate fresh income.

Many will watch with interest when the two authorities come to set their respective rates. We can then judge which council—in the words of the Audit Commission—has made proper arrangements for securing economy, efficiency and effectiveness in its use of resources.

10.53 pm
Mr. Donald Coleman (Neath)

Having listened to the hon. Member for Delyn (Mr. Raffan) denigrate the county that he represents, I wonder why he ever sought to represent it in this House.

Although we are discussing the Welsh RSG settlement for 1985–86, we cannot get away from the central fact of the Government's strategy for expenditure by local authorities which has been set out by the Association of Metropolitan Authorities in its briefing to hon. Members in respect of RSG settlements in these words: The RSG Report maintains that the Government's expenditure figures should enable the Government's policies for individual services to be maintained. However, those figures imply a massive cut from the level of services provided by local authorities in 1984–85. For current expenditure—wages, goods and services—a cash reduction of 0.5 per cent. is demanded, which represents a real cut of £700 million.

All debates on matters affecting rate support grant, concerning England, Scotland or Wales, must be approached from a common standpoint — that the Government are determined to interfere in the activities of those who have a direct responsibility towards those who elected them. The public must accept that if the services provided by local authorities are cut, those cuts are the responsibility of the Secretary of State for Wales and his Cabinet colleagues. It is no use the Government trying to take it out on local councillors. The responsibility lies squarely on the occupants of the Treasury Bench.

The RSG settlement for Wales fails to take account of the need for economic regeneration in all parts of the Principality, the increase in total expenditure being only 5.4 per cent., which is 4.5 per cent. for current costs. The shortfall of 1.5 per cent. in the 1984–85 RSG provision has not been taken into account in the figure for 1985–86. It is reasonable to assume that the right hon. Gentleman, who has praised local authorities for their efforts in cutting costs in the last five years, should have taken account of that.

The Chancellor of the Exchequer seems glued to the idea of making cuts in income tax for the better off sections of society. If there is room for some relief, it should be used to spread the burden more widely. One way to achieve that would be to give a better deal to local communities. In the latest RSG settlement we are told that there will be a reduction in the aggregate Exchequer grant of 2.2 per cent., from 69.2 to 67 per cent., which is the equivalent of an average rate increase in Wales of 11p in the pound, or 6.5 per cent.

The block grant, which is the main rate support for Welsh local authorities, has been increased by only £12 million, or 1.5 per cent., which, when measured against the increase in the total expenditure provision, is a reduction of £30 million, or 3.5 per cent. — the equivalent of a 6 per cent. increase in rates in Wales for 1985–86.

So persuasive have the Government been in influencing local government expenditure, and so great is their confidence in that influence, that they have resorted to setting targets enforceable by penalties. Those penalties have been retained in this RSG settlement. Indeed, they have been increased, from 40 per cent. and 90 per cent. of excess expenditure in 1984–85 to an average of 150 per cent. in 1985–86—namely 100 per cent. for the first 1 per cent. excess, 200 per cent. for the next 1 per cent. and 150 per cent. thereafter—while the limiter on the effect of penalties for low rateable value authorities has been halved. As my hon. Friend the Member for Alyn and Deeside (Mr. Jones) said, that is resented by local authorities.

There is much more that could be said on this subject, but the time available to us in the debate is limited. In fairness to my hon. Friends who wish to make contributions, I shall bring my remarks to a conclusion. In this matter, as in so many others for which he has responsibility in Wales, the Secretary of State is failing Wales and the Welsh people. How much longer have we to wait before he goes?

11 pm

Mr. Ian Grist (Cardiff, Central)

Little would one have thought from the speech of the hon. Member for Neath (Mr. Coleman) that after deducting the national insurance surcharge from the Manpower Services Commission's contributions to the higher education budget, the grant has been increased by about 5 per cent. I do not think that he has spotted that, although it was referred to by my right hon. Friend the Secretary of State at the outset of his remarks.

It is worth looking back to last year's debate on the same issue, which continued for rather longer than, thankfully, this one will. Labour Members gave terrible warnings to the people of Wales during that debate of what would happen in the following 12 months. Most of their predictions fell flat on their faces. Rates did not rise to the extent that we were promised and old people's homes were not closed as they threatened. People were not left without a meals-on-wheels service, although we were told that that would happen. None of these things occurred. However, we were not warned of the devastating effect on the economy of Wales, especially south Wales, of the miners' strike, which is ardently supported by most Labour Members. The strike has damaged local life and the capacity of the British community to raise finance, because it has deducted 1 per cent. from the growth of the nation in the past 12 months. That 1 per cent. of growth could have been used to fund the causes which we all want to support—

Mr. Ron Davies (Caerphilly)

Can you advise me, Mr. Deputy Speaker, whether the comments that the hon. Gentleman is making on the miners strike—

Mr. Grist

Is this a point of order, or is it an intervention?

Mr. Deputy Speaker (Mr. Harold Walker)

Order. Mr. Grist.

Mr. Grist

The hon. Member for Caerphilly (Mr. Davies) obviously has a sore conscience on this issue, and it is one that he well deserves.

The settlement that we are debating will be a major contributor to reducing inflation and inflationary expectations. That will be its major contribution to the future of the Welsh economy and the people of Wales. We must reject the idea that 5 per cent. is a reasonable rate of inflation. At 5 per cent., the value of the pound halves in 14 years. If inflation is 10 per cent., its value will be halved in seven years. We must realise that 5 per cent. is a sharp level of inflation and one that a few years ago we would have considered a disgrace. We must reject the expectation of high inflation and the consequent costs. If we can hold down inflation to 3 per cent. this year, 1 per cent. next year and a flat rate the year after, so much the better for pay claims, the attraction of Wales to foreign industry and our own industry and the support of jobs in our constituencies.

I hope that my right hon. Friend the Secretary of State will be pleased to hear that the rate poundage in Cardiff is not likely to rise by the 5.5 per cent. which his figures suggest. We might very well undershoot 5.5 per cent., and Cardiff is one of the areas that is predicted to have an inflation rate that is slightly above the average. If the rate poundage does not rise by the percentage that is predicted, so much the better for the capital of Wales.

The hon. Member for Alyn and Deeside (Mr. Jones) was remarkably moderate in his speech. He did not belch the flames that he tried on us last year. Unfortunately, he picked, as did the hon. and learned Member for Montgomery (Mr. Carlile), on the education budget. That budget must take account of problems associated with demographic change. We all know of the figures showing that pupil-teacher ratios have been improving, despite decreases in the number of teachers. Studies should show also that movements in population and demographic shifts must lead to changes. Every hon. Member believes that, unless he is a populist who simply wants to gain every available vote. Everywhere the opening of new schools and the closing of old schools helps us to recognise population movements and structure changes. That process must be carried on.

Because elections will be held next year, some authorities and all political parties are sitting on their hands. I speak as a parent with children in local schools, and I believe that, unless our children have fairer opportunities with a better spread of subjects, some schools, even in the cities, will have to merge. The savings can be considerable, and we must examine that aspect.

Some of the difficulties in schools involving books, pens and paper have been the result of the National Union of Teachers urging higher pay awards than provided for in the original budgets. It is clear from the negotiating position of all parties involved in considering teachers' pay that extra pay above last year's 4.5 per cent. guideline would come straight from the education budgets. That money would otherwise go towards assisting pupils in schools. The penalty must be paid for union intransigence, supported by the Opposition, who always envisage a large political buck being gained from supporting union pay demands. If we can keep down the demands of populists and can lower inflationary expectations — part of the effect will show up in pay rises—so much the better for local authorities, the people they serve, the economy and jobs for our young people.

11.6 pm

Mr. Alex Carlile (Montgomery)

I remind the Secretary of State, of something said in 1980, at paragraph 103 of the report on the role of the Welsh Office by the Select Committee on Welsh Affairs. The Committee said: Our conclusion at the end of the inquiry is that, notwithstanding the actions taken by Government, there exists in Wales not a jobs gap but a jobs chasm into which the economic and social structures of large parts of Wales are in danger of falling. Only a sustained programme of Government assistance to the Principality can prevent this. That Committee had a majority of Conservative Members. There is a strong feeling in Wales that that advice, based on long and considered evidence, has been totally ignored and that the Secretary of State and his colleagues, while they swan around opening showpieces, do not look at what is really happening—in housing, transport, education, industry, employment, agriculture and items such as the collection of refuse, water and sewerage. They just do not know what is going on.

It is a disgrace to hear the Secretary of State for Wales supported tonight by the hon. Member for Delyn (Mr. Raffan), whose constituency has been so severely damaged by this settlement. Furthermore, it is apparent that the Welsh Office is not averse to being subtly disingenuous about what is happening in Wales. In answer to a question that I asked some days ago about the proposed development of pre-school and nursery education in Wales, the Minister of State said: Provision for under-fives by local education authorities in Wales is at a high level, some 85 per cent. of 3 and 4 year-olds being catered for. So far, so good. We are proud of that record. But the hon. Gentleman went on to state: and Government policy assumes that provision will continue at this level."—[Official Report, 14 January 1985; Vol. 71, c. 23.] It is absolute humbug to suggest that the Government really believe for one moment that the provision for nursery education could continue at that level with this settlement in mind.

The Powys director of education, in writing to parents who have complained to him about the declining standards in schools and nursery education, is telling them openly that the quality of education in Powys is bound to suffer because of the financial stringencies placed upon it.

I do not believe that the Welsh Office or the Secretary of State could justifiably accuse the Powys education authority of being profligate or of doing anything other than trying to husband its money well and providing a reasonable standard of education. That responsible, nonpolitical education authority is telling the truth about what is happening to education in Wales as a result of this settlement. Standards are being made to fall.

District councils face receiving about 17 million in real terms less than the total of the Welsh district councils' block grant in 1983–84. In real terms total targets have been reduced by 3 per cent. within the past two years. Some of the variations between Welsh local authorities are causing confusion, consternation and a feeling of rank injustice as between one local authority and another. The bottom line of the story is that we have seen a continuous regression of services in Wales since 1981 because of the Government's failure to recognise the conclusion correctly reached by the Select Committee in 1980 to which I referred earlier.

A large part of the problem has arisen from the Welsh Office's reliance on grant-related expenditure assessments as a measure of need. GRE is no longer, if it ever was, a realistic measure of need. It is interesting to note that, while the Government will latch on to anything that the Audit Commission says which enables them to make cuts, they have conveniently sought to avoid the Audit Commission's expressed doubts as to the method of calculation of GRE. The result of the way in which GRE is calculated is that local communities have lost the right to choose through local democracy, as represented in their councils, the balance that they wish to choose between rates and services.

We no longer have local democracy in Wales because of the parameters which are placed upon county and district councils by the Welsh Office and this settlement. In 1980, the Select Committee feared for the state of Wales then. Today, nearly five years later, we must fear seriously for what will be the state of Wales at the end of this Government's term of office.

Surely the time must come soon—though one doubts it with this Secretary of State—when there will be a radical review of the Welsh economy, and when local government will be recognised as one of the realistic means through which the Welsh economy can be revitalised. Surely the time will come when the Welsh Office will be forced to recognise that the limping Welsh economy will have to be regenerated by increased local government support.

We could have debated many issues tonight, but time does not permit us to do so, because many other hon. Members wish to speak. I wished to highlight the truly desperate problem of education. It is high time that we heard the Conservative party confess honestly that it means by its policies, as surely it does, to reduce the quality of education in Wales so that it becomes a second-rate system.

11.13 pm
Mr. Peter Hubbard-Miles (Bridgend)

I wish to highlight the subjects that the hon. Member for Alyn and Deeside (Mr. Jones) highlighted. He was correct to highlight education, which is by far the largest element in local authority budgets. He was right to single out Mid-Glamorgan, which is the largest shire county in Wales with the largest education budget. He was wrong in portraying Mid-Glamorgan as a county that is disadvantaged in its education budget and lacking in its resources, because Mid-Glamorgan only recently boasted about its expenditure on education, and pointed out that per head of population it spends 10 per cent. more than the average English and Welsh county spends on education. In certain fields it spends vastly more per head of population than the average English and Welsh authority. For example on nursery education it spends 250 per cent. more per head of population than the average English and Welsh county; on primary education it spends 38 per cent. more; on secondary education it spends 11 per cent. more. So the idea that Mid-Glamorgan education is somehow disadvantaged is absolute nonsense.

If Opposition Members are claiming that Mid-Glamorgan is disadvantaged, they are accusing Mid-Glamorgan of gross incompetence and mismanagement of its resources. That may well be the case but, far from being short of resources, in this year the Mid-Glamorgan county council has managed to find £668,000 out of its educational budget for non-educational purposes — in other words, for supplying free school meals to the children of striking miners. That has been shrouded in the idea that it is for the children of disadvantaged parents, but I wonder whether the free school meals will continue to be provided for those people after the miners' strike is ended. It will be interesting to see whether Mid-Glamorgan continues providing its free meals for all disadvantaged children.

The hon. Member for Alyn and Deeside is somewhat optimistic in suggesting that in the future there will be no need to penalise counties for overspending, because Mid-Glamorgan county council is now deliberately intending to overspend in order to create a sort of mini-Liverpool situation in Wales; in fact, this year it is taking £3 million from its capital account to subsidise its revenue account, and has been warned by its chief officers over the past four years of the need to make reasonable economies in its budget to avoid a serious situation. Only in recent weeks it has been warned that unless it is prepared to accept certain cuts in its budget, next year it will face a very severe situation.

Therefore, far from being disadvantaged and far from not having resources, the Mid-Glamorgan county council's education budget has the resources, but of course it will continue to pretend that it does not have them.

11.17 pm
Mr. Ron Davies (Caerphilly)

May I first make it clear to the hon. Member for Bridgend (Mr. Hubbard-Miles) that Labour Members understand the problem that exists in Mid-Glamorgan. They understand the scale of deprivation and the problems that Mid-Glamorgan has to tackle as an education authority. The very fact that it spends more than the average means that it has greater needs than the average. That is the sole reason for that additional expenditure.

Let me assure the hon. Member for Bridgend that Labour Members do not want to see anyone starving. They do not want to see the children of miners starving. We regard it as a proper charge on the public purse that the children of striking miners should be prevented from the form of starvation that the hon. Gentleman wishes on them.

Dr. John Marek (Wrexham)

It is really a question of representation. My hon. Friend has hit the nail on the head, because I have a press release from Clwyd county council which states: Mr. Raffan"— the hon. Member for Delyn— in particular must know that making and repeating misleading statements does not disguise the real truth. There we have it. Conservaative Members make misleading statements to disguise the privation in the Principality.

Mr. Davies

I welcome that point. With regard to misinterpretation, I should like to take issue with the Secretary of State because I believe that his statement today and his suggestions on Monday have done a disservice not only to the people of Wales but to local government in Wales. I noticed with interest that in the Western Mail on Tuesday this week he suggested that five of the six local authorities in Mid-Glamorgan would be able to reduce their rates. On Tuesday evening he had a dusty reply from the treasurer of Mid-Glamorgan. The South Wales Echo said: Mr. Ray Lacey, treasurer to Mid-Glamorgan county council, described the Secretary of State's announcement as a 'theoretical exercise which will only serve to confuse ratepayers … What Mr. Edwards does not know—and Mr. Edwards knows that he does not know—is the special circumstances in each local authority. When the Secretary of State calls in aid independent assessors or objective judgments, perhaps he will accept the advice of the treasurer of the largest local authority in Wales.

With regard to the individual problems of our valley communities, I should like to draw the attention of the Secretary of State to the problem that we have in Rhymney valley. I remind him that between the two years from 1982–83 to 1984–85, the amount of rate support grant that the local authority received per 1,000 head of population fell from £66,750 to £57,000, a reduction in real terms in the amount of money received by that local authority. There was a marginal increase for the county authority. The grant rose from £264,000 to £268,000 over a three-year period, when no provision was made for inflation. Mid-Glamorgan is facing a crisis, which forced it at the end of last year to discontinue swimming instruction for young children. That is the nature of the society that the Secretary of State is creating for us in the valley communities in Mid-Glamorgan.

I should like to refer again to Rhymney valley, because I believe that the Secretary of State is misleading us. I refer him to the figure for 1984–85, the current year. He stated that the coming year's settlement for 1985–86 was good. He realises that it might be an easier settlement than the current year's settlement, but he knows that that settlement was the most punitive that we have seen in local government, certainly in the time that the right hon. Gentleman has been in that office down in Cardiff.

The expenditure in Rhymney valley during the current year will be about £8.417 million. The target set by the Secretary of State for next year, 1985–86, is £8.521 million — a marginal increase. However, if the right hon. Gentleman compares the expenditure that that local authority is likely to incur in 1985–86 on the basis of its expenditure in the current year, he will realise that there is a shortfall approaching £500,000. If the local authority attempts to meet that shortfall, if it goes 3 per cent., 4 per cent. or 5 per cent. over target, the right hon. Gentleman will take a further £500,000 of rate support grant away from it, thus forcing it into a crisis.

The Secretary of State may say that it is easy enough for the local authority to make adjustments, that it can trim a bit here and a bit there, but the fact is that it cannot do so, because local authorities have been forced to cut back time and again, year after year, by the successive settlements from the right hon. Gentleman. We are no longer cutting back on luxuries—we are cutting back on essentials. Therefore, the local authority in Rhymney valley, with 60 per cent. of expenditure on personnel and related matters, is forced to take the decision to sack people if it wishes to meet the targets. If it sacks people, it will achieve two things. It will increase the level of unemployment in our valley and it will mean that we have fewer services. That is the accusation that the Secretary of State has to answer.

I make one further accusation against the Secretary of State. The relationship between central and local government has been based on a contract that local government's responsibility is to improve services and central Government's responsibility is to help local government to meet the bill. The Government have broken that contract, and the responsibility for that rests on the shoulders of the Secretary of State.

11.26 pm
Mr. Dafydd Wigley (Caernarfon)

District councils throughout Wales have an enormous problem arising from this settlement, which relates once again to the lack of finance to abide by the promises made for renovation grants for houses. People who will be waiting for another year, two years or three years can thank the Secretary of State for that.

Some councils such as the Dwyfor council in my constituency have enormous problems with capital allocation. To meet their statutory responsibilities, they will have to spend the entirety of their capital allocation on refuse disposal equipment, and they will have nothing left for anything else. That is the magnitude of the problem.

I want to concentrate on the situation facing the counties, particularly Gwynedd. I want to concentrate on the 10 years from 1974 to 1984. In this period, the gross expenditure of the county has increased by only 211 per cent. compared to an expenditure of almost 300 per cent. by central Government. In the same period, the grant from central Government has increased by only 177 per cent. and the ratepayer has been left with an increase of 319 per cent. That is the outcome of the Government's policies. The county has lost the equivalent in current money terms of £9 million in grants from central Government since 1974.

I want to put to the Secretary of State the point that I have put to him before—the unresolved issue of the continuing privations suffered by Gwynedd county council through the formula. The grant-related expenditure generated for Gwynedd is £97.1 million. The target for 1985–86 is only £94.4 million, so the target is £2.5 million less than the Welsh Office recognises to be Gwynedd's needs.

The Secretary of State has repeatedly defended this on the basis that, before he took office, the county did not maintain such a level of services as was shown by the GRE to be justified, so why should it sustain them now? But the Secretary of State knows very well why Gwynedd could not sustain that level of services: it simply did not have have the money. He knows that those services were needed. That is clear from the speeches that he and the hon. Member for Conwy (Mr. Roberts) made during the 1970s when they were in opposition. Gwynedd lost some £4 million between 1974 and 1978. The Secretary of State referred to this with regard to the cuts that were taking place in 1976. As the hon. Member for Pembroke, he said: In terms of social need and stress, problems are as severe in some Welsh counties as in some metropolitan districts. The rural areas have fared particularly badly. Dyfed and Gwynedd suffer from low incomes, poverty and high unemployment … They also suffer from sparsity of population and have to cater for an annual influx of tourists for which sufficient allowance is not made in the present formula. Yet these counties are among the worst sufferers under the system of distribution that the Government have imposed. In other words, the Secretary of State at that stage recognised the need for greater expenditure on services in a county such as Gwynedd. But what did he do? When it came to the rates, he said: To many, this further imposition of rates will come as a final straw, and they will go out of business."—[Official Report, 22 December 1976; Vol. 923, c. 840–2.] He fought hard against the increase of rates.

If one needs the services and one cannot have the increase in rates, there is only one logical conclusion: the money has to come from central grants. It is that logic that Gwynedd is putting back to the Secretary of State now. In order to get the money that is needed to sustain the services that he and the Government recognise as being necessary through the GRE, there must be a great contribution from central Government.

The hon. Member for Conwy repeated this plea in 1977. He implored the counties not to exceed the 10 per cent. ceiling in rate increases at that time because of the effect that it would have on other people. He said that even though that will probably mean cutting services to the bone"— [Official Report, 15 December 1977; Vol. 941, c. 1021.] he wanted a reduction in rate increases. That is fair enough, but if these services are needed and the counties cannot get them from anywhere else, provision should be made for them from central Government money.

That could have been achieved this year if the 4 per cent. limit had not been applied to the increase in target from 1984–85 to 1985–86. Gwynedd could then have increased the £94 million to £96.2 million and been much closer to target. I implore the Secretary of State yet again to ensure in the next 12 months that the target and GREA for Gwynedd are the same so that we can achieve the services that we need.

11.29 pm
Mr. Roy Hughes (Newport, East)

Having listened to the Secretary of State today, I tend to agree with the Welsh Office of the Association of District Councils that the settlement must be regarded as a lost opportunity to provide resources to revitalise the Welsh economy.

In the Secretary of State's handling of these matters the weakest invariably go to the wall. For instance, his favourite target is Mid-Glamorgan—an attitude in which he seems to be supported by the hon. Member for Bridgend (Mr. Hubbard-Miles)—which is probably the most deprived county in the whole of Great Britain, with astronomical unemployment figures, appalling housing which has affected life expectancy, an ageing population and social services strained to breaking point. With all those difficulties, the county might reasonably have expected a sympathetic hearing from the Government, but all that it gets are exhortations to cut the rates and threats of new and further penalties if it does not.

Thousands of disabled people are waiting for specialist conversion work on their homes, but Government cuts have left local authorities too short of money. In Newport alone more than 500 disabled people are now waiting for adaptations to their homes, ranging from stairlifts and bathroom conversions to ramps and handrails, but the cash is simply not available due to the Government's Scrooge-like attitude. That situation applies throughout Wales. It is no wonder that Mr. Joe Hennessy, secretary of the Wales Council for the Disabled, has written to the Secretary of State demanding urgent action.

Councillor Lloyd Turnbull, leader of Gwent county council, wrote to the Secretary of State on 10 January—I understand that the chief executive, Mr. Perry, has written in similar terms—complaining about the jiggery-pokery involving £4.6 million that the authority believes is due to the county. Councillor Turnbull expressed surprise at the statement by the Secretary of State in December that, taking everything into consideration, rate increases should be about 4.5 per cent., as Gwent will actually receive less grant in cash terms in 1985–86 than it received in 1984–85. If the block grant is calculated at the same percentage as in 1984–85, however, the county would receive an additional £4.6 million. As that loss is equivalent to 10.5p in rate precept requirement, how can the council be expected to keep the rate increase down to 4.5 per cent. when services have already been cut to the bone?

The rate support grant provides the wherewithal for local government to carry out its essential functions in the community. Our local authorities realise that the Government are engaged in a cost-cutting exercise. Recently, for instance, in answer to a parliamentary question from my hon. Friend the Member for Alyn and Deeside (Mr. Jones), the Secretary of State was forced to admit that since 1981–82 the amount received by our local authorities in rate support grant had declined by £65.7 million. That financial stringency has posed all manner of problems for our local authorities, which have to provide and operate the essential services.

Criticism is no longer confined to Labour-controlled local authorities. Only last week Councillor Parker, leader of Monmouth district council, which is heavily dominated by the Conservatives, warned his own Government of a coming revolt among Conservative councils over what he called the horrendous situation in local government. He asked, "What the hell are the Welsh Office and the Government doing to us?" I have no wish to embellish those words. To do so would be to gild the lily.

Finally, I endorse the criticism of the Secretary of State's presentation of the settlement. The fact that a second document, amending the first, had to be circulated is almost without precedent. It adds to the failure of the Secretary of State in so many other areas. In the eyes of the people of Wales, the right hon. Gentleman stands condemned.

11.37 pm
Mr. Nicholas Edwards

The hon. Member for Meirionnydd Nant Conwy (Mr. Thomas) asked me about national park grant. National park supplementary grant has been increased by 5.25 per cent., and the overall level of accepted expenditure on which grant is paid has been increased by 6.8 per cent. in the current year.

The hon. Member for Caernarfon (Mr. Wigley) referred to Gwynedd. I have just written to him on the subject. I have pointed out that because of the problems to which he referred, Gwynedd, at £406 a head, has the fourth highest target of any authority in England or Wales. Its share of the Welsh rate support grant system has been increased, and it has been able to increase its current expenditure since 1981–82 by more than the rate of general inflation. Those are all signs that are moving towards meeting some of the problems of Gwynedd.

The hon. Members for Alyn and Deeside (Mr. Jones) and for Neath (Mr. Coleman) and the hon. and learned Member for Montgomery (Mr. Carlile) said a great deal about the contribution that local government could make to the economy and about the Welsh share of that contribution. If they argue that the settlement fails to take account of the need for economic regeneration, I am entitled to point out various facts. The settlement represents a 5 per cent. increase in expenditure and grant above the expenditure rate. The target per head in Wales is 21 per cent. higher than the target per head in England, because of the problems of the Principality. The net capital provision per head is 50 per cent. higher than it is in England, because there is in Wales a better record of control of expenditure by local government in Wales. We are likly to produce average rate increases of not much more than the general level of inflation, and that will make a substantial and significant contribution to economic recovery.

Mr. Gwilym Jones (Cardiff, North)

If I were to tell my right hon. Friend that the rate in Cardiff is likely to be the lowest in Wales, and possibly the lowest in Britain, would he agree that that is the best possible advertisement to encourage people to relocate there?

Mr. Edwards

Yes. My hon. Friend the Member for Cardiff, Central (Mr. Grist) made the same point. That is the real contribution that can be made to the recovery of the economy.

The hon. Member for Alyn and Deeside complained about rotten housing, but the Government of which he was a member spent £58 million on housing improvement in Wales in five years, whereas we spent £107 million in one year. His record is no basis on which to make such criticisms.

We have heard much about the problems of Mid-Glamorgan. Because those problems are understood and recognised, it has the third highest target per head in England and Wales. If it was setting out to tackle the problems that were described, it should not have increased its manpower by 1.8 per cent. since 1981.

We have heard many complaints about transferring the burden of supporting local government from the taxpayer to the ratepayer. However, I note that the Committee of Welsh District Councils does not dissent from the Government's policy of reducing the taxpayers' contribution, and I welcome that.

The hon. and learned Member for Montgomery and the hon. Member for Caerphilly (Mr. Davies) talked about education. I am entitled to tell the hon. and learned Member for Montgomery that, in primary education, expenditure per head in Powys has increased by more than 13 per cent. since 1979–80 and that expenditure on secondary pupils has increased by more than 11 per cent. during the same period. There has therefore been a substantial increase in expenditure in real terms in Powys. Exactly the same is true for Mid-Glamorgan. The hon. Member for Rhondda (Mr. Rogers) recently tabled a question asking for information about expenditure per head in the counties of Wales and I gave him the answer. Expenditure has increased in Mid-Glamorgan as well, and is now at its highest level ever.

Mr. Allan Rogers

If the Secretary of State wants to quote figures to the House, will he say on what basis the figures are calculated? Are they calculated on a 1979 basis, or on some other one?

Mr. Edwards

They are calculated on the basis on which the hon. Gentleman asked his parliamentary question. I answered that question. They are expressed in 1983–84 prices. Expenditure per head on primary school pupils in 1979–80 was £639, and £788 in 1983–84. For secondary education it was £880 per pupil in 1979–80, and £979 in 1983–84. We should not therefore have all this nonsense about the devastation of education.

My hon. Friends the Members for Cardiff, Central and for Delyn (Mr. Raffan) rightly emphasised the importance of low rates to industrial recovery. My hon. Friend the Member for Delyn was criticised by the hon. Member for Neath for daring to make some critical comments about his county council and suggesting that it might call in consultants to improve efficiency. The hon. Member for Neath has an odd concept of the role of a Member of Parliament if he believes that his sole duty is to act as a mouthpiece for his county council.

The hon. Gentleman complained about interference with local government, but I think I am entitled to point out that the taxpayer still produces 67 per cent. of the cost of local government in Wales. Partly because of our low rateable values, and partly because of the good record of local government in Wales, that share has fallen by less than the reduction in England, where the contribution from the central taxpayer is 48.7 per cent. Once again that gives the lie to the allegation that in some way I or the Welsh Office have failed the people in Wales.

The Welsh Office of the Association of District Councils has admitted that this is a fair settlement. It is a good settlement, and I commend it to the House.

Question put:—

The House divided: Ayes 318, Noes 179.

Division No. 68] [11.45 pm
Adley, Robert Butterfill, John
Aitken, Jonathan Carlisle, John (N Luton)
Alexander, Richard Carlisle, Kenneth (Lincoln)
Amess, David Carlisle, Rt Hon M. (W'ton S)
Ancram, Michael Carttiss, Michael
Arnold, Tom Cash, William
Ashby, David Chalker, Mrs Lynda
Aspinwall, Jack Channon, Rt Hon Paul
Atkins, Robert (South Ribble) Chapman, Sydney
Baker, Rt Hon K. (Mole Vall'y) Chope, Christopher
Baker, Nicholas (N Dorset) Churchill, W. S.
Baldry, Tony Clark, Dr Michael (Rochford)
Banks, Robert (Harrogate) Clark, Sir W. (Croydon S)
Batiste, Spencer Clarke, Rt Hon K. (Rushcliffe)
Bellingham, Henry Cockeram, Eric
Bendall, Vivian Colvin, Michael
Bevan, David Gilroy Conway, Derek
Biffen, Rt Hon John Cope, John
Blackburn, John Corrie, John
Blaker, Rt Hon Sir Peter Couchman, James
Body, Richard Cranborne, Viscount
Bonsor, Sir Nicholas Crouch, David
Bottomley, Peter Currie, Mrs Edwina
Bottomley, Mrs Virginia Dickens, Geoffrey
Bowden, A. (Brighton K'to'n) Dorrell, Stephen
Bowden, Gerald (Dulwich) Douglas-Hamilton, Lord J.
Boyson, Dr Rhodes Dover, Den
Braine, Rt Hon Sir Bernard Dunn, Robert
Brandon-Bravo, Martin Durant, Tony
Bright, Graham Edwards, Rt Hon N. (P'broke)
Brinton, Tim Eggar, Tim
Brittan, Rt Hon Leon Emery, Sir Peter
Brooke, Hon Peter Evennett, David
Brown, M. (Brigg & Cl'thpes) Eyre, Sir Reginald
Browne, John Fairbairn, Nicholas
Bruinvels, Peter Fallon, Michael
Bryan, Sir Paul Farr, Sir John
Bulmer, Esmond Favell, Anthony
Burt, Alistair Fenner, Mrs Peggy
Butcher, John Finsberg, Sir Geoffrey
Butler, Hon Adam Fletcher, Alexander
Fookes, Miss Janet Latham, Michael
Forman, Nigel Lawler, Geoffrey
Forsyth, Michael (Stirling) Lawrence, Ivan
Forth, Eric Lee, John (Pendle)
Fowler, Rt Hon Norman Leigh, Edward (Gainsbor'gh)
Fox, Marcus Lennox-Boyd, Hon Mark
Franks, Cecil Lester, Jim
Fraser, Peter (Angus East) Lewis, Sir Kenneth (Stamf'd)
Freeman, Roger Lightbown, David
Gale, Roger Lilley, Peter
Galley, Roy Lloyd, Ian (Havant)
Gardiner, George (Reigate) Lloyd, Peter, (Fareham)
Gardner, Sir Edward (Fylde) Lord, Michael
Garel-Jones, Tristan Lyell, Nicholas
Gilmour, Rt Hon Sir Ian McCrindle, Robert
Glyn, Dr Alan McCurley, Mrs Anna
Goodlad, Alastair Macfarlane, Neil
Gorst, John MacGregor, John
Gow, Ian MacKay, Andrew (Berkshire)
Gower, Sir Raymond MacKay, John (Argyll & Bute)
Grant, Sir Anthony Maclean, David John
Greenway, Harry McNair-Wilson, P. (New F'st)
Gregory, Conal Major, John
Griffiths, Peter (Portsm'th N) Malins, Humfrey
Grist, Ian Malone, Gerald
Ground, Patrick Maples, John
Grylls, Michael Marland, Paul
Gummer, John Selwyn Marlow, Antony
Hamilton, Hon A. (Epsom) Marshall, Michael (Arundel)
Hamilton, Neil (Tatton) Mates, Michael
Hampson, Dr Keith Mather, Carol
Hanley, Jeremy Maude, Hon Francis
Hannam, John Mawhinney, Dr Brian
Hargreaves. Kenneth Mayhew, Sir Patrick
Harris, David Mellor, David
Harvey, Robert Meyer, Sir Anthony
Haselhurst, Alan Miller, Hal (B'grove)
Havers, Rt Hon Sir Michael Mills, Iain (Meriden)
Hawkins, C. (High Peak) Mills, Sir Peter (West Devon)
Hawkins, Sir Paul (SW N'folk) Mitchell, David (NW Hants)
Hawksley, Warren Moate, Roger
Hayes, J. Monro, Sir Hector
Hayhoe, Barney Montgomery, Sir Fergus
Hayward, Robert Morrison, Hon C. (Devizes)
Heathcoat-Amory, David Moynihan, Hon C.
Henderson, Barry Mudd, David
Hickmet, Richard Murphy, Christopher
Hicks, Robert Neale, Gerrard
Higgins, Rt Hon Terence L. Needham, Richard
Hind, Kenneth Neubert, Michael
Hogg, Hon Douglas (Gr'th'm) Newton, Tony
Holland, Sir Philip (Gedling) Nicholls, Patrick
Holt, Richard Norris, Steven
Hordern, Peter Onslow, Cranley
Howard, Michael Oppenheim, Phillip
Howarth, Alan (Stratf'd-on-A) Oppenheim, Rt Hon Mrs S.
Howarth, Gerald (Cannock) Osborn, Sir John
Howell, Rt Hon D. (G'ldford) Ottaway, Richard
Howell, Ralph (N Norfolk) Page, Richard (Herts SW)
Hubbard-Miles, Peter Parkinson, Rt Hon Cecil
Hunt, David (Wirral) Parris, Matthew
Hunt, John (Ravensbourne) Patten, Christopher (Bath)
Hunter, Andrew Patten, John (Oxford)
Jackson, Robert Pawsey, James
Jenkin, Rt Hon Patrick Percival, Rt Hon Sir Ian
Johnson Smith, Sir Geoffrey Pollock, Alexander
Jones, Gwilym (Cardiff N) Portillo, Michael
Jones, Robert (W Herts) Powell, William (Corby)
Jopling, Rt Hon Michael Powley, John
Joseph, Rt Hon Sir Keith Price, Sir David
Kellett-Bowman, Mrs Elaine Proctor, K. Harvey
Key, Robert Raffan, Keith
Kilfedder, James A. Raison, Rt Hon Timothy
King, Roger (B'ham N'field) Rathbone, Tim
King, Rt Hon Tom Rees, Rt Hon Peter (Dover)
Knight, Gregory (Derby N) Renton, Tim
Knight, Mrs Jill (Edgbaston) Rhodes James, Robert
Knowles, Michael Rhys Williams, Sir Brandon
Knox, David Ridley, Rt Hon Nicholas
Lamont, Norman Roberts, Wyn (Conwy)
Robinson, Mark (N'port W) Thomas, Rt Hon Peter
Robinson, P. (Belfast E) Thompson, Donald (Calder V)
Roe, Mrs Marion Thompson, Patrick (N'ich N)
Rowe, Andrew Thornton, Malcolm
Rumbold, Mrs Angela Thurnham, Peter
Ryder, Richard Townend, John (Bridlington)
Sackville, Hon Thomas Townsend, Cyril D. (B'heath)
Sainsbury, Hon Timothy Tracey, Richard
Sayeed, Jonathan Trippier, David
Scott, Nicholas Twinn, Dr Ian
Shaw, Giles (Pudsey) van Straubenzee, Sir W.
Shelton, William (Streatham) Viggers, Peter
Shepherd, Colin (Hereford) Waddington, David
Silvester, Fred Waldegrave, Hon William
Sims, Roger Walden, George
Skeet, T. H. H. Walker, Bill (T'side N)
Smith, Tim (Beaconsfield) Waller, Gary
Soames, Hon Nicholas Walters, Dennis
Speed, Keith Ward, John
Speller, Tony Wardle, C. (Bexhill)
Spence, John Warren, Kenneth
Spencer, Derek Watson, John
Spicer, Jim (W Dorset) Watts, John
Squire, Robin Wells, Sir John (Maidstone)
Stanbrook, Ivor Wheeler, John
Stanley, John Whitfield, John
Steen, Anthony Whitney, Raymond
Stern, Michael Wiggin, Jerry
Stevens, Lewis (Nuneaton) Wilkinson, John
Stevens, Martin (Fulham) Winterton, Mrs Ann
Stewart, Allan (Eastwood) Winterton, Nicholas
Stewart, Andrew (Sherwood) Wolfson, Mark
Stewart, Ian (N Hertf'dshire) Wood, Timothy
Stokes, John Woodcock, Michael
Stradling Thomas, J. Young, Sir George (Acton)
Sumberg, David Younger, Rt Hon George
Tapsell, Sir Peter
Taylor, Teddy (S'end E) Tellers for the Ayes:
Temple-Morris, Peter Mr. Robert Boscawen and
Terlezki, Stefan Mr. Ian Lang.
Adams, Allen (Paisley N) Cook, Frank (Stockton North)
Alton, David Cook, Robin F. (Livingston)
Anderson, Donald Corbett, Robin
Ashdown, Paddy Corbyn, Jeremy
Ashton, Joe Cowans, Harry
Atkinson, N. (Tottenham) Craigen, J. M.
Banks, Tony (Newham NW) Crowther, Stan
Barnett, Guy Cunningham, Dr John
Barron, Kevin Dalyell, Tam
Beckett, Mrs Margaret Davies, Rt Hon Denzil (L'lli)
Beith, A. J. Davies, Ronald (Caerphilly)
Bell, Stuart Davis, Terry (B'ham, H'ge H'l)
Benn, Tony Deakins, Eric
Bennett, A. (Dent'n & Red'sh) Dewar, Donald
Bermingham, Gerald Dixon, Donald
Bidwell, Sydney Dobson, Frank
Boothroyd, Miss Betty Dormand, Jack
Boyes, Roland Douglas, Dick
Bray, Dr Jeremy Dubs, Alfred
Brown, Gordon (D'f'mline E) Dunwoody, Hon Mrs G.
Brown, Hugh D. (Provan) Eadie, Alex
Brown, N. (N'c'tle-u-Tyne E) Eastham, Ken
Brown, R. (N'c'tle-u-Tyne N) Evans, John (St. Helens N)
Brown, Ron (E'burgh, Leith) Ewing, Harry
Bruce, Malcolm Fatchett, Derek
Buchan, Norman Faulds, Andrew
Caborn, Richard Field, Frank (Birkenhead)
Callaghan, Jim (Heyw'd & M) Fields, T. (L'pool Broad Gn)
Campbell-Savours, Dale Fisher, Mark
Canavan, Dennis Flannery, Martin
Carlile, Alexander (Montg'y) Forrester, John
Cartwright, John Foulkes, George
Clark, Dr David (S Shields) Fraser, J. (Norwood)
Clarke, Thomas Freeson, Rt Hon Reginald
Clay, Robert Garrett, W. E.
Clwyd, Mrs Ann George, Bruce
Cohen, Harry Gilbert, Rt Hon Dr John
Coleman, Donald Godman, Dr Norman
Gould, Bryan O'Brien, William
Hamilton, James (M'well N) Orme, Rt Hon Stanley
Hancock, Mr. Michael Parry, Robert
Harrison, Rt Hon Walter Patchett, Terry
Hart, Rt Hon Dame Judith Pavitt, Laurie
Hattersley, Rt Hon Roy Pendry, Tom
Haynes, Frank Penhaligon, David
Hogg, N. (C'nauld & Kilsyth) Pike, Peter
Holland, Stuart (Vauxhall) Powell, Raymond (Ogmore)
Home Robertson, John Prescott, John
Howells, Geraint Radice, Giles
Hoyle, Douglas Randall, Stuart
Hughes, Robert (Aberdeen N) Redmond, M.
Hughes, Roy (Newport East) Rees, Rt Hon M. (Leeds S)
Hughes, Sean (Knowsley S) Richardson, Ms Jo
Hughes, Simon (Southwark) Roberts, Ernest (Hackney N)
Janner, Hon Greville Robertson, George
John, Brynmor Rogers, Allan
Johnston, Russell Rooker, J. W.
Jones, Barry (Alyn & Deeside) Ross, Stephen (Isle of Wight)
Kaufman, Rt Hon Gerald Rowlands, Ted
Kennedy, Charles Sheerman, Barry
Kirkwood, Archy Sheldon, Rt Hon R.
Lambie, David Shore, Rt Hon Peter
Lamond, James Short, Ms Clare (Ladywood)
Leadbitter, Ted Short, Mrs R.(W'hampt'n NE)
Leighton, Ronald Silkin, Rt Hon J.
Lewis, Ron (Carlisle) Skinner, Dennis
Lewis, Terence (Worsley) Smith, C.(Isl'ton S & F'bury)
Litherland, Robert Smith, Rt Hon J. (M'kl'ds E)
Lloyd, Tony (Stretford) Snape, Peter
Lofthouse, Geoffrey Soley, Clive
McCartney, Hugh Spearing, Nigel
McDonald, Dr Oonagh Steel, Rt Hon David
McGuire, Michael Stott, Roger
McKay, Allen (Penistone) Strang, Gavin
McKelvey, William Straw, Jack
McTaggart, Robert Thomas, Dafydd (Merioneth)
McWilliam, John Thompson, J. (Wansbeck)
Madden, Max Thorne, Stan (Preston)
Marek, Dr John Tinn, James
Marshall, David (Shettleston) Torney, Tom
Maxton, John Wallace, James
Maynard, Miss Joan Wardell, Gareth (Gower)
Meacher, Michael Welsh, Michael
Meadowcroft, Michael Wigley, Dafydd
Michie, William Williams, Rt Hon A.
Mikardo, Ian Winnick, David
Millan, Rt Hon Bruce Woodall, Alec
Miller, Dr M. S. (E Kilbride)
Mitchell, Austin (G't Grimsby) Tellers for the Noes:
Morris, Rt Hon A. (W'shawe) Dr. Roger Thomas and
Nellist, David Mr. Lawrence Cunliffe.
Oakes, Rt Hon Gordon

Question accordingly agreed to.

Resolved, That the Welsh Rate Support Grant Report 1985–86 (House of Commons Paper No. 100), which was laid before this House on 12th December, be approved.