Rate Support Grant (Wales)

HC Deb 16 July 1985 vol 83 cc267-88 10.13 pm

The Secretary of State for Wales (Mr. Nicholas Edwards)

I beg to move, That the Welsh Rate Support Grant Supplementary (No. 2) Report 1983–84 (House of Commons Paper No. 448), which was laid before this House on 4th July, be approved. I hope that it will be convenient if at the same time we discuss the Welsh Rate Support Grant Supplementary Report 1985–86 (House of Commons Paper No. 449).

Mr. Ray Powell (Ogmore)

On a point of order, Mr. Speaker. We have all received copies from the Vote Office of the reports on which the Secretary of State for Wales is just about to speak, and I seek your guidance. Earlier this evening, when we were debating the report on which we have just voted, a point of order was raised about discrepancies amounting to some £1 million. That affects the figures on page 27 of that report and all local authorities in England. Indeed, only 12 months ago the Secretary of State for Wales had to admit to the House that many mistakes were contained in the report that was then debated. The treasurers of all the Welsh local authorities have estimated future rates assessments on the figures that have been published in the two booklets that were available to the House on 4 and 9 July. Can you assure us that the Secretary of State will give a personal assurance, before any statement is made, that all the figures contained in those documents are absolutely and perfectly correct? It would be pointless for the House to debate this issue unless we can have that clear assurance.

The treasurer of the Ogwr borough has sent me a list of detailed percentages and estimated rate grants since 1981–82. He has also highlighted the difficulty faced by all the councillors in that borough—half of whom I represent—in trying to fix a rate assessment to the figure to which the Secretary of State has instructed them to adhere.

In order to ensure that in no way will they be subjected to an order by the Secretary of State if they overspend, can we have an assurance that the figures given to those treasurers are perfectly and absolutely correct? Unless we can have such an assurance, I am sure, Mr. Speaker, that you will agree that unfortunately the House will be unable to continue with this debate.

Mr. Nicholas Edwards

Further to that point of order, Mr. Speaker. It may help the House if I say that I express regret that the report as laid—the Welsh Rate Support Grant Supplementary (No. 2) Report 1983–84—contains some small printing errors that were corrected by the issue of a printed slip that was placed with the reports in the Vote Office. As I think the hon. Member for Ogmore (Mr. Powell) knows, I wrote to all Welsh Members on 15 July drawing attention to these corrections. The same corrections are also being drawn to the attention of the local authorities in Wales. I am sorry that these printing errors have occurred, but we have corrected them in advance. I have already looked in the reports lying on the Table, and see that the errata slips are correctly with them. I therefore hope that there will be no inconvenience to the House.

Mr. Ray Powell

Further to that point of order, Mr. Speaker. Surely that admission alone proves conclusively that it is not possible to debate this issue. The two reports are confusing in themselves, but we must then find two small slips and try to adjust the figures. What on earth is the Secretary of State trying to do to people in Wales?

Mr. Ted Rowlands (Merthyr Tydfil and Rhymney)

How many millions of slips have gone out?

Mr. Powell

As my hon. Friend the Member for Merthyr Tydfil and Rhymney (Mr. Rowlands) has said, how many millions of slips have gone out? Many people in Wales are concerned about these orders. What effect will the mistakes by the Welsh Office have on the people of Wales? These mistakes were made 12 months ago, and one would have thought the Government could have righted the wrongs and given us a true and proper statement.

Mr. Deputy Speaker (Mr. Ernest Armstrong)

Order. That is not a point of order for me. It is a matter for the Government, not for the Chair.

Mr. Donald Coleman (Neath)

The Secretary of State for Wales said he had sent these slips to Welsh Members. But this order concerns not only Welsh Members; English and Scottish Members will be voting on it. What information have they been given?

Mr. Nicholas Edwards

I was careful to say that correction slips had been placed with the orders in the Vote Office, and that I had checked that the orders lying on the table had correction slips with them. I was most careful to ensure that all hon. Members and not just Welsh Members would have the correction slips available.

Mr. Barry Jones (Alyn and Deeside)

The right hon. Gentleman does not seem to be able to answer my hon. Friend the Member for Ogmore (Mr. Powell). I understand that the figures are not exactly trifling. The errors total £45 million and £3.4 million.

Mr. Edwards

These reports put into effect a number of adjustments to the rate support grants payable to local authorities in Wales, the details of which I will come to in a moment. The reports have a wider significance because they help to highlight the part that most local councils in Wales are playing in achieving a more effective use of resources and the better balance between private and public sector resources that is fundamental to the task of regenerating the Welsh economy. In the present year, 1985–86, local authorities have come near to achieving the targets I have set for local government spending, with responsible rating decisions by most of them. This is welcome news to ratepayers and to all those who wish to see Wales become an even more attractive location for commerce and industry.

Mr. Ray Powell

I should like to come back to the target figure. Can we have the Secretary of State's assurance that the target figures he has talked about and which have been issued to local authorities are correct.

Mr. Edwards

I can tell the hon. Gentleman that the errors which have been identified are not in the order, which deals with the targets for the current year, but in the final winding up order. We have drawn them to the attention of the House and they are not difficult to comprehend. As I said, I have taken the trouble to write to the hon. Member for Alyn and Deeside (Mr. Jones) and I have sent correction slips to Welsh Members and placed slips in the House before the debate.

Mr. Alan Williams (Swansea, West)

Will the Secretary of State answer my hon. Friend? Is he giving us a categorical assurance that all the other figures are absolutely correct and that he stands by them?

Mr. Edwards

I am coming to the House on the basis that the figures are correct. If any Member of the House were to guarantee that nowhere was there a semi-colon out of place, he would be very rash indeed. I can certainly give the assurance that these documents have been very carefully checked, some typographical errors having been discovered. On that basis I am presenting them to the House and hope they will be approved.

The record of Welsh local government in meeting the targets speaks for itself. In the first year of the separate Welsh arrangements, 1981–82, total expenditure was about £48 million or 4.4 per cent. above target. In current expenditure terms, the excess was £41 million or 4 per cent. In the present year budgeted total expenditure exceeds my target by only £4.6 million or 0.3 per cent. with a current expenditure excess of £14 million or 1 per cent. I have every hope that by next year that final 1 per cent. will have been eliminated and that local authority current expenditure in Wales will have returned in real terms to the level at which it was when we took office in 1979. It is worth emphasising that that is my objective—to bring local authority spending back to the level at which it was when we took office.

I acknowledge that halting the upward spiral of local authority current spending has not been achieved without a great deal of effort on the part of local government. Councils have been obliged to make a careful reassessment of priorities and to pursue greater efficiency, and I thank them for their efforts. More important than any thanks or commendations from me, however, there have been some very important consequential benefits.

First, rates in Wales have risen on average by less than the rise in inflation since 1981–82. Secondly, despite the reduced rate of growth in current spending local authorities have been able broadly to maintain, and in some cases to improve, the level of key services. Expenditure on the police has increased by 18 per cent. more than the rise in costs in the economy as a whole during the period 1979–80 to 1985–86. Spending on personal social services has grown by 9 per cent. with significant increases in the number of social workers and home helps. Residential provision has expanded and I have been able to introduce an initiative for the mentally handicapped which is initially 100 per cent. grant aided. Current spending on the urban programme has more than doubled in cost terms and an even greater growth has been achieved on the capital account. We have heard loud complaints about insufficient resources being available for education, but education spending has increased, despite the large fall in pupil numbers. Last, but not least, the achievement of local authorities in limiting their current spending has enabled me to release considerable additional resources for capital spending. Since 1981–82, when I assumed direct responsibility for rate support grant and capital allocations in Wales, gross capital spending by local authorities has risen by 46 per cent. or twice as fast as inflation.

The Welsh Rate Support Grant Supplementary (No. 2) Report 1983–84 finalises the rate support grant for that year. The first supplementary report for 1983–84, approved by the House in July 1983, withheld £12.6 million grant in respect of a gross spending excess at budget stage of £22.7 million. Outturn figures now show that the gross excess, after disregards, has been reduced to £17.5 million. This enables me to reduce the amount of grant withheld by £2.6 million to £10 million. I welcome the fact that two county and five district councils have successfully brought their budgeted spending down to target and now, in common with the large majority of other councils, avoid any grant penalties at all. The £3.5 million in grant previously withheld from those authorities will be restored to them by means of this supplementary report. Sadly, three authorities—Clwyd, Mid-Glamorgan and Ogwr—have actually increased expenditure between budget and outturn, resulted in additional holdback of £421,000, £844,000 and £446,000 respectively. Grant penalties for those authorities are accordingly increased.

At this point I must refer to the report in last Thursday's Western Mail which alleged that the grant adjustments made by this report to reflect the actual level of interest rates in 1983–84 came as a "bombshell" to local authorities. I find that allegation astonishing. By a longstanding convention, agreed with the local authority associations, interest rates have always been adjusted in final RSG reports. Adjustments in grant for this reason were made in 1981–82 and in 1982–83, and I find it unbelievable that local authorities were unaware that interest rates were falling in 1983–84 and that this would mean that spending would fall as well as their entitlement to grant. The suggestion is absurd.

I see that, in the debate on the corresponding motion on 18 July last year, reported in Hansard Vol. 64, c. 416, I told the House that exactly the same thing had happened in 1982–83. I also told the House that the adjustment can work both ways. Indeed, strongly suspect that for 1984–85 the outcome will be an increase in grant. Every local authority knows perfectly well that, under successive Governments, adjustments of this kind have been made so that grant relates to actual expenditure. Adjustments of grant for this reason were made by the Labour Government in each of the years when they were last in office. Against that background it really would be a bombshell if any local authority treasurer did no know or failed to plan accordingly.

Mr. Allan Rogers (Rhondda)

The Secretary of State said that grant has been adjusted to changes in interest rates. Can he explain the changes between 1981 and 1984 and say how much they have affected RSG for Welsh local authorities?

Mr. Edwards

The results of the changes are set out in the report. This is one of the consequences with which we are dealing. Perhaps the hon. Gentleman will wait until I give the total figures. If he has any questions about individual local authorities, perhaps I can deal with them when, with the leave of the House, I reply to the debate.

The article went on to suggest that the interest rate adjustment was the more painful because of higher spending on house renovation grants in 1983–84. However, the writer seemed to have overlooked the crucial fact that the Welsh Office provided 90 per cent. of the cash for financing these grants and that, in addition, the balance qualified for RSG support. The fact that only three districts have exceeded their target for 1983–84 reinforces the point that the improvement grant factor has been grossly overplayed.

The net effect of these technical changes—I am giving the figures for which the hon. Member for Rhondda (Mr. Rogers) asked—made by the report is to reduce relevant expenditure by £6 million. The block grant element is reduced by £2.9 million—0.4 per cent.—but specific grants are increased by £3.4 million, resulting in a £0.5 million increase in aggregate Exchequer grant. Aggregate Exchequer grant is about 4 per cent. higher than in 1982–83.

Copies of the report have been sent to each local authority in Wales with details of their revised grant entitlement. Adjustments to the payment of grants will, of course, be consequential upon the House approving the report.

Mr. Allan Rogers

I did not ask the Secretary of State about the outturn figures and the total of grant available adjusted according to interest rates, but what the interest rates were. I understand that interest rates have increased and that therefore the total of grant going to local authorities should have gone up accordingly. Can the Secretary of State not give a simple answer to a simple question? How have interest rates varied during the past four years?

Mr. Edwards

We are dealing with a particular year in which interest rates fell. As a result, local government expenditure fell, and as a result of that, authorities are not entitled to as much grant. Last year in the same debate the hon. Member for Rhondda (Mr. Rogers) asked whether, if interest rates rose, a similar adjustment would be made upwards, and I said that it would. If he had listened earlier, he would have heard me repeat that advice in this speech. We make an estimate of what interest rates are likely to be in the year, and, like all our predecessors of both parties, when we know the actual interest rate totals at the end of the period, we make the corresponding adjustment.

The supplementary report for 1985–86 is based on local authorities' budgets. The main report for the year, which was approved by the House on 16 January 1985, set out the basis on which grant would be withheld from authorities planning to spend in excess of their expenditure targets. Of 45 county and district councils in Wales, no fewer than 40—six county councils and 34 district councils—are planning to spend at or below target. Overall, total spending is only £4.6 million or 0.3 per cent. above the aggregate target. At budget stage, that is a remarkably good performance by Welsh local authorities, and I am delighted to place on record my appreciation of their co-operation in seeking to restrain public spending.

The five authorities—two county councils, Dyfed and Mid Glamorgan, and three district councils, Merthyr Tydfil, Wrexham Maelor and Ynys Môn—planning to spend above target have a total gross overspend of £4.6 million. That is a large figure for such a small number of authorities, and I have no hesitation in putting into effect the holdback formula agreed by the House in January. Under the terms set out in the main report that amounts to £0.5 million. That is a direct and avoidable cost, which those authorities have asked their ratepayers to bear.

I hope that the authorities concerned will review their spending decisions carefully in the light of this supplementary report, as it is still open to them to adjust their spending between now and the end of the financial year. By living within the targets that I have set, they can rid themselves of the unnecessary burden of grant holdback. Experience in 1983–84 shows that it is perfectly possible to get down to target by outturn, if the will is there.

Dr. John Marek (Wrexham)

The Secretary of State put forward his view about Wrexham Maelor. In reality, the Wrexham Maelor borough council does not want to cut services to its citizens, which is why it has chosen its present course of action.

Mr. Edwards

I hope that Wrexham's ratepayers note that they are having a heavy unnecessary additional burden placed on them. It is one of only three Welsh district authorities which apparently must spend more than the targets. I do not believe that the great majority of district councils in Wales are uncaring or irresponsible about the needs of their local communities, and yet they have been able to live within the reasonable targets that I have set.

The marked reduction in overspending is welcome news for industry and commerce in Wales, and for the ratepayers of those authorities which are heeding our expenditure guidelines. Welsh local authorities are close to achieving the overall goal which I have set. I look forward with confidence to its achievement, with the benefits it will bring to taxpayer and ratepayer alike.

I commend the two reports to the House.

10.39 pm

Mr. Barry Jones (Alyn and Deeside)

It is fair to say that the Secretary of State's slip is showing tonight. I remind him of the incorrect figures of about £45 million for education and about £3.4 million elsewhere. It is wrong that so many of his senior officials shoud be involved in this retrograde and wretched system of targets and penalties. He should know that his officials could be far better employed than having to run this unpopular and unsuccessful system.

The right hon. Gentleman did not say that the scale of his penalties was draconian. I must protest about them, because in 1985–86, as a percentage of gross expenditure excess, these penalties now stand at 120 per cent. This is a crippling penalty to impose on Welsh local authorities. It was incredible to hear the Secretary of State boast that his objective was to return to 1979 levels of local government expenditure, when we know from debates and questions in the House that unemployment has increased by 125 per cent. since he became Secretary of State for Wales. The right hon. Gentleman should have said that he would give us more money, so that our local authorities could cope with the challenges which have been created by the failure of the Government's policies.

It should be said as loudly as possible throughout Wales that the Welsh rate support grant, as a percentage of expenditure, has been reduced from 72.5 per cent. in 1982–83 to 67 per cent. under the right hon. Gentleman's regime, about which he boasts. He has set our local authorities, which have major unemployment problems, a most difficult task.

The supplementary report for 1985–86 empowers the Secretary of State to put into effect the proposals set out in the original report, which involve the implementation Of target and penalty regimes. As for our eight county councils, this means that, because of an expenditure excess of just more than £4 million, there will be a witholding of grant of nearly £4.7 million. The same applies to Wales' 37 district councils. They budgeted to spend £450,000 less than the Government's estimate of their total expenditure, but they will suffer a grant holdback of £855,000.

The supposed transgressors are Merthyr Tydfil, Wrexham Maelor and Ynys Môn. To put those figures into context, I remind the House that in the main report—

Mr. Ray Powell

My hon. Friend is right to say that Ynys Môn will be subject to holdback. Will he comment on the fact that that local authority is represented by a Conservative Member of Parliament, who used to be the Parliamentary Private Secretary to the Secretary of State? I wonder whether the hon. Member for Ynys Môn (Mr. Best) will comment later on the effect of this proposal on his local authority?

Mr. Jones

I understand the thrust of my hon. Friend's intervention. Perhaps the hon. Member for Ynys Môn (Mr. Best) will catch your eye later, Mr. Deputy Speaker, and can justify the penalisation of his local authority. We look forward to hearing his response to this unjust treatment of the island of Anglesey.

The Welsh local authorities will exceed the Secretary of State's expenditure estimate by only 0.3 per cent., but they will incur penalties of £5.5 million. We believe that the entire process is unfair. First, total expenditure is so close to the Government's original guidance figures that there is a reasonable case for suggesting that the Secretary of State should abandon his thumbscrew, financial torture penalties. If he will not go so far as to abandon the penalties, will he not say that the system is a farce or a black comedy, and even if he will not admit that his system is a ridiculous waste of his hard-pressed Department's time, the fact that the total grant holdback substantially exceeds the total expenditure excess is indefensible. Ministers have said that Wales' authorities have done well in operating the Government's guidelines, yet they persist in exacting savage penalties from vulnerable, hard-pressed local authorities which are trying to cope with the aftermath of the Government's failed economic policies.

Mr. Peter Hubbard-Miles (Bridgend)

Is the hon. Gentleman aware that in Mid-Glamorgan the Audit Commission has recently identified savings of nearly £2 million which are achievable in just two areas of local government, school meals and further education, and that such savings would be more than the grant holdback?

Mr. Jones

I find it incredible that the hon. Gentleman, a Member from the area of the Mid-Glamorgan county authority, should sneakily be attacking his own county, when he should be demanding of his right hon. Friend more and more money to help the most socially deprived local authority in Britain. It is a disgraceful posture for the hon. Gentleman to adopt, and he should be ashamed of himself.

The reports are a cruel nonsense. The system is discredited tonight by the mistake for which the right hon. Gentleman had to make a wretched apology. It is a Gilbert and Sullivan situation: the crime is small and the punishment is severe. The Minister has declared financial war on Merthyr Tydfil. Long-term unemployment in Merthyr is 47 per cent. of all unemployment. Male unemployment in that beleaguered community stands at 23.7 per cent.

My hon. Friend the Member for Merthyr Tydfil and Rhymney (Mr. Rowlands) has taken me to his constituency. I have seen the dereliction and the problems in housing and the need for reclamation of industrial land. It is incredible that this Secretary of State should want to penalise one of the ablest of local authorities, with one of the biggest sets of problems in the Principality.

The right hon. Gentleman forgets that, in the fair island of Anglesey, Holyhead has 3,670 workless people. The male unemployment rate there is 23.9 per cent. and the female unemployment rate is 17.7 per cent. Yet he wishes to attack Ynys Môn and penalise it heavily. It looks as though he will have the willing aid of the hon. Member for Ynys Môn. We shall watch with interest to see how he votes tonight. [Interruption.] Yes, he has fled the Benches because he is too embarrassed by the reality of the situation.

The right hon. Gentleman wishes to penalise Wrexham harshly. I remind him that unemployment in that constituency stands at 19 per cent.

I also remind the right hon. Gentleman that the Dyfed dole queue exceeds 18,000 and that in Mid-Glamorgan it is 34,000, the highest in Wales. Mid-Glamorgan is the seat of some of Europe's most serious social and economic problems, and without any doubt it is the source of Britain's worst housing problems. Yet the Secretary of State has sanctioned grant holdback of £3.1 million from his own county, Dyfed. The people of Dyfed believe that the right hon. Gentleman's policies are operating an unjust and very spiteful system.

It is true that in the second report for 1983–84 the grant holdback penalties of £10 million are less than predicted in the first supplementary report for that year. Of the Welsh districts, 37 exceeded the Government's estimate by only 0.1 per cent. Yet three districts—Merthyr, Ogwr and Wrexham Maelor—suffered penalties nearly two and three quarter times the total expenditure excess. That illustrates the stupidity and the iniquity of the system.

The Secretary of State did not dwell on it for long, but the Government have reduced relevant expenditure and grant. The Welsh districts' block grant before holdback penalties has effectively been reduced by 3.75 per cent. Some of our districts have had huge reductions. Man, under the heading of reduced relevant expenditure and grant, has suffered a reduction of 18 per cent., which amounts to about £380,000. Torfaen has had a reduction of 9.8 per cent. while the reductions for Swansea and Alyn and Deeside have been 7.4 per cent. and 5.4 per cent. respectively. For Alyn and Deeside—my own constituency—to lose £140,000 is a hammer blow. The authority is endeavouring to modernise homes, to attract new industries and to cope with a male unemployment rate of one in five. We think that the Government have kicked us in the teeth.

Mr. Nicholas Edwards

Will the hon. Gentleman give way?

Mr. Jones

If the right hon. Gentleman is prepared to acknowledge that he has kicked us in the teeth, yes.

Mr. Edwards

The reductions which the hon. Gentleman has quoted, including Alyn and Deeside, are about 90 per cent. due to the reduction in interest rates. The authorities have had to pay lower interest rates and have had lower expenditure. Therefore, they are entitled to a lower level of grant. For that reason, we have made the same adjustment as that which was made in every year of the previous Labour Government.

Mr. Jones

The right hon. Gentleman should spend more time with the Association of District Councils in Wales, which will not find that explanation sufficient. It is angry. For the district councils which lose relevant expenditure and grant—27 of the 37 lose—it is not good enough to be so informed in the report about 18 months after the closing of their books. The district authorities believe that this is an instance of the Government being guilty of a special sort of incompetence.

Mr. Allan Rogers

The Secretary of State has given a specific figure for the reduction in rate support grant to Alyn and Deeside, but he has still not said by how much interest rates have fallen over the period for which he has calulated the outturn. If he is saying that all the outturns in Wales and the reductions in grant to local authorities are the result of the reduction in interest rates, is he saying that there have been no penalties or cuts in Wales?

Mr. Jones

My hon. Friend has pinned down the right hon. Gentleman, from whom we have had no assurances and no clear explanation in response to my hon. Friend's cogent argument. As I was about to say before I was so cogently interupted, rate support grant for Wales has been reduced by £5.5 million before holdback since the main order. Is it not the case that nearly all of the reduction—about £5.4 million—has been borne by the Welsh districts.

I deal next with the position of the counties in the 1983–84 report. Clwyd, Mid-Glamorgan and West Glamorgan have been slammed viciously for overspending. I should tell the House that their budgets involve hundreds of millions of pounds. However, the grant holdbacks total over £9 Million. The counties are struggling desperately to cope with the coal and steel closures. The Mid-Glamorgan authority must now endure a series of agonising coalmine closures in valley communities, where the prospects of locating new industries must be almost nil in today's climate. I ask the Secretary of State and his junior Ministers to visit Mardy and Maesteg, which are the scenes of imminent pit contractions and closures. If they do, they will realise that it is monstrous to penalise by over £4 million Mid-Glamorgan, where unemployment, ill health and unfit housing exist to an alarming degree, and, arguably, to a degree not experienced anywhere else in the United Kingdom.

West Glamorgan and Clwyd, the other errant counties, are still reeling from the 1980 steel closures.

Mr. Coleman

My hon. Friend referred to the penalties imposed on local authorities and related them to unemployment. Does he think that next year West Glamorgan and the borough of Neath, which face about 1,000 job losses, will be penalised because the local authority may want to spend money to help unemployment?

Mr. Jones

My hon. Friend clearly fears the worst. He has received no assurances in response to his recent substantial questioning of the Secretary of State. My hon. Friend may well draw the worst conclusions in view of the Secretary of State's silence tonight and previously.

The Courtaulds closures in Clwyd have made the task of creating a new economy immensely difficult. The loss of 1,100—

Mr. Ian Grist (Cardiff, Central)

The hon. Gentleman makes a fair point when he talks about the difficulties which local authorities face with the closure of steel and other plants. I am sure he will agree that any threat to close Llanwern would be a catastrophe for my constituents and the borough of Newport in the county of Gwent. In which case, why did he and so many of his colleagues support the miners' strike, which threatened the future of that plant?

Mr. Jones

At this late hour we should be spared such petty, snivelling interventions. It was a most unworthy intervention. The hon. Gentleman unwittingly makes my case. He concedes that local authorities must face the consequences of closures. Why does he not denounce his right hon. Friend, who has boasted that he wishs to get local authority expenditure back to 1979 levels, which was before the closures took place? The hon. Gentleman's intervention clearly lacked logic. There is clearly a lack of good intent in the right hon. Gentleman's strategic and tactical policy.

The loss of 1,100 Courtaulds manufacturing jobs and the P.D. Cans venture is a major blow. It is perverse of the Government to penalise my county, which has 24,000 jobless citizens, when it is striving ably to improve the social and economic infrastructure.

West Glamorgan, as my hon. Friend the Member for Neath (Mr. Coleman) stressed, suffers in parallel. Neath has lost about 1,000 jobs in two months. The BP job losses rival in seriousness the loss of the Courtaulds jobs.

I wish to raise the issue of council house sales receipts, against the background that these reports release insufficient moneys. The districts are bitter. There are 66,000 renovation grants outstanding. Their cost may exceed £231 million. Four years will be needed before we can attempt to clear the backlog. Why do the Government not release their hold on that cash? Why does Wales suffer a 15 per cent. capital receipts limit? Our valley communities, steel and quarry towns desperately need housing cash. Why can the English authorities use 20 per cent. of their receipts? Why does the right hon. Gentleman acknowledge and accept that inequity? He has never explained the discrimination. He should do that tonight if he catches your eye, Mr. Deputy Speaker, because my right hon. and hon. Friends are deeply worried by the Augean stable of rotten housing in the valleys, and they see no prospect from these reports of ever having the money to put it right. Our people are suffering because of the right hon. Gentleman's failure to win the battle in the Cabinet.

The blunt truth is that the Government come to the House seemingly oblivious to the message from the electors of Brecon and Radnor.

Mr. Rowlands

Are the Government aware that the Green Paper on housing grants proposes moving from grants to loans, but that a condition of that is that all outstanding applications be fulfilled and 90 per cent. grants be made? When do the Government expect to fulfil that agreement?

Mr. Jones

We will look forward with interest, if the Secretary of State catches your eye, Mr. Speaker, to hearing his answer to that important point.

The message of the electors of Brecon and Radnor should be clear to the Government. Ordinary people throughout Powys complained about the decline in the services delivered by local councils. They said that the councils were without adequate finance, and they knew that services would continue to decline in quality and extent. We noted that parents were at their wits' end because of the never-ending cuts at schools. Residents noted the squalor of the learning environment, were in despair at the dog-eared books, the increasing reliance on work sheets and the narrowing of the curriculum, and the loss of the teaching staff. They complained about all those things, and there is nothing in the report to show that the moneys to stem the adverse tide will become available.

Everybody complains about the increase in vandalism, in burglaries, in theft and fraud, but our police forces are cut or are insufficient. Although these financial reports are abstract and complex, they guarantee a continuing steep decline in the quality of life for the Welsh people. The Secretary of State operates a discredited, unjust local government regime. The Labour party is committed to local government democracy in Wales. We shall dispel the poison in the local government system. Our approach will be based on local democratic control, clear local accountability, and a local choice within a national framework. We will give greater importance to social needs, to economic problems and deprivation.

Mr. Ray Powell

On a point of order, Mr. Deputy Speaker. I notice that behind the Chair some advice is being given to Tory Members. Is that available to Labour Members?

Mr. Deputy Speaker

That is not a matter for the Chair.

Mr. Powell

I am asking for a ruling on that point of order, Mr. Deputy Speaker.

Mr. Deputy Speaker

I am giving a ruling. Nothing has occurred that is out of order.

Mr. Powell

Further to that point of order, Mr. Deputy Speaker. May I go along to the Box and ask for the information that was given to the hon. Member for Ynys Môn (Mr. Best)?

Mr. Deputy Speaker

It is not for me to advise the hon. Gentleman. Nothing has occurred that is out of order.

Mr. Jones

I respect your ruling, Mr. Deputy Speaker. It became clear to my eagle-eyed Friend the Member for Ogmore (Mr. Powell) that the hon. Member for Ynys Mon was going to the Officials' Box to attempt to get answers. The hon. Gentleman knows that if he catches your eye in this debate he will have a difficult task justifying the penalties against his local authority. That is why my hon. Friend intervened.

The Labour party will make sure that the hated Rates Act and the unjust targets and penalties regime will go. The Secretary of State must abandon his penalties and targets, restore democracy to the local government scene, and acknowledge the folly of the system that he has introduced.

11.4 pm

Mr. Geraint Howells (Ceredigion and Pembroke, North)

Nowhere more than in Wales have the Government's unjustified penny-pinching attitudes towards local government been resented, as recent events in Mid-Wales have amply demonstrated. Should I mention Brecon and Radnor here this evening?

Mr. Alex Carlile (Montgomery)

Yes.

Mr. Richard Livsey (Brecon and Radnor)

Yes.

Mr. Howells

I am delighted that the new hon. Member for Brecon and Radnor (Mr. Livsey), my hon. Friend, has been able to join my hon. and learned Friend the Member for Montgomery (Mr. Carlile) and myself on these Benches. I am sure that he will stay with us for many years to come.

I have referred to Brecon and Radnor. The Secretary of State said that the rates have risen very little in Wales during the past 12 months—not higher than the rate of inflation. However, the Local Government Chronicle of 14 June 1985, refers on page 678 to The rises in Brecknock (13.9 per cent.) and Radnor (15.4 per cent.)". No wonder the electorate in Brecon and Radnor made sure that the Tories would be ousted in the constituency, arid have elected my colleague to represent them.

People are rightly blaming the Government for inadequate and even dangerous school buildings, for the limited facilities offered our schoolchildren, and for the lack of provision of even the most basic materials in some schools in Wales. Highly placed officials in the education service have been quoted as saying how they were first motivated in their work by the desire to bring about an improvement and expansion in education, but were now having to spend their time trying to limit the damage to a whole generation of children that will result from severe cutbacks imposed on local authorities by central Government.

Mr. Alex Carlile

Is my hon. Friend aware that teachers in high schools in Wales are now in despair at the amount of time that they have to spend writing and typing out worksheets for their pupils because there is not money available to buy textbooks for those pupils? Is he further aware that that is even so with students who are studying specialist subjects for A-level?

Mr. Howells

I entirely agree with the sentiments expressed by my hon. and learned Friend. It makes us wonder whether the Secretary of State is aware of the problems in many of the high schools and whether he cares for the children who live in our communities.

Likewise, the money for road improvements is not being made available, and the tremendous backlog in housing maintenance and repair throughout Wales is rapidly becoming a national scandal. Various Ministers have been trying to stem the tide of discontent against the Government by blaming the local authorities, but that is manifestly unfair. Local authorities in Wales, as elsewhere, have been forced to budget in the most insecure conditions. They must feel at times that they are treading on quicksands. It is now surely time that the Government tried to build greater stability into the rate support grant formula to give local authorities greater certainty about their block grant entitlement. It is now 12 months since local authorities closed their accounts for 1983–84, yet we have before us a report that changes the grant entitlement for individual authorities quite significantly in some cases. For example, Ceredigion district council will lose approximately £28,000 this year in respect of 1983–84. It is obvious that since the introduction in 1981 of the present rate support grant system it has been used more and more as an instrument by which central Government are attempting to control the level of local authority spending and, by that means, undermining local democracy. Do the Government intend to perpetuate this policy?

In the shorter term, will the Minister assure the House that provision for education, roads and housing will not be further damaged by the Government's short-sighted policy towards the funding of local government?

I hope that the Minister will say how many employees in local government have been made redundant in the last 12 months and how many are likely to be made redundant in local government in the coming two years due to the Government's policy, which is having a disastrous effect on Wales and its people.

11.11 pm

Mr. Keith Best (Ynys Môn)

I welcome the opportunity that the hon. Member for Ogmore (Mr. Powell) took of going to the Officials' Box. Any information that might improve the quality of his speeches is a welcome addition, though as he has disappeared so rapidly from the Chamber he can only have received unwelcome news. Judging from the concentrated look of despair that he always seems to wear on his visage, the news that he received could not have been particularly apposite to the case that he might have sought to advance had he chosen to remain in his place. However, one must not be too beastly towards him.

Mr. Hubbard-Miles

Does my hon. Friend think that the news he got was that in 1983–84, when the figure was withheld, Ogwr borough council borrowed £6 million from merchant bankers, not to provide housing for the needy but to provide new council offices and a leisure centre?

Mr. Best

I am grateful to my hon. Friend for making that point, because his knowledge of these matters is profound. One reason why the hon. Member for Ogmore may have disappeared so rapidly from the Chamber is that not only his local authority but most Labour-controlled local authorities in the Principality do not have a happy story to tell about the way in which they spend their ratepayers' money.

Ynys Môn, my local authority, has been mentioned as one of those which will suffer a penalty. I wish to place on record the exact nature of that overspend. From a target of £5,149,000, the total expenditure comes out at £5,318,720, an overspend of £169,720. I hope that the Secretary of State acknowledges that that is a good attempt to stay within the target.

The Secretary of State will be the first to acknowledge that the borough of Ynys Môn has particular difficulties to confront, especially in housing, with about 900 applications for housing improvement grants waiting to be satisfied. There is little prospect of their being satisfied in the near future unless further money is made available, and my right hon. Friend knows my views on the release of further capital receipts to try to satisfy that demand. He will also be aware of the severe unemployment problem in Ynys Môn, with 22 per cent. male unemployment.

My local authority has concentrated on alleviating the unemployment problem. The establishment of an economic development unit has been the latest step in that endeavour. A local authority in an area where there is high unemployment can be expected to spend more than authorities in areas where the problem is not so severe. I hope that my right hon. Friend the Secretary of State will soon be able to announce what we would both like— targets will be done away with and we will return to a more sensible element of establishing local government expenditure.

Targets are only a temporary measure, as has been repeatedly acknowledged. They are an unwelcome measure, however necessary they are. I hope that the time when they can be done away with altogether is rapidly approaching. This does not detract from central Government's problem of trying to resolve the conflict between local government autonomy—every hon. Member believes that every local authority should have as much say as is commensurate with central Government's overall duty—namely control of overall identifiable public expenditure.

The manifest failure of the Opposition parties to address their minds to that central question removes all credibility from the speeches by the Opposition. Until they address their minds to how to enable central Government to control overall public expenditure, of which local government expenditure is a significant part, and give local government autonomy that is commensurate with the expression of will of the ratepayers through the ballot box, there will not be a comprehensive and cohesive Opposition policy. At least the Government have tried to resolve that difficulty in a short-term, in many ways unsatisfactory, measure by the introduction of targets. There seemed to be little alternative to that measure.

I hope that, because of the responsibility that local government has shown in the Principality—to a greater extent than in England—we are approaching a period when the Principality will return to a more sensible resolution of local government finance. My right hon. Friend the Secretary of State does not need me to remind him that the local authorities' success in Wales is his success, and vice versa. Central and local government must work hand in glove, because it is to the overall benefit of the people—whether taxpayers or ratepayers—that expenditure should be kept to levels that the country can afford.

That point must not escape the notice of every hon. Member participating in this debate. Unfortunately, the hon. Member for Alyn and Deeside (Mr. Jones) and the hon. Member for Ogmore, who has rapidly departed rabbit-like, have not addressed their minds to that aspect. They do not therefore provide a credible alternative to the Government's measures.

11.18 pm

Dr. Roger Thomas (Carmarthen)

I very much regret the last couple of sentences by the hon. Member for Ynys Môn (Mr. Best). Perhaps they were uncharacteristic of him.

It is essential to allow democratically elected members to put into operation services that are compatible with local needs and interests at levels of provision thought necessary by those with local government concerns. That proviso should be accepted by all honest, decent-thinking people. Restrictions in this direction have to be resisted.

One must admit that RSGs and GREs are complex. Earlier in the debate they were regarded as being Byzantine, and that is possibly under-estimating the situation. But they are affecting more and more the lives of every elector in the electorates we serve. Political issues these days are often divided into national and domestic issues. It was said that at the recent by-election domestic issues took precedence over national issues. That is not surprising, because the community is becoming more and more sophisticated, and more and more it thinks for itself.

One of the things I have noticed is that these days the community values, to a greater extent than ever before, the wide range of services provided under the auspices of local authorities, and there is now solidifying a determination to defend those services against the onslaught of central government. Nowhere is this more clearly defined than in the defending of services provided by social service departments. Yet within county councils a continuing battle goes on to tailor restricted finances to growing demands. It is a miserable sight to behold the genuine and heart-searching efforts of elected councillors being belittled and sometimes denigrated by those pursuing political dogma.

Restricted local government financing has the most widespread repercussions and ramifications. Ministers, and particularly the Minister of State, must be sick and tired of representations which I and other hon. Members make about the effect of unemployment upon certain areas within the county of Dyfed. Nowhere is that more apparent than in the fact that Dyfed county council does not have enough money to spend on roads leading north and west from Carmarthen, north and west from the termination of the A4, in order to bring down unemployment rates in that area. We had a disaster in that area when the creamery was closed at Newcastle Emlyn. We are not prepared to accept another disaster if this process of contractorisation, or privatisation under another name, is to take place at Aberforth in the constituency of the hon. Member for Ceredigion and Pembroke, North (Mr. Howells). We warn the Government that we will not accept that.

We in Dyfed will fight the Government on these issues. The Government are penalising us now, but there will be a solid opposition in Dyfed. I appeal to the Liberal party to have some influence upon Liberal members in Dyfed county council, so that we can present a united front and face these penalties. We will be honoured and supported by farming people in Dyfed.

11.23 pm

Mr. Dafydd Wigley (Caernarfon)

Reference has been made to the Brecon and Radnor by-election, but I do not want to go on too long about that. There is a message which Conservative Members should take to heart, and it is that people put a value on services. They put a greater value on real value for money services than they do on an additional penny on the rates, provided that that penny is being spent in a way which meets their requirements. That is something the Government will forget at their peril in all parts of Wales and elsewhere when it comes to an election.

In the papers before us, we are seeing yet further penalisation of areas, particularly rural areas. We have heard about the position in Dyfed. The position in Gwynedd is not good at all. Gwynedd kept substantially below the target set by the GRE, and that was because of cuts it had to make and further cuts that are threatened in order to keep expenditure down. There is talk of axeing the teaching of musical instruments, and we are seeing the inability of Gwynedd to fulfil the infrastructure needed for the all-Wales strategy for mentally handicapped people. We are seeing a lack of finance for joint funding of schemes between the social services and the health authority. That is the price we have to pay to meet targets which are not related to the acknowledged level of need in Gwynedd as elsewhere.

We are seeing problems in counties such as Dyfed. Dyfed has a GRE-recognised need of £133.1 million, and an expenditure forecast of £132.4 million, which is less than the GRE, less than the recognised need in Dyfed. In spite of that, the target has been set at £130 million. Dyfed is £2.4 million above the target and is being penalised by £3.1 million.

That is a devastating situation for Dyfed. Interestingly enough, I believe that Dyfed is the only county council in Wales since reorganisation which has not elected an official Conservative county councillor. Is this the price to be paid? [Interruption.] I hear someone say that that is because no one will stand as a Conservative candidate. That is a fascinating reflection on the situation. I wonder whether that is why the county is being clobbered in the settlement? Or is it because Dyfed county council recently passed a vote of no confidence in the Secretary of State and called for his resignation? The people in the right hon. Gentleman's own area will have to pay for the Government's imposition on the county council and the people of south Pembroke should bear in mind that the actions of their own Member of Parliament have led to this.

Dyfed faces the possibility of having to cut 103 teaching posts, although the need for them is very great. If the Secretary of State thinks that the council can dip into its reserves, I should inform him that the reserves amount to about £900,000. If the teachers' pay increase is 5¾ per cent. instead of the 4¼ per cent. that has been budgeted. that will take a further £600,000 from the reserves arid the council will have virtually nothing left. Central Government must take responsibility for the full pay settlement, because with a financial régime of this kind it would be utterly unfair to pass the burden on to local authorities which do not have the resources to meet it.

If the same pattern of increased burdens continues next year Dyfed will need a further £10 million. The ratepayers will then have to face a 30 per cent. or 40 per cent. increase in rates or the county will face bankruptcy. That is the crazy logic of a regime which penalises a county which is spending less, not more, than its GREA but which cannot meet the unrealistic targets set by the Government.

The same applies to Mid-Glamorgan, an area of tremendous social need. Again, if any part of Wales has enormous social needs it is Merthyr Tydfil, an area which I know well. In Wrexham, unemployment is constantly increasing. Then there are the problems of Ynys Môn. As we have heard, members of the Select Committee on Welsh Affairs were in Llanfair P.G. looking at what was supposed to be a prime tourist sight and seeing the grotesque need for expenditure on developing the station forecourt, car parking facilities, and so on. Yet the local authority is being penalised not for spending more than its GREA but for spending more than the iniquitous target imposed by the Government.

The present arrangements for local government expenditure in Wales do not give people the responsibility and the right to develop services in response to the needs of each locality. The sooner that system is changed, the better.

11.27 pm

Mr. Gwilym Jones (Cardiff, North)

As always, I listened with interest to what the hon. Member for Alyn and Deeside (Mr. Jones) had to say from the Opposition Front Bench, but I was even more interested in what he did not say. As a year has passed since we last had a similar debate I thought that the hon. Gentleman might have answered the following quotation which was given in last year's debate the Chancellor spoke the truth in his Budget speech. His message on public expenditure was loud and clear. We cannot afford it. I am sorry, but the fact is that nearly everyone is in favour of cuts in public expenditure as a means of helping to solve our economic problems, but very few are prepared to accept the local implications of such a policy."—[Official Report, 18 July 1984; Vol. 64, c. 431] In fact, that quotation is from the hon. Gentleman himself, addressing the Welsh Grand Committee on 7 May 1975.

I have nothing new from the hon. Member for Alyn and Deeside today. Instead, he gave the familiar litany of statistics and unemployment figures that are trotted out on every occasion in Welsh debates. In the Chamber, in Welsh Grand Committee debates and at Welsh Question Time, as though the hon. Gentleman wished to convince us that he revels in ever higher unemployment.

I have recently had the privilege of visiting the hon. Gentleman's part of the world. I was in his constituency with the Select Committee on Welsh Affairs last week looking into matters of tourism. The week before we were taking evidence about the closure of Courtaulds in Wrexham. I was somewhat gratified to receive the assurance of Wrexham Maelor Council that it was convinced of the need to hold back the lunatic fringe in Wales.

It is almost heartening that the Labour party has changed its view about council house sales and that tenants should not be denied their right to buy. However, councils often complain that they cannot spend their own money. Is it their own money? Surely it is their ratepayer's money. That money has been borrowed and ratepayers have repaid the capital and the interest on it. They are trying to spend the money twice instead of seeking to return that money to the ratepayers and eliminate interest charges.

We would all agree in wanting to see the backlog of renovation grants taking less than the four years described by the hon. Member for Alyn and Deeside. Such small works are important because they create work and employment. We must not neglect such opportunities. We all want effective and efficient spending. I fully support the Government's policies for council spending. While I realise that they are necessary. I look forward to when the implications for council spending are somewhat different. I hope that we can look forward to a greater freedom, particularly in renovation grants for small works.

I was pleased to hear how near local authorities are to achieving the targets set by responsible rating decisions. I noted my right hon. Friend's hope that the 1 per cent. difference between targets and expenditure will soon be eliminated. I welcome the move towards more responsible rating decisions. However, I warn my right hon. Friend that there is a cynical, cycle in Wales which is based on the frequency of two-year local government elections. Certainly in south Glamorgan the rates increase was artificially held down in election year. Many Cardiff ratepayers know that we can expect a big increase in rates next year. This will be a savage burden on the ratepayers in Cardiff, domestic and industrial, and I warn that the Minister might have to make use of his powers to cut back on excessive spending in south Glamorgan.

11.34 pm

Mr. Roy Hughes (Newport, East)

This debate is a hardy annual. The Secretary of State presents his proposals as if he were dealing with a bunch of unruly schoolchildren. He threatens to use his authoritarian powers against Welsh local authorities which have to deal with the most terrible social problems in the whole of Great Britain. It cannot be said too often that local authorities in the Principality have always acted with the utmost restraint and sense of responsibility. They deserve better treatment from the Secretary of State.

The councils believe that they could achieve greater efficiency if there were fewer controls on them. The 37 Welsh district councils in the Association of District Councils would like autonomy over their financial affairs. That request was turned down; the councils are getting nowhere in their consultations with the Secretary of State. Hard-pressed authorities such as Wrexham and Merthyr, which has terrible unemployment problems, get nothing but penalties and the money goes into the Treasury coffers.

The Secretary of State tries to make out that his proposals are fair and reasonable. Why, then, do our district councils protest that the rate support grant report will withhold £10 million of block grant from Welsh ratepayers? It is highway robbery and the Secretary of State has become the Dick Turpin of Welsh politics. Money is urgently needed for many public projects throughout Wales.

The district councils allege that the report reduces the relevant expenditure of Welsh local authorities by £6 million and reduces grants by £5.5 million. Those figures illustrate the pressure on our local authorities who have to cope with overwhelming problems.

When the Secretary of State exercises his power to redistribute grants to Welsh districts there will, of course, be winners and losers. Afan, which covers the Port Talbot area, is adversely affected. When a local authority embraces a pattern of expenditure, it is often difficult for it to cut back on projects that it has undertaken. When it attempts to rectify the situation by putting up the rates, there is invariably a public outcry. The Secretary of State is passing the buck to our local authorities. They are having to carry the can for his deficiencies and errors.

We know that the favourite target of the Secretary of State is the Mid-Glamorgan county council in perhaps the most socially deprived county in Great Britain. Umpteen reports have set out all the details of the county's terrible problems, but apparently it is to be penalised.

The story tonight is a depressing one of cuts, cutbacks and restrictions. The message from Brecon and Radnor was that people are calling for improved social services. That is a call of enlightened self-interest and the Opposition fully endorse it. A future Labour Government will restore the freedom of local government and increase the functions of our local authorities. That is the best course for Wales.

11.39 pm

Mr. Nicholas Edwards

The hon. Member for Alyn and Deeside (Mr. Jones) said that it was unfortunate that this information came 18 months after the event and the hon. Member for Ceredigion and Pembroke, North (Mr. Howells) asked why there had been delay. We wait until after the local authorities' accounts have been audited and we have the final figures so that we can make the final adjustments.

The hon. Member for Alyn and Deeside said that it requires a special kind of financial incompetence to produce figures at this late stage. It would require a special kind of financial incompetence for any treasurer not to be aware of the effect of grant on the changes in expenditure, especially changes resulting from interest charges.

The hon. Member for Rhondda (Mr. Rogers) asked about the change. In 1983–84, there was a fall from the assumption of 11.5 per cent. to the actual interest rate of 10.5 per cent. It is that adjustment with which we are dealing. The total resulting from that change was £6,261,000 in Wales. Of the £10 million that has been referred to, £3.8 million was accounted for by holdback. Of the £140,000 difference between the first and the second report in Alyn and Deeside, £63,000 was due to the interest rate change.

My hon. Friend the Member for Ynys Môn (Mr. Best) talked of his constituency's special problems. His local authority has increased rates faster than inflation since 1979 and has the highest manpower growth in any district council in Wales. There has been a 5 per cent. growth in full-time equivalent since 1979. Most districts find that they can provide the same services with less manpower. I wonder whether the increase in manpower is a proper use of expenditure. He was right to say that we are anxious to move away from a system of targets.

I have just completed the consultation process with local government that will lead to the statement on RSG next week. I have already told local authorities that, thanks to that consultation process and the views that they expressed, I hope to be able to get away from the target system in Wales. I believe that both sides of the House will welcome that.

The hon. Member for Caernarfon (Mr. Wigley) rightly emphasised that people care about services. His local authority has increased expenditure on services above the rate of inflation during the past few years. No doubt it has therefore been able to improve services. Several local authorities have been mentioned. Ogwr has got into the extraordinary state of apparently doing some creative accounting against itself, and it has paid money back into reserves and therefore incurred penalty. That seems a clumsy action which reveals a need for advice. I hope that that will be drawn to its attention.

It being one and a half hours after the commencement of proceedings on the motion, MR. DEPUTY SPEAKER put the Question, pursuant to Standing Order No. 3 (Exempted business).

Question agreed to.

Resolved, That the Welsh Rate Support Grant Supplementary (No. 2) Report 1983–84 (House of Commons Paper No. 448), which was laid before this House on 4th July, be approved.

Motion made, and Question put, That the Welsh Rate Support Grant Supplementary Report 1985–86 (House of Commons Paper No. 449), which was laid before this House on 9th July, be approved.—[Mr. Nicholas Edwards.]

The House divided: Ayes 240, Noes 180.

Division No. 280]	[11.43 pm
AYES
Amess, David	Arnold, Tom
Ancram, Michael	Ashby, David

Aspinwall, Jack	Goodhart, Sir Philip
Atkins, Rt Hon Sir H.	Gorst, John
Atkins, Robert (South Ribble)	Gow, Ian
Baker, Rt Hon K. (Mole Vall'y)	Gower, Sir Raymond
Baker, Nicholas (N Dorset)	Grant, Sir Anthony
Baldry, Tony	Greenway, Harry
Batiste, Spencer	Gregory, Conal
Bellingham, Henry	Griffiths, Sir Eldon
Bendall, Vivian	Griffiths, Peter (Portsm'th N)
Benyon, William	Grist, Ian
Bevan, David Gilroy	Ground, Patrick
Biffen, Rt Hon John	Grylls, Michael
Biggs-Davison, Sir John	Gummer, John Selwyn
Blackburn, John	Hamilton, Hon A. (Epsom)
Blaker, Rt Hon Sir Peter	Hamilton, Neil (Tatton)
Bonsor, Sir Nicholas	Hampson, Dr Keith
Boscawen, Hon Robert	Hanley, Jeremy
Bottomley, Peter	Hannam, John
Bottomley, Mrs Virginia	Hargreaves, Kenneth
Bowden, A. (Brighton K'to'n)	Harris, David
Bowden, Gerald (Dulwich)	Haselhurst, Alan
Brandon-Bravo, Martin	Hawkins, Sir Paul (SW N'folk)
Bright, Graham	Hawksley, Warren
Brinton, Tim	Hayes, J.
Brooke, Hon Peter	Hayward, Robert
Brown, M. (Brigg & Cl'thpes)	Heathcoat-Amory, David
Browne, John	Henderson, Barry
Bruinvels, Peter	Heseltine, Rt Hon Michael
Bryan, Sir Paul	Hickmet, Richard
Buck, Sir Antony	Hicks, Robert
Budgen, Nick	Higgins, Rt Hon Terence L.
Burt, Alistair	Hirst, Michael
Carlisle, Kenneth (Lincoln)	Hogg, Hon Douglas (Gr'th'm)
Carttiss, Michael	Holland, Sir Philip (Gedling)
Chapman, Sydney	Holt, Richard
Churchill, W. S.	Howard, Michael
Clark, Hon A. (Plym'th S'n)	Howarth, Alan (Stratf'd-on-A)
Clark, Dr Michael (Rochford)	Howarth, Gerald (Cannock)
Clark, Sir W. (Croydon S)	Howell, Ralph (N NorfolK)
Clarke, Rt Hon K. (Rushcliffe)	Hubbard-Miles, Peter
Cockeram, Eric	Hunt, David (Wirral)
Colvin, Michael	Hunt, John (Ravensbourne)
Coombs, Simon	Hunter, Andrew
Cope, John	Jessel, Toby
Corrie, John	Johnson Smith, Sir Geoffrey
Couchman, James	Jones, Gwilym (Cardiff N)
Cranborne, Viscount	Jones, Robert (W Herts)
Crouch, David	Joseph, Rt Hon Sir Keith
Currie, Mrs Edwina	Key, Robert
Dickens, Geoffrey	King, Roger (B'ham N'field)
Dicks, Terry	King, Rt Hon Tom
Dorrell, Stephen	Knight, Greg (Derby N)
Douglas-Hamilton, Lord J.	Knight, Dame Jill (Edgbaston)
Dover, Den	Knox, David
Dunn, Robert	Lang, Ian
Dykes, Hugh	Latham, Michael
Edwards, Rt Hon N. (P'broke)	Lawler, Geoffrey
Eggar, Tim	Lee, John (Pendle)
Evennett, David	Leigh, Edward (Gainsbor'gh)
Fairbairn, Nicholas	Lennox-Boyd, Hon Mark
Fallon, Michael	Lloyd, Peter, (Fareham)
Farr, Sir John	Lord, Michael
Favell, Anthony	McCurley, Mrs Anna
Finsberg, Sir Geoffrey	Maclean, David John
Fletcher, Alexander	Major, John
Fookes, Miss Janet	Marland, Paul
Forman, Nigel	Mates, Michael
Forsyth, Michael (Stirling)	Mather, Carol
Forth, Eric	Maude, Hon Francis
Fowler, Rt Hon Norman	Merchant, Piers
Fox, Marcus	Meyer, Sir Anthony
Franks, Cecil	Mills, Sir Peter (West Devon)
Fraser, Peter (Angus East)	Moate, Roger
Freeman, Roger	Monro, Sir Hector
Fry, Peter	Morris, M. (N'hampton, S)
Gale, Roger	Moynihan, Hon C.
Galley, Roy	Needham, Richard
Gardiner, George (Reigate)	Newton, Tony
Gardner, Sir Edward (Fylde)	Normanton, Tom
Garel-Jones, Tristan	Norris, Steven

Oppenheim, Phillip	Terlezki, Stefan
Powley, John	Thompson, Donald (Calder V)
Renton, Tim	Thompson, Patrick (N'ich N)
Rhodes James, Robert	Thorne, Neil (Ilford S)
Roberts, Wyn (Conwy)	Thornton, Malcolm
Robinson, Mark (N'port W)	Thurnham, Peter
Roe, Mrs Marion	Townend, John (Bridlington)
Rost, Peter	Tracey, Richard
Rowe, Andrew	Trotter, Neville
Rumbold, Mrs Angela	Twinn, Dr Ian
Ryder, Richard	van Straubenzee, Sir W.
Sackville, Hon Thomas	Vaughan, Sir Gerard
Sainsbury, Hon Timothy	Viggers, Peter
Sayeed, Jonathan	Waddington, David
Shaw, Giles (Pudsey)	Wakeham, Rt Hon John
Shaw, Sir Michael (Scarb')	Waldegrave, Hon William
Shelton, William (Streatham)	Walden, George
Shepherd, Colin (Hereford)	Walker, Bill (T'side N)
Shepherd, Richard (Aldridge)	Wall, Sir Patrick
Shersby, Michael	Ward, John
Silvester, Fred	Wardle, C. (Bexhill)
Sims, Roger	Warren, Kenneth
Skeet, T. H. H.	Wells, Bowen (Hertford)
Smith, Sir Dudley (Warwick)	Wells, Sir John (Maidstone)
Soames, Hon Nicholas	Wheeler, John
Speed, Keith	Whitfield, John
Spencer, Derek	Whitney, Raymond
Spicer, Michael (S Worcs)	Wiggin, Jerry
Squire, Robin	Wilkinson, John
Stanbrook, Ivor	Winterton, Mrs Ann
Stanley, John	Winterton, Nicholas
Steen, Anthony	Wolfson, Mark
Stevens, Lewis (Nuneaton)	Wood, Timothy
Stevens, Martin (Fulham)	Woodcock, Michael
Stewart, Allan (Eastwood)	Yeo, Tim
Stewart, Andrew (Sherwood)	Younger, Rt Hon George
Stradling Thomas, J.
Sumberg, David	Tellers for the Ayes:
Taylor, Teddy (S'end E)	Mr. Michael Neubert and Mr. Tony Durant.
Temple-Morris, Peter

NOES
Anderson, Donald	Carlile, Alexander (Montg'y)
Archer, Rt Hon Peter	Clark, Dr David (S Shields)
Ashdown, Paddy	Clarke, Thomas
Ashton, Joe	Clwyd, Mrs Ann
Atkinson, N. (Tottenham)	Cocks, Rt Hon M. (Bristol S.)
Bagier, Gordon A. T.	Cohen, Harry
Barnett, Guy	Coleman, Donald
Barron, Kevin	Concannon, Rt Hon J. D.
Beckett, Mrs Margaret	Conlan, Bernard
Beith, A. J.	Cook, Robin F. (Livingston)
Bell, Stuart	Corbett, Robin
Benn, Tony	Corbyn, Jeremy
Bennett, A. (Dent'n & Red'sh)	Cowans, Harry
Bermingham, Gerald	Craigen, J. M.
Bidwell, Sydney	Crowther, Stan
Blair, Anthony	Cunliffe, Lawrence
Boyes, Roland	Cunningham, Dr John
Bray, Dr Jeremy	Dalyell, Tam
Brown, Gordon (D'f'mline E)	Davies, Rt Hon Denzil (L'lli)
Brown, Hugh D. (Provan)	Davies, Ronald (Caerphilly)
Brown, N. (N'c'tle-u-Tyne E)	Davis, Terry (B'ham, H'ge H'l)
Brown, R. (N'c'tle-u-Tyne N)	Deakins, Eric
Bruce, Malcolm	Dewar, Donald
Buchan, Norman	Dixon, Donald
Caborn, Richard	Dobson, Frank
Callaghan, Jim (Heyw'd & M)	Dormand, Jack
Campbell-Savours, Dale	Douglas, Dick

Dubs, Alfred	Martin, Michael
Duffy, A. E. P.	Maxton, John
Dunwoody, Hon Mrs G.	Maynard, Miss Joan
Eadie, Alex	Meacher, Michael
Eastham, Ken	Meadowcroft, Michael
Evans, John (St. Helens N)	Michie, William
Ewing, Harry	Millan, Rt Hon Bruce
Fatchett, Derek	Miller, Dr M. S. (E Kilbride)
Faulds, Andrew	Morris, Rt Hon A. (W'shawe)
Fields, T. (L'pool Broad Gn)	Morris, Rt Hon J. (Aberavon)
Fisher, Mark	Oakes, Rt Hon Gordon
Flannery, Martin	O'Brien, William
Foot, Rt Hon Michael	O'Neill, Martin
Forrester, John	Orme, Rt Hon Stanley
Foster, Derek	Park, George
Fraser, J. (Norwood)	Parry, Robert
Freeson, Rt Hon Reginald	Patchett, Terry
Freud, Clement	Pavitt, Laurie
Garrett, W. E.	Pendry, Tom
George, Bruce	Penhaligon, David
Gilbert, Rt Hon Dr John	Pike, Peter
Godman, Dr Norman	Prescott, John
Gould, Bryan	Radice, Giles
Hamilton, James (M'well N)	Randall, Stuart
Hardy, Peter	Redmond, M.
Harman, Ms Harriet	Rees, Rt Hon M. (Leeds S)
Hart, Rt Hon Dame Judith	Richardson, Ms Jo
Haynes, Frank	Roberts, Ernest (Hackney N)
Hogg, N. (C'nauld & Kilsyth)	Robertson, George
Home Robertson, John	Robinson, G. (Coventry NW)
Howell, Rt Hon D. (S'heath)	Rogers, Allan
Howells, Geraint	Rooker, J. W.
Hoyle, Douglas	Rowlands, Ted
Hughes, Robert (Aberdeen N)	Sedgemore, Brian
Hughes, Roy (Newport East)	Sheerman, Barry
Hughes, Sean (Knowsley S)	Sheldon, Rt Hon R.
Hughes, Simon (Southwark)	Shore, Rt Hon Peter
Janner, Hon Greville	Short, Ms Clare (Ladywood)
John, Brynmor	Short, Mrs R.(W'hampt'n NE)
Johnston, Sir Russell	Silkin, Rt Hon J.
Jones, Barry (Alyn & Deeside)	Skinner, Dennis
Kilroy-Silk, Robert	Smith, Cyril (Rochdale)
Kirkwood, Archy	Smith, Rt Hon J. (M'kl'ds E)
Lambie, David	Snape, Peter
Lamond, James	Soley, Clive
Leadbitter, Ted	Steel, Rt Hon David
Leighton, Ronald	Stott, Roger
Lewis, Ron (Carlisle)	Strang, Gavin
Lewis, Terence (Worsley)	Straw, Jack
Litherland, Robert	Taylor, Rt Hon John David
Livsey, Richard	Thomas, Dafydd (Merioneth)
Lloyd, Tony (Stretford)	Thompson, J. (Wansbeck)
Loyden, Edward	Thorne, Stan (Preston)
McCartney, Hugh	Tinn, James
McDonald, Dr Oonagh	Wardell, Gareth (Gower)
McGuire, Michael	Wareing, Robert
McKay, Allen (Penistone)	Wigley, Dafydd
McKelvey, William	Williams, Rt Hon A.
MacKenzie, Rt Hon Gregor	Winnick, David
McNamara, Kevin	Woodall, Alec
McTaggart, Robert	Young, David (Bolton SE)
McWilliam, John
Madden, Max	Tellers for the Noes:
Marek, Dr John	Mr. Roger Thomas and Mr. Roger Powell.
Marshall, David (Shettleston)

Question accordingly agreed to.