HC Deb 15 May 1985 vol 79 cc315-8
6. Mr. David Marshall

asked the Secretary of State for Scotland what further additional assistance he intends to give to scottish ratepayers.

7. Mr. Wallace

asked the Secretary of State for Scotland whether the Government intend to seek to take any immediate action to relieve the rates burden on those commercial businesses most adversely affected by recent rates increases.

11. Mr. Kirkwood

asked the Secretary of State for Scotland what proposals he is considering for rating reform in Scotland to relieve the added financial burden on many small businesses during the present financial year.

Mr. Ancram

I refer the hon. Gentlemen to the statement my right hon. Friend made yesterday.

Mr. Marshall

Yesterday's statement anticipated many of today's questions, but for domestic ratepayers this is a case of too little too late. Will the Minister give a categorical assurance that this level of relief will continue for each year until revaluation takes place in the rest of Britain, when the situation can be reviewed? Will he also give an assurance that it will all be new money and that it will not be taken from the Scottish Office budget or recouped by further cuts in local government rate support grant?

Mr. Ancram

As my right hon. Friend the Secretary of State said yesterday, we are talking about new money. The hon. Gentleman claims that we are giving too little too late to domestic ratepayers. He might like to consider the fact that the domestic relief element of the rate support grant, which directly benefits domestic ratepayers, was increased by £88 million this year, in addition to the £10 million announced yesterday. We have reacted to the revaluation problems in an exceptionally generous way and I am sure that the ratepayers of Scotland recognise that. As my right hon. Friend said yesterday, we shall consider what will happen next year in the autumn, when we make decisions on public expenditure for next year.

Mr. Wallace

Since the Chancellor of the Exchequer warned the Scottish Conservatives in Perth that he might not be so open-handed next year, can the Minister assure the House that the Secretary of State will at least argue his corner in Cabinet next year to achieve a similar arrangement? If it is not too late, will the Minister accept the need to consider the particular difficulties facing distilleries in Scotland, in particular two in my constituency, which face rate increases of over 80 per cent.? Will he give them special assistance this year and in future years?

Mr. Ancram

The hon. Gentleman's concern for the Scottish ratepayers is in distinct contrast to that shown by his hon. Friend the Member for Gordon (Mr. Bruce), who yesterday said that the package showed warped priorities. I wonder how many Scottish ratepayers will regard the package that way. We shall take decisions about next year in the autumn when we consider the rate support grant settlement and the domestic and other elements.

Mr. Kirkwood

I endorse what the Government have done, but will the Minister accept that there is an element of rough justice in the way in which the ceiling is applied? Has the Minister any plans to help the small business man with a multiplier of less than a factor of three who might still be put out of business? Has he any plans to consider his plight?

Mr. Ancram

We had to create a level of protection which we believed to be correct. The factor of three in terms of a multiplier on valuations covers the worst of the examples that have been drawn to our attention. As my right hon. Friend said yesterday, it covers about 50,000 commercial subjects. On the basis of those figures it is clear that many people who have been hard hit by the revaluation will benefit. I believe that the system is fair. When the details are made clear the hon. Gentleman might agree that it is fair.

Several Hon. Members


Mr. Speaker

Order. There was a statement yesterday on this subject, so today I propose to give priority to those right hon. and hon. Members who were not called yesterday.

Mr. Fairbairn

Does my hon. Friend appreciate that, although we are grateful for the increase in money for domestic and commercial rate relief, quoting figures does not assist domestic or commercial ratepayers who are being asked to pay extra sums in rates which are uncommercial because they simply cannot afford them? Will he consider a scheme which, after the application of the announced scheme, is equitable and provides an equitable remedy for those who are caught in the rates poverty trap?

Mr. Ancram

I have to agree with my hon. and learned Friend that in some instances even a small increase in rates, of the type that has been imposed in past years, will cause problems. Even my hon. and learned Friend would not expect a scheme to be so sensitive as to deal with such instances. We have reached a formula by which, on the data available, we believe that the worst of the increases, such as those in my hon. and learned Friend's constituency which he drew to my attention, will be mitigated. I hope that my hon. and learned Friend's welcome for the scheme will be further enhanced when he sees the details of it and realises what it will mean.

Mr. Gourlay

Is the Minister aware that relief for domestic and commercial ratepayers, with which I agree, sets aside decisions by assessors? Will the Minister therefore take a further step and encourage the Scottish assessors to agree a basic system of valuation for Scotland and so prevent the assessor in Fife from going his own solitary way and deciding on his own the basis for certain properties?

Mr. Ancram

I do not think it can be said that we have set aside the decisions of the assessors, because, as my right hon. Friend the Secretary of State said yesterday, there is a gap between the neutral effect of revaluation and the three times multiplier. Within those areas, the effects of the assessors' valuations will still be felt. It is important to remember that the basis of the system in Scotland is that the assessors are independent; they come to their judgments independently and, if necessary, they have to defend those judgments before the courts. There is an appeal system. Where valuations are felt to be unfair, I hope that people will make use of that appeal system, which we improved last year.

Mr. McQuarrie

I congratulate my right hon. Friend the Secretary of State on his most excellent statement to the House yesterday, which was widely welcomed in Scotland despite what we heard from the Opposition. Can my hon. Friend give any advice to highly rated commercial and domestic ratepayers, who have already received their demand notices, about whether they should withhold payment of their rates pending publication of the details of the Bill that my right hon. Friend the Secretary of State will introduce?

Mr. Ancram

The information that my right hon. Friend the Secretary of State gave yesterday is sufficient for both domestic and commercial ratepayers to calculate whether they will benefit under the scheme, and by how much, because it is related to the amount of rates that is applicable as a result of their revaluations being over the three times multiplier. As those people will know that they will receive relief for that amount, I hope that they can make their business and commercial judgments accordingly.

Mr. Robert Hughes

Will the legislation make it clear that this is not a one-off exercise? Otherwise, what the Secretary of State offered yesterday will be seen as a sop to dissipate anger, but the anger will be much greater next year when the rate increases have to be met. Will the Under-Secretary guarantee that the Bill will carry on the Secretary of State's commitment to extra relief for more than one year?

Mr. Ancram

My right hon. Friend said yesterday that he had heard what hon. Members had had to say about that matter. However, the details of the Bill must remain confidential until the Bill itself is published. That is the normal way in which things are done in the House. We hope to be able to publish the Bill shortly, and at that time the details will become apparent to the hon. Gentleman.