HC Deb 10 February 1986 vol 91 cc623-5
3. Mr. Wigley

asked the Secretary of State for Wales how many representations he has received from local authorities in Wales concerning the rate support grant settlement for 1986–87; and how many of these expressed dissatisfaction with the settlement.

Mr. Nicholas Edwards

I have received letters from four local authorities, and five hon. Members have written expressing concern on behalf of their local authorities.

Mr. Wigley

As the eight counties in Wales have had to increase their rates by between 11 and 28 per cent. to make up for the loss in real terms of rate support grant from the Welsh Office, does the Secretary of State agree that the blame for the rate increases that will hit the people of Wales later this year must be laid fairly and squarely at the door of the Welsh Office?

Mr. Edwards

No, I do not agree. Provision is up, above the expected rate of inflation, and the settlement is extremely generous in relation to the settlement in England and the past performance of Welsh local government. I can see no possible justification for some of the very large rate increases that have been proposed by counties in Wales. I believe that they will be damaging, not only to those who have to pay the bills, but to employment prospects, about which people have been expressing concern.

Sir Raymond Gower

What circumstances explain the difference in the rates proposed by Welsh counties this year and those imposed last year, apart from the fact that there were local government elections last year?

Mr. Edwards

In the case of South Glamorgan, my hon. Friend may have a point. I understand that the county council spent about £3.5 million of balances last year and has decided not to spend them this year. I believe that the county council should justify the proposed rate increase to its ratepayers and local people. I do not believe that any proper justification has been given for it.

Mr. Barry Jones

I urge the right hon. Gentleman to cease his attacks on the Welsh county councils. No one wants higher rates, but I remind the Secretary of State that the counties are facing demands on their services that are a consequence of cuts and high unemployment. Does the right hon. Gentleman agree that Gwynedd county council has a first-rate case, because Holyhead town has a male unemployment rate of about 27 per cent.?

The county of Clwyd faces a loss of £2 million because of technical changes in the rate support grant assessment. I remind the right hon. Gentleman again that 25,000 people in Clwyd are seeking work. The Secretary of State's financial policies in local government are virtually in ruins. He should acknowledge the difficulties of the counties at a time of high unemployment.

Mr. Edwards

In my view, none of that justifies, for example, South Glamorgan proposing an increase in precept of six times the forecast rate of inflation. The hon. Gentleman refers to Gwynedd, where expenditure per head is the highest in Wales, block grant per head is higher than the Welsh county average, and grant-related expenditure per head is the highest in Wales. That does not make a particularly good case for the hardships of Gwynedd.

I know that Clwyd has difficulties, but it is a high-spending authority which has increased the numbers in its employment while other counties have found it possible to reduce the numbers that they employ and, therefore, reduce their costs. Perhaps the county council might have a go at that.

Mr. Harvey

Although many Conservative Members have reservations about the rate support grant for Clwyd, we find the proposed 15.7 per cent. rate increase totally unacceptable. Will my right hon. Friend condemn it?

Mr. Edwards

I hope that local ratepayers and employers, in particlar, will make clear to the county council what the consequences will be if it proceeds with its rate proposal.