HC Deb 15 July 1987 vol 119 cc1116-9
2. Mr. Doran

asked the Secretary of State for the Environment what consideration he has given to the details of the implementation of the proposed community charge in England and Wales.

5. Mr. Latham

asked the Secretary of State for the Environment whether he will make a statement on the details of the proposed community charge.

The Secretary of State for the Environment (Mr. Nicholas Ridley)

Considerable thought has been given to the operation and implementation of the community charge. Following the consultative paper, detailed proposals were placed in the Library on 15 December 1986.

Mr. Doran

The Government recognised during the passage of the Abolition of Domestic Rates etc. (Scotland) Bill that the phasing in of the charge would lead to considerably increased costs. Now that the Minister has announced that he intends to phase in the charge in England, will he advise us what extra assistance he proposes to give to the English and Welsh local authorities?

Mr. Ridley

No decision has been taken on transitional arrangements in England. The position is as stated in the Green Paper. When the Government have come to a conclusion about the details of the transitional arrangements, a statement will be made.

Mr. Latham

As there is no easy or universally popular way of raising billions of pounds for local services, does my right hon. Friend accept that we must at last implement our election promise, grasp the nettle of rates reform and get on with it straight away?

Mr. Ridley

Yes, Sir. I can assure my hon. Friend that a Bill will be brought before the House. If the House would like to sit through August and September, we could probably deal with it then. It might be kinder to bring the Bill hack before the House when it returns after the summer recess.

Mr. Simon Hughes

Did not the Cabinet Committee, under the Prime Minister, decide yesterday to change the Government's policy and to phase in the implementation of the poll tax? Is that not a change to the original idea as it was to apply in Scotland, England and Wales? Does it not show that the Government themselves are as divided as their Back Benchers and that it would be better to make a U-turn now and give up the idea of a poll tax?

Mr. Ridley

I admit that I have an advantage over the hon. Gentleman, in that I was at yesterday's meeting and he was not. His problem is not to be solved by reading press reports of the meeting. I advise the hon. Gentleman to read the reports in The Times and The Daily Telegraph, which he will find are mutually contradictory. Perhaps the best approach is to wait until the Government make an announcement. I repeat that the Government's proposals for England and Wales were set out in the Green Paper that was published about 18 months ago. When the Government have completed their consideration of the detail of the transitional arrangements on the basis of the Green Paper, we shall tell the world.

Mr. Charles Morrison

Now that my right hon. Friend and the Government appear to have decided that the impact of the poll tax will be so serious that its introduction has to be phased, will he give further consideration to the possibility of including within his proposals that account be taken of the ability to pay?

Mr. Ridley

I beg my hon. Friend to await details. The details for Scotland, where there will be a safety net, are well known. We have not yet come to a final decision on the arrangements for England and Wales. They might be different, because arrangements and problems in the three countries are different. I can give my hon. Friend the assurance that we will take account of ability to pay by the system of rebates and the uprating of benefits, with a taper, between 100 and 20 per cent. for those who will be required to pay who are on low incomes.

Mr. Blunkett

Will the Secretary of State say which of the two press reports to which he has referred is correct? Did either of them take into account Cabinet discussion on the amount of money that will have to be found to administer the rating system and the poll tax at the same time, and whether local government will be remunerated in a way that will take account of the chaos that will ensue, especially in the implementation and administration of housing benefits?

Mr. Ridley

I do not think that the hon. Gentleman can hold me responsible for confirming or denying reports in newspapers. I merely point to the contradictory nature of various reports that I saw. I repeat to him that when the Government have come to a conclusion about the transitional arrangements they will make clear what those arrangements are. The point that the hon. Gentleman raised about the cost of administration will arise at that time, not now.

Mr. Robert G. Hughes

When my right hon. Friend considers the details of his proposals, will he also consider the effects on home owners of paying rates based on the capital value of their homes, as proposed by Labour Members during the general election, and how much more that proposal, if implemented, would cost people?

Mr. Ridley

My hon. Friend is absolutely right. A movement to capital values would be extremely damaging for those who are now paying far more than their fair share of the bills for local government. However, he was slightly wrong in one respect. The Labour party fought the district elections on 7 May on a movement to capital values and briefed its candidates that that was party policy, but when we came to the general election, Labour Members changed their minds. The Leader of the Opposition changed the plans on about Wobbly Thursday, when he was obviously the one who was wobbling most.

Dr. Cunningham

Does the right hon. Gentleman recall saying that he wanted to introduce the poll tax in one go? Are not the implications of phasing that, for several years, poll tax and rates will be levied on every household simultaneously, and that each household will thus receive several bills each year? Is it not also the case that the right hon. Gentleman is now proposing a different system for Scotland from that proposed for England and Wales? How can he shrug off the impact of all this bureaucracy on the 7.1 million families receiving housing benefit, and the millions of others receiving other benefits related to housing costs? Finally, how can the Government describe their proposals as simpler, more efficient, fairer and easier to understand than the rates? Is not what the right hon. Gentleman is proposing an absolute bureacratic nightmare?

Mr. Ridley

It is my pleasant duty to congratulate the hon. Gentleman on retaining his seat on the Front Bench, and on dealing with his subject. My team on the Government Front Bench are more than usually delighted that we have him there, because he always asks too many questions, and they are usually pretty silly ones—as on this occasion.

I have never, to my knowledge, said that the community charge will be introduced in one go. Arrangements for local authority financial support in Scotland, Wales and England are very different. I understand that the percentage paid from the Exchequer in England is 46.4, in Scotland 55.5—

Mr. Dewar

It is 56.1 per cent.

Mr. Ridley

I take the hon. Gentleman's correction. It has gone up. It is going up all the time.

In Wales, the figure is over 60 per cent. That shows how different the arrangements are. There is nothing wrong with that. My hon. Friends can demonstrate the way in which their constituents have accepted and understood the community charge by the votes that they received at the last election. Those people are very much more able to understand it than is the hon. Member for Copeland (Dr. Cunningham), which is why we again welcome him back to his position.