Rate Limitation

HC Deb 18 February 1988 vol 127 cc1208-52 7.14 pm

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

I beg to move, That the draft Rate Limitation (Prescribed Maximum) (Rates) Order 1988, which was laid before the House on 12th February, be approved. The order, which specifies rate limits for 12 of the authorities subject to rate capping in 1988–89, marks the end of a process which began in July last year. It may assist the House if I briefly outline that process. I announced last July that I had designated 17 authorities under part 1 of the Rates Act. They were budgeting to spend from 13 up to 112 per cent. above their grant-related expenditure assessment; and those which were newly selected were budgeting to increase their spending by 8 to 21 per cent. on the previous year's budget. Also in July, each authority was informed of the expenditure level determined for it. The authorities were given until mid-October to apply, if they wished, for the expenditure level to be increased. Two authorities did so, and in one case — Tower Hamlets — I agreed to redetermine the expenditure level at a higher figure.

On 9 December I notified all 17 authorities of the proposed rate limits for 1988–89 and gave them the opportunity to accept those proposals or to make representations about the matter. Three authorities did, in fact, accept their limit within the statutory period ending on 15 January; these were Manchester, Middlesbrough and Kingston upon Hull.

After considering all the representations from authorities, and all the other relevant information, I took the view that I would be prepared to agree a higher figure than that proposed in December for five authorities. Two of these — Greenwich and Hackney—agreed to accept the new figures. This makes a total of five authorities where a rate limit has been fixed by agreement. It leaves 12 out of the original 17 where the limit needs now to be specified by order—and these are the ones named in the draft now before the House.

I should add that, even among the 12 authorities specified here, one—Tower Hamlets—has notified me that it does in fact accept the limit specified for it. It is only because that acceptance fell outside the statutory period that the authority has to be included in the order. So the essence of the order is about 11 of the original 17 rate-capped authorities which did not feel able to agree with me the figure that I put forward for their rate limit for the coming financial year.

I have set out this potted history of the year's process because I think it will help the House to see that it has been conducted in a very considered and reasonable manner. Had it not been so, I doubt whether six authorities would have come to the conclusion that they could accept what I had proposed. All this is a far cry from the first time the House debated a rate limits order back in 1985. Then, the hon. Member for Hackney, South and Shoreditch (Mr. Sedgemore), who is not in the House at the moment, said: the Secretary of State … is creating a tragedy and a constitutional crisis that he, this Government and the Department of the Environment will live to regret till the end of time."—[Official Report, 25 February 1985; Vol. 74, c. 82.] Time has not come to an end, but the hon. Gentleman has not even come to the debate.

Dr. John Cunningham (Copeland)

That cannot be allowed to pass unchallenged. My hon. Friend is in Committee on the Education Reform Bill.

Mr. Ridley

Hackney has accepted the rate limit proposed. [HON. MEMBERS: "Apologise."] Of course I apologise to the hon. Gentleman for suggesting that he should be here. We all have our priorities.

Mr. Frank Haynes (Ashfield)

My hon. Friend cannot be here and in Committee at the same time.

Mr. Ridley

I respect the hon. Gentleman's priorities enormously, and I admire them. I think that he has his priorities right. I could not make a more handsome apology.

It is three years on, and the audience must still be waiting for the curtain to go up on the tragedy, as the hon. Member for Hackney, South and Shoreditch described it. The constitution has not crumbled. The Government certainly have no cause for regret. Indeed, the local authority in which the hon. Gentleman's constituency lies is not even included in the draft order, because the council has calmly accepted the rate limit that I proposed for it. The Government's policy has stayed the same, but clearly times have changed to catch up with it, since so many people in local government are now prepared to operate calmly within the framework of that policy.

Mr. Simon Hughes (Southwark and Bermondsey)

The Secretary of State may say that the tragedy has not happened nationally. Perhaps he would address himself to Southwark, which asked for a higher rate level. The effect of the rate support grant supplementary report which the House approved last night, and of today's marginal increase accorded by the Secretary of State, is a £2.7 million reduction in the money that Southwark will receive for the coming year, and it cannot add to it. That is a 5 to 10 per cent. cut in real services, and many people are suffering. Does the Minister not realise that, although calamity has not struck him, for many old, young and vulnerable people the effect of the order will be severe disadvantage, when they are already in a dire state?

Mr. Ridley

I can only say to the hon. Gentleman that all the factors, including the rating order that was debated yesterday, are taken into account in setting the limit. The funny thing about the hon. Gentleman is that although he often makes similar points about his borough, I have never heard him mention its ratepayers, who also need to be taken into account.

Mr. John Butterfill (Bournemouth, West)

Does my right hon. Friend agree that it is extraordinary for Southwark, if it is so hard up, to spend £13,800 on a reggae concert for Black Solidarity day?

Mr. Ridley

That is not a factor that I took into account in reaching my decision, because it is the first that I have heard of it. I do not think that it constitutes new evidence. I am grateful to my hon. Friend for raising it.

In considering the order, the House may also want to bear in mind the extent to which the times have changed in some of the local authorities that are named, and in other authorities with a similar background. I have touched on the early history of rate capping, the terrible warnings sounded in the Chamber, and the cries of outrage from some quarters of local government. A recent account of this phase of rate capping tells us that Left-wing councils saw the scope for politicising support for council services around the anti-cuts campaigns. If they publicised the potential cuts long and hard enough, local people would rise up to save the services"— rather like the hon. Member for Southwark and Bermondsey (Mr. Hughes) Looking back it is astonishing to think how naive it was for nearly everybody on the local government Left to consider that people could be so easily politicised around such a disingenuous tactic. These phoney wars reached their nadir with the 1985 ratecapping campaign. Those are not my words. I hope that Opposition Members do not find the assessment contentious, because it is from a publication called "Labour Councils in the Cold", which was produced by a body called the Labour Coordinating Committee. I am glad to see that the hon. Member for Copeland (Dr. Cunningham) is reading it and, I hope, learning from it. He has a great deal to learn from it. I do not think that he will find it unpalatable, although some of his hon. Friends from the Left of the Labour party might find it a bit prickly-making.

I do not know whether the publication is Bennite or not, but it has such insight that I cannot resist sharing it further with the Opposition. It calls on Labour councils to desist from taking rates from people's pockets when they are not getting value for it. It continues: We owe it to the consumers who need our services, are willing to pay good money for them, but just want the services delivered properly. The new challenge to labour councils is to improve services despite the cuts. That is wise advice, with which I agree. I am sure that Opposition Members, who are better placed to judge, will agree with the booklet's dictum that there is nothing Socialist about inefficiency, incompetence or waste. I am sure that hon. Gentlemen will agree with the same sentiment, more quaintly expressed by the leader of Hackney council, who said that inefficiency is organized theft from the working-class.

Mr. Stuart Holland (Vauxhall)

It is astonishing that the Secretary of State has spent his time so far in knock-about students' union debating points. When he says that boroughs should be able to improve the quality of service with cuts, he should make an analogy with a private enterprise firm whose cash flow is cut, and whose self-financing and investment powers are cut as well. In the private sector such an enterprise would go out of business.

Mr. Ridley

That is a schoolboy debating point. It is not a matter of competition. If the overheads of private sector companies are too high and their cash flow is wrong, they go out of business. Local authorities are expected to get those things right through the discipline of the rates or, if it comes to it, the discipline of rate limitation. That is why we are here this evening.

My colleagues and I have held meetings with nine local authorities which wanted to see us about their proposed limits. Many of them provided us with useful information about the circumstances of their authority. Not all of them persuaded us that it would be appropriate to agree a rate limit higher than that originally proposed, but nearly all of them sought to impress on us that they were already taking steps to trim their expenditure to match their resources, and to improve the efficiency of their operations.

If these conversions are sincere, as the hon. Member for Copeland might believe, he must be as relieved as I am that a new realism has dawned. It may be because of the events of last June, or it may be, as I prefer to believe, the realisation at last that the Government's policy on the control of local authority current expenditure is indeed sensible.

I do not want to detract from what many of these councils have told us that they have embarked upon. I have not hesitated to criticise the wasteful spending of some of them in the past, or their delay in making the necessary savings to live within their means. I have not been slow to criticise their use of so-called "creative accounting", which has simply exacerbated the problems. I gladly acknowledge, however, that many of the authorities seem to be taking, or squaring up to, those long-overdue decisions to cut costs and improve efficiency. They undoubtedly have a very long way to go, but they seem to be making a start.

Mr. Frank Dobson (Holborn and St. Pancras)

On the assumption that the Secretary of State welcomes the £5 million to £6 million economies that the London borough of Camden has made in revenue spending on its housing estates, will he say whether it is a sensible incentive for the Government to reduce Camden's housing subsidy by £5 million, thus wiping out all the savings?

Mr. Ridley

The hon. Gentleman may be confusing current account, which we are talking about in relation to rate limitation, with the completely separate capital account. I am not prepared tonight to go into the circumstances of individual authorities because it is not the practice—[Interruption.]—in arriving at rate limits to give the detailed reasons or sums that were in my mind when I came to a conclusion. I am not prepared to depart from that principle now.

Mr. Sydney Bidwell (Ealing, Southall)

In making these calculations, do the wishes of an electorate supporting a party that sets out its manifesto in a local authority election come into the Secretary of State's mind?

Mr. Ridley

The considerations that have to be in my mind are enshrined in the statute. I am simply operating a statute that was passed by the House of Commons. I shall give the hon. Member for Ealing, Southall (Mr. Bidwell) the same reply that I gave the hon. Member for Holborn and St. Pancras (Mr. Dobson)— that I have to operate and make my decisions entirely in accordance with the Rates Act 1984. It is all set out there. The hon. Member for Southall was probably active in the House when that measure was debated and ought to know exactly how I have to conduct myself in making the order.

Mr. Robert B. Jones (Hertfordshire, West)

Does my right hon. Friend agree that it is rare, if not unprecedented, for a local government election address or manifesto to pledge that a party will raise the rates by 15 or 25 per cent.? Where only the expenditure side is presented, that obviously will confuse the electorate.

Mr. Ridley

Some of them do not even worry, because as few as 20 per cent. of the electorate are ratepayers. I hope that position will soon be remedied.

Mr. Simon Hughes

rose—

Mr. Ridley

This will be the hon. Gentleman's second, and last, intervention.

Mr. Simon Hughes

Will the Secretary of State accept, though, that the great difference is that the ratepayers of any borough or district can hear their budget debated in public and in detail, whereas tonight one order relates to many authorities and the determination of all their finances? The Secretary of State, who is ultimately responsible for their budgets, says that he cannot speak about the detail. That is not democracy. Democracy is about decisions and debates on issues affecting hundreds of thousands of people.

Mr. Ridley

The hon. Gentleman should have made that point in the debates on what is now the Rates Act. He knows perfectly well that I am only operating the Rates Act, and I shall not depart from that.

The essence of the order is not about the principle of rate capping, which the hon. Gentleman is raising again. That is well established in statute and appears now to be accepted by the authorities concerned as a constraint within which they must work. The order is concerned with the practical application of rate capping in those authorities which have not accepted the limits that I proposed for them. They consider that they need to raise a higher amount from their ratepayers. In my judgment, they do not. I have not come to this view lightly. I have looked at a large amount of information and evidence and have taken account of what the council leaders have had to say. I accept that many of these authorities will not find it easy to take the measures necessary to live within their resources, but I am satisfied that their task is by no means impossible.

Ms. Joan Ruddock (Lewisham, Deptford)

The Minister must know, because of the representations that have been made to him by Lewisham, my local authority, that it is prepared to take some of the measures that the Minister has sought, such as the 12.3 per cent. cut in staff over all council departments, robbing us of much-needed services. Having done all that, we are then required to go further and to cut, for example, two occupied residential homes for the elderly and one home for adolescent children, to close two day centres for the elderly and five luncheon clubs, to reduce by one third the existing level of hospital social work, and so on. How can the Minister possibly justify that? It is not an economy. It is robbing desperate people of desperately needed services.

Mr. Ridley

That is the old trick that the hon. Lady is playing. One puts up front for cutting the things that one thinks will get the maximum public sympathy. For instance, I also read about the Lewisham council: Cash for gays but NSPCC grant axed. [Interruption.] I am only quoting from a newspaper.

Mr. Dobson

A Tory newspaper.

Ms. Ruddock

Indeed, the report was published in a local newspaper. It does not explain that the NSPCC had access to other funds, that the amount of money that was being cut was a very small amount and that the amount being given, as the Minister suggests, to gays is actually money being given to advice centres — counselling centres—particularly for young people who are facing difficulties in adjusting to their own sexuality. In the age of acquired immune deficiency syndrome, I would have thought that those counselling services were vital to an inner-city authority.

Mr. Ridley

The hon. Lady is unwittingly giving me much evidence with which to rebut the suggestion of the hon. Member for Southwark and Bermondsey (Mr. Hughes), that it would be a very good idea if these matters were debated at length in the House in relation to each borough. She has exposed the extreme range of complications, views and different spending projects of each council. I take into account all the factors, including full knowledge of the accounts of each council, and I listen to their pleas. I do not think that we are going to get any further by proceeding in the way that the hon. Lady is going.

Mr. Peter Shore (Bethnal Green and Stepney)

rose—

Mr. Ridley

I shall give way to the right hon. Gentleman, but after that I must finish, because a lot of time is needed for others to take part in the debate.

Mr. Shore

The right hon. Gentleman is most generous in giving way. I want to put to him the very special problem in connection with Tower Hamlets council, of which I hope he will be fully aware and take note.

We are alleged to be overspending in Tower Hamlets by £21 million, but £18 million of that sum is spent on looking after over 1,000 homeless families. Does the Secretary of State expect the council, even if it can lawfully do so, to put those families in the street? What advice, apart from that, does he give to a council faced with a special and very urgent human problem of that kind?

Mr. Ridley

Both I and the Tower Hamlets council consider that the rate limits in the order are reasonable. It has informed me that it does not disagree with them. I admit that that was after the statutory period, but it has indeed done that. The right hon. Gentleman's point falls to the ground if his own council agrees with the rate proposal. It does not have to do so.

Mr. Shore

It agreed under great duress. I really have to say that to the right hon. Gentleman. The council tried to secure some serious aid. It received £2 million towards the £18 million from the Secretary of State. I know that it is assenting to his order, but only under great duress.

Mr. Ridley

That must be rubbish. There is no duress whatsoever. There cannot be duress. Eleven authorities have not voluntarily agreed, and that is why we are debating the order. Tower Hamlets is in the order only because it agreed after the order was put before the House. It did not have to do that. If it had felt that the rate limit was intolerable, it could have done as the other eleven authorities did and not agreed to it.

The limits in the order reflect the financial circumstances of the individual authorities. I have considered not only the appropriate expenditure level in each case, but each authority's present financial position and the grant that it is likely to receive next year, including the changes that flowed from last night's order. Leaving aside Tower Hamlets, which, as I have said, has accepted its limit, in each case the figure is the same as that which I proposed in December. In these cases I was not persuaded by the authorities' representations that the figures in question were not appropriate. In three cases—Camden, Southwark and Ealing—the figures in the order are higher than those proposed in December, but the authorities still have not agreed to accept them. They, too, have not persuaded me, however, that the new figures are inappropriate.

The overall effect of the order is to reduce the average local rates of the 12 authorities by about 9 per cent. compared with the current year. At the individual authority level the range is from a reduction of 31 per cent. in Waltham Forest to an increase of 11.5 per cent. in Tower Hamlets. This range is due to the differences in the individual expenditure and financing circumstances of the various authorities. The overall effect on the amounts paid by ratepayers in these authorities is a reduction of £87 million compared with bills in the current year. Taken together with the rate limits that the other five rate-capped authorities have already accepted, the reduction in rates is equivalent to over £100 million less than in the current year. That £100 million will be to the benefit of local people and local businesses, as will the level of prosperity that will result.

For those reasons, I consider the rate limits specified in the order to be both appropriate to the circumstances of each authority and a good overall result for local ratepayers. The evidence available to me suggests that most of the authorities concerned are already taking a realistic approach to the implications of the limits. I urge these authorities to press on with their task. I ask the House to have due regard to the interests of local ratepayers in this the penultimate year of the present rating system.

I commend the order to the House.

7.37 pm

Dr. John Cunningham (Copeland)

I begin by unequivocally placing on record our absolute opposition to the Rates Act 1984 and its use in this way by Ministers to determine the budgets and the revenue income of local authorities. It is important to recognise that although the order covers 12 local authorities, five more authorities have accepted the Secretary of State's decision with great reluctance, and some 19 other local government bodies and joint boards have their budgets and their precepts controlled by the Secretary of State, as does the Inner London education authority. So some 40 local government bodies in England have their budgets and their rates or precepts determined by Ministers and civil servants, who are not well placed to make the best judgments about the local circumstances that prevail.

Let me say also that I do not think that the House of Commons is fit or equipped to be making decisions of this kind about local authority budgets and revenue.

In the case of the elected local authorities affected by the order, those budgets add up to £2.3 billion. The number of people living in the affected areas is over 4 million. Here we are, in a debate of three hours' duration, making decisions of this magnitude without any real grasp or understanding of all the implications involved. It is nonsense for a national legislature to make such decisions in such a way. Anyone who has given the matter any serious thought could not fail to agree.

What does the Secretary of State intend to do when the powers that he exercises under the Act that abolished the metropolitan authorities expire, as they will at the end of the coming financial year? He will then have to decide whether to use the powers under the Rates Act to take control of the budgets of the 18 joint boards, and we should like to know his thoughts on that. Presumably, he will have to make a decision in a relatively short time, and I hope that he will announce it here.

The Secretary of State had little to say about the benefits of what he is asking the House to approve. It is important to examine just what has happened to the Government's claims since the Act was introduced. The Secretary of State said that the Act was working to control local government expenditure, but that is simply not true. In the case of those authorities, and of authorities more generally, expenditure has risen and will continue to rise. If that is a test of the workings of the Rates Act 1984, it is clearly a failure.

Let us look at another test of what has been happening under this Government and their legislation. In 1979–80, the average unrebated domestic rate bill in England was £155. By the current financial year, the figure had risen to £428. There is not much evidence of protecting the ratepayer in those figures. Over the Government's period in office, rates have risen on average by 13.6 per cent. every year. Some protection for the ratepayer there!

Although the Government have claimed to be on the side of the ratepayer, the majority of their actions and decisions on local government finance have been very damaging to the ratepayer's interests. The major and continuing reductions in rate support grant were just one — perhaps the most important — case in point, and I intend later to examine how those reductions have affected the financial circumstances of the authorites subject to the order.

All that makes nonsense of the claims by the Secretary of State — including his most recent claims for the coming financial year—that the Government have been acting to minimise rate increases. They have been doing exactly the opposite. Last year, average domestic rates in Britain rose by nearly 10 per cent. What the Government have been doing is transferring resources from non-rate-capped authorities to rate-capped authorities. That is the effect of the Act, and that is what we said would happen when it was under consideration as a Bill. It will continue to happen, and that is why the Government's claim that they are protecting ratepayers is false.

The effect of the Act is to increase the proportion of rate support grant — albeit a smaller amount of rate support grant—that goes to designated authorities, to the detriment of the non-designated authorities. All the claims, supported by Tory Members, that the Rates Act would benefit rural areas, cities and towns that were not designated are false, and are exposed by the workings of the Act.

The 11 most consistently rate-limited authorities have suffered a cumulative loss of nearly £2 billion—£1,980 million—during the time in which the Act has been in force. Some of the boroughs worst affected by the withdrawal of grant—a deliberate part of Government policy — are the very inner-city boroughs that the Government claim that they most want to help. The great initiative in the few days after the general election victory was the Prime Minister's announcement that they must do something about the inner-cities. Well, they are doing something about the inner cities all right: they are continuing to take more and more resources away from them. No adequate compensation or comparable support has been brought to the boroughs and inner-city areas that the Prime Minister so falsely claimed that she intended to help and support.

The introduction of rate capping in 1985 saw a net extra £118 million in rate support grant go to the 18 designated authorities. I have to say that the overwhelming proportion went to the then Greater London council. A net extra £79 million went to the nine newly rate-capped authorities, compared with the previous year when they had not been rate-capped. However, that extra grant has been swamped by the eight succeessive years of systematic, deliberate and continuing withdrawal and reduction of rate support grant as a whole.

Mr. Martin M. Brandon-Bravo (Nottingham, South)

In percentage terms.

Dr. Cunningham

In percentage terms, and in real terms as well.

The Secretary of State said in December, when introducing the rate support grant order: ratepayers in areas where local authorities choose to budget sensibly should on average receive rate bills which increase by around the rate of inflation."—[Official Report, 9 December 1987; Vol. 124, c. 466.] He had made the same claim in a statement about rate support grant on 30 November. Earlier still, in July of last year, he used almost identical words about the coming rate increases.

Let us see what is happening. In 1988–89, county precepts will be many times higher than the rate of inflation in many counties, including several under Conservative control. What the Association of County Councils had to say about the rate support grant decisions of the Government has been almost exactly borne out: Present indications are that over £200 million of shire counties' block grant will be returned to the Treasury; this alone will cost the equivalent of a 5p rate and will necessitate precept increases which, on average, will exceed 10 per cent. The Secretary of State denied that, but I have the published precept decisions of some 22 shire counties. The average increase for the coming year is 11.2 per cent., several times the rate of inflation and nowhere near the claims made for Government policy by the Secretary of State in his announcements.

Lower rates, if they exist in rate-capped authorities, are being financed by higher rates in the shire counties. The basis of rate capping is an above-average increase in expenditure targets for designated authorities, which brings budgeting targets closer together — thereby reducing penalties and earning the authorities more rate support grant than in the previous year.

But in the newly rate-controlled Ealing, for example, the rate support grant allocated to the borough will rise from £71 million in the current financial year to £84 million in 1988–89.

Mr. Ridley

What is wrong with that?

Dr. Cunningham

What is wrong with that is that it has been done at the expense of ratepayers in other areas. Therefore, the claim that the Act benefits ratepayers is bogus. I shall have a little more to say about Ealing in a moment, but let me examine further the Government's claims to protect ratepayers.

Authorities with budgets below £12.2 million can raise rates and expenditure with impunity because they are not covered by the Act, and many of them do. There is no protection for their ratepayers in the Act. This year the Secretary of State chose the criteria of a budget below £12.2 million and an increase of 12.5 per cent. or more in grant-related expenditure for existing rate-capped authorities. For newly selected authorities, he used those two criteria plus increased spending on 1986–87 of more than 6 per cent.

But for the fourth successive year, authorities were selected on the basis of spending above grant-related expenditure assessments. They were never intended to be a normative spending target, but rather a means of distributing grant. That was made clear at the time that the Government constructed the system and that was the promise given to local authorities and Parliament at the time. It is simply not a suitable bench mark by which to make this kind of judgment.

London has perhaps been worst affected by the Government's policy under the Rates Act. London has been the focus for much of the attack on local authority services and jobs, as several of my hon. Friends have already pointed out. In each of the four years of ratecapping, over half the authorities selected have been London authorities. In 1985 it was 11 out of 18; in 1986, eight out of 12; in 1987, 12 out of 20 and in the coming financial year it will be 10 out of 17.

Seven London authorities — Camden, Greenwich, Hackney, Haringey, Lambeth, Lewisham and Southwark—have been selected every year since the Act came into force. Again, I emphasise that those are some of the hardest hit authorities in the country, with some of the worst problems of homelessness, deprivation, bad housing and the like. Yet the Government go on and on imposing restrictions on those authorities' ability, freedom and flexibility to tackle those very problems.

It is hypocrisy for the Prime Minister to say that it is her Government's aim and objective to help inner-city boroughs to solve their problems when the Secretary of State for the Environment is introducing orders such as this. The rate limit set out in the order, and the expenditure levels on which they are based, imply serious shortfalls between the resources available to those councils and the money required to maintain local services.

In addition, many London councils also confront sharply rising levels of demand on those services. That is particularly the case with homelessness, as my right hon. Friend the Member for Bethnal Green and Stepney (Mr. Shore) has pointed out. London authorities face a crisis of homelessness. At the close of 1987, some 19,000 families were in temporary accommodation in the capital. That is costing the ratepayer a colossal amount of money, and it is money inefficiently spent. It would be cheaper and better value for the taxpayer and the ratepayer to build houses to house those families rather than to keep them in temporary accommodation.

Mr. Brandon-Bravo

Nobody will dispute the needs of many London boroughs and inner cities throughout Britain, but the theme of the hon. Gentleman's speech so far seems to give a clear message from the Opposition Benches that local authority spending should not be restrained or limited. Is it the Labour party's policy that, in the totality of national spending, the one area which is not the business of the House and should in no way be constrained is local authority spending? That seems to have been the message for the past 10 minutes.

Dr. Cunningham

Of course that is not the message. The hon. Gentleman is a regular attender of these debates and often contributes. He knows very well that that is not Labour party policy, because I have had the opportunity to tell him so on several occasions. But since his memory seems to be as defective as his political reasoning, let me put it on the record again.

Mr. Brandon-Bravo

Charming.

Dr. Cunningham

I took the trouble to re-read the previous two debates on this subject last year and the year before. If the hon. Gentleman had taken the trouble to do that, he would have known the answer that I am about to give. It is simply that the Labour party's policy makes it clear that what the Government provide to local authorities would, of necessity, be controlled and limited—

Mr. Simon Coombs (Swindon)

How?

Dr. Cunningham

Because the Government and the Chancellor of the Exchequer would come to a decision. That is how, fathead.

The difference between us and the Government is simply that we do not believe that local government's revenue-raising powers should be subject to Government control. Whatever revenue-raising powers local government has, it should be free to determine how to use them.

What is happening here is, in a way, a fundamental negation of local elections. That is perhaps best illustrated by the case of the London borough of Ealing. The Conservatives were swept out of power in the local elections in Ealing in 1986 and Labour was elected with a good majority and given a vote of confidence in that borough. Labour decided to change the priorities for Ealing's budget — rightly so — on the basis of the manifesto on which it had campaigned. Therefore, it started spending more money.

But along came the Secretary of State and said that he would not allow that to happen. He would not allow the decision of the people of Ealing in the ballot box to take effect. He decided to rate-cap Ealing in an almost nonsensical way. However, I am pleased about one thing. He did respond to the representations from Ealing and the questions that I and other Opposition Members raised with him some time ago about the stupidity of his first announcement in respect of that borough. But even now, Ealing's expenditure limit in pounds per head is considerably less than all other rate-capped London boroughs. At £570 per head, it is £88 per head lower than the next lowest designated authority.

Ealing has housed 1,000 homeless families, appointed 140 new teachers and entered into deals with the private sector to build at least 600 new homes. But the Government want to negate all that and make a judgment about what should happen in Ealing, not on the basis of what the people of Ealing voted for, but on the basis of what the Secretary of State decides.

Mr. Holland

Does it not illustrate the economic illiteracy of Conservative Back Benchers that they assume that public spending drains the private sector? In housing, which my hon. Friend mentioned, public spending sustains the private sector. In Greater London, only 13 per cent. of council houses are built via the public sector through direct labour organisations and 87 per cent. are built by private contractors. The cuts in council house spending are one of the reasons why bankruptcies among private contractors in house building have doubled since the Government came to power.

Dr. Cunningham

I agree with my hon. Friend.

Mr. Ridley

Does the hon. Gentleman really agree with that?

Dr. Cunningham

I agree with my hon. Friend that local authority expenditure brings major benefits to the economy and often to the private sector. If the Secretary of State thinks that there is something odd about that, he had better say so.

Mr. Ridley

I was wondering whether the hon. Gentleman agreed with his hon. Friend the Member for Vauxhall (Mr. Holland) that rate limitation has an effect on the building of council houses. He would surely agree that that is not on the revenue but on the capital account. Perhaps he could educate his hon. Friend, who has made the mistake before.

Dr. Cunningham

I can agree with the Secretary of State on that point at least.

I return to what has happened in the London borough of Ealing. I see that the hon. Member for Ealing, Acton (Sir G. Young) is in his place. The Government's solution in Ealing is simply to force the recently elected Labour administration effectively to continue the spending policies of the previous Conservative administration. That is the direct implication of the order. We might as well ask ourselves what is the purpose of having local elections in Ealing at all if the view of the electors is to be so obviously and nakedly negated.

Mr. Nicholas Bennett (Pembroke)

How does the hon. Gentleman explain the result of the general election?

Dr. Cunningham

The hon. Gentleman asks how I explain the result of the general election. If the Conservative party is concerned only with more and more central control, it had better be honest and stand up and say so, because that is the inevitable consequence of the Act and the order.

If the hon. Gentleman wants to be enlightened, he should look at clause 96 of the Local Government Finance Bill—the poll tax Bill—which is currently in Committee. He will see that even these powers are not sufficient for the Government. Under clause 96 of that Bill, the Government are to give themselves powers to limit and control the poll tax in every authority in the country. They are giving themselves powers retrospectively — [HON. MEMBERS: "Hear, hear."] It is interesting that Conservative Members should say "Hear, hear." Under the power, local electors can go to the polls and elect a council, but when the council introduces a budget, and fixes the poll tax at a level commensurate with that budget Ministers can come along and say retrospectively, "We shall not allow that to happen. We shall insist on changes in this budget retrospectively."

Quite apart from the fact that that is an absolute negation of the local democratic process, the provision simply does not make sound economic and managerial sense. It is a recipe for confusion and inefficiency.

Mr. Butterfill

Does not the hon. Gentleman accept that, as local government spending represents 25 per cent. of all public expenditure, any Government who are responsible overall to the electorate must reserve some power to control the overall level of expenditure?

Dr. Cunningham

As I have said many times, there are no sensible macro-economic arguments of which I am aware in favour of central Government controlling the totality of local government expenditure as this Government have sought to do but failed.

Mr. Nicholas Bennett

The party's over.

Dr. Cunningham

I am getting rather tired of the hon. Gentleman waffling away from a sedentary position.

Every time he opens his mouth he displays his ignorance. To assist him, I shall send him a copy of the speech made by my late friend Anthony Crosland so that he can see—if he bothers to read it, which he clearly has not—that any resemblance between the contents of the Manchester town hall speech and what the Government propose is only a figment of his imagination.

Mr. Brandon-Bravo

The hon. Gentleman said that there were no macro-economic arguments for such control. I ask him to consult his right hon. Friend the Member for Bethnal Green and Stepney (Mr. Shore), who was Secretary of State for the Environment not so many years ago. On precisely the same grounds, he wrote to all the local authorities requesting them to rein back their expenditure that year by £1,000 million because that was the wish of Parliament. In those happy days, local authorities said, "Parliament is supreme and we rein back our expenditure." They did that to meet the target of the right hon. Gentleman, who is here tonight.

Dr. Cunningham

The hon. Gentleman will recall that in those days there was a consensus between local and central Government on these matters. There is no such consensus now; it has been broken by the Government. On coming to office in 1979, they decided to reduce the level of rate support grant which, under my right hon. Friend the Member for Bethnal Green and Stepney, was approaching 62 per cent. and has now been—

Mr. Nicholas Bennett

It was coming down.

Dr. Cunningham

The hon. Gentleman's memory is not just defective; it is very defective. When Labour was elected in the 1970s, the level of rate support grant was 62 per cent. and when we left office, it was 62 per cent. The hon. Gentleman cannot win with his canards. As a deliberate act of policy, the Government have now reduced rate support grant from 62 per cent. to 45 per cent.

Mr. Brandon-Bravo

It went up to 66 per cent.

Dr. Cunningham

Yes, of course it did, but when the Labour Government left office, rate support grant was at the level that the Conservative Government had inherited. Now it is at 45 per cent. and the major consequence of that is that the boroughs and those elected in inner cities are facing considerable problems.

Mr. Bidwell

My hon. Friend has spent some time on the case of Ealing. Is not the Government's action pure political spite? There are special needs, particularly in my constituency, which is part of the London borough of Ealing, which the Secretary of State seems not to have taken into account at all.

Dr. Cunningham

My hon. Friend is right. The Government have been vindictive and spiteful about local government and local democracy ever since they came to office. The Act is one of the worst manifestations of that, and the order seeks to put into practice decisions that we want none of. That is why we shall vote against it.

8.9 pm

Sir George Young (Ealing, Acton)

I propose to speak on behalf of the London borough of Ealing—briefly, because I know that many of my hon. Friends wish to speak. The order enables my hon. Friend the Member for Ealing, North (Mr. Greenway) and me to honour the commitment that we gave our electors in Ealing last year. We said that if we were re-elected the council would be rate-capped and the rates would go down: we were, it is and they will.

Almost a year ago, the Labour council in Ealing announced a rate increase of 65 per cent. which turned out to be the highest in the country. In an Adjournment debate last March, I asked the Government to rate-cap the authority at the earliest opportunity. The general election intervened before a decision could be made. Much as I would have been willing to fight that election on the achievements of the Administration, the issue on the doorstep in Ealing was the rate increase. I am sure that the hon. Member for Ealing, Southall (Mr. Bidwell), who is in his place, will agree that that was the dominant local issue in Ealing.

The only party that was prepared to offer protection against extravagant authorities such as Ealing was the Conservative party. Those who are interested in the minutiae of election results—I imagine that is everyone in the Chamber—will see that in Ealing there was an above-average swing to the Conservative party. Much as I would like to attribute that result to my charisma and my twice-weekly advice bureaux, and to the other excellent services offered by the Conservatives in Ealing, Acton, the reality is that the rates have much to do with the result.

The 65 per cent. increase bit very deep in Ealing. It hit people's incomes, pushed up prices in the shops and has depressed investment and employment. Many of the Budget reductions that were introduced by my right hon. Friend the Chancellor of the Exchequer last March were soaked up in Ealing by the higher rate increase. One small example of that impact is that about a year ago I launched an appeal to restore St. Mary's church. Many people, including industrialists, who responded said that they would have given more to the appeal if they had not had that rates demand over the same period.

Mr. Tony Banks (Newham, North-West)

rose—

Sir George Young

I shall give way when I have finished my point.

Indignation in Ealing is, if anything, higher than it was at the time of the last general election, for two reasons. First, nearly everyone has now paid his rates. A large number of carefully made budgets were wrecked by the increase.

Secondly, people cannot for the life of them find out what the bulk of that increase has secured. My constituents take the view that if the rates can go up without services being improved, rates can go down without them getting worse. Indeed, that is just what the order does, and it will be widely welcomed in Ealing by employers as much as by householders.

The hon. Member for Copeland (Dr. Cunningham) mentioned the homes that were being built by Ealing. Those homes, in Priory road in my constituency and in Drayton Bridge road in Ealing, North, were already being built by Laing and Barratt. They would have been bought by first-time buyers in the London borough of Ealing. However, through a deal which would now require the Secretary of State's consent, the London borough of Ealing bought them through a housing association. There are no more homes now than there would have been if the London borough of Ealing had not intervened. All that has happened is that the tenure has changed from owner-occupation to renting. It has not generated more work or more homes.

The council is now engaged in the usual propaganda exercise of indentifying some visible cuts, mainly in Conservative wards, to embarrass the Government. For example, there are rumours that Pitshanger library is to be closed. That library was operated throughout the years of Conservative administration, when expenditure levels were far below that fixed in the order tonight. People are already asking why that library is under scrutiny when £12 million is being spent on the huge empire which embraces the equal opportunities unit, the police unit, the race unit, the women's unit and the economic development unit. Might not the economies sought by this order be secured there, rather than from libraries and luncheon clubs?

Mr. Tony Banks

The hon. Gentleman has a reputation for being fair in his analyses. That is true until he starts talking about his own borough of Ealing, when he is grossly unfair — as, indeed, is his hon. Friend the Member for Ealing, North (Mr. Greenway). The hon. Gentleman has just told the House something that is palpably untrue—that Ealing was spending £12 million on equal opportunities policies. I think that is what he said. My information is that all those policies amount to an expenditure of £1.5 million. When the hon. Gentleman comments on the amount by which the rates have increased, why does he not say something about the 1,000 homeless people who have been housed since 1986, or something about the 180 teachers who have been appointed? Can he not be fair about his own borough for once?

Sir George Young

The hon. Gentleman mentioned homelessness. If he considers the figures, he will find that Ealing is now somewhere near the top of the league for accepting homeless families in London. When the Conservatives were in office there, it was somewhere near the bottom. Ealing has acquired the reputation of being a soft touch. People come to Ealing knowing that the criteria there are somewhat more generous than elsewhere. Therefore, that figure for homelessness is not a true reflection of need, but a reflection of the fact that the administration and the criteria have changed.

Perhaps I can give one example that Opposition Members will accept as fair. For entirely ideological reasons, the council changed its bank account from Barclays to National Giro, at a cost of £100,000 in extra charges. However, worse was to follow. National Giro is not a clearing bank, so when Ealing ratepayers recently paid their rates through their own banks, the full details on the paying-in slips were not passed on to Giro. Ealing now has about £20 million in its Giro account, without knowing who that money belongs to. As a result, many people were summonsed for non-payment of rates when, in fact, they had paid them. The result is a cost of about £250,000 in staff time to put the matter right. I understand that the council is now to switch its account from Giro to the NatWest.

Money is also being spent on propaganda. I have sent my hon. Friend a copy of a leaflet describing in wholly inaccurate terms the Government's Housing Bill. Whether this is in breach of the new code remains to be seen, but the costs of the publicity unit have risen enormously and, to my mind, much of it seems to be campaigning against the Government. I believe that some economies could be secured there.

I want to put one point to my hon. Friend who is to reply to the debate. I believe that it is still possible for councils to indulge in creative accounting to get round the restrictions in the order. In Ealing, capital funds are being used for revenue purposes and I suspect that other ingenious devices are about to be launched. I urge my hon. Friend to have yet another look at the opportunities for evasion.

Apparently there is now a lot of support for the London borough of Ealing from Opposition Members. However, although the leader of the Labour party lives in the London borough of Ealing, there was no trace during the last general election of him lifting one finger to support any of the local candidates in the two marginal seats in that borough. Indeed, judging by what his press secretary said last year, the London borough of Ealing and other London boroughs are widely believed to be an embarrassment to Opposition Members.

The order is good news for Ealing. It shows my constituents that Parliament is there to protect them from local excess and that the Conservative party is in tune with what the voters in Ealing want.

Mr. Butterfill

Will my hon. Friend confirm the report in the Municipal Journal that the cost to the ratepayers of taking street cleaning away from private contractors and giving it to a local authority work force is an increase from £900,000 to £1.7 million?

Sir George Young

I understand that those figures are accurate. Street cleaning was deprivatised, but again there is no visible improvement in the service.

Mr. Bidwell

Yes, there is.

Sir George Young

Well, I live in the borough and the hon. Gentleman does not. I can look out of my window to see whether the streets are now cleaner.

Ealing council is living on borrowed time and on borrowed money. This order is the first nail in its coffin. I hope that the House will drive it home.

8.17 pm

Mr. David Alton (Liverpool, Mossley Hill)

The hon. Member for Ealing, Acton (Sir G. Young) has just made some points about the borough of Ealing, some of which were hotly contested, which just goes to show that what the Secretary of State said earlier about the way in which we debate these orders simply is not true. He said that we would not be debating the detail of individual local authorities. However, as the hon. Gentleman has just said, there are specific local circumstances in Ealing that need to be looked at, some of which are disputed, but the House is given just three hours in which to decide on 17 local authorities which are to be rate-capped.

Although we will not agree—even on the Opposition side—about the nature of some of the local policies, the problem is that there is no legitimate way in which hon. Members can put forward the case of their local authority except in a series of hurried speeches, which some will contest and some will accept.

The Secretary of State reminded us that 1988 marked the fourth year of rate capping under the Rates Act 1984. The last debate on this matter took place on 25 February 1986. No such debate occurred last year because of the fiasco surrounding the Government's discovery late in 1986 that for several years they had been operating the entire rate support grant system in a way that was illegal. Following that discovery, they introduced into Parliament what became the Local Government Finance Act 1987, which enabled the Government retrospectively to make legal the previous year's rate support grant settlement and the rate-capping arrangements and to make it possible for there to be a legal settlement in 1987–88.

My purpose in tracing the origins of the order, which rate-caps 17 authorities, including my own local authority in Liverpool, is to remind hon. Members of the turmoil and uncertainty that has engulfed local government for a sustained period.

During the eight years in which I served as a member of the local authority in Liverpool, I chaired some of its committees and, as deputy leader, was involved in budget-making. It was always an agonising business for me and for other council members from all political parties—to temper financial prudence with a proper desire to enhance local amenities, facilities and services. In those days, the rate-cappers were the ratepayers, who ultimately held the sanction of turfing out an administration if they disapproved of the way in which it was governing their affairs.

That relationship has been entirely changed. Rate capping by central Government has driven out of local government people who in the 1970s and earlier would have had a great deal of satisfaction from working in local government and putting before local ratepayers priorities that they believed to be right. These days, many men and women see little point in merely acting as the Government's bookkeepers and have left local government. I passionately believe that the strength of democracy lies in the foundations of its local government and I mourn the passing of a strong and stable local government.

The Government's approach has been to bid the gelding run faster and then to hobble it. Local government all over Britain has been put into leg irons. The Government's task has been made easier by a handful of local councils, dominated by the militant Labour Left, whose antics have simply played into the Government's hands. Time and again, the Government have been able to use the excesses of a few to harness public opinion and push through punitive legislation. Many ordinary councils and ratepayers have been involuntarily caught in the crossfire and through the actions of extremists many Labour, Liberal and even Conservative councillors have faced disqualification and surcharge.

When he was the Member of Parliament for Hexham, Sir Geoffrey Rippon said of rate capping: It is deplorable. It raises major constitutional issues. It is a classic example of elected dictatorship. The right hon. Member for Old Bexley and Sidcup (Mr. Heath) said: I do not believe these powers should be given to Ministers. The Conservative-controlled ADC also opposed its introduction.

It is my simple contention that a community that is not allowed to make its own decisions on how much to spend on schools, clinics, libraries, old people's homes, roads, homes, or street sweeping will simply decay.

Rate capping neuters local government and annually it throws it into confusion. It has a second insiduous effect. Rate capping hits the most disadvantaged local authorities the hardest. As the hon. Member for Copeland (Dr. Cunningham) reminded us, in the aftermath of the 1987 election, the Prime Minister said that she was going to do something about those inner cities. Now we know exactly what she had in mind.

The order runs contrary to that claim. Almost all the rate-capped authorities this year, as in previous years, have to deal with some of the worst urban deprivation—areas where homelessness, poor housing, unemployment, crime and alienation are at their worst. Those councils are now to be used as a punchbag.

The consequences for the rate-capped authorities will be severe. On 8 January The Independent stated: Councils in London are drawing up plans to cut at least 5,500 jobs because of rate-capping. Final decisions on the cuts will be made at budget meetings over the next two months, but at least four Labour-controlled councils have already decided on the number of jobs to cut. My hon. Friend the Member for Southwark and Bermondsey (Mr. Hughes) who is on the Housing Bill Committee this evening—he was in the Chamber earlier and is hoping to return—told me in a note: The effect of this in the coming year will be a reduction in real terms of between 5 and 10 per cent., a cut in our spending of between 5 and 10 per cent.

Mr. Butterfill

Will the hon. Gentleman give way?

Mr. Alton

In a moment.

My hon. Friend the Member for Southwark and Bermondsey went on: It looks as if the most severe cuts will fall on housing and social services, and in particular on the most vulnerable closures of day centres, nurseries, old people's provisions, libraries, swimming pools and the like.

Mr. Tony Banks

I do not wish to be unfair to the hon. Member for Liverpool, Mossley Hill (Mr. Alton) as I agree with him, but he has been misled by the hon. Member for Southwark and Bermondsey (Mr. Hughes). The Housing Bill Committee finished at 8 o'clock. I am the Labour Whip on the Committee, so I can say that with some certainty. That is why I am here. A number of Conservative Members who were on the Housing Bill Committee are present. The hon. Member for Southwark and Bermondsey is not in the Housing Bill Committee.

Mr. Alton

My hon. Friend has been at that Committee and he was in the Chamber when the hon. Member for Newham, North-West (Mr. Banks) was not present. He intervened in the Secretary of State's speech. Similarly unfair criticism was made about the hon. Member for Hackney, South and Shoreditch (Mr. Sedgemore) earlier when he was in the Education Reform Bill Committee.

The hon. Member for Newham, North-West will also recognise that only one person ever gets called from this Bench in a debate. I am sure that my hon. Friend the Member for Southwark and Bermondsey will be happy for me to have made his point, and I hope the hon. Member for Newham, North-West will let me proceed as we agree on a number of points.

Mr. Nicholas Bennett

The hon. Member for Liverpool, Mossley Hill (Mr. Alton) talked about rate capping. Perhaps he will explain why Liverpool city council has the largest number of empty council properties anywhere in Britain—10.8 per cent. or 6,955—whereas Knowsley has only 499 empty properties or 1.9 per cent. There are five times as many empty properties in Liverpool owned by the council as there are in any other Merseyside borough. That is one reason why the Government has had to rate-cap Liverpool.

Mr. Alton

The hon. Gentleman misunderstands the position in Liverpool. The problem exists because we have lost one third of our population during the past 20 years. As there has been this massive exodus from the city, property has been left empty. Many of those properties are uninhabitable and have had to be closed; others form part of the demolition programme.

Part of the problem also stems from the overheated economy in the south. As people move south, the homeless problem in the south-east increases. As we have become a nation of Dick Whittingtons and as people leave cities such as Liverpool, problems have been created in some of the London boroughs as people coming from the north seek accommodation here. Secondly, this causes empty housing in places like the north-west of England.

Mr. Heffer

I am sure that the hon. Member for Liverpool, Mossley Hill (Mr. Alton) will agree with me, in relation to empty property, that one of the great problems in Liverpool is that a number of years ago properties were built on a fairly large scale, but the people who built them ought to be put in prison because of the state of those properties. They have had to be emptied out, and they include empty properties that are uninhabitable. That is not the responsibility of the present local authorities and to a large extent was caused by previous Government policy.

Mr. Alton

The sins of our fathers are often visited on their sons. The hon. Gentleman will recall that in 1972 thousands of properties were constructed on the Netherley estate. That was a great mistake by Liverpool council. I made my maiden speech on Liverpool city council in opposition to that scheme. Regardless of who now administers the city, the debt charges that still stem from the construction of those properties remain to haunt the local authority. The repayments will go on for a further 40 years. The debts on properties now demolished will go on being a major millstone around the neck of Liverpool city council. Those special circumstances are never taken into account when the rate support grant settlement is made.

This year, the gap between what is prescribed by the order and what will be allowed to be spent in Liverpool amounts to some £45 million.

Mr. Brandon-Bravo

Will the hon. Gentleman give way?

Mr. Alton

Not at the moment. That is the difference between the anticipated expenditure and that allowed by the Government. The consequences for Liverpool city council will be catastrophic. If the money were to be saved entirely by shedding labour, it would require 5,625 employees to be sacked, according to the chief executive of Liverpool city council. But if redundancies are to be the key to meeting the targets set by the Government, in a city where unemployment stands at 20 per cent., is that, to use the Prime Minister's words, doing something to help those cities"? That seems a strange way of helping them. Surely what is needed is a true partnership, where local and central Government tackle the problems together.

Liverpool council refused to apply for a redetermination — in my view, wrongly. But I understand its reasons. It was given no assurance that its permitted expenditure would not be reviewed downwards. If the Government could at least have promised not to make matters even worse, it would have been a catalyst to bring Liverpool's politicians around the table.

One does not have to be clairvoyant to see what failure to obtain agreement will lead to. The city will shortly be plunged into a debilitating fiscal crisis and the casualties will be the ratepayers, with yet more damage inflicted on the city's battered image. Today's Financial Times bleakly states: The warning, in a letter that will be made public tomorrow, will say that setting a spending limit and trying to run services within it in an attempt to avoid cuts in jobs and services will not be an acceptable alternative to setting a proper budget. Failure to do so might lead to further surcharges and disqualifications of councillors. Some of the wounds suffered by Liverpool are self-inflicted. One example is the decision to spend £250,000 on the trade union resource centre. That decision alone will attract £200,000 in penalties this year. I was also opposed to the decision to borrow £60 million from Swiss and Japanese bankers—that borrowing will incur additional loan repayments of £92 million. I believe that that is reckless and irresponsible. However, I would fight against such decisions locally, through local elections, not through rate capping. Although we may disagree with some of the council's policies—and it should be said that some of those policies date back to the council's predecessor—such matters should be determined locally rather than nationally.

I hope that the Government will reconsider enhancing the urban progremme. If some of the city's housing was transferred to housing associations or co-operatives, that would also help. However, it would still not be enough. If the Government vindictively leave Liverpool to stew in its own juice they will create the conditions for Militant and its friends to prosper. As Peter Taafe said last weekend: There are more Militants on the council now than there even were before. Government inertia will simply create a breeding ground for extremism and militancy to prosper.

Rate capping does not create better local government—it leads to confrontation and centralisation. It does creates the climate not for good management but for chaos, and it drives decent people out of local councils. In July, the Secretary of State said that, because of the pending abolition of domestic rates and the introduction of the poll tax, this would be the penultimate rate support grant settlement". In October, at the Conservative party conference, the Secretary of State said: The choice before us is a stark one. We must either have more and more central control or local electors must exert real local control. We vote for local control. By the autumn, the truth was out. The Minister for Local Government admitted that the Government were to extend rate capping to cover the poll tax. Therefore, we are not discussing the penultimate capping of local councils, as he said. So much also for the power of the ballot box, a simplified system and less central interference. Capping rates has led to this present vale of tears. For the future, capping the community charge will simply be an act of selective vengeance against councils that the Government do not like. For those reasons, Liberals will vote against the order.

8.32 pm

Mr. Simon Coombs (Swindon)

Before the general election, I recall that the hon. Member for Blackburn (Mr. Straw), who then sat on the Opposition Front Bench for matters concerning the environment, telling me that as a result of my intention to vote in favour of rate capping, I would be unseated at the general election. That hon. Gentleman has moved on to other responsibilities, but I am happy to tell his successor, the hon. Member for Birmingham, Perry Barr (Mr. Rooker), that my majority increased by 350 per cent. at the election. Therefore, I believe that we should beware of name calling, in which the hon. Member for Copeland (Dr. Cunningham) indulged. It is not possible to solve the intractable problems of local government in that way.

The problem is that the consensus between national and local government has broken down. However, that problems lies not with the Government, but with the councils with which we have attempted to maintain that original consensus.

Mr. Tony Banks

The hon. Gentleman would say that, wouldn't he?

Mr. Coombs

The hon. Gentleman has said from a sedentary, if not lying, position that I would say that, and he is right. Let me give the hon. Gentleman and his hon. Friends the facts, which I believe justify my case.

In 1976, a Labour Secretary of State asked local authorities to rein in their expenditure by £1,000 million. At that time, a large proportion of local government was in the hands of the Conservative party. The response of those Conservative-controlled councils in that national crisis — a crisis brought about by the Labour Government of the day—was that it was right that they should react in a public-spirited and responsible manner. As a result, the Labour party was able to rein in local government expenditure.

When the present Government came to power in 1979, they found that the problems had continued to mount on the hapless head of the previous Labour Government and that the economy was overstretched and in considerable difficulties. There was also an international crisis in the oil market. Yet again there was a need to restrain public expenditure. What happened? There was no response from the councils which, after 1979, were under Labour party control. The only response was to continue to increase dramatically at the cost of local ratepayers.

When we discuss the breakdown of consensus, we must remember that it is due to the fact that in the past eight years Labour councils have consistently refused any request to act responsibly in the national interest. It is nonsense for the hon. Member for Copeland to say, in answer to my question, that it is for the Treasury to sort things out.

Mr. Butterfill

Will my hon. Friend confirm that, since 1982, the London borough of Camden has increased its staff by 2,000? I also believe that since 1985 the London borough of Hackney has increased its staff by 1,150.

Mr. Coombs

Those are two examples of the way in which expenditure has been heaped upon the ratepayers and the citizens of some councils in the country. It is not my intention to make detailed attacks on the Labour party. I wish to make my case on a national basis.

In a sedentary intervention, I asked the hon. Member for Copeland how the Labour party would respond to the fact that, in the macro-economic sense, it cannot allow 25 per cent. of national public expenditure to go on increasing every year because local Labour councils are unable to deal with their problems in a cost-effective manner. If the Labour party ever came to power again, it would have to tackle that problem. I invited the hon. Member for Copeland—he is not in the Chamber—to tell me how the Labour party would do that, but rather than answer he called me a rude word.

I hope that the hon. Gentleman's colleague, the hon. Member for Perry Barr, who has a reputation for independence of thought, will not feel it necessary to follow the official Labour line of calling people rude names if they do not understand the question or if there is no answer. When the hon. Gentleman replies, perhaps he might be persuaded to tell us how the Labour party would tackle the problem of rapidly expanding local government expenditure. The Opposition, if in power, would have to face such a problem.

Rate capping is not unpopular among the people. If it were, at least a dozen Conservative Members would not be representing seats with Labour-controlled local councils. If voters were unhappy with rate capping, undoubtedly they would have turned out Conservatives representing parts of the affected boroughs. On the contrary, in one such area, Waltham Forest, the Conservative party made a gain rather than a loss. We must accept that rate capping is not an unpopular policy for those who suffer the high rates of local Labour councils. On the contrary, those high rates are unpopular; that is why my hon. Friends the Members for Ealing, Acton (Sir G. Young) and for Ealing, North (Mr. Greenway) were returned with such thumping good majorities at the election in 1987.

Mr. Tony Banks

Does the hon. Gentleman accept that, when rate support grant—central Government support for local authority services—has been cut from 61 to 46 per cent., there is bound to be pressure upwards on the rates? The Financial Times said that the reason for rate increases was the cut in rate support grant. Why cannot the hon. Gentleman not accept that, and accept also that the problems of the inner-city boroughs are nothing like the problems of the shire counties? If the Labour party were in government and needed to control the overall sum, it would at least ensure that the resources went into the inner-city areas, where they are most needed.

Mr. Coombs

I welcome the fact that the hon. Gentleman is a convert to the Financial Times. I feel sure that as the years go by, a greater sense of financial reality will break in on him.

I shall deal now with the reduction in rate support grant. The Labour party comes to the House tonight, as always, in the guise of defending local democracy. What could be more appropriate to local democracy than that an ever greater share of expenditure on local services should come from local people? That is what the switch of rate support grant is designed to do.

When we discuss democracy in the House, we should reflect on the fact that Labour councillors are elected by 25 or 30 per cent. of the electors in their wards. Conservative Members of Parliament, representing those same areas, are returned by turnouts of 75 per cent. Which of those two groups is the more democratically entitled to speak on behalf of the ordinary people of those areas? I would say that Conservative Members are.

Mr. Bernie Grant (Tottenham)

The hon. Gentleman says that only about 25 per cent. of people elect Labour councillors. What is the average figure for the election of Tory councillors in Tory boroughs and local authorities?

Mr. Coombs

I am grateful to the hon. Gentleman. I belatedly congratulate him on surviving a 6.8 per cent. swing to the Conservatives in his seat at the general election last year. We are glad to have him with us. The point I made was that Labour councillors are the beneficiaries of those areas because they control the authorities. Of course, the point applies equally to councillors in general. Conservative Members of Parliament have a greater right to speak on behalf of all the people in the areas they represent because they have been elected by a majority of the people—75 per cent. of them.

I want to say a word about the borough of Thamesdown, which is on the list, in the company of authorities in inner London, which, as I recognise, have real social problems that are not to be compared with the problems which, happily, the people of Thamesdown face — although in Swindon many people have severe difficulties. There is no reason why Thamesdown should continue to figure in the list, apart from its own reluctance, its refusal, to come to the Secretary of State to discuss the problems. I understand that all that has happened this year is that a letter of protest was sent. There was no attempt to discuss the problems that face the borough or to persuade the Secretary of State that more money would be appropriate.

Other authorities have gone to my right hon. Friend and been given extra cash to deal with the problems. Some have been allowed to increase their rate precept by more than the rate of inflation. Not Thamesdown. Its attitude is simple. Before the general election its ex-deputy leader said that it was a Labour Government or bust. We told him then that he had to face the responsibilities of his own actions, because there was no way that he would have a Labour Government to bail him out.

These problems remain. I am happy to support the order, but unhappy that it affects the people that I represent here. I hope that, as the years go by, the people of Thamesdown will be represented by a council which will be prepared to discuss these matters rationally and which, in due course, will be Conservative-controlled, removing our name for all time from the list of those whose expenditure has to be controlled by the Government.

Several Hon. Members

rose—

Mr. Deputy Speaker (Sir Paul Dean)

Order. Time is getting very short, and many hon. Members wish to speak. I appeal for short contributions.

8.45 pm

Mr. Peter Shore (Bethnal Green and Stepney)

I shall oppose the order on behalf of Tower Hamlets. I repeat the point that I made to the Secretary of State, that the alleged agreement between him and the borough of Tower Hamlets was made under duress. If Tower Hamlets had not consented to it, he would have had the option of reducing still further the grant given to the borough. If that is not duress, I do not know what is.

I am glad to see that the Secretary of State has returned to the Chamber, and I want to put to him some of the difficulties we face. I want to urge him to think again, or at least to explain why he has taken this decision, which has such adverse consequences for my borough.

Like the other inner-London boroughs affected by the order — and like Liverpool and Newcastle — Tower Hamlets was part of the original partnership of boroughs that we set up deliberately in 1977, because we recognised that they were areas of exceptional need, requiring exceptional help. That was the spirit and the intention of our inner-city policy. Those same boroughs have sustained successive attacks on their finances by reductions in the rate support grant from 61 per cent. to 46 per cent. Fines have been imposed on them for alleged overspending, and they are faced now with the effects of rate capping.

When rate capping of Tower Hamlets was announced last autumn, the council decided to apply for a redetermination. Its alleged overspend of 22 per cent. above GRE amounted to £23 million. As a result of the Department of the Environment rethink, an additional £2 million for expenditure was allowed. Still, that means that the borough must retrench by £21 million next year—20 per cent. of its total expenditure.

When the council went to see the Minister of State for Local Government, the case that it argued was based almost completely on the exceptional problem of homelessness and the high cost of bed-and-breakfast accommodation for our homeless people. No less than £18 million of the council's alleged overspend last year and this year will have been incurred in securing temporary accommodation for the 980 homeless families in 1986–87 and the 1,150 homeless families in 1987–88.

No other borough, with the possible exception of Camden, has had to face a bill for accommodating the homeless of anything like the scale that we face. The reasons are plain: we have a large Bengali community. Being the last major ethnic group to settle in the United Kingdom, the flow of relatives to join husbands and fathers here in Britain is inevitably high. Moreover, Bengali settlement is highly concentrated in a few locations in the United Kingdom, the largest of which is in Tower Hamlets. The council, people and Members of Parliament of Tower Hamlets have long argued that additional special housing money was essential to meet the special problem of homelessness in Tower Hamlets.

When the council met the Minister, he merely listened. The Secretary of State did not turn his mind to the problem or attempt to give the reasons for his decision. I want to know whether the Government recognise the exceptional problem of homelessness in Tower Hamlets, and if not, why not? Is it the Government's case that the council is spending money extravagantly on other services? If so, which are they, and by how much should they be cut?

Mr. Butterfill

rose—

Mr. Shore

I am asking the Secretary of State, not the hon. Gentleman.

Is it the Government's case that the problem of homelessness could be solved by making better use of the voids in the council housing stock? Certainly there are far too many voids, but the Government must be aware of the fact that there is a major mismatch between the large size of homeless families who need to be accommodated and the small size vacant accommodation, which consists mainly of one and two-bedroomd flats.

On top of that major housing crisis, the Government's rate capping of Tower Hamlets will produce a further crisis in the provision of other services throughout the borough. The number of homeless families cannot be easily or quickly reduced, in spite of the restrictive and harsh provisions of the Immigration Bill.

What have the Government to say? Are they blind or are they indifferent to the special problems of Tower Hamlets? Have they nothing to offer except a relentless squeeze on its expenditure and its power to raise revenue from rates? The order — not the Prime Minister's rhetoric about regeneration—reveals the true and ugly face of Government policy for the inner cities.

8.50 pm

Mr. David Amess (Basildon)

I welcome the order to cap rates in Basildon, as do many of my constituents. I say that in the light of the fact that the previous Labour council got us into debt to the tune of £34 million, which is a disgrace. Net expenditure will exceed income by £14.6 million by March 1990.

The House may wish to know that in 1983 Basildon was ranked 112th in the list of Labour seats that could be won by the Conservative party. In the general election last year, Basildon was ranked as the 14th most marginal seat. A number of Opposition Front Bench spokesmen visited my constituency, including the campaign manager for the Leader of the Opposition, who was frequently seen on television forecasting a Labour gain. Hon. Members will be aware that the Basildon count was shown on television; the seat was retained by the Conservative party, and we doubled our majority.

I am proud to represent the largest new town in the country. It is now the finest new town in the country. It is a supreme example of the success of the Government's policies. We have the largest covered shopping centre in Europe. When I became the Member of Parliament for Basildon, there were about 9,000 unemployed people. The caring Labour council, in typical fashion, put a board outside the council offices to display the number of people who were out of work. I am proud that in the past five years unemployment in Basildon has been cut by 50 per cent. During that time, the display board disappeared. When I inquired why that was so, I was told that one of the screws had gone rusty and the board had fallen clown. I do not think that we are so naive as to believe that. It was all very well when the arrow was going up, but when it went down the council did not like it.

In the last Parliament, I talked about rates in Basildon on a number of occasions. There is no doubt that the rate burden in Basildon has been intolerable. I made my maiden speech on the Rates Bill. I served on the Committee with a number of hon. Members who are present in the Chamber and I well remember difficulties that the noble Lord Jenkin of Roding encountered with the Opposition about rate capping. I feel that my constituents have benefited from rate capping.

Mr. Peter L. Pike (Burnley)

Does the hon. Gentleman believe that the statement that he made at the beginning of his speech, when he spoke in such glowing terms of the progress in his constituency, is consistent with what he is claiming to be a problem with rates? Is it not a fact that the growth that he mentioned has been helped by the local authority and that it has played a major part in the progress of that town?

Mr. Amess

The hon. Member for Burnley (Mr. Pike) should be careful when intervening on another hon. Member's constituency matters. He probably does not know where Basildon is. Basildon's success has nothing to do with the work of the local authority but everything to do with the Basildon development corporation and the Commission for the New Towns. Those are the organisations that should be praised, not the irresponsible spenders on the former Labour council.

In my maiden speech, I suggested that we should abolish rates and introduce a community charge. I welcome the Local Government Finance Bill, and when it becomes law many of my constituents will benefit from it.

Over the past years, I have had occasion to refer a number of items of extravagance to the district auditor. Unfortunately, he has found it difficult to act on those matters as his powers seem rather toothless.

We have had to cope with a barrage of propaganda. We have a district council which employs 12 people in its public relations department. I am sure that the House will be interested to listen to the detail of a press release that it put out in early 1986: Basildon ready to win through with Labour's national commitments. 'Basildon is ready and able to take full advantage of any multi-million investment programme by the next Labour Government to create jobs,' says the Labour council leader. He pointed to Basildon's recently announced multi-million pound capital development programme, aimed at taking the District bustling into the 1990s, as evidence that the Caring Council and Community are 'winning through', and as an indication of how local planning is tying in with Labour's national approach and commitments. The council leader continued: As a District Council we are fully prepared for the next Labour Government to implement a multi-million programme of capital investment. Our recently announced programme will see Basildon into the 1990's, and we will be ready with details of other development and job creation projects. Despite all the obstacles this present Tory Government attempts to place in our way and all the pressures it tries to bring on our community we are winning through. We are laying the plans locally which tie in with the national plans and commitments of Labour's incoming Government team. The choice will be for the people of Basildon and similar hard pressed communities up and down the nation. He got his answer on 11 June when I was re-elected and doubled my majority.

The truth of that press release is revealed by what I said earlier in my speech—Basildon is £34 million in debt because of the irresponsibility of that administration.

Mr. Butterfill

Will my hon. Friend confirm that that press release was prepared at the expense of the ratepayers?

Mr. Amess

Of course it was. In Basildon, everything is done at the ratepayers' expense.

Just before the general election, the Under-Secretary of State replied to an Adjournment debate in which I showed him a glossy leaflet. That leaflet supplied information to the ratepayers, but it might just as well have said, "Vote Labour." That is the sort of thing with which we have had to contend in Basildon over the past few years. Basildon district council has often provided services and interfered in matters for which it is not responsible. For example, it has confused people about the sort of welfare benefits to which they are entitled.

The House will want to know what sort of council we have in Basildon. I refer to a press release headed: Militant threat to Labour rule", which states: Councillor David Harrison resigned as the Labour whip on Basildon council after being suspended for failing to support a £700 grant to community associations. His defection, together with Councillor Peter Maloney, a lifelong member of the Labour party, means that the Labour party lost control of Basildon district council.

Mr. Bernie Grant

On a point of order, Mr. Deputy Speaker. This is supposed to be a debate about rate capping and rate limitation. The speech of the hon. Member for Basildon (Mr. Amess) is just a series of scandalous stories.

Mr. Deputy Speaker

I was also becoming slightly worried about the hon. Gentleman's remarks. I am sure that he will address his remarks to the order.

Mr. Amess

I shall certainly do that. I understand the embarrassment of Labour Members. The councillor about whom I am speaking in connection with this rate-capped authority, said that he would now vote in line with his conscience. He remains chairman of Basildon district council.

In the previous Parliament, I was the only Conservative Member not to have a Conservative district or county councillor in my constituency. They were all Labour. I am delighted to tell the House that, in September 1987, the first Conservative councillor was elected in my constituency since 1979. He took the seat from Labour when the alliance was expected to win, so we came from third to first position. The councillor now fully supports the rate-capping measure.

I wish to give the House some brief examples of items of expenditure which have led to rate capping in Basildon. As my hon. Friend the Member for Ealing, Acton (Sir G. Young) said, creative accounting is rife in Basildon. On 11 April, the largest and most expensive theatre in the country will be opened in Basildon. That theatre cost £8 million, but none of that money was paid in interest over the past three years. We are now forced to pick up the bill. The Socialists responsible for that gross extravagance have run away from their responsibility.

The Socialists have also committed us to building a town hall which will cost £17 million. They have decided to replace the Laidon community centre, at a cost of £1.7 million. They have set up an area management style of services which is extremely expensive. It is a clever Socialist way of taking the power away from the elected council and giving it to a few people who turn up at the meetings and push forward Socialist propaganda.

A sports hall will be built at Markham Chase for £2 million. Before that sports centre was built, the local people were consulted and given two options. They plumped overwhelmingly for one option and the local authority chose the other option. That is a wonderful example of Socialist democracy. They then opened another sports centre in Pitsea in my constituency, at a cost of £1.2 million. They have also built community workshops.

The latest Socialist idea is to organise the countryside. They decided to organise Wat Tyler park. They put in a floating ramp, which cracked. Then a slipway was installed for people outside the area to use, and the Socialists calmly wrote off £20,000. A boat compound was moved on a number of occasions. That cost £25,000. In 1974, the Socialists dredged a creek, which cost £10,000. In 1985, at a cost of £6,000, they built a beach, but they built it on mud and it has since vanished. They built a jetty for a crane, but we do not even have a crane to put there. If we want one, it will cost us £30,000.

The Socialists built a nature pond and filled it in after four months because it leaked. That cost us £2,500. A private caterer was catering for the good people who work at Wat Tyler park, but, because of the Socialist belief that profit is a dirty word, he was driven off. The job was given to someone in the council and the business now makes a dirty great loss.

We had, as ever, a peace festival which, of course, was not supported by people from Basildon but by people from all sorts of areas. The ratepayers of Basildon had to pay for all the rubbish to be collected. We have the usual nonsense of nuclear-free zones and a number of ideas for theme parks to be built in the area.

If Labour had won the election, the reality for people in Basildon, with no other commitments than those I have announced to the House, would have been a doubling of the rates in Basildon. That is the irresponsibility of Socialism in Basildon.

I am delighted that we now have a hung council. A hung anything is not ideal, but at least it is a little better than the previous Socialist administration. In the hung council, the Conservative group put forward suggestions for savings of £7.5 million and the Liberals — who always find themselves in difficulty when they are given power and have to make decisions—did not quite have the guts to go all the way with us and suggested savings of £4.5 million.

My constituents and I welcome the order to cap rates in Basildon. We eagerly look forward to the benefit that a community charge will bring to all the people of Basildon.

9.6 pm

Mr. Eric S. Heffer (Liverpool, Walton)

I have heard some remarkable arguments from Conservative Members. The hon. Member for Basildon (Mr. Amess) suggested that Members of Parliament have the right to represent people only if they have an overwhelming majority on a particular council. I have to tell the hon. Member that Labour has an enormous majority on my council, but at one stage it was Conservative-controlled and every councillor was Conservative. I do not quite know the logic of his argument and I do not think it has a great deal to do with rate capping, so I will not waste time pursuing it. The hon. Member for Basildon has wasted an awful lot of time.

I wish to make two quick points, because other hon. Members want to speak. The hon. Member for Liverpool, Mossley Hill (Mr. Alton) made a good case for our position in Liverpool, but I disagree with him on two points. He talked about militants and the loony Left running local authorities, which was totally irrelevant. Let us talk about the real position.

My area has problems of unemployment, housing and drugs — you name it, we have it. The problems have arisen not because of the dreadful activities of the local council, however the council has been made up, but because over the years the port of Liverpool, because of the change in world trade and our entry into the Common Market — [Interruption.] Hon. Members should listen for once instead of smirking. If they came from areas such as mine, they would understand that the local economy has changed so that we are left, as it were, stranded on the shore. If we still had the same economy and trading patterns, we would not be in the position we are in today. Areas such as mine need assistance from Governments, not rate capping.

The previous council went to the Government and asked whether it could have back some of the money which had been taken away in the rate support grants. It had lost about £350 million. I think that over those years the total grant was about £500 million. The council asked the Government for £30 million as a loan, but it did not get it; it had to go to international bankers. I deplore that, as does everyone else. That happened because the Government refused to assist a council with housing problems which hon. Members from nice new towns do not begin to understand; they live in an entirely different world and in a different atmosphere from the people in my part of the world.

The hon. Member for Mossley Hill said that the council is faced with cutting jobs and services. It will have to impose a rent increase of £4 a week, which will raise only £11.6 million. Rents of council property in Liverpool are 16th highest of the 36 metropolitan districts. Rents are already too high in an area where the people cannot afford them because there is so much unemployment.

Enough has been said. We must impress upon the Government that they have a duty to people in all parts or the country. Because the people elect Labour or Liberal authorities, or in Ulster other authorities, that does not mean that the Government can run away from the their responsibilities and say, "We will only help Conservative authorities because they represent the people who support us." If the Government continue along that path, sooner or later the anger which is growing in inner cities like Liverpool will again bubble over. That is the last thing I want to see.

Therefore, I ask the Government to think again. Certainly I shall vote against the order. I hope that Conservative Members who have still got a little conscience will at least abstain, even if they will not vote against the order, and let the Government know that they are not satisfied with the present policy.

Several Hon. Members

rose—

Mr. Speaker

Order. The hon. Member for Liverpool, Walton (Mr. Heffer) set a commendable example in making a brief speech. Many hon. Members are affected directly by the order. I should be grateful if we could have brief speeches so that most of them may be called.

9.12 pm

Mr. Martin M. Brandon-Bravo (Nottingham, South)

Until May last year I was privileged to have been associated with local authorities for the previous 20 years. Therefore, I was sad when it became necessary for the Government to bring in rate limitation, but it was and still is necessary. I do not object to the reserve powers contained in the new legislation which will reform the domestic rating system.

Earlier, the hon. Member for Copeland (Dr. Cunningham) spoke of the old consensus. My hon. Friend the Member for Swindon (Mr. Coombs) explained why the consensus had broken down. Clearly, it broke down because many local authorities forgot that they were local authorities and slipped into the jargon of referring to themselves as local governments, or even governments in exile, ignoring the fact that this is the place where laws are made and which answers to the wider public.

Time and time again, in this debate and in others, Opposition Members have referred only to the rate support grant when commenting on the needs of inner cities, some rate-capped and some not rate-capped under the order. Some might wish that they were being rate-capped in view of the forecasts for rate precepts in the list referred to by the hon. Member for Copeland.

The area of central Government support that seems to be ignored, as it was by the hon. Member for Liverpool, Mossley Hill (Mr. Alton), is that of specific grants. To give the right hon. Member for Bethnal Green and Stepney (Mr. Shore) his due, he mentioned programme partnership authorities. For many years these authorities have received specific grants in addition to their rate support grant. Many cities in the midlands, if they put the two grants together, find that the percentage of rate support, in its widest sense, is as high now as it has ever been, but, because part of it is specific, it is much better targeted and in many ways the money is being better spent because of that.

There seems to be a view that, somehow, local government spending ought not to be constrained. Again, from the Opposition Front Bench, that policy has been confirmed. As we have heard, the right hon. Member for Bethnal Green and Stepney, recognised the national need when he asked local authorities to rein back £1 billion spending. People should also remember that local government expenditure has to be seen in the totality of national needs. At the time that the right hon. Member for Bethnal Green and Stepney reined back local government spending, hon. Members will remember that the Chancellor of the Exchequer, in those dreadful years, had to make cuts in our National Health Service.

The NHS is very dear to all our hearts. When we look, even now, at the overspending of local authorities, with an estimate of £1.6 billion overspending, it seems foolish for the House to ignore the sort of runaway expenditure that could happen. Even with strict controls, overspending is £1.6 billion.

Mr. Robert N. Wareing (Liverpool, West Derby)

They are underfunded.

Mr. Brando-Bravo

The hon. Member for Liverpool, West Derby (Mr. Wareing), from a sedentary position, talks about underfunding. If the Government of the day spend £1.6 billion more on supporting local authorities, they have to choose whether they want to do that or to spend it on the Health Service. The money cannot be spent twice. It is totally unacceptable for hon. Gentlemen to imagine that they can talk about any one Department's expenditure as if that had no impact on any other.

Mr. Holland

Instead of the hon. Member simply reasoning that if one spends money in one way it cannot be spent in another, may I ask whether he is aware that the figure of £1.6 billion is less than 0.5 per cent. of GNP? If the Government could maintain the rate of growth of the economy rather than have it halved next year, they could spend that on local authorities and also generate resources for the private sector.

Mr. Brandon-Bravo

The hon. Member likes to choose a yardstick that suits his case, but I must remind the House that each of the various items of additional expenditure that the Opposition promised the electorate prior to the general election, with a few billion here and there, came to about £34,000 million, and the people of this country realised that that was simply not on.

Mr. Holland

rose—

Mr. Brandon-Bravo

No, I shall not give way. I must make progress.

The criteria for rate capping mean that the order will affect only 17 authorities. I must draw the attention of the House to the constituency that I represent, the southern part of Nottingham. In the years until May 1987, when both Nottingham city council and the county council were Labour-controlled, I believe that my constituents wished in many ways that they could have been rate-capped. Nottinghamshire county council under Labour increased an 81p in the pound rate precept forecast in 1981 to a precept forecast this year of 253p in the pound. I wish that we were part of the order. Indeed, I think that it is illustrative that in May of last year the city council became Conservative. It does not need to be rate-capped. It has a zero—

Mr. Speaker

Order. This is a debate about the boroughs that have been rate-capped. It is legitimate for the hon. Gentleman to draw comparisons, but he must not dwell too heavily on his own constituency.

Mr. Brandon-Bravo

I apologise if I am dwelling too heavily; I am merely trying to illustrate my support for the principle in general and for the specific order before the House. I only wish that my own authority had been rate-capped, because only the remaining Labour authority of Nottingham county council is increasing the rates in the coming year.

This order is right. The people affected by it will benefit by lower rates. I only wish that there were some mechanism for protecting much of the rest of the country that is not affected by this rate limitation order.

9.21 pm

Mr. Sydney Bidwell (Ealing, Southall)

I shall not be sidetracked into alluding to the antics or activities of the hon. Members for Ealing, Acton (Sir G. Young) and for Ealing, North (Mr. Greenway), who we in the area feel to have been largely responsible for the adverse rate-capping activity, which in the end will be sufficiently clear to blow back in their faces politically when the time comes for judgment.

Ealing, with 11 of the other rate-capped authorities, refuses to accept the Secretary of State's maximum proposed rate for 1988–89. Ealing's treatment by the Government has been unique in the circumstances that I have already described. Ealing is rate-capped considerably below the level at which many Tory-controlled authorities are spending. The neighbouring borough of Harrow, for example, is currently spending at 6.5 per cent. above the grant-related expenditure assessment.

Ealing's expenditure limit per head will be considerably lower than that of all other London rate-capped boroughs. At £570 per head, it is £88 per head lower than the next lowest. I want the Secretary of State, who is not in the Chamber at the moment, or his Minister, to take these figures on board and try to reply to them this evening, because they are fundamental to the needs of the people of the London borough of Ealing as a whole and of my end of the borough in particular.

It was freely accepted by the Labour Government, in particular my right hon. Friend the Member for Bethnal Green and Stepney (Mr. Shore), that my constituency—he will remember visiting it on more than one occasion—had special needs. It seems to me that this has been entirely overlooked in making these calculations. The Government have not taken into consideration Ealing's social needs. The revised offer does nothing to face the particular problems of the borough. This is part of a continuous policy of refusing to accept Ealing as an authority with inner-city characteristics.

As an example, on 1 December 1986, using the Z index to measure urban deprivation, Ealing ranked 10th of the 23 authorities that qualified for permanent status, but it has been refused that status. This is extremely important for the future when we consider the iron necessity of sustaining racial harmony in our borough.

The revised offer meets exactly the Tory opposition's request to bring the rate cap up to the grant-related expenditure and ignores all the arguments put forward by the elected administration. The balance of the council is currently Labour 47, Tory 20 and alliance three. That result, reversing the political line-up on the council, was no accident. The results at the general election in the Ealing, North and Ealing, Acton constituencies have been freely alluded to, but in my constituency I held the ethnic minority vote almost to the identical figure of the two previous general elections.

The revised rate limit will leave Ealing with a budget gap of around £38 million—a massive sum in a single year. Much of the new growth that has been introduced by the current administration since its election in May 1986 is committed and cannot be reversed. Reference has been made to homeless families. Moreover, 140 new teachers have been appointed, and deals have been entered upon—as we heard earlier—for the building of at least 600 new homes. That is a financial commitment, regardless of who started it.

The council does not wish to reverse those and many other achievements. Even if it did, however, it would not be possible to give notice to staff, end leases on property and evict homeless families in time to make the required savings. The sheer impracticality of such action was the principal reason for all-party opposition to the Government's first rate limitation.

The Government's action is designed to force the administration to adopt the spending policies of the previous council—which were rejected by the electorate, when the Tories were soundly defeated at the last local election. The expenditure level now set is exactly equivalent to what the Tories would be spending if they had continued in office with the same policies, and their rate base was the lowest in west London. To achieve that, all new growth would need to be cut.

New and essential services would disappear: for instance, rising-five admissions to schools, involving 80 teachers; restoring middle-school teacher posts, involving 60 teachers; additional curriculum protection posts in high schools, involving 20 teachers; and free school milk in first schools. We would also lose the improved street cleaning service — and it has improved. The council, I am informed, is receiving far fewer complaints. The hon. Member for, Acton can become equally well informed if he chooses. Officials are receiving far fewer complaints than they did when the service was in the private sector.

Other services that would be lost would be nursery nurses in every first school, involving 65 posts, and additional social services workers to protect children and elderly people at risk, involving 27 posts.

I met a woman the other day who is a teacher. Normally she votes Conservative, and no doubt she voted for the Conservative candidate in Acton. She told me that she was disgusted with the activities of the hon. Member for Ealing, North, whose presence in the Chamber is sadly missed this evening, and who has been peddling some considerable myths. He was admonished by the council's finance director — who, I notice from a copy of his letter, is on Christian terms with the hon. Gentleman, so pally have they been in the past. The finance director wrote: If you were, as you claim, largely responsible for prompting the Judicial Review procedure, then that action has certainly severely affected the cash flow of the Council, with consequent loss of interest on balances, and will result in a major hike in Ealing's rate arrears problems. The council has made attempts to secure more equal service provision and employment practices. That is not surprising, in a borough where 25.4 per cent. of the population live in households whose head was born in the New Commonwealth — which, of course, applies substantially to my constituency. But many myths have been peddled about the council's activities. It is accused of alienating the business community. That is not true. Where I live, the rate level is about the same as in Hillingdon. I do not know what the rate is in Cookham, Berkshire, but no doubt we will be enlightened on that point at some other time.

The chamber of commerce has complimented the authority on its consultative process. I have already mentioned the deprivatisation—an awful word—of the cleaning service. We are also told that Ealing is misleading its tenants about their right under the Housing Bill. That, too, is not true. The council is setting those rights out very clearly in accordance with the law. Eventually the electorate will see clearly the difficulties that the Government have placed on the local authority and they will return the Labour party with a handsome majority when they have the opportunity.

9.29 pm

Mr. Nicholas Bennett (Pembroke)

I am grateful for the opportunity to take part in the debate and to speak shortly on rate capping. I have just one thing to say to the hon. Member for Ealing, Southall (Mr. Bidwell). People in Ealing had a chance to vote on the 65 per cent. increase in rates in Ealing last year: in every constituency in Ealing there was a swing to the Conservatives and the hon. Gentleman's own majority fell from 11,000 to 7,000.

My constituents will be delighted that the Government are controlling local government expenditure and capping high-spending councils because they, as ratepayers and taxpayers, are contributing to the spending of those boroughs. I have a personal interest as a ratepayer in one of the rate-capped boroughs and as a former leader of the opposition in the London borough of Lewisham in seeing that the expenditure of that borough is kept under control.

As a ratepayer in one of the rate-capped boroughs, I know of the anger among ratepayers when they see the misuse of resources, the high staffing levels in the council and the poor services that they get in return for high rates. They are concerned that the council is not prepared to spend money on things which the ratepayers want, but instead wastes it on activities which are not in their best interests.

In the borough of Lewisham, in which I live, there are 1,331 empty properties. We have the 12th worst record in Britain on rent arrears, with 12 per cent. of the total rent roll outstanding—it was £4.1 million in 1987 and that has now risen to £5.6 million. [Interruption.] I am a ratepayer in the London borough of Lewisham and hon. Gentlemen should listen to what I have to say.

Let me give a few examples of the way in which the local authority wastes money. One cannot get a copy of the local paper in the public libraries there, yet in the foyer there are certain machines which do not work. Until recently, one could not read The Times in the local libraries because it was banned by the local authority. It was only due to the action of my right hon. Friend the Minister for the Arts that they were forced to have The Times back. It is interesting to note that the arts lobby made no protest when The Times was banned from some local council libraries.

The London borough of Lewisham has potholes everywhere because the council does not repair the roads as it should. When I went to register as an elector in the borough it did not manage to put me on the electoral register but had to add me to a supplementary list although my application went in before 10 October. The public library did not even have a list of new voters.

The borough council has an appalling record on street cleaning. There is no rubbish tip. People have to take their household rubbish to the Tory borough of Bromley. Wherever one looks, there is a lack of basic services in Lewisham. Instead, the local council spends its money on things such as the campaign unit which costs £300,000 and a public relations department which has 30 staff. It cuts its grant to the National Society for the Prevention of Cruelty to Children, as we see from the London Evening Standard tonight, yet it increases its grant to gays' organisations. That is how money is wasted in Lewisham.

Lewisham declares itself a nuclear-free zone and puts posters up everywhere telling people, but that makes no difference at all. It has a women's equality unit, a race equality unit, a community affairs unit, a women's committee, a police unit—all wasted public money in the borough.

In addition, I have just had through my letterbox a useful directory with 140 glossy pages — Lewisham women's directory. I thought at first that it might be a list of available women. Unfortunately, it turned out to be a list of Left-wing organisations in the borough of Lewisham.

Mr. Tony Banks

On a point of order, Mr. Speaker. I accept that every hon. Member has a right to speak, but it does seem to Opposition Members to be an abuse that an Member who represents an authority that is not rate-capped should prevent Members who represent those that are from speaking.

Mr. Speaker

The hon. Member for Pembroke (Mr. Bennett) has as much right to speak as anyone else, as long as he relates his remarks to the order, which he is doing.

Mr. Bennett

As a ratepayer in Lewisham, I care about how the money is spent. In the introduction to this little booklet, we find—[HON. MEMBERS: "The hon. Member does not pay the rates."] I do pay the rates. The little booklet says—

Mr. Ridley

Perhaps my hon. Friend could moderate his remarks a little, as it is clear that he is annoying Opposition Members. I introduced the order with great aplomb and solemnity, and if my hon. Friend would not say things which so infuriate Opposition Members, the mood of the debate will continue to be tranquil.

Mr. Bennett

I am grateful to my right hon. Friend. He will realise that I have a heavy cold and have to speak loudly to be heard.

In the introduction to the booklet, the chair of the women's committee says that the Government are attempting to reintroduce Victorian values, to erode employment rights for women workers and so on. Of course, she signs the introduction "in sisterhood". This glossy pamphlet, produced at the ratepayers' expense, contains only one section of information for ratepayers. In the section on family planning and abortion, the abortion information services are listed but there is no information about Life, the group that tries to help people who want to keep their children. In the section on peace, all the organisations, as the House might imagine, are Left-wing, CND groups. There is no information on Peace Through NATO or any other Right-wing group. The pamphlet, which must have been quite expensive to produce, is published at the ratepayers' expense. It says on the back cover that the pamphlet is what we have all been waiting for.

Mr. David Wilshire (Spelthorne)

Will my hon. Friend tell the House whether any of the literature that he received from Lewisham contains any news about reductions in costs in administration or any reference to fewer people being used in the finance department or any of the sensible things that could have been done to help the people in Lewisham?

Mr. Bennett

It does not. In fact, I can quote Dave Sullivan, the Labour leader of the council, as reported in the South London Press on 10 July 1987: Although we are spending more on services and employing more people, there has been little discernible increase in satisfaction. On the same day on which the glossy pamphlet came through my door, I read in my copy of my local paper, the Lewisham and Sydenham Comet: Libraries forced to shut to save cash. I have described how Lewisham spends its money. I commend the order to the House as a sensible and welcome move to protect ratepayers and taxpayers.

9.37 pm

Mr. Bernie Grant (Tottenham)

As an hon. Member representing a genuinely rate-capped authority, I am disgusted by the shower on the Conservative Benches. They are wasting the time of the House when we should be discussing the rate limitation order, which is spiteful and vindictive to the people in my borough. For the fourth year running, the London borough of Haringey has been rate-capped and this year we are asked to cut rates by 10 per cent.

Some of the things that have caused us to incur additional expenditure have absolutely nothing to do with the London borough of Haringey. They are not our responsibility. First, the Teachers' Pay and Conditions Act 1987 was passed after long disputes between the trade unions and the Government. As a result of that agreement, Haringey will have to pay about £3.328 million more than we budgeted for. Hon. Members have alluded to the problem of homelessness. Homelessness will cost us about £3.25 million more but that is something over which we have no control. The North London waste authority, which was set up by the Government after they abolished the GLC has told Haringey that its levy will be increased by 35 per cent. over the 1987–88 rate. That will cost the borough about £516,000. Time-expired urban aid projects will cost the borough some £418,000.

All this extra expenditure is a direct result of agreements or requirements placed on the borough by the Government, yet the Government refuse to increase the expenditure for the borough. We should add to that the fact that, during the past year, we have sustained a loss against GREA of £12.526 million.

Our borough has a number of problems. On the Z index of deprivation of the Department of the Environment, Haringey ranks sixth. However, on just one of the variables used, unemployment in Haringey was 10.7 per cent. when the indices were set up. It is now 14.1 per cent. Under the Department of Education and Science's cluster analysis, 14 per cent. of children in Haringey received free school meals in 1982, but that figure is now 24.4 per cent. There are many other poverty indicators relating to my borough of which the Secretary of State has not taken account.

Finally, a delegation from our borough went to see the Minister of State to try to gain an increase in the expenditure limit of Haringey council. After 22 minutes it was shown the door and told point blank that Haringey would not get a penny more from this miserable Government. It is a disgrace that the Government can perpetrate this con trick not only on the people of Haringey, but on the whole country. However, I advise them that the chickens will come home to roost in the poll tax when people will see, once and for all, what the Government are doing to their liberties.

9.41 pm

Mr. Jeff Rooker (Birmingham, Perry Barr)

In some ways the debate has been interesting, but there are times when the House can make an utter fool of itself. To spend only two and three quarter hours dealing with the detailed effects of local public expenditure on 4 million of our fellow citizens — dealing with about £2 billion-plus of expenditure—is an absolute farce. I advise the House that it will not make good television. Whether or not people outside are rate-capped, they will not understand how on earth the House of Commons — 650 elected Members — can sit in this place, talk and appear to make expert decisions about the detailed expenditure of local authorities. It beggars belief. We are simply not competent to do it. We never will be, and we should not even attempt to do it.

Many hon. Members have spoken for all the world as if we never have a local election. I advise Conservative Members that it is not that we do not have any simple answers. In the short time available I would not, in any event, attempt simple answers, and indeed, I should not attempt that if the time were longer, but we have repeatedly challenged the Government and repeatedly offered them an easy passage through the House for a Bill to legislate for annual elections in all areas of local government, yet they will not do it. The Government talk as though local elections do not exist.

As I listened to my hon. Friends and looked around at my hon. Friends who sought to speak, I wondered where, behind me, Tory councils were represented. Of course, there are none. The Labour party is repeatedly returned to power when there are local elections. We sincerely wish that there were local elections in, for example, the London boroughs every year and not just once ever four years.

Mr. Robert B. Jones

rose—

Mr. Rooker

No, I shall not give way.

We are prepared to meet that challenge.

Several of my hon. Friends have said that the Tory Government desire to ignore local government. Of course, if local government is of a different political complexion from central Government, local government seems a bad thing. However, it is not a bad thing to have local government and national Government of different political complexions. That was one of the reasons for having local government in a unitary state—to divide up the political power. If the political power is not divided up but simply resides at the centre, that leads to a dictatorship. It is as simple as that.

Mr. Harry Cohen (Leyton)

Will my hon. Friend give way?

Mr. Rooker

I cannot give way, I have to give the Minister a chance to reply. I hope that the Minister will give way, as he will have more time.

Mr. Cohen

Why should he give way?

Mr. Rooker

The Minister should give way because he has to answer questions.

Hon. Members must ask themselves whether rate capping makes for better local government — [HON. MEMBERS: "Yes."]. If Ministers think that they know everything and have great deal of confidence, I can give them a warning shot. What will happen when the poll tax legislation becomes law? What are the implication of national poll tax capping? The Department of the Environment does not always get it right.

There are three local authorities on the order for which the figures set by the Government were subsequently changed. They were changed after discussions and representations, but the Government had promoted the original figures on the basis that they were correct. For Ealing council, which has been often mentioned by two hon. Members, the figure went up from 125p to 167p. The Government must have thought that the figure was right when they promoted 125p. Where are the guarantees that they will get it right in the poll tax-capping era? The figures make us wary about what will happen.

The hon. Member for Swindon (Mr. Coombs) made it crystal clear when he said that the reduction in the rate support grant is designed to switch more of the burden of local spending onto local people. That is absolutely true.

Mr. Simon Coombs

Will the hon. Gentleman give way? He mentioned me.

Mr. Rooker

I mentioned the hon. Gentleman. I wrote down the words that he used, and he can check the record in Hansard. It was an honest statement. The hon. Gentleman clearly made that statement. That is a consequence of what is happening.

The rates have gone up in many areas, as there have been cuts in the rate support grant. It is a moot point whether central Government should be funding two thirds of local authority expenditure, but it is not a point that we can debate tonight. It is also a moot point whether the figure should be as high as that. We do not accept that it should be less than 50 per cent. and falling, as it is now. That causes other problems.

My hon. Friend the Member for Liverpool, Walton (Mr. Heffer) and the hon. Member for Liverpool, Mossley Hill (Mr. Alton) spoke about Liverpool. Whatever view one may take about Liverpool and its current and past difficulties, its population is about 500,000, it has an infrastructure to service about 750,000 people but an economy that will support only 250,000 people. That is a recipe for disaster for the people in Liverpool. There is no way in which one can juggle the figures to make sense of that equation.

My right hon. Friend the Member for Bethnal Green and Stepney (Mr. Shore) reminded us that many of the authorities, perhaps the vast majority of them, are partnership authorities. It was wrong to say that if one adds the partnership money to the rate support grant the percentage will be about the same. The needs of those areas would mean that the percentage should be higher and not the same. I can assure the hon. Member for Nottingham, South (Mr. Brandon-Bravo) that in many areas the cuts in the partnership money have only exacerbated the cuts in rate support grant to make a bad situation worse. That rightly has been described as the ugly face of Toryism. The Government ignore completely the situation in Tower Hamlets, which is a London borough with a unique problem over housing homeless families. It has specified the exact amount of money that it knows it needs as £21 million.

It is ridiculous for the House to try to legislate for the detailed expenditure of the local authorities. Four million fellow citizens are affected by the rate-capped authorities. Frankly, locally elected councillors know a lot better than us about the needs of their areas and they are more responsible so long as they face the consequences of their decisions at the ballot box. That is why we should have annual elections. That principle applies to Labour or Conservative councillors. They are the locally elected people and that is where the battle on such expenditure decisions should be fought. They should not be fought on the Floor of the House of Commons.

Mr. Cohen

On a point of order, Mr. Speaker. You are the custodian of parliamentary democracy and you represent the rights of Back Benchers. There are a number of Back Benchers who represent rate-capped authorities and they have important points to make in respect of those authorities. How can it be right that those hon. Members—

Mr. Speaker

Order. It is a great sadness that not every hon. Gentleman who wishes to be called every day can be.

Mr. Tony Banks

They represent rate-capped authorities.

Mr. Speaker

Order.

Mr. Cohen

On a point of order, Mr. Speaker.

Mr. Speaker

Order. It is not a point of order. The hon. Gentleman must resume his seat.

9.51 pm

The Parliamentary Under-Secretary of State for the Environment (Mr. Christopher Chope)

I am sure that there are many hon. Members who regret that the hon. Member for Leyton (Mr. Cohen) was unable to explain why he felt that the massive rate increase in Waltham Forest this year was justified.

Mr. Cohen

Will the Minister give way?

Mr. Chope

No, I will not give way.

Mr. Cohen

rose—

Mr. Speaker

Order. The hon. Gentleman must sit down.

Mr. Chope

rose—

Mr. Cohen

Will the Minister give way?

Mr. Speaker

Order. The hon. Gentleman knows that if the Minister does not give way he must not persist.

Mr. Chope

rose—

Mr. Cohen

Will the Minister give way?

Mr. Speaker

Order. If the hon. Gentleman does that once more, I shall have to ask him to leave the Chamber.

Mr. Chope

rose—

Mr. Cohen

rose—

Mr. Speaker

Order. I now tell the hon. Gentleman to leave the Chamber.

Mr. Cohen

I refuse to do so.

Mr. Speaker

Order. If the hon. Gentleman does not obey the Chair, I shall have to take further action. I order him to leave the Chamber.

Mr. Cohen

My constituents—

Mr. Speaker

Order. I will give the hon. Gentleman one more chance. If he does not leave the Chamber I shall be forced to name him.

Mr. Cohen

My constituents—

Mr. Speaker

Order. I name Mr. Harry Cohen.

Motion made, and Question put, That Mr. Harry Cohen be suspended from the service of the House.—[Mr. Lennox-Boyd.]

The House divided: Ayes 262, Noes 73.

Division No. 188]	[9.53 pm
AYES
Adley, Robert	Baldry, Tony
Aitken, Jonathan	Banks, Robert (Harrogate)
Alexander, Richard	Batiste, Spencer
Alison, Rt Hon Michael	Bellingham, Henry
Alton, David	Bennett, Nicholas (Pembroke)
Amess, David	Benyon, W.
Anderson, Donald	Blackburn, Dr John G.
Arnold, Jacques (Gravesham)	Blaker, Rt Hon Sir Peter
Arnold, Tom (Hazel Grove)	Body, Sir Richard
Ashby, David	Bonsor, Sir Nicholas
Ashdown, Paddy	Boscawen, Hon Robert
Aspinwall, Jack	Boswell, Tim
Atkins, Robert	Bottomley, Peter
Atkinson, David	Bowden, Gerald (Dulwich)
Baker, Rt Hon K. (Mole Valley)	Bowis, John
Baker, Nicholas (Dorset N)	Boyson, Rt Hon Dr Sir Rhodes

Braine, Rt Hon Sir Bernard	Grist, Ian
Brandon-Bravo, Martin	Hamilton, Hon Archie (Epsom)
Brazier, Julian	Hamilton, Neil (Tatton)
Bright, Graham	Hampson, Dr Keith
Brittan, Rt Hon Leon	Hanley, Jeremy
Brooke, Rt Hon Peter	Hannam, John
Brown, Michael (Brigg & Cl't's)	Hargreaves, Ken (Hyndburn)
Browne, John (Winchester)	Harris, David
Bruce, Ian (Dorset South)	Haselhurst, Alan
Buchanan-Smith, Rt Hon Alick	Hawkins, Christopher
Buck, Sir Antony	Hayes, Jerry
Budgen, Nicholas	Hayhoe, Rt Hon Sir Barney
Burns, Simon	Heseltine, Rt Hon Michael
Burt, Alistair	Hicks, Mrs Maureen (Wolv' NE)
Butcher, John	Hicks, Robert (Cornwall SE)
Butler, Chris	Higgins, Rt Hon Terence L.
Butterfill, John	Hogg, Hon Douglas (Gr'th'm)
Campbell, Menzies (Fife NE)	Holt, Richard
Carlile, Alex (Mont'g)	Hordern, Sir Peter
Carlisle, John, (Luton N)	Howard, Michael
Carrington, Matthew	Howarth, Alan (Strat'd-on-A)
Carttiss, Michael	Howarth, G. (Cannock & B'wd)
Cash, William	Howell, Ralph (North Norfolk)
Channon, Rt Hon Paul	Hughes, Robert G. (Harrow W)
Chapman, Sydney	Hughes, Simon (Southwark)
Chope, Christopher	Hunt, David (Wirral W)
Churchill, Mr	Hunt, John (Ravensbourne)
Clark, Hon Alan (Plym'th S'n)	Hunter, Andrew
Clark, Dr Michael (Rochford)	Irvine, Michael
Clark, Sir W. (Croydon S)	Irving, Charles
Clarke, Rt Hon K. (Rushcliffe)	Jack, Michael
Colvin, Michael	Jackson, Robert
Conway, Derek	Janman, Tim
Coombs, Anthony (Wyre F'rest)	Johnson Smith, Sir Geoffrey
Coombs, Simon (Swindon)	Jones, Gwilym (Cardiff N)
Cope, John	Jones, Robert B (Herts W)
Couchman, James	Key, Robert
Cran, James	King, Roger (B'ham N'thfield)
Curry, David	King, Rt Hon Tom (Bridgwater)
Davies, Q. (Stamf'd & Spald'g)	Knight, Greg (Derby North)
Davis, David (Boothferry)	Lennox-Boyd, Hon Mark
Day, Stephen	Livsey, Richard
Devlin, Tim	Lloyd, Peter (Fareham)
Dicks, Terry	McCrindle, Robert
Dobson, Frank	Macfarlane, Sir Neil
Dorrell, Stephen	Maclean, David
Douglas-Hamilton, Lord James	McLoughlin, Patrick
Dunn, Bob	Marshall, Michael (Arundel)
Dunwoody, Hon Mrs Gwyneth	Michie, Mrs Ray (Arg'l & Bute)
Durant, Tony	Miscampbell, Norman
Dykes, Hugh	Molyneaux, Rt Hon James
Evennett, David	Monro, Sir Hector
Fairbairn, Nicholas	Montgomery, Sir Fergus
Fallon, Michael	Morrison, Hon Sir Charles
Farr, Sir John	Neale, Gerrard
Favell, Tony	Neubert, Michael
Fearn, Ronald	Newton, Rt Hon Tony
Fenner, Dame Peggy	Nicholls, Patrick
Field, Barry (Isle of Wight)	Nicholson, David (Taunton)
Fookes, Miss Janet	Nicholson, Emma (Devon West)
Forman, Nigel	Onslow, Rt Hon Cranley
Forsyth, Michael (Stirling)	Oppenheim, Phillip
Foster, Derek	Page, Richard
Fox, Sir Marcus	Paice, James
Franks, Cecil	Patten, Chris (Bath)
Freeman, Roger	Patten, John (Oxford W)
French, Douglas	Pawsey, James
Fry, Peter	Peacock, Mrs Elizabeth
Gale, Roger	Porter, Barry (Wirral S)
Gardiner, George	Porter, David (Waveney)
Gilbert, Rt Hon Dr John	Portillo, Michael
Gill, Christopher	Price, Sir David
Goodson-Wickes, Dr Charles	Raffan, Keith
Gorman, Mrs Teresa	Raison, Rt Hon Timothy
Gow, Ian	Redwood, John
Grant, Sir Anthony (CambsSW)	Riddick, Graham
Greenway, Harry (Ealing N)	Ridley, Rt Hon Nicholas
Greenway, John (Ryedale)	Ridsdale, Sir Julian
Griffiths, Sir Eldon (Bury St E')	Rifkind, Rt Hon Malcolm
Griffiths, Peter (Portsmouth N)	Roberts, Wyn (Conwy)

Robertson, George	Taylor, Matthew (Truro)
Roe, Mrs Marion	Taylor, Teddy (S'end E)
Rooker, Jeff	Tebbit, Rt Hon Norman
Rossi, Sir Hugh	Temple-Morris, Peter
Rost, Peter	Thompson, Patrick (Norwich N)
Rowe, Andrew	Thornton, Malcolm
Rumbold, Mrs Angela	Thurnham, Peter
Ryder, Richard	Townend, John (Bridlington)
Sainsbury, Hon Tim	Tracey, Richard
Sayeed, Jonathan	Twinn, Dr Ian
Shaw, David (Dover)	Vaughan, Sir Gerard
Shaw, Sir Giles (Pudsey)	Viggers, Peter
Shaw, Sir Michael (Scarb')	Waddington, Rt Hon David
Shelton, William (Streatham)	Wakeham, Rt Hon John
Shephard, Mrs G. (Norfolk SW)	Waldegrave, Hon William
Shepherd, Colin (Hereford)	Walden, George
Shepherd, Richard (Aldridge)	Walker, Bill (T'side North)
Shersby, Michael	Wardle, Charles (Bexhill)
Sims, Roger	Warren, Kenneth
Skeet, Sir Trevor	Watts, John
Smith, Sir Dudley (Warwick)	Wells, Bowen
Speed, Keith	Wheeler, John
Speller, Tony	Whitney, Ray
Spicer, Michael (S Worcs)	Widdecombe, Ann
Squire, Robin	Wiggin, Jerry
Stanbrook, Ivor	Wilshire, David
Steen, Anthony	Winterton, Mrs Ann
Stern, Michael	Winterton, Nicholas
Stevens, Lewis	Wolfson, Mark
Stewart, Allan (Eastwood)	Wood, Timothy
Stewart, Andy (Sherwood)	Woodcock, Mike
Stewart, Ian (Hertfordshire N)	Yeo, Tim
Stradling Thomas, Sir John	Young, Sir George (Acton)
Straw, Jack
Summerson, Hugo	Tellers for the Ayes:
Taylor, Ian (Esher)	Mr. David Lightbown and
Taylor, John M (Solihull)	Mr. Kenneth Carlisle.
NOES
Allen, Graham	Litherland, Robert
Banks, Tony (Newham NW)	McAllion, John
Barnes, Harry (Derbyshire NE)	McCartney, Ian
Battle, John	Macdonald, Calum A.
Benn, Rt Hon Tony	McKelvey, William
Bermingham, Gerald	McTaggart, Bob
Bidwell, Sydney	Madden, Max
Bradley, Keith	Martlew, Eric
Brown, Nicholas (Newcastle E)	Michie, Bill (Sheffield Heeley)
Caborn, Richard	Morley, Elliott
Callaghan, Jim	Nellist, Dave
Campbell, Ron (Blyth Valley)	Parry, Robert
Canavan, Dennis	Patchett, Terry
Clay, Bob	Pendry, Tom
Clelland, David	Primarolo, Dawn
Clwyd, Mrs Ann	Ruddock, Joan
Corbyn, Jeremy	Salmond, Alex
Cousins, Jim	Sedgemore, Brian
Cox, Tom	Short, Clare
Cryer, Bob	Skinner, Dennis
Cummings, John	Smith, Andrew (Oxford E)
Davis, Terry (B'ham Hodge H'l)	Steinberg, Gerry
Dunnachie, Jimmy	Thompson, Jack (Wansbeck)
Fields, Terry (L'pool B G'n)	Turner, Dennis
Flannery, Martin	Vaz, Keith
Flynn, Paul	Wall, Pat
Fyfe, Maria	Welsh, Michael (Doncaster N)
Galloway, George	Wigley, Dafydd
Gordon, Mildred	Williams, Alan W. (Carm'then)
Graham, Thomas	Wilson, Brian
Grant, Bernie (Tottenham)	Winnick, David
Hardy, Peter	Wise, Mrs Audrey
Heffer, Eric S.	Wray, Jimmy
Hinchliffe, David	Young, David (Bolton SE)
Hood, Jimmy
Hughes, John (Coventry NE)	Tellers for the Noes:
Jones, Martyn (Clwyd S W)	Mrs. Alice Mahon and
Lestor, Joan (Eccles)	Ms. Diane Abbott.
Lewis, Terry

Question accordingly agreed to.

Ordered, That Mr. Harry Cohen be suspended from the service of the House.

It being after Ten o'clock, MR. SPEAKER put the Question, pursuant to order [12 February]:—

The House divided: Ayes 252, Noes 210.

Division No. 189]	[10.07 pm
AYES
Adley, Robert	Devlin, Tim
Aitken, Jonathan	Dicks, Terry
Alexander, Richard	Dorrell, Stephen
Alison, Rt Hon Michael	Douglas-Hamilton, Lord James
Amess, David	Dover, Den
Arnold, Jacques (Gravesham)	Dunn, Bob
Arnold, Tom (Hazel Grove)	Durant, Tony
Ashby, David	Dykes, Hugh
Aspinwall, Jack	Evennett, David
Atkins, Robert	Fairbairn, Nicholas
Atkinson, David	Fallon, Michael
Baker, Rt Hon K. (Mole Valley)	Farr, Sir John
Baker, Nicholas (Dorset N)	Favell, Tony
Baldry, Tony	Fenner, Dame Peggy
Banks, Robert (Harrogate)	Field, Barry (Isle of Wight)
Batiste, Spencer	Fookes, Miss Janet
Bellingham, Henry	Forman, Nigel
Bendall, Vivian	Forsyth, Michael (Stirling)
Bennett, Nicholas (Pembroke)	Fox, Sir Marcus
Blackburn, Dr John G.	Franks, Cecil
Blaker, Rt Hon Sir Peter	Freeman, Roger
Body, Sir Richard	French, Douglas
Bonsor, Sir Nicholas	Fry, Peter
Boscawen, Hon Robert	Gale, Roger
Boswell, Tim	Gardiner, George
Bottomley, Peter	Gill, Christopher
Bowden, Gerald (Dulwich)	Goodson-Wickes, Dr Charles
Bowis, John	Gorman, Mrs Teresa
Boyson, Rt Hon Dr Sir Rhodes	Gow, Ian
Braine, Rt Hon Sir Bernard	Grant, Sir Anthony (CambsSW)
Brandon-Bravo, Martin	Greenway, Harry (Ealing N)
Brazier, Julian	Greenway, John (Ryedale)
Bright, Graham	Gregory, Conal
Brittan, Rt Hon Leon	Griffiths, Sir Eldon (Bury St E')
Brooke, Rt Hon Peter	Griffiths, Peter (Portsmouth N)
Brown, Michael (Brigg & Cl't's)	Grist, Ian
Browne, John (Winchester)	Ground, Patrick
Bruce, Ian (Dorset South)	Hamilton, Hon Archie (Epsom)
Buchanan-Smith, Rt Hon Alick	Hamilton, Neil (Tatton)
Buck, Sir Antony	Hampson, Dr Keith
Budgen, Nicholas	Hanley, Jeremy
Burns, Simon	Hannam, John
Burt, Alistair	Hargreaves, Ken (Hyndburn)
Butcher, John	Harris, David
Butler, Chris	Haselhurst, Alan
Butterfill, John	Hawkins, Christopher
Carlisle, John, (Luton N)	Hayes, Jerry
Carrington, Matthew	Hayhoe, Rt Hon Sir Barney
Carttiss, Michael	Heddle, John
Cash, William	Heseltine, Rt Hon Michael
Channon, Rt Hon Paul	Hicks, Mrs Maureen (Wolv' NE)
Chapman, Sydney	Hicks, Robert (Cornwall SE)
Chope, Christopher	Higgins, Rt Hon Terence L.
Churchill, Mr	Hind, Kenneth
Clark, Hon Alan (Plym'th S'n)	Hogg, Hon Douglas (Gr'th'm)
Clark, Dr Michael (Rochford)	Holt, Richard
Clark, Sir W. (Croydon S)	Hordern, Sir Peter
Clarke, Rt Hon K. (Rushcliffe)	Howard, Michael
Colvin, Michael	Howarth, Alan (Strat'd-on-A)
Conway, Derek	Howarth, G. (Cannock & B'wd)
Coombs, Anthony (Wyre F'rest)	Howell, Ralph (North Norfolk)
Coombs, Simon (Swindon)	Hughes, Robert G. (Harrow W)
Cope, John	Hunt, David (Wirral W)
Couchman, James	Hunt, John (Ravensbourne)
Cran, James	Hunter, Andrew
Curry, David	Irvine, Michael
Davies, Q. (Stamf'd & Spald'g)	Irving, Charles
Davis, David (Boothferry)	Jack, Michael
Day, Stephen	Jackson, Robert

Janman, Tim	Shepherd, Colin (Hereford)
Johnson Smith, Sir Geoffrey	Shepherd, Richard (Aldridge)
Jones, Gwilym (Cardiff N)	Shersby, Michael
Jones, Robert B (Herts W)	Sims, Roger
Key, Robert	Skeet, Sir Trevor
King, Roger (B'ham N'thfield)	Smith, Sir Dudley (Warwick)
King, Rt Hon Tom (Bridgwater)	Speed, Keith
Knight, Greg (Derby North)	Speller, Tony
Lennox-Boyd, Hon Mark	Spicer, Michael (S Worcs)
Lightbown, David	Squire, Robin
McCrindle, Robert	Stanbrook, Ivor
Macfarlane, Sir Neil	Steen, Anthony
Maclean, David	Stern, Michael
McLoughlin, Patrick	Stevens, Lewis
Maples, John	Stewart, Allan (Eastwood)
Marshall, Michael (Arundel)	Stewart, Andy (Sherwood)
Miscampbell, Norman	Stewart, Ian (Hertfordshire N)
Monro, Sir Hector	Stradling Thomas, Sir John
Montgomery, Sir Fergus	Summerson, Hugo
Morrison, Hon Sir Charles	Taylor, Ian (Esher)
Neale, Gerrard	Taylor, John M (Solihull)
Neubert, Michael	Taylor, Teddy (S'end E)
Newton, Rt Hon Tony	Tebbit, Rt Hon Norman
Nicholls, Patrick	Temple-Morris, Peter
Nicholson, David (Taunton)	Thompson, Patrick (Norwich N)
Nicholson, Emma (Devon West)	Thorne, Neil
Onslow, Rt Hon Cranley	Thornton, Malcolm
Oppenheim, Phillip	Thurnham, Peter
Page, Richard	Townend, John (Bridlington)
Paice, James	Tracey, Richard
Patten, Chris (Bath)	Twinn, Dr Ian
Patten, John (Oxford W)	Vaughan, Sir Gerard
Pawsey, James	Viggers, Peter
Peacock, Mrs Elizabeth	Waddington, Rt Hon David
Porter, Barry (Wirral S)	Wakeham, Rt Hon John
Porter, David (Waveney)	Waldegrave, Hon William
Price, Sir David	Walden, George
Raffan, Keith	Walker, Bill (T'side North)
Raison, Rt Hon Timothy	Wardle, Charles (Bexhill)
Redwood, John	Warren, Kenneth
Renton, Tim	Watts, John
Riddick, Graham	Wells, Bowen
Ridley, Rt Hon Nicholas	Wheeler, John
Ridsdale, Sir Julian	Whitney, Ray
Rifkind, Rt Hon Malcolm	Widdecombe, Ann
Roberts, Wyn (Conwy)	Wiggin, Jerry
Roe, Mrs Marion	Wilshire, David
Rossi, Sir Hugh	Winterton, Mrs Ann
Rost, Peter	Winterton, Nicholas
Rowe, Andrew	Wolfson, Mark
Rumbold, Mrs Angela	Wood, Timothy
Ryder, Richard	Woodcock, Mike
Sainsbury, Hon Tim	Yeo, Tim
Sayeed, Jonathan	Young, Sir George (Acton)
Shaw, David (Dover)
Shaw, Sir Giles (Pudsey)	Tellers for the Ayes:
Shaw, Sir Michael (Scarb')	Mr. Peter Lloyd and
Shelton, William (Streatham)	Mr. Kenneth Carlisle.
Shephard, Mrs G. (Norfolk SW)
NOES
Abbott, Ms Diane	Blair, Tony
Adams, Allen (Paisley N)	Boateng, Paul
Allen, Graham	Boyes, Roland
Alton, David	Bradley, Keith
Anderson, Donald	Bray, Dr Jeremy
Archer, Rt Hon Peter	Brown, Gordon (D'mline E)
Armstrong, Hilary	Brown, Nicholas (Newcastle E)
Ashdown, Paddy	Brown, Ron (Edinburgh Leith)
Ashley, Rt Hon Jack	Buchan, Norman
Ashton, Joe	Buckley, George J.
Banks, Tony (Newham NW)	Caborn, Richard
Barnes, Harry (Derbyshire NE)	Callaghan, Jim
Battle, John	Campbell, Menzies (Fife NE)
Beckett, Margaret	Campbell, Ron (Blyth Valley)
Bell, Stuart	Campbell-Savours, D. N.
Benn, Rt Hon Tony	Canavan, Dennis
Bennett, A. F. (D'nt'n & R'dish)	Carlile, Alex (Mont'g)
Bermingham, Gerald	Clark, Dr David (S Shields)
Bidwell, Sydney	Clarke, Tom (Monklands W)

Clay, Bob	Grant, Bernie (Tottenham)
Clelland, David	Griffiths, Win (Bridgend)
Clwyd, Mrs Ann	Grocott, Bruce
Coleman, Donald	Hardy, Peter
Cook, Frank (Stockton N)	Harman, Ms Harriet
Cook, Robin (Livingston)	Hattersley, Rt Hon Roy
Corbyn, Jeremy	Haynes, Frank
Cousins, Jim	Healey, Rt Hon Denis
Cox, Tom	Heffer, Eric S.
Crowther, Stan	Henderson, Doug
Cryer, Bob	Hinchliffe, David
Cummings, John	Hogg, N. (C'nauld & Kilsyth)
Cunliffe, Lawrence	Holland, Stuart
Cunningham, Dr John	Home Robertson, John
Darling, Alistair	Hood, Jimmy
Davies, Rt Hon Denzil (Llanelli)	Howarth, George (Knowsley N)
Davies, Ron (Caerphilly)	Hughes, John (Coventry NE)
Davis, Terry (B'ham Hodge H'l)	Hughes, Roy (Newport E)
Dewar, Donald	Hughes, Sean (Knowsley S)
Dixon, Don	Hughes, Simon (Southwark)
Dobson, Frank	Ingram, Adam
Douglas, Dick	John, Brynmor
Duffy, A. E. P.	Jones, Martyn (Clwyd S W)
Dunnachie, Jimmy	Kaufman, Rt Hon Gerald
Dunwoody, Hon Mrs Gwyneth	Lambie, David
Eadie, Alexander	Lamond, James
Eastham, Ken	Leadbitter, Ted
Ewing, Harry (Falkirk E)	Leighton, Ron
Fatchett, Derek	Lestor, Joan (Eccles)
Fearn, Ronald	Lewis, Terry
Field, Frank (Birkenhead)	Litherland, Robert
Fields, Terry (L'pool B G'n)	Livsey, Richard
Fisher, Mark	Lloyd, Tony (Stretford)
Flannery, Martin	Lofthouse, Geoffrey
Flynn, Paul	McAllion, John
Foot, Rt Hon Michael	McAvoy, Thomas
Foster, Derek	McCartney, Ian
Foulkes, George	Macdonald, Calum A.
Fraser, John	McFall, John
Fyfe, Maria	McKay, Allen (Barnsley West)
Galbraith, Sam	McKelvey, William
Galloway, George	McLeish, Henry
Garrett, John (Norwich South)	McTaggart, Bob
Garrett, Ted (Wallsend)	McWilliam, John
George, Bruce	Madden, Max
Gilbert, Rt Hon Dr John	Mahon, Mrs Alice
Gordon, Mildred	Marek, Dr John
Graham, Thomas	Marshall, David (Shettleston)

Marshall, Jim (Leicester S)	Ruddock, Joan
Martin, Michael J. (Springburn)	Salmond, Alex
Martlew, Eric	Sedgemore, Brian
Maxton, John	Sheerman, Barry
Meacher, Michael	Sheldon, Rt Hon Robert
Meale, Alan	Shore, Rt Hon Peter
Michie, Bill (Sheffield Heeley)	Short, Clare
Michie, Mrs Ray (Arg'l & Bute)	Skinner, Dennis
Millan, Rt Hon Bruce	Smith, Andrew (Oxford E)
Mitchell, Austin (G't Grimsby)	Smith, C. (Isl'ton & F'bury)
Molyneaux, Rt Hon James	Smith, Rt Hon J. (Monk'ds E)
Moonie, Dr Lewis	Snape, Peter
Morgan, Rhodri	Soley, Clive
Morley, Elliott	Spearing, Nigel
Morris, Rt Hon A. (W'shawe)	Steinberg, Gerry
Morris, Rt Hon J. (Aberavon)	Stott, Roger
Mowlam, Marjorie	Strang, Gavin
Murphy, Paul	Straw, Jack
Nellist, Dave	Taylor, Matthew (Truro)
O'Neill, Martin	Thompson, Jack (Wansbeck)
Orme, Rt Hon Stanley	Turner, Dennis
Parry, Robert	Vaz, Keith
Patchett, Terry	Wall, Pat
Pendry, Tom	Walley, Joan
Pike, Peter L.	Wardell, Gareth (Gower)
Powell, Ray (Ogmore)	Wareing, Robert N.
Prescott, John	Welsh, Michael (Doncaster N)
Primarolo, Dawn	Wigley, Dafydd
Quin, Ms Joyce	Williams, Rt Hon Alan
Randall, Stuart	Williams, Alan W. (Carm'then)
Rees, Rt Hon Merlyn	Wilson, Brian
Reid, Dr John	Winnick, David
Richardson, Jo	Wise, Mrs Audrey
Roberts, Allan (Bootle)	Worthington, Tony
Robertson, George	Wray, Jimmy
Robinson, Geoffrey	Young, David (Bolton SE)
Rogers, Allan
Rooker, Jeff	Tellers for the Noes
Ross, Ernie (Dundee W)	Mrs. Llin Golding and
Rowlands, Ted	Mr. Alun Michael.

Question accordingly agreed to.

Resolved, That the draft Rate Limitation (Prescribed Maximum) (Rates) Order 1988, which was laid before this House on 12th February, be approved.