HC Deb 18 January 1988 vol 125 cc655-7
3. Mr. Ron Davies

To ask the Secretary of State for Wales how many people will be liable to pay the proposed community charge in Wales in comparison with those presently liable for rates.

Mr. Peter Walker

The object of the community charge is to spread the responsibility for the 15 per cent. of local government spending that will come from the domestic contribution to all adults and not just to the householders, so 2.1 million adults will be liable compared with 1.1 million present ratepayers.

Mr. Davies

Will the Secretary of State acknowledge that in every district of Mid Glamorgan, which is the county with the worst social and economic deprivation in Wales, every household will be worse off? We noticed the Secretary of State's obvious displeasure and distaste when he commended the Second Reading to the House last December. When he went against his better judgment and voted for the Bill, did he do so to advance his personal ambition, or from fear of the Prime Minister?

Mr. Walker

Both, probably. As I was able to point out, the community charge will be a fairer, better system for Wales. The hon. Gentleman's allegation that every household in his constituency will be worse off is a load of nonsense. Many of his constituents, particularly one-parent families, widows and a load of people who had an unfair burden in the past, will greatly benefit from the changes. In addition, as I pointed out in my answer, as only 15 per cent. of local government expenditure in Wales will come from the community charge, we can organise the needs element in Wales to ensure perfect fairness. That is why I supported the Second Reading happily and I am glad to say that it was cheered loudly from these Benches.

Mr. Rowlands

Is the Secretary of State aware that in Aberfan, Treharris, Rhymney and Merthyr Vale more than three quarters of the householders are likely to be losers under the so-called poll tax? In the name of heaven, what is the case for increasing costs on some of the poorest householders? I thought that the right hon. Gentleman was supposed to be a "One Nation" Tory, but there is no evidence of it in this case.

Mr. Walker

On Second Reading I pointed out that this depends wholly on the needs element that operates when the community charge is introduced. In the past the hon. Gentleman has given me figures about the poverty of many of his constituents. The basis of the rebate scheme and the nationally spread rebate for those on low incomes may well substantially improve the lot of a number of his most poverty-stricken constituents.

Mr. Gwilym Jones

May I put it to my right hon. Friend that if we were not to move to the community charge, and were to persist with this manifestly unfair rating system, there would have to be a revaluation of all properties and that the greatest rate demands would be likely to fall on the lower-priced houses, particularly in the valleys of south Wales?

Mr. Walker

The manner and method of operating the community charge will be perfectly good and sensible for Wales. It will remove a great deal of the considerable hardship that one-parent families and others like them have suffered in the past.

Mr. Alan Williams

Does the Secretary of State realise that although it is bad enough that the poll tax will mean massive increases for the people in the valley communities, it also has an industrial context? The Secretary of State will recollect that last week he produced his future strategy for employment in the valley communities based purely on small firms, although he cut capital grants to one fifth of what they are now. In that context, will he confirm that the combined effect of the poll tax, the unified business rate and revaluation will be twice as great on small firms as on medium-sized and large firms? How, therefore, does he reconcile his employment aims, as stated last week, with the lower capital incentives of the regional policy and the higher costs implicit in his changes in the rating system?

Mr. Walker

That is a load of nonsense. I now have more money with more flexibility than ever before to encourage small and large firms. Before the right hon. Gentleman makes these pronouncements he should study the facts. Small firms in the valleys will benefit from many of last week's announcements. They will also have available through the WDA and selective assistance every possible inducement and incentive available to larger firms. The combination of our policies is undoubtedly good for the valleys. On the rating system — I should have thought that this was to the hon. Gentleman's delight —I announced that if there was any shift of emphasis it would be to the benefit of Swansea as opposed to Cardiff.