TOTAL EXPENDITURE: 1985–86 to 1988–89

HC Deb 07 November 1988 vol 140 cc47-112

5.4 pm

Mr. Jeff Rooker (Birmingham, Perry Barr)

I beg to move amendment No. 1, in page 1, line 9, at end insert 'except where in relation to any year a local authority has before 7th July 1988 approved its accounts in which case he shall treat total expenditure as equal to the amount approved by the authority'.

The Chairman of Ways and Means (Mr. Harold Walker)

With this it will be convenient to discuss the following amendments: No. 19, in page 1, line 9, at the end insert 'except where in relation to any year a local authority has before 7th July 1988 approved its accounts and submitted them to the district auditor in which case he shall treat total expenditure as equal to the amount approved by the authority.'.

No. 4, in schedule 1, page 8, line 44, at end insert 'except where paragraph 3A applies'.

No. 6, in page 8, line 50, after 'the relevant amount', insert 'except where paragraph 3B applies'.

No. 8, in page 8, line 50, after 'the relevant amount' insert 'subject to sub-paragraph (2A) below.'.

No. 9, in page 8, line 50, at end insert— '(2A) Where a local authority has made a decision before 7th July 1988 which affects its total expenditure in relation to the year and the authority has submitted to the Secretary of State by 31st January 1989 a statement certified by the auditor appointed under Part III of the Local Government Finance Act 1982 that the decision increases or decreases the authority's total expenditure by a certified amount, the relevant amount is (as regards the authority) the amount submitted under sub-paragraph (2) above as adjusted by the certified amount.'.

No. 5, in page 9, line 40, at end insert— '3A.—(1) This paragraph applies where a local authority has approved its accounts after 6th July 1988 and before 31st October 1988 and where the amount of its total expenditure in relation to the year has been certified by the auditor appointed under Part III of the Local Government Finance Act 1982. (2) In such a case the relevant amount is the amount certified by the auditor.'.

No. 7, in page 9, line 40, at end insert— '3B.(1)—This paragraph applies where—

1. (a) A local authority or a Committee of a local authority has received before 7th July 1988 from the person having responsibility for the administration of its financial affairs a report containing estimates of expenditure in the relation to the year, and
2. (b) the authority has submitted to the Secretary of State before 31st January 1989 a statement containing an amount of total expenditure consistent with the 48 estimates and certified by the auditor appointed under Part III of the Local Government Finance Act 1982.

(2) In such a case the relevant amount is the amount certified by the auditor.

3) Where there is more than one report received, the report referred to in sub-paragraph (1)(a) above is the latest to be received before 7th July 1988.'.

Mr. Rooker

This is the largest group of amendments and, in effect, they encompass four separate points although they are all related to the retrospective nature of the Bill and the fact that many local authorities feel extremely hard done by because of the nature of the Government's announcement in July. Certainly I do not intend to repeat the points that I made on Second Reading last week, but obviously I suspect there will be constant reference to those local authorities that will lose considerable sums of money because of the operation of the Bill.

The purpose of amendment No. 1 and the purpose of several other amendments, is to allow information that was known about a local authority's expenditure and which was already in the public domain before 7 July, to be used, even though that information had not been received by the Secretary of State. His closedown date for such information was midnight 6 July.

Amendment No. 1 is certainly the most straightforward of the amendments, which will inevitably contain a great degree of technical detail. It deals specifically with the circumstances of an authority which had approved the accounts for any of the years beginning 1985–86, 1986–87 or 1987–88. Of course I accept that the amendment principally affects the year 1987–88 because, in most cases, the 1985–86 and 1986–87 accounts had been closed before the beginning of this year.

Although accounts may have been closed, it would not normally be a matter that would be immediately reported to the Department of the Environment. I understand that, for the accounts for 1987–88, the normal course of events would have been for the authorities to report the outturn of expenditure on a group of forms, not due for return to the Department of the Environment until 1 August. They would not even have been issued by the Department until 24 June. Of course, 6 July comes virtually in the middle of those two dates.

Authorities that have been prompt in closing their accounts and have managed to reduce expenditure below the level anticipated in their budgets or have produced revised estimates are now denied any advantage they would have received because of the Secretary of State's insistence on using information that was received by him before 7 July. Those authorities feel roughly treated, to put it mildly.

At this stage I shall give one example that has been well documented. The authority does not constitute a large urban area—I tended to concentrate upon such examples on Second Reading. It is helpful that my new example comes from a district in the constituency of a Cabinet member. Obviously that is advantageous because I do not want to be seen to be seeking to make partisan points. This is an example of local government feeling badly treated by central Government. Last week I made it clear that Conservative authorities will lose hundreds of millions of pounds, as will Labour authorities, and that it will be the ratepayers and the poll tax payers who will have to foot the bill.

I hope that the Minister will give us the reason why West Somerset district council has been so roughly treated. I should like to draw the attention of the Committee to correspondence sent from that council to its Member of Parliament, the Secretary of State for Northern Ireland. A few short sentences, giving the relevant dates, show how a well-run, efficient authority, which is not large, has been shortchanged by more than £100,000 as a result of the Bill. The letter was sent to the Secretary of State from the treasurer and is dated 11 July. It makes it clear that as a result of the decision of midnight on 6 July, the council will lose £133,000.

It is worth giving details of some of the dates because that will show how other authorities are affected. The treasurer states: On 4th March, 1988 I returned RER89 showing the Council's revised estimated 1987–88 'Total Expenditure' for Rates Support Grant of £1,621,000. On 6th May, 1988 the Council's Final Accounts for 1987–88 were completed and the actual 'Total Expenditure' for Rate Support Grant was £1,477,808. The effect of this reduction of £143,000 enabled me to calculate an additional amount of Rate Support Grant of £133,000 at a marginal grant rate of 93p for every £1 of reduced expenditure. The treasurer made it clear that there had been a reduction from what was originally budgeted. Whereas councils that spend over the figures laid down by the Government have their grant reduced, if councils spend under those figures, they get additional grant that is not even pro rata, in this case, 93p for every £1 of reduced expenditure.

The treasurer continues:

The Council's Statement of Accounts for 1987–88 was completed on 18th May, 1988 and signed by me. The Council's Finance Sub Committee received a report … on 14th June, 1988 about the Final Accounts-General Rate Fund Net Rate Fund Expenditure 1987–88 which it approved. The Department of the Environment sent me the Annual Revenue Outturn Returns for 1987–88 including the Rate Support Grant Return on 24th June, 1988 which I received on Tuesday 28th June, 1988. This was four weeks later than in 1987. My Deputy tackled them immediately and completed them on Wednesday, 6th July, 1988. All Returns were posted 2nd class the next day". That local authority saved ratepayers' money and did not automatically use first-class post. There was no reason to do so.

The letter continues: the Department stipulates that it requires them back by 1st August, 1988. Clearly, the Department would have received the returns by 1 August. However, in the meantime, the 6 July decision was made and as a result the council lost £133,000.

I ask the Minister what was slipshod and lethargic about the council's behaviour. What was inefficient about the way in which the council dealt with the forms that it was required to send to the Department, and the way in which the treasurer and his deputy dealt with its committee meetings? What is lethargic, incompetent or inefficient about that? The council lost a considerable sum. I do not know what the percentage is, but it will be a fairly hefty percentage of the council's expenditure.

5.15 pm

The reply from the Secretary of State for the Environment to his Cabinet colleague can be summed up as, "Tough." According to the treasurer, the £133,000 is a loss equivalent to a 22p rate for ratepayers in West Somerset. When ratepayers in west Somerset get their rate demands for next year, over 2p in the pound will be a direct result of the council being short-changed through the Government choosing an unfair, arbitrary date and then not wanting to take on board other information that was already in the public domain. That council would not seek to change a single figure in the accounts to which I have referred. No creative accounting is involved. All the information went before the committees and was dealt with in public. The council does not seek to change any of it. All it says is that because it was public information, the Department of the Environment should take it on board and look at the accounts accordingly.

Amendment No. 5 and its paving amendment, No. 4, require the Secretary of State to take into account local authorities' final expenditure figures for 1987–88 in determining their grant entitlement in cases where the authority had approved its accounts and had them certified by its auditor after 6 July but before 31 October 1988. The significance of the latter is that that was the date of the Bill's Second Reading.

Again, the information would be available already. We are addressing ourselves simply to the arbitrary cut-off date of 6 July. The accounts would be certified by an auditor. The amendment would require the Secretary of State to take into account information later than 6 July if it met the relevant criteria. He would have to take into account increases in expenditure that would reduce grant as well as reductions in expenditure that would increase grant, which is the example that I have just given from west Somerset. On past trends, local authorities' final expenditure would be lower in aggregate than the earlier estimates, so there would be a net recoupment of holdback grant. Even so, the Treasury would still gain.

The Minister should consider that seriously. We are looking at the period from 6 July until 31 October, which is not arbitrary, but the date of the Bill's Second Reading. That is another point that should be considered as the Bill goes through its legislative process, although one can hardly call what is happening today a legislative process because the Bill will not receive the scrutiny that it deserves.

For practical purposes, I should like to call amendments Nos. 6 and 7 the Brent amendments because they are about the effect on the London borough of Brent. The amendments would allow the latest expenditure estimates for 1987–88, prepared by the director of finance or the treasurer of an authority before 7 July, to be substituted for the latest figures received by the Department of the Environment.

Let me give the reasons for the amendments. Clearly, local authorities did not know before 7 July of the Secretary of State's intention to use the latest information available to him as the final basis of calculation for the rate support grant in 1987–88 or, indeed, any of the Iwo previous years. That was a secret. The Secretary of State's scheme to come to the House to make his statement would not have worked if it had not been a secret. That was a necessary part of his plan. As a consequence, authorities were unaware of the need to get the latest estimates for expenditure for 1987–88 to the DOE. The authorities could have sent earlier estimates. As a result, the Government were using estimates which were too high and local authorities will lose grant. It is only fair that amendment No. 7 would allow local authorities to replace the DOE's assumption with later estimates.

It is important to note that amendment No. 7 will only allow that substitution if the following five conditions are met. First, it will allow substitution if the later estimates were received from the director of finance or treasurer by the local authority or a committee of the local authority, in other words, if the estimates are a matter of public record. No local authorities hold meetings in secret. If they do, we would like to know about them because that is not supposed to be the case. We are looking for information which is clearly in the public domain.

The second condition is if the later estimates were received by the authority before 7 July—that is, before the date of the Secretary of State's announcement—so there is no question of the estimates being doctored after the statement.

The third condition is that the authority makes known to the DOE by 31 January next that it has later estimates so that there will be no additional work for DOE staff in finding the latest estimates from each authority. We do not want to impose extra work on the hard-pressed civil servants in the DOE.

Fourthly, the district auditor—who is independent—must certify that the total expenditure figure submitted fulfills the requirement of the law in that it is the latest estimate before 7 July 1988 and that the total expenditure figure is consistent with the estimates.

The final condition is that the report to be used as the basis of the substitution should be the latest report prepared for the director of finance or treasurer before the 7 July deadline, so that there is no scope for any authority to choose the most favourable report. Some authorities may have three or four estimates, some higher and some lower than others. We do not want to allow an authority to choose one, knowing the new rules, to maximise its grant. I am referring to the latest estimate that has been prepared and presented to the authority.

If the Minister for Local Government wants to accept any of the amendments or to intervene at any time, I will gladly shut up and sit down and we can then make further progress. I take that for granted in Committee. I am not here to listen to the sound of my own voice or to talk to Ministers if they do not listen to me. I offer that opportunity to the Minister in a spirit of co-operation.

Clearly, the Minister is not about to accept the amendment and I must therefore surmise why the Minister will rubbish it. First, he will say that there is scope for ambiguity about the total expenditure figure and therefore it is not certain. Obviously there is certainty in the Bill at the moment and it will mean extremely rough justice for many local authorities. The Government will argue that local authorities should be free to choose whether they submit a certified statement. If that approach is taken, all authorities should be treated in the same way. The Minister might also say that the amendment will delay the making of a supplementary report for 1987–88 until the new year.

For the benefit of my education, the Opposition's advisers have provided me with replies to those objections which the Minister might use. I will cite this advice now because it will save bother later and reinforce my points about Brent.

We argue that there will be certainty about the appropriate total expenditure figure because of the five safeguards, or conditions, which I have referred to in some detail. There will be no change if a local authority does not submit a certified statement. Clearly it is up to the authority to do that. If it submits such a statement, the Government will know that it is consistent with the latest estimate to the authority or its committee before 7 July and that it is the latest estimate. The district auditor will be required to certify that that is the case. There is no scope for ambiguity.

Those authorities which submit a statement will only regain grant that they were entitled to before the advent of the Bill. As I said last week, local authorities had every expectation that the £512 million would in due course be available to them and not paid back to the Treasury. We are not talking about new money over and above that which Parliament has already agreed. The amendment will allow authorities to avoid injustice which they would otherwise suffer. That is fair enough.

I have it on the best authority that the delay to a supplementary report is not serious. For 1987–88 the grant entitlement of one authority is not affected by that of others. Therefore, each authority will know what change in grant it can expect to receive. I understand that it is quite common practice for the DOE and the Secretary of State to lay the supplementary reports before Parliament in the period before a new financial year, but only to implement the change once the year begins. That allows local authorities to budget for otherwise unforeseen grant changes. The timetable built into the amendment allows all that to happen.

I want to refer to the figures for one authority which would benefit from the amendment. Most of the figures used by the DOE for the purposes of the Bill for the year 1987–88—which is the year affected for which the accounts will be closed down, it is not the current financial year—come from the form RER89. That form contains budget figures for 1988–89 and the revised estimates for 1987–88.

Brent council had not submitted its RER89 form by 7 July 1988. No one would argue about that. Brent had agreed a total expenditure figure when it set its rate in March, but it was unable to decide how its budget should be split between the different service areas. Therefore it could not fill in all the form. No hon. Member needs to recite the financial difficulties that Brent has faced.

While Brent had agreed its total figure, it could not fill in the detailed form for the particular service areas. As it did not want to send off a partly filled in form, that form was not sent. Officials from the DOE telephoned Brent to find out the total expenditure figure for 1988–89 and asked for that to be confirmed in writing. Brent did not confirm the revised estimate for 1987–88, although the figure was available and provided to DOE officials orally.

Brent did not appreciate the significance of this until after 7 July. Its revised estimate as reported to the council in March showed a £5.9 million reduction in expenditure compared to the figure that the Government are using. Everyone realises that Brent council is making substantial cuts in its expenditure this year. However, as a result of the Bill the difficulties facing the councillors and citizens of Brent will be made even worse. That is because Brent will lose £8 million in grant that it reasonably expected to receive. The figures were calculated by Brent officials and agreed by the councillors. Councillors do not go round willy-nilly cutting services. However, they cut the budget by £5–9 million and are prepared to take the consequences and to fight their corner. I shall later deal with the detail about that.

5.30 pm

Brent councillors reasonably expected to receive £8 million in extra grant. That is part of what the debate is all about. The Government always tell councils to cut their expenditure below the level that they are planning and they will get more grant, more money pound for pound. The amendment would allow Brent to submit a statement certified by the district auditor saying that its latest estimates of expenditure for 1987–88 are lower than the Department of the Environment had assumed.

How many times have we heard local government Ministers—I exclude the present Minister who has not been long in post attack—Brent for spending too much and call upon it to reduce expenditure? Brent has done that and it is grossly unfair to penalise it to the tune of £8 million. We want the amendment so that Brent will be allowed to submit a statement of the sort that I have outlined. That would certainly remove the unwanted and unwarranted financial pressure on Brent council which is extremely hard pressed and suffering.

I recently read a heavyweight piece in The Independent written by some professor whose name I forget. The piece was about Brent but the writer did not say whether he was a ratepayer or lived there. However, he said that Brent needed financial help. He also made some political points and said that Brent had been badly treated over its finances.

Brent council continues to spend over £300 million a year. The borough spends more on social service day nurses than any other outer London borough. Its rent figure is about the same as the outer London average and, believe it or not, with all its problems Brent's pupil-teacher ratio is still above the national average. That is much to the credit of Brent councillors who have had to agree the latest budget. The level of service in all areas of Brent is still superior to any comparable Tory-controlled authority.

Brent council is prepared to be honest and to face the consequences of the problems that were left to the present administration. No one can point the finger at any single party, because Brent suffered greatly when it was run by a coalition of Liberals and Conservatives. That coalition left a considerable mess and balances of £37 million were cleared out before Labour took control. I must put the positive case for Brent. As long as I am responsible for speaking for the Labour party on local government matters I am not prepared to listen to unfair criticism of any local authority, Labour or Tory. Sometimes there is fair criticism but there has been a great deal of unfair criticism about Brent. In the view of many people, Brent is now bravely seeking to put its finances in order. It is grossly unfair that this legislation will result in Brent losing £8 million of Government grant.

Mr. Graham Allen (Nottingham, North)

Would my hon. Friend like to comment on the change of control of councils? He may be aware that a by-election last Thursday in Nottingham turned out the sitting Tory council, not least because of its mismanagement of Bradford and the Government's unpopularity in Nottingham. Would he like to say something about the change of control now that Nottingham has a Labour-controlled authority?

Mr. Rooker

My hon. Friend is right. In a debate in the House last week Nottingham figured almost as much as Bradford. A Conservative Member who is not present at the moment said that he knew Nottingham better than my hon. Friend the Member for Nottingham, North (Mr. Allen). I understand that a Conservative majority of 400 was turned into a Labour majority of 600. The Labour candidate, now Councillor Clark to whom we send our congratulations, polled over 2,000 votes. The Democratic party candidate polled more votes than there are amendments on today's order paper from that party. He polled 89. It is to the credit of the people of Nottingham that they listened to our debate on Monday and took on board the arguments that we advanced about the Bill and its unfair treatment of the people there. They voted accordingly. I understand that today that decision will be translated into practical effect in the council chamber.

The Minister for Local Government (Mr. John Selwyn Gummer)

Would the hon. Gentleman like to comment on the by-election that took place in Hyndburn, one of the most marginal seats? In that by-election the Labour candidate was booted out by the Conservative candidate and the community charge was an important issue in the by-election. Would the hon. Gentleman speak in the same way about the people of Hyndburn, or are they backward compared to the people of Nottingham?

The Second Deputy Chairman of Ways and Means (Miss Betty Boothroyd)

Order. I think that both sides of the Committee have had their say on this issue. Perhaps we could get back to the amendment.

Mr. Rooker

The difference is that everybody knew, because it had been made clear in the House during our debate last week, that the elections in that one ward were crucial to the control of the council. That adds greater weight to the point made by my hon. Friend the Member for Nottingham, North.

Mr. Irvine Patnick (Sheffield, Hallam)

I understand that the casting vote is now in the hands of a Communist.

Mr. Rooker

Yes. He holds the distinguished flying cross, an honour he won in the battle of Britain. We live in a democracy and he was elected as a councillor. I do not see anything wrong in that. Does the hon. Gentleman see something wrong in it?

Mr. Patnick

I see no difference between that and the casting vote of the mayor of Bradford.

Mr. Rooker

At the moment, the mayor of Bradford is using two votes. I understand that each councillor in Nottingham uses one vote.

I should like to come to my final point on amendments Nos. 8 and 9. I am looking round to see if I can locate one of my hon. Friends but he does not appear to be here at the moment. Perhaps he will arrive before we conclude the debate. The revaluation of superannuation funds was raised on Second Reading and the Minister said that he would look at the matter. I do not know whether he will have anything to say about that in this debate. Amendments Nos. 8 and 9 cover police authorities, passenger transport authorities and, of course, local councils. We have some other matters to raise about superannuation funds and their effect.

I understand that some local authorities are in the process of taking decisions in good faith which affect the expenditure of block grant entitlement. I shall stick to one narrow point. Some authorities, which have undertaken interim revaluations on the superannuation funds, have taken account of reduced employers' contributions in the revised estimates. Other authorities decided not to take them into account until the position was clearer, but will have done so when closing their accounts. In the normal course of events those councils would probably not have closed their accounts for about another year.

The retrospective nature of the Secretary of State's statement of 6 July is causing difficulty. Amendments Nos. 8 and 9 rescue at least those decisions that were made prior to the Secretary of State's announcement. That is all that we are talking about here. Being dependent on the external auditors' certificate, the figures could not be open to manipulation by any of the authorities, and no authority is seeking to do that. The Government have to meet this point. I know that many of my hon. Friends who represent constituencies in the west midlands have received representations on this matter.

One of the difficulties that we are under is the nature of the Bill and the way that it is being rushed through all its stages. On a later amendment I have a point to make about a major authority which was unaware, for whatever reasons, of the effect of the Bill upon its operations until something like Thursday of last week. That is difficult to imagine, but nonetheless, that is the case, and millions of pounds are involved. I should like the Minister to look at amendments Nos. 8 and 9 in the context of those authorities where revaluations of superannuation funds have taken place. I know that in some cases there were objections from the Government earlier on. Any proposals will have losers and gainers, but there seem to be more losers than gainers in this proposal. Authorities tend to underspend against the estimates.

Mr. Gummer

I hope to help the hon. Gentleman. With the superannuation, there is a problem. Authorities could not have written back after this date a sum that would help them because a revaluation between the dates has been seen to be contrary to the law. Therefore, the amendments that he is proposing would not help authoritites in those circumstances. This was the point I was trying to discuss earlier. I agree that this is a complicated matter, but that point would not be met by these two amendments, although the hon. Gentleman is right to say that others might be.

Mr. Rooker

I take the Minister's point.

The seven west midlands district councils stand to lose some £25 million over three years if the Secretary of State fails to take account of the impact of revaluation. If the west midlands authorities are revaluing their pension funds contrary to law, then someone will have to point that out to them. They are unaware that the revaluation was contrary to the law.

Mr. Alun Michael (Cardiff, South and Penarth)

I almost feel sorry for Ministers who are left to defend what they must know to be completely indefensible. If they have understood the facts and the arguments, they must surely know that the Bill contains matters that constitute a public scandal. If they were to walk out now and tell Cabinet Ministers to do their own dirty work, they would have the greatest sympathy and understanding from Labour Members.

The smokescreen for the Bill is that it will merely stop creative accounting or prevent unscrupulous councils getting around rules. That is irrelevant to the objections I have to it, because of the effect that it will have on my constituents as ratepayers of Cardiff city council and South Glamorgan county council. It is also irrelevant to the point of principle involved. Amendment No. 19, which I have tabled, is so tightly drawn as to make it impossible for any local authority that was the target of the Government's wrath to have the slightest chance of "getting away with it". The Secretary of State for Wales made a statement about the effects that the Bill will have on Welsh local authorities. When he and the Secretary of State for the Environment made their statements on 7 July, they must have known that they were not only breaking past promises, but acting illegally, and the Bill seeks simply to legitimise that illegitimate behaviour. That cannot be put too strongly.

Three quotations show how serious this is. The first comes from G. C. Thornton writing in "Legislative Drafting", the authoritative text book on this matter: Retrospective laws offend against the general principle that legislation intended to regulate human conduct ought to deal with future acts and ought not to change the character of past transactions carried on upon the faith of the then existing law. The Bill flies in the face of that principle.

5.45 pm

Lord Pearce, in a judgment in the other place in 1971, said: the presumption against retrospection is not a technicality. It is a general rule of justice not dependent on forms of words. It is founded on a judicial preference, where choice is possible, for the reading which does not invalidate existing rights and obligations. The Bill flies in the face of that principle.

The third and most telling quotation comes in the words of Professor Goodhart in the Law Quarterly Review of July 1950, who refers to principles that "few people would dispute": The first is that the law should, as far as is reasonably possible, be certain and stable, and the second is that it ought to be general in character and not be altered in regard to particular individuals. Certainty is necessary so that men can have reasonable confidence that their plans for the future will no be subject to sudden unpredictable changes. If established rights are altered retrospectively then life becomes a double gamble because now both the past and the future become uncertain. I should like Tory Members to mark the final part of this quotation: No commercial community could hope to survive if such an element of chance were introduced into normal life. Ministers are expecting local authorities to live with such uncertainties. The point is simple and basic—this Bill fails on both the counts set out in that quotation.

The Under-Secretary of State for the Environment, who replied to the debate last week, relied on being able to say that the local authority, in this case Cardiff, had plenty of time to get these figures in before 7 July. As I am sure that the Minister did not intend to mislead the House deliberately last week, I hope that she is now aware that what she said was inaccurate, and that she will take the opportunity today to put the record straight. I will set out the position simply and clearly, and ask the Minister or her colleague in the Welsh Office, who must be well aware that what she said last week was inaccurate, to confirm that what I say now is the truth, the whole truth and nothing but the truth.

I am referring specifically to Cardiff city council, and some of the details are similar to the cases quoted by my hon. Friend the Member for Birmingham, Perry Barr (Mr. Rooker), although in our case, it is the Secretary of State for Wales and the Welsh Office who have to take responsibility and must account for the decisions. This is a cast-iron case. The city council provides the Welsh Office with details of its projected, estimated and actual expenditure on forms dispatched by the Welsh Office. In February 1988, form RER89 and a covering letter were received for completion. The form was to be returned by 25 March 1988. Paragraph 7 of the covering Welsh Office letter emphasises that the details need be only The best estimates that can be made in the time available, as an informed approximation". It goes on to say that the refined figures should be provided at a later stage.

When the form was being completed, the financial year to which it related had not ended; nor were final figures then available for all items of income and expenditure for the year. The hon. Member for Cardiff, North (Mr. Jones), who, like me, has served on Cardiff city council finance committee, will confirm that accounts are closed only after all relevant information has become available. In the event, the completed form RER89 was an estimate of expenditure for the year based on budget figures and incomplete data based on such figures as were available—the normal and proper way to deal with such cases.

On 16 June 1988, the final accounts for 1987–88 were laid before the finance committee of the city council and approved. These showed that, whereas the city council's expenditure had been estimated in 1987–88 to be £23,694,500, actual council expenditure had been reduced to £22,396,876. That was the result of measures adopted by the city council to achieve savings in accordance with central Government guidelines and policy, and made on the basis of published grant figures and of statements made to the House by the Secretary of State for Wales. The result was that expenditure has been reduced by £1,297,624 from the budget figure. In accordance with the information then available, additional grants of almost £2,300,000 therefore became payable.

I want the Minister to take note of the date that I am about to give. On 29 June 1988, just one week before the statement by the Secretary of State for Wales—when the intention must have been known to Ministers and officials at the Welsh Office—the authority received form RO 1987–1988 and a covering letter. With the form was another form headed "Block Grant Claim Form 1987–1988". It was stated that that was the final block grant claim form and required certification by the chief financial officer and auditor. The earlier form had not required such audit certification or signatures. The covering letter stated that the form was to be returned by 31 July 1988.

In the past, Cardiff city council has always completed the RO form on the basis of actual expenditure—which has formed the basis of the audited accounts. The Welsh Office has always calculated the grant payable on the basis of the form and the actual expenditure of the city council.

There was no consultation or advance notification prior to the statement of 7 July. There was no suggestion that the form should be returned earlier than the specified date —that is, 31 July 1988. There was no warning that the basis on which the block grant was calculated would be changed from actual to estimated expenditure. The arbitrary and fundamental alteration of the basis for payment of the council's grant caused initial disbelief and then upset and dismay among everyone concerned with local government finances.

During the financial year, many hard decisions had been taken to ensure that the council did not exceed its budget figures. The expectation and understanding, based on the law and on the Government's announcement, was that by achieving economies the council would be entitled to an increased grant. Now, for no good reason related to the council's behaviour, and without prior notice, the Government seek to change the position after the event and deny the council those moneys. The council was misled in circumstances that were unreasonable, unfair and damaging to the integrity of proper public administration. Do the Government intend to cause such

Since 7 July, there have been efforts to put matters right. Civil servants were clearly embarrassed. The local authority believed that, when Ministers realised the impropriety of their decision, matters would be put right. I believe that hon. Members of all parties thought that Ministers would draw back from their decision.

I shall summarise the scandal in words of one syllable—I realise that the word "scandal" has two syllables, but I hope that most of the other words that I use will have one. One must bear in mind the assurance that was given in the House by the Secretary of State for Wales and by the Secretary of State for the Environment that actual expenditure—not estimated expenditure—would count in the calculation of the eventual RSG payment made to the local authority. One must also bear in mind that Cardiff city council had observed every requirement made by the Secretary of State, had kept within the targets set by the Secretary of State, had provided all the information that was required by the Secretary of State and had been reassured only days before 7 July that it had until the end of July to submit the form giving details of actual expenditure.

In the light of that rectitude, will Ministers seriously press ahead with these provisions? They should also bear in mind that Cardiff city council had gone further and had succeeded in keeping its expenditure below the target set by the Secretary of State, secure in his assurance that it would thus attract the additional £2.3 million grant to which I referred earlier. The council had gone far beyond the minimum certainty that the Secretary of State might have expected.

The council closed its account by 7 July. The accounts were approved by the finance committee and the full council by the end of June. The accounts had also been sent to the district auditor before 7 July—he can attest to that quite easily. The information was also sent to the Under-Secretary of State for Wales, in his capacity as one of the local Members of Parliament. That information had reached all local Members by that date—well before the date requested by the Welsh Office. Finally, the accounts were provided to the Welsh Office by the date requested on the form.

There is no doubt about the figures on which the Government ought to base their decision about the grant to Cardiff city council. The figures were in print and in the public domain before the Secretary of State's announcement on 7 July. They were with the district auditor, who can verify that fact. The figures had reached the local Members of Parliament, including the Under-Secretary of State for Wales, who is not only the Minister responsible but represents Cardiff, Central and whose constituents, as ratepayers, will be affected by the Government's appalling behaviour in this regard.

There is not only no creative accounting, there is no scope or possibility of creative accounting. There is no way in which those figures could have been tampered with after the statement given by the Secretary of State. Cardiff and South Glamorgan have such cast-iron cases that it will be a public scandal if the Minister does not accept my submissions. I call on the Minister and on the Under-Secretary of State for Wales to respond by accepting either my amendment or the slightly wider one tabled by my hon. Friend the Member for Birmingham, Perry Barr (Mr. Rooker). I call on them to put matters straight, to put them back into the area of public rectitude and to avoid what will otherwise be a public scandal.

Mr. Malcolm Thornton (Crosby)

The hon. Member for Cardiff, South and Penarth (Mr. Michael) has raised what he called a fairly narrow point. My point could be described as even narrower as it is very much a technical matter.

The Merseyside residuary body has made representations to me that there is an expenditure figure in the 1985–86 RSG fourth supplementary report consultation paper which is not correct for rate support grant purposes in respect of Merseyside county council, which, as we know, is now defunct. If my right hon. Friend the Minister for Local Government can give me an assurance, I need not detain the House any longer. Can he assure me that, notwithstanding the proposed specified date of 6 July 1988, the residuary body will be given the opportunity to present the revised grant-eligible expenditure figure of £203–219 million in lieu of £204–186 million which the district auditor now suggests is not appropriate for grant purposes? Perhaps my right hon. Friend can state whether that assurance can be given.

Mr. Gummer

I must advise my hon. Friend that when I deal with the matter in rather more detail he will see that I will not be able to give the assurance that he seeks.

Mr. Thornton

In that case, perhaps I can give some further background information which might assist the Minister in the time between now and when he replies to the debate. I shall be brief, because these are technical matters but perhaps I can give the basic facts.

The accounting year in question is 1985–86, the final year of the former Merseyside county council. Because it was the final year, it was both prudent and necessary to bring in prior year adjustments amounting to £967,000 to reflect the county's closing position. It has been accepted by the Department of the Environment and confirmed by a letter dated 14 February 1985 that prior year adjustments should not have implications on the amount of rate support grant entitlement. In completing form RS1B, which is the block grant claim form, the district auditor made amendments which effectively included an inappropriate figure as a result of prior year adjustments for total expenditure for the year, which would involve the Merseyside residuary body in the loss of £1.4 million grant for the year.

The district auditor has now confirmed in a letter dated 28 October 1988 that the effect of the submitted RS1B is not in line with the DOE letter of 14 February and has suggested that the total expenditure figure should be reconsidered.

Further, on 26 August 1988, a Department of the Environment letter inviting views by 21 September 1988 on the proposed rules included an exemplification of the figures of total expenditure which will be used to calculate the block grant. That was the first occasion on which the Merseyside residuary body became aware that an incorrect figure was in the possession of the Department of the Environment. The letter was delayed beyond the response date by the postal strike, but, on receipt, an immediate response was made.

The facts concerning this narrow, technical point should persuade the Minister at least to allow the Merseyside residuary body the opportunity to present the amended figures. The figures were amended not by the former county council, nor by the residuary body, but on the advice of the district auditor, despite his original advice to include the figures in the submission. I should have thought that that in no way runs counter to the general thrust of the Bill and is a point well worth consideration.

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Mr. Matthew Taylor (Truro)

The hon. Member for Cardiff, South and Penarth (Mr. Michael) said that he would sum up the issue in words of one syllable. I wondered how he would manage that and he proved conclusively that we cannot sum up this issue in words of one syllable.

The Government are aiming in the Bill to prevent the continuation or deterioration of the lottery of rate support grant. The amendments—I have tabled amendments with a similar intention—would allow us to get away from one of the most unjust and harsh lotteries that the Government have introduced by their random choice of a cut-off deadline for those authorities affected.

The Association of County Councils has heard from 37 counties on the impact of the announcement. Most of the detailed information and complaints relate to 1987–88. The replies show a general underspend on revised estimates, meaning that the expenditure rules have led to a loss of grant. The estimated losses range from the very small right up to the figure of £9.7 million, which is far from being a small figure. Only three counties closed at 6 July figures. In addition to underspending, some authorities lost expected grant as their plans to reduce outturn through the use of balances were rendered irrelevant.

Four counties showed that the rules resulted in grant gains for them, largely owing to overspends on revised estimates. However, without the announcement, two of those counties would have sought means of reducing that overspend, so the Government's intentions have not been fulfilled. The largest gain by far is £8 million to one county, due to new accounting practices in preparation for the community charge. That is not just a lottery; it is like playing bingo. It does not require any serious thought or planning; the Minister merely requires the same skill as the bingo caller.

In addition, a number of specific points were made to the ACC. The part of the 7 July announcement to which authorities most object has consistently been the application of the rules to 1987–88. The Minister, in trying to defend what he has done, is most vulnerable on that point and should show the greatest flexibilty in responding to the points that have been made.

The 6 July deadline is quite simply unfair. There are many reasons for that, but I shall highlight just a couple. The 6 July date is close, but just prior, to the closedown date for many authorities. The Department of the Environment's deadline for outturn figures was 1 August. Therefore, even those authorities which had effectively closed down their accounts had no incentive to submit those final figures to the Department before 6 July. That can he seen in all authorities. West Somerset, the case quoted at great length by the hon. Member for Birmingham, Perry Barr (Mr. Rooker), is just one example of the many authorities that have been caught out in this way. The underspends in 1987–88 are, to a great extent, genuine and not the product of any form of creative accounting. As the Minister must be well aware, many of them affect authorities wholly or partly controlled by the Conservative party.

I shall he brief, as these points have already been made very eloquently. The solution to the problems lies in the Minister's hands. He can deal with them effectively, through the amendments before us, through alternative amendments tabled by other hon. Members, including myself, or in ways that he and his civil servants can no doubt think up; but, at present, he shows no intention of recognising the unfairness and injustice of what he is doing. He would rather see a saving to the Treasury and have his civil servants given a little bureaucratic ease in their dealings than respond to the genuine needs and pressures of the authorities affected, whether they be Brent or councils controlled by the Democrats or the Conservatives. The effect of this lottery in the Bill is unfair. He can correct it, and I hope that he will tell us now that he will do so.

Mr. Gwilym Jones (Cardiff, North)

I find myself in general agreement with the concern for the consequences of the case in Cardiff, mentioned by the hon. Member for Cardiff, South and Penarth (Mr. Michael), although he used far more extreme language than I want to use. We have a good case in Cardiff and I hope that it will not be affected by such extremist positions.

I do not much care for amendment No. 1. I find amendment No. 19 far more preferable, but both amendments are superior to the position in the Bill. I accept that he who sets the rules is entitled to change them whenever necessary. However the rules are changed—either through parliamentary legislation or through the Secretary of State acting under the proper authority of regulations—some form of consistency is desirable. When my right hon. Friend the Secretary of State described the outcome of the rate support grant settlement in March 1987, he said:

Ultimately the grant paid to a local authority in respect of the year will depend on what that authority actually spends. He went on to say: I intend that the settlement for 1987/88 should give the further certainty of ensuring that each authority's grant entitlement will depend solely on its own spending decisions and not be affected by decisions taken by other authorities. Many, if not all, of us should subscribe to that latter statement. Authorities should have the certainty of knowing that the outcome will be determined by their own spending decisions and will not be affected by the decisions of other authorities.

I am moved by the Cardiff case. That is not an example of creative accountancy. The books for Cardiff were closed well in advance of the key date, introduced this year, of 6 July 1978, but Cardiff will now receive a figure slightly different from that quoted by the hon. Member for Cardiff, South and Penarth. The council's director of administrative and legal services advises me that Cardiff stands to lose £2,127,000. However, whether we take the figure quoted by the hon. Gentleman or that quoted by the city council, it is no small sum for any district council and certainly not for the capital city of Wales.

Cardiff comes to be in that position because of an estimate form requested by the Welsh Office to be submitted by 25 March. That was not the formal return, giving accurate final figures, which was requested later, but an estimate that was requested before the end of the financial year. That was clearly an estimate and could only have been an estimate. Indeed, the covering letter asking for the form to be returned by 25 March advised councils to opt for speed rather than accuracy if a choice had to be made.

What opportunity does such an estimate give for creative accounting? There is no requirement to give hard figures. The authority can put down any figures that it chooses and even manipulate its own case depending on its view of the situation. As it is only an estimate, it can entail no responsibility on the part of the council. Certainly, it cannot be a proper basis to enshrine in legislation for the determination of grant for 1987–88. I have the greatest apprehension that this legislation cannot be the end of the matter, that there must be a distinct possibility of legal action and that we may find ourselves attempting to legislate again in the light of a court decision.

I very much doubt whether I shall be able to support the Government on this. I will listen closely to the debate, but I feel strongly about the way in which Cardiff is treated by the proposed legislation. As the hon. Member for Cardiff, South and Penarth pointed out, the accounts were closed before the new final date. The figures were properly submitted to my hon. Friend the Minister with responsibility for local government in Wales and I seek the important assurance today that those accounts, rather than any estimates, will be accepted as the final and crucial figures.

Mr. Ian McCartney (Makerfield)

I apologise to the Minister and to my hon. Friend the Member for Birmingham, Perry Barr (Mr. Rooker) for missing their initial comments on the amendments as I was at a meeting to discuss Lords amendments to the Housing Bill, which will come before the House later this week. As a former member of Wigan metropolitan borough council, I served on both the finance committee and the policy and resources committee. Later I was also a member of the Greater Manchester fire and civil defence authority which I represent in the House on an honorary basis.

On Second Reading, I listened with growing incredulity to the Minister's responses and to the excuses given for the promotion of this legislation. When I returned to my constituency at the weekend, my incredulity turned to anger as a result of a meeting with elected members of the authority and its financial officer to determine the effects of the Government's proposals both on Wigan metropolitan council and on the Greater Manchester fire and civil defence authority. Wigan metropolitan borough council stands to lose £1.29 million in grant entitlement—a loss of a further £600,000 on the calculations given to it following discussions with the Department of the Environment after the Government's announcement of 7 July. Wigan council is particularly disappointed because many of the measures suggested for the reduction of expenditure last year and this year were not merely identified but actually met. Reductions were shown under many heads—housing, social services, leisure and education—but despite that, the Minister's statement will mean a major loss in terms in grant entitlement.

In reviewing this and next year's budgets, the authority did not act only in a political way. Joint meetings were held between the policy and resources committee and the management team to identify heads of expenditure under which improvements could be made without disrupting the level of services provided so as to meet the Government's requirements. That was done to the satisfaction not just of the local authority but of the Secretary of State. Indeed, the Under-Secretary of State has many times cited Wigan council at Question Time as an example of value for money in services, especially in relation to housing.

6.15 pm

Earlier this year, the Under-Secretary of State, the hon. Member for Southampton, Itchen (Mr. Chope), met a deputation from the authority led by myself and my hon. Friends the Members for Wigan (Mr. Stott) and for Leigh (Mr. Cunliffe). At that meeting, we identified a miscalculation by the Government of about £1 million in the authority's grant last year. It was also agreed that, to determine whether the grant provided was fair, officers from the Department should sit down with officers from the authority to consider the budget for the current financial year. Despite all that close scrutiny and involvement by the Department, no indication was given between the 7 July announcement and the 31 October statement that the authority would face such a major reduction in grant entitlement. The Minister cannot have it both ways. He cannot suggest that the aim of the Bill is to deal with the wide boys in local authorities when councils such as Wigan have sat down with officers from the Department to consider value for money in services provided but still face substantial losses in this and future years.

The authority has a difficult task ahead in trying to balance its budget. I hope that the Minister will tell me and my hon. Friend the Member for Cardiff, South and Penarth (Mr. Michael) what advice he has for local authorities which have consistently followed statements made in the House and advice given by civil servants as well as advice given to regional authorities in discussions about both capital and revenue programmes but still find themselves with a major shortfall because the Government have decided to change the rules, not just part way through the year but almost at the end of the year. The Minister owes it to the ratepayers of Wigan, Cardiff and other authorities to make the position clear in relation to the level of services provided and the nature of the expenditure identified by those authorities as necessary for the continuation of those services without major disruption.

This measure has also greatly affected my authority's ability to deal with the capital cost this year and next year of introducing the poll tax arrangements. The Government's decision has merely rubbed salt in the wound, further reducing the grant available without reducing by a penny the imposed cost of introducing poll tax. Having considered the Government's proposals with officers from the Department, the authority identified its needs in terms of both capital and revenue in 1989 and 1990 for the introduction of poll tax. The Government have committed my authority to substantial capital allocations with revenue consequences.

As a result of the present proposals, the authority will have to rearrange its budget not just to meet current levels of services but in such a way as not to dislocate the intoduction of poll tax in terms of capital outlay, facilities provided and estimated revenue costs. Will the Minister assure the House that revenue implications for local authorities' capital expenditure—not capital allocations—will be included both in this year's estimates and in the rate support grant estimates for 1990–91? Without such an assurance, local authorities such as mine will face a shortfall of more than £1 million.

During the Second Reading debate last week, my hon. Friend the Member for Perry Barr highlighted the effects of the Bill on police authorities. However, there was little discussion of the fire and civil defence authorities in metropolitan areas. Like the police, they have been rate-capped, yet they are responsible for the services they provide to both the Department of the Environment and the Home Office. There is little manoeuvrability in either the budget or the level of services. The Home Office and the inspectorate set down the number of stations, the manning levels, the training levels, the purchase of equipment and what campaigns can be undertaken. All that is, quite rightly, tightly regulated because of the work done by the fire services. Whether in Greater Manchester, Cornwall, Essex, Sussex or Scotland—which I have occasionally visited—the fire services are professional and have minimum standards.

Despite assurances about the level of services given to the Home Office for this year and next, the calculated loss of grant for the Greater Manchester fire authority is £1.9 million. Before the Minister's arrangements of 7 July and his statement of 31 August, that authority expected to receive an additional £900,000 in block grant because of the steps taken to reduce its administrative costs and the level of precept levied. At the same time, the authority has maintained the level of services within the professional standards set by the Home Office. The Government's decision means a major loss of grant to that authority, and I understand that the same applies to Merseyside, west Yorkshire and South Yorkshire.

In view of the financial loss to the nation in major fires, it makes no economic sense to make large cuts in fire authority budgets simply because of the Government's accounting procedure. There will be no reduction in the number of fires or the hours that the men need to work. However, because of the loss of grant, the services will have to be provided on an increasingly reduced income base. One major fire in an industrial establishment in Greater Manchester, Merseyside or South Yorkshire can cost the nation £3 million, £4 million or £5 million. Surely even the Government understand the necessity for a professional fire service that is cost-effective in the real sense—not in the balance sheet at the Department of the Environment.

Mr. Patnick

On 31 October the hon. Member for Birmingham, Perry Barr (Mr. Rooker) said that South Yorkshire would lose £750,000. I wish to quote The Star—and, as I have said before, if something does not appear in The Star, it has not yet happened. On 3 November it stated: The average family in South Yorkshire pays just 61p a week for their police and fire services. For 38p, they get 2,912 uniformed police officers, backed up with 507 vehicles, while the 23p a week for the fire service gives them 1,077 full-time and 132 part-time firemen, 77 fire engines and other assorted rescue vehicles and tenders. There does not appear to be any shortage of cash or manpower in South Yorkshire.

Mr. McCartney

That is because of the commitment given by the elected representatives of both South Yorkshire and Greater Manchester fire authorities which, despite the Government's rate-capping, through brilliant management and administration have maintained the level of fire services set down by HMI and the Home Office. I remind the hon. Gentleman that those services were under threat last year. A joint delegation from the fire and civil defence authorities, involving Conservative, Labour and Liberal Members and local authority representatives, came to see the Minister to sort out the discrepancy between the rate support grant arrangements made by the Department of the Environment and the maximum expenditure limits set by the Home Office, which were not compatible. The fire and civil defence authorities quite rightly took safety and professional standards to be the key words and worked to the maximum expenditure limits set by the Home Office and not the RSG limits set by the Department of the Environment. Had they not done so, there would have been major reductions in the number of fire fighters and in the level of services provided.

I remind the hon. Member for Sheffield, Hallam (Mr. Patnick) that both this year and last year the fire services in London have operated without a single penny of grant from the Department of the Environment. It is the only major capital city in the world whose fire service is being funded out of the pockets of its residents. I hope that Londoners will remember that at the appropriate time.

It is not just the Opposition who feel that these proposals are unsatisfactory. I wish to read a short extract from the most recent report of the Greater Manchester fire and civil defence authority's financial adviser. It is not a political appointment; he works on behalf of the precept payers to ensure that the authority remains within its capital and revenue budgets. He also advises the authority on the relationship between the Department of the Environment and the Home Office in the calculation of grant. That independent, non-political officer reported:

If the Block Grant rules had not been changed then this Authority would have received some additional £0.900 million in Block Grant. It has been demonstrated to the Home Office, through the A.M.A., that the high rate of marginal grant loss has been considerably disadvantageous to this Authority and its Precept payers. In effect the 'goalposts' have been moved once more and the benefits of good housekeeping have been diminished. Additionally, there seems to be nothing now that the Authority can do to improve its 1988/89 entitlement. Since that report, the Minister's announcement has meant not only the loss of that grant but a calculation that leaves the authority £1.9 million short. Surely it was not the Government's intention to introduce legislation that would financially cripple such an important service, especially as the level of services provided by each authority is set down in co-operation with the Home Office and HMI. The Greater Manchester fire authority did not take a political decision, and neither did West Yorkshire or South Yorkshire. It was an agreement set down under HMI standards.

I have served in Committee with the Minister, whom I found to be a reasonable man. He had the reputation of someone who went to the Ministry of Agriculture, Fisheries and Food not so much as a green politician but as someone who was to do the Prime Ministers bidding. His period in the Ministry of Agriculture, Fisheries and Food caused him to change his mind. He became greener the longer he served in the House.

6.30 pm

I hoped that the same would apply to this legislation. I am not sure whether the Minister wanted the job, but he was certainly given it following the previous Minister's mauling over the Housing Bill. I hoped that he would learn as quickly in his present job as he had to do at the Ministry of Agriculture, Fisheries and Food. Metropolitan or non-metropolitan authorities and fire authorities, whose budgets are already determined by the Home Office, try to provide value for money on a 12–month budget and, at the same time, look ahead to the next year. They consider the number and level of services provided and the way in which they are delivered. It makes no economic or social sense, part of the way through the year, despite negotiations with his Ministry, as the professional report indicates, for the Minister to move the goalposts. That is done to the detriment of rate and precept payers, without a single penny being added to the level or nature of services.

I hope that, even at this late stage, the Minister will see some sense and support the amendment, and stop the madness of continually treating local government as though it were a political football. People in the provinces are desperately trying to provide a level of service to maintain simple, decent standards of education, housing or fire facilities. They constantly bear a yoke imposed by the Minister and his predecessors. The Government are continually changing the rules and pinching substantial sums of money from ratepayers' pockets. At the end of the financial year, when local authorities set their next precepts, the Government blame local authorities for increases in rates and precepts. In the past six years we could have had reductions in precepts while maintaining services if the Government had maintained the level of grant that previous Governments provided.

As we have seen throughout the country, there has not only been a deliberate attempt by the Government to try to cripple the finances of local authorities but a devious attempt to blame local authorities for a deduction in services and opportunities that they provide for ratepayers. It is time for the Minister to come clean, get rid of this simple little Bill, and accept the amendment. If he does not accept the amendment, through no fault of their own, local authorities will be in financial chaos. By acting on the misinformation that was deliberately released during the summer by the Secretary of State and by civil servants in the Department of the Environment, this autumn, local authorities may find themselves with substantial reductions in grants that will directly affect the services that they provide to ratepayers.

Mr. Michael Lord (Suffolk, Central)

I shall not speak for too long, because, although the relevant amounts of money vary, most hon. Members will speak about much the same issue. My right hon. Friend the Minister of State also represents a Suffolk constituency, so he will know about the things that I shall speak about concerning Suffolk county council. I have already quizzed him on some matters. I shall speak briefly about the Severn-Trent water authority v. Cakebread case. It is not strictly relevant to the debate, but it will have a major impact on the finances of Suffolk county council over the year ahead.

Mr. Gummer

As an amendment relating to Cakebread is to be discussed, perhaps it would be better for my hon. Friend to deal with it then.

Mr. Lord

I was about to say a few words about choosing the date of 7 July. I shall refer to the Cakebread issue at the appropriate time.

As we know, the date of 7 July was chosen in an arbitrary way. I am not quite clear why that date was chosen or why local authorities were given such a short time in which to respond. For Suffolk county council, the cost will be £2.5 million. For a county council that is fairly prudent in its financial dealings, that penalty is rather harsh.

I want to talk about Cakebread because I wish to draw the Committee's attention to the effect of retrospective legislation when it could be helpful and when it could be harmful to Suffolk county council.

For Suffolk county council, the total amount involved in the two issues—the Cakebread point which involves £1.9 million and the £2.5 million involved in choosing the date of 7 July—is £4.4 million. That will have a serious effect on the ratepayers. I know that my right hon. Friend is fair in such matters. Does he consider that this measure is fair and honest? Even at this late stage, will he give the matter further consideration?

Mr. Paul Boateng (Brent, South)

I join my hon. Friend the Member for Makerfield (Mr. McCartney) in apologising to the Minister of State and to my hon. Friend the Member for Birmingham, Perry Barr (Mr. Rooker) for having missed their speeches. I particularly regret missing the contribution of my hon. Friend the Member for Perry Barr, with its stout defence of my local authority, Brent, which will be much appreciated.

I hope that, when the Minister replies, he will not be tempted to regard hon. Members' contributions as yet another basket of special pleadings. The matter involves much more than that. It goes to the heart of a provision in a Bill that is fundamentally unjust in its impact on local authorities and their budget-making processes. The Bill does not take into account the real difficulties that many local authorities of all political persuations are experiencing, not only in balancing their books, but in maintaining an adequate standard of service right across the board for local ratepayers and residents.

Therefore, the Bill should not be seen by the Minister in a narrow party way—as a way, yet again, of screwing local authorities. He should recognise it for what it is. I make a heartfelt plea to him to think again about the impact of the Bill on the hard-pressed ratepayers about whom the Government purport to be concerned. Hard-pressed ratepayers and residents will have to pay the price of the Bill if the amendment is not carried.

Sometimes there is a tendency to suggest that my local authority is faced with a problem that is entirely of our own making, and that the current crisis in the provision of services—a crisis that all too often hits those who are least able to defend and take care of themselves, those who are unemployed, those who are disabled, those who are elderly, those who, for one reason or another, are particularly dependent on local authority provision, just as much as it hits those who simply require the ordinary services such as refuse collection and the like that a local authority should provide for its residents—is entirely of the making of the Labour administration. That is simply not the case. When we ask the Minister to think again, it is against a backcloth of responsibility arising from decisions made by Conservative-Liberal administrations as well as by Labour administrations.

The problems faced by the current administration in my borough, like so many problems faced in our country today, can be traced back to 1979 when the present Government were elected. Since that time rate support grant in Brent has been reduced from some 65 per cent. of net borough requirements to 38 per cent. If the Government had continued to fund Brent at 1979 levels, the council would be receiving an additional £52 million in the current financial year.

The picture has been made that much more dire by decisions that cannot be attributed to the present Labour administration. The problem today would have been more manageable, although there would still have been a problem, had it not been for the irresponsible behaviour of the Tory-Liberal administration between 1983 and 1986. We then saw some £39 million of accumulated balances squandered to depress the rates artificially, particularly in election year. Massive problems were built up for the future. We have become accustomed in the House to seeing the national family silver squandered unacceptably, but in Brent we became accustomed to seeing the municipal silver disposed of in the same way, by the Conservative party.

I want to give the figures, because what we are discussing can ultimately be broken down into figures. In 1986—which just happened to be an election year—the Conservative administration constructed a budget that assumed rate support grant of some £45,320,300, more than £7 million of it from the GLC to pay for the levies of successor bodies and interest of some £1.5 million on balances that no longer existed, having been squandered. When the Department of the Environment came to make its own calculations, when the mysteries were worked out and the entrails pored over—for presumably that is what goes on in Marsham street, being about as scientific an approach as can be managed—the rate support grant actually paid proved to be some £38,580,200, with some £3,352,200 from the GLC. The projected interest on balances was a debit figure, because the Conservative party left the council without any balances

Coming into power in 1986, the Labour administration had to face a budget with a built-in deficit in excess of £14 million. The problem is graphically illustrated by the council's total revenue expenditure in 1986–87, the first year of Labour control. People can hardly be blamed for swallowing the myth of the high-spending, profligate Labour council. In the South Yorkshire Star, mentioned by a Conservative Member, it' something does not appear it has not happened; in some papers that my authority has to put up with, if something appears we can be sure that it has not happened.

Mr. McCartney

They quoted the Chancellor today.

6.45 pm

Mr. Boateng

Such are the depths to which certain papers will sink to build up a political bogey-person and act accordingly.

That myth of the high-spending Labour council is not borne out by the figures. The council spent £189,921,084. That was just £3,042,924 more than the Tory budget—an increase of 1.6 per cent., less than the the rate of inflation. There is your profligate, high-spending Labour council.

Since then the Government in their wisdom—again, presumably consulting the entrails have continued to reduce their contribution to the council's budget, which has compounded the problem. We hear a great deal from Conservatives about creative accountancy, and of course we must be wary of it: no one pretends that it is to be entered into lightly or welcomed with open arms. We must, however, face the fact that the creative accountancy that we in Brent are now having to handle was introduced by the Tory-Liberal administration in 1987, and the exigencies of fortune have required a successor Labour authority to continue with it.

That is the truth. It is not some pie-in-the-sky figment of a rabid Left-wing imagination. The facts can be discovered by looking at the books, and I invite the Department to do just that. I ask the Minister to consult his advisers and to find out whether he can reasonably dispute any figure given in this debate by me or my hon. Friend the Member for Perry Barr. Those are the figures on which the Department is basing its assumptions about Brent's spending.

The background is made still worse by changes in Government regulations, often made at a moment's notice. I still hope that there is a glimmer, a sliver of a chance that the Department may yet think again about this charge, because of the weight of representations received from local authorities, again of all political persuasions. The Minister will know only too well the impact on authorities of the announcement of the change in the method of subsidy for homeless families. That cost my authority a little under £4 million at a stroke—at a grimace from the Secretary of State. Many of us remember the afternoon, and the spirit in which, it was announced. I am afraid that the spirit was much closer to vindictiveness and glee than to any genuine concern about the impact of the decisions on homeless families.

We hope that the Secretary of State will reconsider, but the local authority has already had to respond to the circumstances. It has made some difficult decisions that have been painful for my constituents, and very painful for disabled people like those whom I met only a few days ago at the Stonebridge training centre. Trainees there, many of them suffering from Down's syndrome, are able to make a small contribution to the working economy by putting together packets of cosmetics which are then used in hotels. They gain considerable satisfaction from so doing. Above all, they gain a sense of their own worth and value by being paid £4 a week, the meagre amount that they are allowed without falling foul of the social security benefit system. As a result of the last round of cuts forced on my local authority by this Government, that £4 was removed. What does one say to those people? There are so many of them.

People find that their local library, such as the one in Kensal rise, is to be shut. They are forced to fall back on the generosity, which one hopes will be forthcoming, of All Souls which has a traditional and long-standing relationship with that library. All Souls bequeathed it in the first place and it was opened by Mark Twain. People are forced to fall back on that sort of private charity to keep the library open because the local authority, subject to current restraints, cannot do so. So it goes on and on. The number of teachers in schools throughout my constituency has been reduced. Social service night duty has been cut, so now there is no official night duty service. One can imagine the impact of that on some of the most deprived and at-risk families and children.

That is just a sample for the Minister. I urge him to ensure that those we advise him examine what the impact will be on the ground. What else do they want us to cut? Have we yet reached the stage when the DOE can come and say, "Cut this, cut that., cut the other," so that at least it can take the blame for the decisions which local authorities are being forced to make?

One of the great evils of the rate support grant system is the way in which the blame is transferred to local councillors and the Government walk away from the problems and turn their back on the people. That is unacceptable, whether in a Labour, Liberal or Democrat—whatever the party is called now—Conservative or hung local authority.

If the Bill is not amended as my hon. Friend the Member for Perry Barr suggests, its impact on my local authority will be a retrospective clawback of £8.8 million. There is no way that that money can be clawed back without either a rate rise of about 8 per cent. over and above any increase already agreed in the budget-making process—it was hoped to keep increases to a bare minimum—or a further round of cuts. In my constituency neither the voluntary organisations nor the residents and ratepayers find the burden of another round of cuts acceptable. The existing round has already had an unacceptable impact on them and the quality of their lives.

I cannot stand by and watch the Government force the local authority to make cuts in order to obey the law. I do not see how the imposition of an additional rate burden of 8 per cent. on my constituents as a result of the machinations at Marsham street can be justified. Why should already hard-pressed people suffer, as a result of this legislation, which is designed ostensibly to reduce the burden of rates on them, a further increase and burden?

I ask the Minister to think again and to be prepared to come with his civil servants to meet my local authority and me to explain how it will be possible to manage the local authority budget within the constraints that the Bill will impose. I ask him to think again and to respond positively to the pleas from both sides of the Committee for the amendment.

Mr. Gummer

We have had a useful debate on this good set of amendments. They put before the House the various possibilities before the Government in trying to arrange for the transitional period from our present system to a future one. The hon. Member for Birmingham, Perry Barr (Mr. Rooker) rightly said that we do not want to go over the debates that we had earlier, but he made one point which I should like to discuss with him and which we should put right on the record.

Some time ago, I came to these discussions to try to find the best way to face this issue. Although I inherited the debate and the announcement—

Mr. Rooker

It is somebody else's fault.

Mr. Gummer

I am merely saying that I inherited this matter, so naturally I looked at it with care. Therefore, what I have to say is the fruit of trying with an open mind to see what it is best to do.

Naturally, there are many attractions in having the other dates which have been suggested and I shall deal with each case on the basis that it will probably cover a reasonable cross-section of local authorities. Common to all the cases is the fact that they are the cases of local authorities for which another date would have been preferable. They are not cases of local authorities which would suffer by having another date. [Interruption.] I am trying to approach the hon. Gentleman's point with considerable care. I took what he said seriously and I hope that he will do the same with my comments.

Whatever the date, the authorities that wish us to choose another date are always those which are discommoded by the date. One does not hear of the authorities which benefit from the date and would be discommoded by another date.

Mr. Michael

Will the Minister give way?

Mr. Gummer

No. When I come to deal with Cardiff, the hon. Gentleman will undoubtedly want to question me closely. I do not want to run away from any of the specific points which he raised.

In our original debate, I recognised that, whatever we did, some local authorities would be put out by the date that we chose. I also said that they would not necessarily be controlled by Opposition parties. The hon. Member for Brent, South (Mr. Boateng) asked that we should not consider this in a narrow party way, and I wish to make it clear that there is no question of this date being harder on authorities of one political persuasion than another. That is not the case, and I hope that he will take that from me. However one chooses these dates, it is not a question of picking out one particular party for benefit, so I have to look at the individual cases.

I understand the West Somerset case. The hon. Member for Perry Barr is right in the sense that West Somerset is likely to lose by this date compared with what it might have lost if another date had been chosen. It is true for any date that some will lose and some will gain. The question then is, who should be blamed for it. If there were no possibility of creative accounting and if we could reach agreements with all authorities on a fair basis, we could undoubtedly be more flexible.

I fear that it is not the Government that West Somerset must blame. Over the years, several authorities have behaved in ways which were inconceivable in the past. They have taken it on themselves to determine what the national figure for spending should be by seeking to take from the pool more than they should under the rules or any sensible sense or spirit of the rules. If West Somerset asks who should be blamed, I would reply, "Authorities that have used methods of calculation of their grant requirement and expectation that decent authorities would not have used." I do not include all authorities in that, and I certainly do not say that of Cardiff.

7 pm

The hon. Members for Perry Barr and for Brent, South mentioned Brent council, which is an important case that I should consider carefully. The first suggestion is that, if we had chosen another date, Brent would have done better than it has. The second suggestion that has been carried all the way through is that we should be careful about Brent because, although it has been badly reported in the newspapers, it has done its best and we are being unfair.

I wish to consider Brent as fairly as possible. I have listened to the hon. Members' figures, but the House should be aware that those figures were available to the hon. Member for Brent, East (Mr. Livingstone). Having examined those figures, he said that Brent council—controlled by the Labour party—reminded him of the Pol Pot regime in Cambodia. It is at least open to the House to take a different view of the way in which Brent council has handled its affairs from the one put forward by the hon. Member for Brent, South. Two Labour Members in adjacent constituencies represent the council, first, as a paragon of virtue and, secondly, as probably the worst council that ever existed. We start with a pretty even-minded view from the Labour party, and I shall try to be as moderate as I can in my response.

Mr. Boateng

To call my local authority a paragon of virtue would be somewhat over-egging the pudding, but when has the Minister ever taken seriously a word said by my hon. Friend the Member for Brent, East (Mr. Livingstone)? For him now to rely on something said by my hon. Friend to a newspaper as an indictment of my local authority, and a reason for him not to treat it sympathetically, is trying it on a bit.

Mr. Gummer

I thought that I had introduced the point in the most moderate way possible. I merely suggested that there was disagreement—I put it no stronger than that—between two members of the same political party about the character of the local authority that they represent. I have tried to look for the facts.

Of course I take seriously the views of the hon. Member for Brent, East. That is why I spent much time opposing them in London. His views were so serious as to be worth considerable opposition. In those days, the hon. Member for Brent, South was a great supporter of his hon. Friend and commended his views to us. He fought—not in this place, but elsewhere—for the retention of the body of which the hon. Member for Brent, East was leader so that those views could be imposed not just on Brent but on all of Greater London.

Mr. Boateng

I commended my hon. Friend the Member for Brent, East when he was leader of the Greater London council, and was glad to serve under him. I commended him as an expert on the affairs of London, not as a political commentator on nasty regimes in south-east Asia. As a commentator on political regimes in south-east Asia, seeking to draw analogies between them and local authorities in London, my hon. Friend is not necessarily a man on whom the Minister can rely to bolster his very weak argument.

Mr. Gummer

The hon. Member for Brent, East was not comparing the Pol Pot regime with the local council in Brent. He was comparing the local council in Brent with the Pol Pot regime.

Mr. Rooker

We asked the Minister to consider the figures for Brent, not what I or my hon. Friend may have said. The Minister is making great play of this point. The leaders of Brent council made a substantial, detailed, four-page reply to my hon. Friend the Member for Brent, East (Mr. Livingstone). It would be in no one's interest for me to place it on the record, but its response to the comparison with the Pol Pot regime was that it was "dishonest, opportunistic and mendacious". Will the Minister explain why Brent, having taken the courageous decision to balance the budget and make cuts, will suffer a further cut of £8 million?

Mr. Gummer

As there seemed to be a disagreement about this in Brent, I was trying to establish that we should examine the figures carefully, and that is what I shall do.

The first fact is that the rate in Brent is the second highest in outer London. In 1988–89, its reported figure of total expenditure is 11.5 per cent. above the needs assessment, not taking into account the spending financed by creative accounting. We have always said that we should consider not only the amounts of money that people lose, but the amounts of money that others gain. Although it is true that, if we had chosen another date, Brent might have been about £8 million better off than it appears to be under this arrangement, Opposition Members have not mentioned the fact that, as a result of the forthcoming supplementary reports, Brent will gain an extra £9.4 million. We must set that gain against any reduction. The hon. Member for Brent, South must accept that those two facts should be considered together and that the rate increases that he feared will probably be unnecessary.

I am trying to examine the matter as fairly as I can, but it is difficult to take Brent's claim seriously. The hon. Members for Brent, South and for Perry Barr explained the problems. London authorities do not have the easiest of wickets, but the truth is that the figures that we should have received on 29 February were still outstanding on 12 May, although some figures were given on the telephone. On 17 May, Brent promised to send the form by the Whitsun weekend. On 7 June, having been telephoned again, the council said that it hoped to send the form by Friday 17 June. On 20 June, the council said that it was having difficulty finalising the figures, but it telephoned back to give another figure. On 21 June, we wrote confirming one figure and asked for the form to be returned as soon as possible.

We cannot deal with an authority that does not appear to be able to do what every other authority—bar one—has done. I do not wish to repeat stories from newspapers, and I have been careful not to do so, but it is extremely difficult to deal with an authority that appears not even to know who are its council tenants and who are not, and which admits that it is beyond its power to find out, except on a sample survey basis. The hon. Member for Brent, South mentioned cuts, but any independent observer of Brent—I leave aside him and the hon. Member for Brent, East—would say that the cuts were introduced in so incompetent, extreme and haphazard a manner as to cause as much damage as possible, although the council could have done many other things.

I shall give hon. Members an example. At the same time as cutting the number of teachers in schools, Brent is recruiting teachers in Ireland. How can one deal with an authority which deals with its own electorate in that way? The hon. Gentleman said—I wrote this phrase clown because I wanted to quote it—that we should be concerned with the unemployed, the elderly and those who are particularly dependent upon the local authority. I believe that we should be. However, given that, roughly speaking, Brent is about £1 million better off under the arrangements so far announced, the hon. Gentleman would do better if—perhaps in a less unattractive way than his next-door neighbour—he brought home to Brent the fact that the real answer would be for Brent not to complain about this and about the extra gains from the supplementary report, but to get its act together and run the system properly.

It does not matter what happened in the past, and the hon. Gentleman did not mention the period in which the present authority was run by an apparently more extreme group. If Brent does not do this, there will be statements in the newspapers daily—which it does not appear to be able to deny—which show that there are apparently people in Nigeria who can buy the keys to council properties in Brent.

Brent cannot honestly be used as an example of the sort of authority for which the whole system must be rewritten. I believe that it is the sort of authority that has to get its house in order. When it does so, no doubt we can take more seriously the views of the hon. Member for Brent, South and forget the comparison with the Pol Pot regime, which I agree with him was rather overstated. I am sure that anyone who has any real acquaintance with the Pol Pot regime would not suggest that there is any comparison, because the local authority in Brent has not gone out to kill people. However, it has failed to carry out its obligations as an authority and it would be better for the hon. Gentleman to consider those points.

Having dealt with Brent, where I do not believe there is a case, I must deal with a much more difficult case. I say to the hon. Member for Cardiff, South and Penarth (Mr. Michael) that I do not know of any date on which there would not be a case such as that of Cardiff, South and Penarth. I say that, too, to my hon. Friend the Member for Cardiff, North (Mr. Jones). Wherever there is a stocktaking line, there will be at least one or perhaps more authorities which will say to us, "Look, we are especially hard it, because we have done everything that you wanted us to do except that we have not quite met the obligations that you have made, so can we change it slightly?"

That is the problem of all the other amendments put forward by the hon. Member for Perry Barr. Each one of those amendments suggests that, for apparently good reasons, the goal posts should be moved slightly, but each one of them provides us with what I would call a Cardiff, South and Penarth situation, because there will always be one or more which will appear to fall just outside the line that is drawn. Therefore, I must justify to the hon. Member for Cardiff, South and Penarth why this line seems to be a better one than others, and then I shall explain to him why I do not believe one can take a particular view of his authority.

Using this line, we know exactly where we are from that point. No authority claims that we have interpreted our own rules in a way which produces the wrong figure. We know exactly where we are. It enables local authorities to make their plans for the future much more effectively, and it makes that transit possible. The hon. Member for Ashfield (Mr. Haynes) may yawn, but I am trying to answer the specific cases—which I am sure he would have heard if he had been here—of the hon. Member for Cardiff, South and Penarth, who has made an important point, which I hope I am dealing with as carefully as possible.

7.15 pm

The problem is that any other date would raise all kinds of arguments, which would mean that the argument of the hon. Member for Cardiff, South and Penarth and that of my hon. Friend the Member for Cardiff, North would become multiplied. I say to the hon. Gentleman that it is a date which does not serve Cardiff well. It means that, had we chosen another date, Cardiff would have been able to benefit from the cuts that it has made. However, what worries me is that almost every other authority in his area reflected such cuts in the figures that they put in.

Mr. Michael

indicated dissent.

Mr. Gummer

The hon. Gentleman shakes his head, but I have been careful about checking this. However, if I am wrong, I shall apologise to him. As I understand it, almost all the cuts which we are talking about could have shown up at the date that the figure was sent in. The chief financial officer signed the document as being the best estimate available at the time. I find it difficult to believe that those cuts were started, continued and completed between the form being sent in and the date which he now says, if he had only put in the next form early enough, he could have reflected them. I must say that that does not appear to be likely. Therefore, although I understand that Cardiff will be unhappy about this—I am sorry that that will be so—it must be true if there is a cut-off date of any kind.

It appears to me that, if I move in the direction of the hon. Member for Cardiff, South and Penarth on this issue, that I must then talk about the contribution made by my hon. Friend the Member for Crosby (Mr. Thornton), about the Merseyside residuary body. He has already explained that the problem there is that there is an argument between the auditor and the authority. Until that argument is solved, we do not even know the basis upon which the authority would like us to choose between the two figures, both of which have been given to us—the earlier figure which it appears now to want us to take or the later figure that we have taken because we have said that we would take the later figure. That is the same kind of problem as that of the hon. Member for Cardiff, South and Penarth. I believe that there is no way round having a date, and with any date, if he were not the one who was asking me this point, I would have to answer other hon. Members who would be putting forward their points.

Mr. Michael

I hope that I can assist the Minister by providing exactly the sort of suggestion that will meet his requirements. The Minister knows full well that the Secretary of State for the Environment and the Secretary of State for Wales said in the House that the figures that would count would be those for the actual expenditure rather than those for the estimated expenditure by an authority. As the Minister must know, he refers to a form that deals with estimated rather than actual expenditure. The Minister's reference to the so-called choice of dates clouds the simple point that I shall make once more.

The Government had already chosen their date and the Government are seeking in the Bill retrospectively to change their date without any regard to principle or reason. The Government's date was 31 July. That was set in the letter from the Welsh Office dated 29 July. That letter could have specified 6 July, but instead it specified 31 July. My only plea is that, having made a promise, the Government should stick to it and, having chosen a date on which others relied as they were meant to rely, the Government should stick to it.

Mr. Gummer

In order to support that line, the hon. Gentleman quoted two authorities, one which said that we needed to be careful about retroactive laws in order to be sure that we are certain and stable, and, secondly, as Professor Goodhart said, the law should be general and not designed for one particular person. This date has been chosen in order to be certain and stable, because if we did what the hon. Gentleman suggested, it would give people the opportunity retroactively to change what had happened in the past by creative accounting. It is not that his local authority might do so, but that many other local authorities would.

Mr. Thornton

rose—

Mr. Gummer

I do not think that I should give way, because there are a number of debates to come and I have been speaking for some time, but I shall do so for the last time.

Mr. Thornton

My right hon. Friend has said that, on Merseyside, there is a disagreement between the district auditor and the residuary body, but that is not the case. The disagreement concerns the interpretation of the Department's figures. In a letter from the district auditor to the Merseyside residuary body dated 28 October it states clearly: It would appear, therefore, that whilst the RS1B submitted to the department accurately reflects the accounts which were presented in accordance with accepted practice … the effect has been for the DoE to treat the prior years adjustments as having implications for block grant entitlement which is not in accordance with the DoE letter of 14 February 1985. My simple plea is that we allow the residuary body to submit its figures in line with the Department's accustomed practice.

Mr. Gummer

There is a disagreement between the auditor and the local authority, which continues. We said, for the benefit of all local authorities, that we would take the last figure given to us and that we would not argue that we should take the smallest or the largest one. We said that we would take the last one, as we said that that would be the one most likely to be of help to a local authority.

Mr. Gwilym Jones

rose—

Mr. Gummer

No, I will not give way. [HON. MEMBERS: "Give way."] I have already said that I will not give way.

I believe that the hon. Member for Truro (Mr. Taylor) should look at the figures in the round because quite a few of them will show that his comments have been unfair.

The hon. Member for Makerfield (Mr. McCartney) put the case for Wigan, which is likely to lose £48,000 on closedown. The hon. Gentleman did not mention, however, that, on the total supplementary report, Wigan is likely to gain £725,000, which is important. When the hon. Gentleman makes his case about the sadness and difficulties of Wigan he must take the figures in the round. In that way it is clear that Wigan will gain substantially and lose marginally.

The hon. Gentleman also mentioned the Greater Manchester fire and civil defence authority and said that it would lose money. I believe that he got the million in the wrong place, but I accept that, if that authority had given the best answer that it could, it is likely that it might have got an additional £900,000. If one considers the forthcoming supplementary report, however, one sees that the Greater Manchester fire and civil defence authority is set to gain £1.6 million. Therefore, far from being a net loser, that authority is a net gainer.

Mr. McCartney

rose—

Mr. Gummer

I refused to give way to one of my hon. Friends, so I must refuse to give way to the hon. Gentleman.

Mr. McCartney

On a point of order, Mr. Walker. Is it not the tradition of this House that, if a Minister names an hon. Member, that Member is then given the opportunity to respond?

The Chairman

It is entirely a matter for the Minister whether he gives way or not.

Mr. Gummer

There will he other occasions tonight on which what the hon. Member for Makerfield has said can be raised again. I hope that the hon. Gentleman will accept that I have given way most generously, and that I must press on.

I accept that there is a problem about Suffolk, which will lose money because of the proposed date. My hon. Friend the Member for Suffolk, Central (Mr. Lord) should consider that, if any of the other suggested dates were chosen, other authorities would lose and would argue that another date should be chosen—I accept that what happens to other authorities may not be as embarrassing to him and me.

In future, it is unlikely that, overall, there will be any gain for the Treasury. It is much more likely that, in terms of total grant, the local authorities will benefit year to year in a way that will gain the approval of my hon. Friend the Member for Suffolk, Central. I realise that Suffolk has a particular difficulty, but I cannot see how I can do something for Suffolk without producing something for other authorities which are just outside its area.

I do not believe that any of the amendments tabled by the Opposition will help us out of the problems that are bound to arise when one moves from one system to another. There is a need for a stocktaking date, and I believe that the proposed one is fair and absolutely clear. It means that we can start the new system in a certain manner so that people know where they are. I do not believe that any alternative date or method would achieve that end. For the benefit of all local authorities, I believe that it would be better to stick to the proposed date than to go with any other more complicated system that would only produce further difficulties.

Mr. William O'Brien (Normanton)

The Minister has done nothing to explain why the Government have chosen a particular date or why they should penalise local government through the rate support grant allocations.

It has been made abundantly clear that the Minister is not aware of what is taking place or what has been said in the debate. Even the hon. Member for Crosby (Mr. Thornton) had to remind the right hon. Gentleman that his response was misleading and that the issue that the hon. Gentleman had put to his right hon. Friend had not been addressed in his reply. At no time has the Minister said why 7 July has been chosen as the cut-off date, which the Minister has described as a fair date.

My hon. Friend the Member for Birmingham, Perry Barr (Mr. Rooker) gave five examples of how the Government and the Department of the Environment could consider the problems facing authorities. My hon. Friend the Member for Makerfield (Mr. McCartney) has already referred to the Greater Manchester fire and civil defence authority, on which he used to serve, which will lose nearly £1 million. During the two years in question my authority of West Yorkshire could lose £700,000 because of the cut-off date. The Minister should be aware of the problems that will face local authorities and joint committees because of his Department's action, which will stop all consideration of approved expenditure by local authorities after 7 July.

The Minister did not address any of the five suggestions put forward by my hon. Friend the Member for Perry Barr. I believe that it is unfair to bulldoze the Bill through without giving fair consideration to the issues involved in the amendments.

Reference has been made to West Somerset. The Minister said that those ratepayers should know who to blame if their rates increased because of a reduction of £133,000 in rate support grant. That is what they will suffer because of the cut-off date proposed by the Secretary of State. I hope that the ratepayers of West Somerset will realise, in common with the ratepayers of many other local authorities, that the real reason for the increase in rates lies with no other person than the Secretary of State.

A letter sent by the Secretary of State to his right hon.Friend the Member for Bridgwater (Mr. King) said: I do of course understand the disappointment of authorities, like West Somerset, which have spent less in 1987–88 than they had previously reported to the Department but will not now gain any extra grant as they had expected to do 7.30 pm

Therefore, the Secretary of State admits that there is disappointment and that such local authorities are being unfairly treated. They agreed to the terms set by the Secretary of State, but now they are being told that they will not be compensated for meeting the criteria set by the Department.

We believe that the amendments will redress the imbalance that local authorities will suffer if the Bill is passed. I draw the attention of hon. Members, particularly those who have not been here thoughout the debate, to the fact that contributions from both sides of the Committee have all been critical of the Bill. I hope that Tory Members who are here for the Division will note that their colleagues are dissatisfied with the way in which the Bill is being applied to local authorities. I hope that all hon. Members will support the amendment.

Question put, That the amendment be made:—

The Committee divided: Ayes 174, Noes 235.

Division No. 469]	[7.31 pm
AYES
Abbott, Ms Diane	Gordon, Mildred
Adams, Allen (Paisley N)	Gould, Bryan
Allen, Graham	Grant, Bernie (Tottenham)
Anderson, Donald	Griffiths, Nigel (Edinburgh S)
Archer, Rt Hon Peter	Griffiths, Win (Bridgend)
Armstrong, Hilary	Grocott, Bruce
Banks, Tony (Newham NW)	Hardy, Peter
Barnes, Harry (Derbyshire NE)	Hattersley, Rt Hon Roy
Barnes, Mrs Rosie (Greenwich)	Heffer, Eric S.
Barron, Kevin	Henderson, Doug
Beckett, Margaret	Hinchliffe, David
Beith, A. J.	Hogg, N. (C'nauld & Kilsyth)
Bell, Stuart	Holland, Stuart
Benn, Rt Hon Tony	Howarth, George (Knowsley N)
Bennett, A. F. (D'nt'n & R'dish)	Howell, Rt Hon D. (S'heath)
Bermingham, Gerald	Hoyle, Doug
Bidwell, Sydney	Hughes, John (Coventry NE)
Blair, Tony	Hughes, Robert (Aberdeen N)
Blunkett, David	Hughes, Roy (Newport E)
Boateng, Paul	Hughes, Sean (Knowsley S)
Boyes, Roland	Illsley, Eric
Bradley, Keith	Janner, Greville
Bray, Dr Jeremy	John, Brynmor
Brown, Gordon (D'mline E)	Jones, Barry (Alyn & Deeside)
Brown, Nicholas (Newcastle E)	Jones, Martyn (Clwyd S W)
Brown, Ron (Edinburgh Leith)	Kinnock, Rt Hon Neil
Buchan, Norman	Kirkwood, Archy
Buckley, George J.	Leadbitter, Ted
Caborn, Richard	Leighton, Ron
Callaghan, Jim	Lestor, Joan (Eccles)
Campbell, Menzies (Fife NE)	Lewis, Terry
Campbell, Ron (Blyth Valley)	Litherland, Robert
Campbell-Savours, D. N.	Livingstone, Ken
Clark, Dr David (S Shields)	Lofthouse, Geoffrey
Clay, Bob	Loyden, Eddie
Clelland, David	McAvoy, Thomas
Clwyd, Mrs Ann	McCartney, Ian
Cohen, Harry	McKelvey, William
Coleman, Donald	McLeish, Henry
Cook, Frank (Stockton N)	McNamara, Kevin
Cook, Robin (Livingston)	Madden, Max
Corbett, Robin	Mahon, Mrs Alice
Cox, Tom	Marek, Dr John
Crowther, Stan	Marshall, Jim (Leicester S)
Cryer, Bob	Martlew, Eric
Cunliffe, Lawrence	Michael, Alun
Cunningham, Dr John	Michie, Bill (Sheffield Heeley)
Davies, Rt Hon Denzil (Llanelli)	Mitchell, Austin (G't Grimsby)
Davies, Ron (Caerphilly)	Morgan, Rhodri
Davis, Terry (B'ham Hodge H'l)	Morley, Elliott
Dixon, Don	Morris, Rt Hon A. (W'shawe)
Dobson, Frank	Mowlam, Marjorie
Doran, Frank	Murphy, Paul
Duffy, A. E. P.	Nellist, Dave
Eastham, Ken	Oakes, Rt Hon Gordon
Evans, John (St Helens N)	O'Brien, William
Ewing, Harry (Falkirk E)	O'Neill, Martin
Fatchett, Derek	Orme, Rt Hon Stanley
Faulds, Andrew	Patchett, Terry
Fearn, Ronald	Pike, Peter L.
Field, Frank (Birkenhead)	Powell, Ray (Ogmore)
Fields, Terry (L'pool B G'n)	Primarolo, Dawn
Fisher, Mark	Quin, Ms Joyce
Flannery, Martin	Randall, Stuart
Flynn, Paul	Redmond, Martin
Foot, Rt Hon Michael	Richardson, Jo
Foster, Derek	Roberts, Allan (Bootle)
Fraser, John	Robertson, George
Galbraith, Sam	Robinson, Geoffrey
Galloway, George	Rogers, Allan
Garrett, John (Norwich South)	Rooker, Jeff
Gilbert, Rt Hon Dr John	Ross, Ernie (Dundee W)
Godman, Dr Norman A.	Rowlands, Ted

Sedgemore, Brian	Wall, Pat
Sheerman, Barry	Wallace, James
Sheldon, Rt Hon Robert	Walley, Joan
Shore, Rt Hon Peter	Wardell, Gareth (Gower)
Short, Clare	Wareing, Robert N.
Skinner, Dennis	Welsh, Michael (Doncaster N)
Smith, Andrew (Oxford E)	Williams, Rt Hon Alan
Snape, Peter	Williams, Alan W. (Carm'then)
Soley, Clive	Wilson, Brian
Spearing, Nigel	Winnick, David
Steel, Rt Hon David	Wise, Mrs Audrey
Steinberg, Gerry	Worthington, Tony
Stott, Roger
Taylor, Matthew (Truro)	Tellers for the Ayes:
Thompson, Jack (Wansbeck)	Mr. Frank Haynes and
Turner, Dennis	Mrs. Llin Golding.

NOES
Alexander, Richard	Evennett, David
Alison, Rt Hon Michael	Fairbairn, Sir Nicholas
Amess, David	Fallon, Michael
Amos, Alan	Favell, Tony
Arnold, Tom (Hazel Grove)	Fenner, Dame Peggy
Ashby, David	Field, Barry (Isle of Wight)
Aspinwall, Jack	Finsberg, Sir Geoffrey
Atkins, Robert	Fishburn, John Dudley
Baker, Nicholas (Dorset N)	Forman, Nigel
Baldry, Tony	Forsyth, Michael (Stirling)
Banks, Robert (Harrogate)	Forth, Eric
Batiste, Spencer	Franks, Cecil
Beaumont-Dark, Anthony	Freeman, Roger
Bendall, Vivian	Fry, Peter
Bennett, Nicholas (Pembroke)	Gale, Roger
Benyon, W.	Gardiner, George
Bevan, David Gilroy	Garel-Jones, Tristan
Blackburn, Dr John G.	Gill, Christopher
Bonsor, Sir Nicholas	Glyn, Dr Alan
Boswell, Tim	Goodhart, Sir Philip
Bottomley, Peter	Goodlad, Alastair
Bottomley, Mrs Virginia	Goodson-Wickes, Dr Charles
Bowden, Gerald (Dulwich)	Gorman, Mrs Teresa
Bowis, John	Gow, Ian
Boyson, Rt Hon Dr Sir Rhodes	Gower, Sir Raymond
Brazier, Julian	Grant, Sir Anthony (CambsSW)
Bright, Graham	Greenway, Harry (Ealing N)
Brooke, Rt Hon Peter	Greenway, John (Ryedale)
Brown, Michael (Brigg & CI't's)	Gregory, Conal
Bruce, Ian (Dorset South)	Griffiths, Peter (Portsmouth N)
Buck, Sir Antony	Grist, Ian
Budgen, Nicholas	Ground, Patrick
Burns, Simon	Grylls, Michael
Burt, Alistair	Gummer, Rt Hon John Selwyn
Butcher, John	Hamilton, Hon Archie (Epsom)
Butler, Chris	Hamilton, Neil (Tatton)
Butterfill, John	Hampson, Dr Keith
Carlisle, Kenneth (Lincoln)	Hanley, Jeremy
Carrington, Matthew	Hargreaves, A. (B'ham H'll Gr')
Cash, William	Hargreaves, Ken (Hyndburn)
Chope, Christopher	Harris, David
Clark, Hon Alan (Plym'th S'n)	Haselhurst, Alan
Clark, Dr Michael (Rochford)	Hayes, Jerry
Clark, Sir W. (Croydon S)	Hayhoe, Rt Hon Sir Barney
Clarke, Rt Hon K. (Rushcliffe)	Hayward, Robert
Colvin, Michael	Heathcoat-Amory, David
Coombs, Anthony (Wyre F'rest)	Heddle, John
Coombs, Simon (Swindon)	Hicks, Robert (Cornwall SE)
Cope, Rt Hon John	Higgins, Rt Hon Terence L.
Cran, James	Hogg, Hon Douglas (Gr'th'm)
Currie, Mrs Edwina	Hordern, Sir Peter
Curry, David	Howard, Michael
Davis, David (Boothferry)	Howarth, Alan (Strat'd-on-A)
Day, Stephen	Howarth, G. (Cannock & B'wd)
Devlin, Tim	Howell, Rt Hon David (G'dford)
Dickens, Geoffrey	Howell, Ralph (North Norfolk)
Dorrell, Stephen	Hughes, Robert G. (Harrow W)
Dover, Den	Hunt, David (Wirral W)
Dunn, Bob	Hunt, John (Ravensbourne)
Durant, Tony	Hunter, Andrew
Dykes, Hugh	Irvine, Michael
Emery, Sir Peter	Irving, Charles

Jack, Michael	Paice, James
Janman, Tim	Patnick, Irvine
Jessel, Toby	Patten, John (Oxford W)
Johnson Smith, Sir Geoffrey	Pattie, Rt Hon Sir Geoffrey
Jones, Robert B (Herts W)	Pawsey, James
Jopling, Rt Hon Michael	Peacock, Mrs Elizabeth
Kellett-Bowman, Dame Elaine	Porter, Barry (Wirral S)
Key, Robert	Porter, David (Waveney)
Knapman, Roger	Portillo, Michael
Knight, Dame Jill (Edgbaston)	Powell, William (Corby)
Knox, David	Price, Sir David
Lamont, Rt Hon Norman	Raffan, Keith
Lang, Ian	Raison, Rt Hon Timothy
Lawrence, Ivan	Renton, Tim
Lawson, Rt Hon Nigel	Ridley, Rt Hon Nicholas
Lee, John (Pendle)	Ridsdale, Sir Julian
Leigh, Edward (Gainsbor'gh)	Roe, Mrs Marion
Lennox-Boyd, Hon Mark	Rossi, Sir Hugh
Lester, Jim (Broxtowe)	Rost, Peter
Lloyd, Sir Ian (Havant)	Rowe, Andrew
Lloyd, Peter (Fareham)	Rumbold, Mrs Angela
Lord, Michael	Ryder, Richard
Lyell, Sir Nicholas	Scott, Nicholas
McCrindle, Robert	Shaw, David (Dover)
Macfarlane, Sir Neil	Shaw, Sir Michael (Scarb')
MacGregor, Rt Hon John	Shelton, William (Streatham)
MacKay, Andrew (E Berkshire)	Shephard, Mrs G. (Norfolk SW)
McLoughlin, Patrick	Shepherd, Colin (Hereford)
McNair-Wilson, Sir Michael	Shepherd, Richard (Aldridge)
McNair-Wilson, P. (New Forest)	Shersby, Michael
Madel, David	Sims, Roger
Malins, Humfrey	Skeet, Sir Trevor
Mans, Keith	Smith, Tim (Beaconsfield)
Maples, John	Speed, Keith
Marlow, Tony	Spicer, Sir Jim (Dorset W)
Marshall, John (Hendon S)	Spicer, Michael (S Worcs)
Marshall, Michael (Arundel)	Stern, Michael
Martin, David (Portsmouth S)	Stewart, Andy (Sherwood)
Maude, Hon Francis	Stokes, Sir John
Mayhew, Rt Hon Sir Patrick	Stradling Thomas, Sir John
Mellor, David	Taylor, Ian (Esher)
Meyer, Sir Anthony	Taylor, John M (Solihull)
Miller, Sir Hal	Thompson, D. (Calder Valley)
Mills, Iain	Thornton, Malcolm
Mitchell, Andrew (Gedling)	Thurnham, Peter
Mitchell, David (Hants NW)	Vaughan, Sir Gerard
Moate, Roger	Waddington, Rt Hon David
Montgomery, Sir Fergus	Wakeham, Rt Hon John
Moore, Rt Hon John	Watts, John
Morrison, Rt Hon P (Chester)	Wheeler, John
Moss, Malcolm	Widdecombe, Ann
Moynihan, Hon Colin	Winterton, Mrs Ann
Mudd, David	Wolfson, Mark
Neale, Gerrard
Neubert, Michael	Tellers for the Noes:
Nicholson, David (Taunton)	Mr. David Maclean and
Onslow, Rt Hon Cranley	Mr. Tom Sackville.
Page, Richard

Question accordingly negatived.

7.45 pm

Mr. O'Brien

I beg to move amendment No. 2, in page 1, line 20, at end insert— '( ) Before making a calculation and notification under section 66(2) of the 1980 Act the Secretary of State shall take into account any reduction in a local authority's rateable value effective from the date on or before that which is relevant for determining the gross rateable value of the hereditaments in the authority's area under Part VI of the 1980 Act'. The amendment requests the Secretary of State to consider the vast reductions in the rateable value of local authorities before the effective date set out in the Bill. It requires the Secretary of State to take into account reductions in rateable values when determining an authority's final grant entitlement. It will provide local authorities with financial compensation for the large refunds of rates which they have been required to make as a result of two recent rating cases, the Addis v. Clement House of Lords decision and the Severn-Trent water authority v. Cakebread Court of Appeal case.

Addis v. Clement turned on a decision whether a factory on the borders of the lower Swansea enterprise zone could rely on the introduction of the enterprise zone to seek a reduction in rateable value on the grounds that the favourable treatment on rates for companies within the zone depressed rateable values immediately outside the zone. That matter causes concern wherever an enterprise zone operates. On that occasion the House of Lords found that ratepayers could obtain changes in rateable values to reflect changes in market conditions. That decision was contrary to the traditional view and it caused problems.

The case of the Severn-Trent water authority v. Cakebread affected the rating of individually rated water hereditaments particularly sewage treatment works. The Court of Appeal held that, because the Water Act 1973 changed the statutory definition of water hereditaments, separately rated water hereditaments should be covered by the statutory formula governing the rating of water undertakings even though the formula made allowances for them in its original state.

That decision was taken on 4 December last year and many repayments were made before 7 July, the magical date in the Bill. The Appeal Court judgment excluded hereditaments around water undertakings from rating. Apart from the changes proposed in the Bill, we can imagine what results the Appeal Court decision has had and will have on local authorities' rateable value assessments.

On 9 March, the Secretary of State announced that he intended to legislate to overturn the decisions of the House of Lords and the Court of Appeal and restore the law to its previous standing. His proposals were subsequently enacted in the Local Government Finance Bill which was before the House a few weeks ago. Local authorities were worried that the restoration of the law was effective only from 10 March. Successful appeals by ratepayers prior to 10 March, some going back to 1984–85, were allowed to stand. That resulted in some authorities having to pay large rate refunds, with a consequent reduction in rateable values. That is the backcloth to the amendment.

During the passage of the Local Government Finance Bill the Association of London Authorities supported amendments to the Secretary of State's proposals about retrospection. If accepted, those amendments would have avoided the need for authorities to make refunds. Having failed in that approach, the association sought compensation through the rate support grant system. Further representations to the Secretary of State appear to have fallen on deaf ears.

A letter from the Department of the Environment to the Association of County Councils refers in detail to the Severn-Trent water authority v. Cakebread. The letter is dated 3 October and I shall quote from it because it is important and pertinent to the amendment. The letter says:

The Local Authority Associations have made representations to the Department about the consequences for local authorities of the decision of the Court of Appeal in this case. In short, they argued that authorities would have to refund substantial amounts of rate income, and that this would have an unreasonable effect on their financial position. They therefore argued that the Secretary of State should make some arrangements to compensate them through the RSG system or otherwise. Ministers have carefully considered these arguments. As you will know, the law has been amended so as to restore the position to that which was understood to operate before the Cakebread decision as regards valuation proposals submitted after 10 March 1988. It has also been made clear by the legislation that section 9(2) of the General Rate Act 1967 has no application to these cases, and this has substantially reduced the maximum amount which the Water Authorities might have been able to reclaim from local authorities. Ministers do not, however, intend to bring forward any proposals to modify the existing RSG arrangements so as to provide any additional Exchequer resorces. That means that the Department emphatically turned down the request from local authorities for compensation for the loss of rateable value as a result of the court decisions. The amendment refers to the period before 10 March and pertains to decisions which influenced local authorities to make refunds.

Current legislation provides for special arrangements in cases where local authorities have suffered a reduction in rateable value. The ceiling for that is that it must be more than 2.5 per cent. of the rateable value. Section 67 of the Local Government, Planning and Land Act 1980 empowers local authorities to apply to the Secretary of State for grant to be recalculated. Unfortunately, no authority met the rateable value criteria that resulted from the Cakebread and Addis cases.

The reduction in rateable values and the consequent liabilities to make refunds are significant. It is estimated that local authorities will have to refund no less than £90 million as a result of the Cakebread decision and between £30 million and £40 million as a result of the Addis case. The decisions have created tremendous problems for many authorities. I shall give some examples of the reductions in rateable values as a result of the decisions. The rateable value in Newham was reduced by £957,700.

In Trafford it was reduced by just under £500,000, in Sutton by £269,000, in Bradford by £212,700 and in Sheffield by £200,600. The rate refund paid by Newham was £2.3 million. Bradford paid £2.1 million, Wakefield £1.6 million, Bexley just over £1 million and Calderdale £692,000. Most of the money was paid before 10 March.

The Secretary of State should consider the problems facing local authorities. In addition to the refunds, they have to face cuts in rate support grant because of the cut-off date of 7 July. One can understand why local authorities are distraught. They also face a further reduction because no compensation will be paid for the fall in their rateable values.

This amendment would allow reductions in rateable values to feed through into grant entitlement, thereby providing some compensation for those authorities most seriously affected. I have already listed a number of those authorities. I ask the Minister to take into consideration the appeals that have been made by the various local authorities, and to agree that some consideration be given to the authorities that are most affected because of the decisions that have been taken.

8 pm

The amendment is a genuine approach to try to resolve a serious matter. It does not try to score points or steal any ground from the Secretary of State. It tries merely to redress the imbalance. We heard a great deal in the last debate about cuts in services, and about how local authorities and those who serve on local authorities have had the traumatic experience of trying to meet the budget. Without any shadow of doubt, over the past nine years, local authorities have suffered tremendously because of Government decisions. The amendment will help to make some adjustment to the problems that are facing certain local authorities because of those decisions. I ask the Committee to accept amendment No. 2 because of its fairness and because it points out an anomaly that has arisen as a result of the decisions taken by the Secretary of State.

Mr. Lord

These amendments are linked to the group that we discussed with amendment No. 1, because of the power of the Government in both cases to put right what are seen as unfairnesses. I shall speak about the effects on county councils of the case of Severn-Trent Water v. Cakebread, with particular reference to Suffolk county council. I shall not rehearse the arguments, because the hon. Member for Normanton (Mr. O'Brien) has laid out the position fairly clearly. I am sure that my hon. Friend the Under-Secretary will not disagree with at least the framework of the way in which he laid down the case.

The result of the case is that Suffolk county council will have to repay £1.9 million to Anglia Water through no fault of its own. Clearly, that has a great impact on the rate level for next year and the way that the whole rating package is put together. The council would like the Government to introduce retrospective legislation so that it does not have to pay out this embarrassing amount of money. The Government are saying that they are not able to do that, but in another part of the Bill, they are doing just that. They are employing retrospective legislation to establish figures for the rate support grant for the forthcoming year, and by doing so, and by choosing in a fairly arbitrary way the date of 7 July, they are penalising Suffolk county council to the tune of £2.5 million. That means that Suffolk county council will lose a grand total of £4.4 million.

The Government cannot have it both ways. They should either allow retrospective legislation so that Suffolk county council does not have to meet the £1.9 million charge to Anglian Water, or they should not use retrospective legislation to calculate the rate support grant figures for the years ahead. There is a great anomaly. I am not talking about levels of services or levels of rates. I am talking simply about honesty and fairness in Government dealings. In this case, it is patently obvious to everyone that things have not been done as fairly as they ought to have been. I ask my hon. Friend the Under-Secretary, as I asked my right hon. Friend the Minister for Local Government earlier, to consider my remarks and those made by every other hon. Member tonight, and to see whether justice and fairness can be done so that these unfair penalties do not fall on county councils such as mine in Suffolk.

Ms. Joan Walley (Stoke-on-Trent, North)

I am in the unusual position of agreeing not only with what my hon. Friend the Member for Normanton (Mr. O'Brien) said from the Opposition Front Bench but with what the hon. Member for Suffolk, Central (Mr. Lord) said. I wish to place on record the grave concern with which Staffordshire county council views the Cakebread case and its results. Like those councils mentioned by my hon. Friend and the hon. Member for Suffolk, Central, the Staffordshire county council is being badly penalised. There is an anomaly and the Government have it in their power to do something about that anomaly. There is no problem in the Government introducing retrospective legislation if they wish to.

It would be wrong of me to let the debate go by without saying that there should be full recognition of the grave effects that the Cakebread decision has had on county councils such as those in the area that I represent. Staffordshire county council was involved in lengthy legal proceedings when the Cakebread case was heard. The matter has been taken up by the council with hon. Members on both sides of the House representing the area, and the council has subsequently taken the matter up with the local authority associations.

I should like the Minister to accept that this is an anomaly with which the Government can and will deal, so that my county council will not have to make grave cuts because of a shortfall in expenditure caused by no fault of its own but by the fact that it has had to give huge amounts of money to the water authorities at a time when we all know that privatisation is just around the corner.

The Parliamentary Under-Secretary of State for the Environment (Mrs. Virginia Bottomley)

The hon. Member for Normanton (Mr. O'Brien) put the facts clearly. Let me go over some of the ground. One of the key figures in determining how much grant each authority receives is its rateable value. The higher the rateable value, the less grant it needs. The 1980 legislation on rate support grant provides that the rateable value of each area is taken from the valuation list on the specified date. That date has always been 1 April, 12 months before the year in question. The gross figure taken from the valuation list is then adjusted to allow for the relief given to charities and to unoccupied buildings.

When a ratepayer challenges a rateable value, it often takes some time for the ratepayer's proposal to be determined. With complex legal cases, it can take several years. Rating law provides that the ratepayer enjoys the benefit of any reduction in rateable value going back to the date on which the proposal was made or, in some cases, 1 April of the rating year during which the proposal was made. This reduction in rateable value does not, however, have a retrospective effect for rate support grant purposes.

The amendment is designed to require the Secretary of State to take into account changes to the valuation list when calculating grant entitlement. The aim is that where a local authority faces a loss of rate income, for example because of a valuation decision, the authority should receive extra block grant in compensation.

Hon. Members on both sides of the Committee have described consequences for local authorities of the decisions in the Cakebread and Addis cases. In the former, as the hon. Member for Normanton said, the Court of Appeal found that certain premises used by all water authorities should not be separately rated as had always been thought to be the practice, but they were included within the formula rating arrangements applicable to the water industry. In the Addis case, the House of Lords found that the creation of an enterprise zone was a factor justifying a reduction in rateable value. That went against the conventional understanding that changes in economic circumstances were not grounds for changes in rateable value between normal revaluations.

In both cases, the Government took the view that the law, as declared by the courts, should not be allowed to stand and that the position should be restored to the one that had always been assumed to operate prior to the decisions. The Government therefore included the necessary clauses in the Local Government Finance Act 1988 to restore the position. The new basis applies to all proposals for revaluations made after 9 March—the date on which the Secretary of State announced the change.

We recognise that local authorities have had to make refunds in respect of the period up to the Secretary of State's announcement. As the hon. Member for Normanton said, about £95 million of rates will have to be refunded. Clearly, it is not possible to identify the amounts refunded as a result of the Addis case, although the hon. Gentleman made an estimate. Section 67 of the Local Government, Planning and Land Act 1980 makes provisions that, deal with changes in rateable values. It provides that once a conclusive calculation has been made for any year, an authority may serve a notice on the Secretary of State if the rateable value is reduced and the reduction exceeds a threshold. The Secretary of State must then pay extra grant to the authority.

The threshold is presently set at 2.5 per cent., so existing provisions mirror roughly the position sought by the amendment, except that the amendment does not provide for a threshold. The amendment seeks to provide that any reduction in rateable value would result in extra grant. It does not mention increases in rateable value, which could also occur. Local authority associations have made representations to the Government, asking that they should provide compensation for authorities that have had to make refunds as a result of the two cases.

We considered those representations carefully, but we concluded that there was no case for departing from the existing arrangements—which I have just described—which were introduced precisely to deal with such circumstances. It would not be sensible or reasonable for the block grant system to track every change in rateable value that may have an effect on an authority's circumstances. It is sensible to take the valuation list at the most convenient point before each grant year begins and to fix on that as the basis for the calculations.

Section 67 of the Local Government, Planning and Land Act 1980 provides a mechanism for dealing with cases in which subsequent changes in rateable value are excessive. The threshhold was set at 2.5 per cent. by statutory instrument and the Opposition did not pray against it. The provisions are available to local authorities if the case under consideration fits the conditions set out. We see no overwhelming case for changing the provisions at present.

8.15 pm

My hon. Friend the Member for Suffolk, Central (Mr. Lord) referred to Suffolk county council. I realise that Suffolk county council will be disappointed that, in the Cakebread case, the Court of Appeal found for the ratepayer rather than the district valuer and that, as a result, a refund of rates has had to be made. For reasons given by my right hon. Friend the Minister for Local Government, that coincided for Suffolk with the date of 7 July. However, the cumulative loss for Suffolk for all the years affected amounts to less than 1.5 per cent. of the rate income for one year.

I do not have the precise figure, but I can confirm that it is less than 1.5 per cent. However, I can offer my hon. Friend some comfort. The full supplementary reports are due to be made shortly and are about to go out for consultation. They are likely to result in an additional £1.1 million of grant to Suffolk.

Some hon. Members, including my hon. Friend the Member for Suffolk, Central, have argued that retrospective legislation to reverse the court's decision should have been introduced, so that no repayments would have been due. We cannot accept that argument. It would be wholly unreasonable for the Government to introduce legislation that imposed a retrospective tax liability which, in the Addis case, would fall on private organisations. The Bill is not retrospective—it freezes expenditure information on the date on which the new policy was announced. That is quite different. The rating provisions in the Local Government Finance Act 1988 and the Bill are strongly similar, in that they operate from the date on which the new policies were announced. I therefore urge hon. Members to oppose the amendment.

Mr. Rooker

Will the Minister tell us how many times the 2.5 per cent. limit has been breached since it was agreed by the House? She has been well briefed, as she knows that the Opposition did not pray against it.

Mrs. Bottomley

I am not in a position to give that information.

Mr. Rooker

It is no good the Minister coming to the House to imply that Opposition parties agreed with the figure of 2.5 per cent., when she has not the information to back up her assertion. We are discussing a substantial sum of money—over £90 million—which will be used to featherbed the water authorities. If the Minister's argument about the 2.5 per cent. limit is valid, will she tell us how many times the limit has been breached, and therefore how many times the Government have had to recompense local authorities?

Mrs. Bottomley

I understand that the provision has been made use of once in Wales and never in England. The hon. Gentleman misses the point. Parliament has already discussed the matter and the 2.5 per cent. threshold was agreed.

Mr. Rooker

We are talking about very different circumstances. I challenge the Minister to give chapter and verse about whether a case similar to the Cakebread case was given as an example by Ministers. It is a case that has overturned the normal rating conventions.

It is ironic that the Minister should talk about Parliament's agreement. The Government guillotined the poll tax Bill, so Parliament did not have a chance to debate this matter then. The date of 10 March was legislated for in the summer. I admit that the announcement was made at the Dispatch Box on 10 March, but by that time the poll tax Bill had completed its Committee stage. The matter was never properly debated in the House. The first opportunity to have a debate on it has come tonight.

Mr. O'Brien

The Minister referred to the normal reduction in rateable values through the demolition of properties or the closure of factories. However, the case that we are presenting is different. The 2.5 per cent. threshold to which the Minister referred applies to the principle of the general reduction in rates because of changes in the local authority area. The reduction in rates usually comes about because older properties are removed from the valuation list or because certain industries close. We accept that if there is a substantial reduction, an application can be made for compensation under the rate support grant order.

We are not discussing demolished properties being removed from the valuation list. We are discussing properties that are taken out of the valuation list to the benefit of some ratepayers. In this case, the Severn-Trent water authority was one of the greater beneficiaries, but other water authorities throughout the country have also benefited. There is a substantial difference between the principle outlined by the Minister and the case that we are presenting, and I hope that she will accept that. It is abysmal that she should come here, miss the whole point of the argument and bring in other issues that have no bearing on the amendment. The amendment seeks to be fair to the authorities that have suffered because of the two decisions. I hope that the Minister will accept the amendment. If she does not, I hope that other hon. Members will support it.

Question put, That the amendment be made:—

The Committee divided: Ayes 164, Noes 201.

Division No. 470]	[8.19 pm
AYES
Abbott, Ms Diane	Davies, Ron (Caerphilly)
Adams, Allen (Paisley N)	Davis, Terry (B'ham Hodge H'l)
Allen, Graham	Dixon, Don
Archer, Rt Hon Peter	Doran, Frank
Armstrong, Hilary	Duffy, A. E. P.
Banks, Tony (Newham NW)	Eastham, Ken
Barnes, Harry (Derbyshire NE)	Evans, John (St Helens N)
Barnes, Mrs Rosie (Greenwich)	Ewing, Harry (Falkirk E)
Barron, Kevin	Fatchett, Derek
Beckett, Margaret	Faulds, Andrew
Bell, Stuart	Fearn, Ronald
Benn, Rt Hon Tony	Field, Frank (Birkenhead)
Bennett, A. F. (D'nt'n & R'dish)	Fields, Terry (L'pool B G'n)
Bermingham, Gerald	Fisher, Mark
Bidwell, Sydney	Flannery, Martin
Blair, Tony	Flynn, Paul
Boateng, Paul	Foot, Rt Hon Michael
Boyes, Roland	Foster, Derek
Bradley, Keith	Fraser, John
Bray, Dr Jeremy	Galbraith, Sam
Brown, Gordon (D'mline E)	Galloway, George
Brown, Nicholas (Newcastle E)	Garrett, John (Norwich South)
Brown, Ron (Edinburgh Leith)	Gilbert, Rt Hon Dr John
Buchan, Norman	Godman, Dr Norman A.
Buckley, George J.	Gordon, Mildred
Caborn, Richard	Grant, Bernie (Tottenham)
Callaghan, Jim	Griffiths, Nigel (Edinburgh S)
Campbell, Menzies (Fife NE)	Griffiths, Win (Bridgend)
Campbell, Ron (Blyth Valley)	Hardy, Peter
Campbell-Savours, D. N.	Hattersley, Rt Hon Roy
Clark, Dr David (S Shields)	Heffer, Eric S.
Clay, Bob	Henderson, Doug
Clelland, David	Hinchliffe, David
Clwyd, Mrs Ann	Hogg, N. (C'nauld & Kilsyth)
Cohen, Harry	Home Robertson, John
Coleman, Donald	Howarth, George (Knowsley N)
Cook, Frank (Stockton N)	Hughes, John (Coventry NE)
Cook, Robin (Livingston)	Hughes, Robert (Aberdeen N)
Corbett, Robin	Hughes, Roy (Newport E)
Cox, Tom	Hughes, Sean (Knowsley S)
Crowther, Stan	Illsley, Eric
Cryer, Bob	Janner, Greville
Cunliffe, Lawrence	John, Brynmor
Cunningham, Dr John	Jones, Barry (Alyn & Deeside)
Davies, Rt Hon Denzil (Llanelli)	Jones, Martyn (Clwyd S W)

Kirkhope, Timothy	Redmond, Martin
Leadbitter, Ted	Richardson, Jo
Leighton, Ron	Roberts, Allan (Bootle)
Lestor, Joan (Eccles)	Robinson, Geoffrey
Lewis, Terry	Rogers, Allan
Litherland, Robert	Rooker, Jeff
Livingstone, Ken	Ross, Ernie (Dundee W)
Lofthouse, Geoffrey	Rowlands, Ted
Loyden, Eddie	Sedgemore, Brian
McAvoy, Thomas	Sheerman, Barry
McCartney, Ian	Sheldon, Rt Hon Robert
McKelvey, William	Shore, Rt Hon Peter
McLeish, Henry	Short, Clare
McNamara, Kevin	Skinner, Dennis
Madden, Max	Smith, Andrew (Oxford E)
Mahon, Mrs Alice	Snape, Peter
Marek, Dr John	Soley, Clive
Marshall, Jim (Leicester S)	Steel, Rt Hon David
Martlew, Eric	Steinberg, Gerry
Meale, Alan	Stott, Roger
Michael, Alun	Straw, Jack
Michie, Bill (Sheffield Heeley)	Taylor, Matthew (Truro)
Mitchell, Austin (G't Grimsby)	Thompson, Jack (Wansbeck)
Morgan, Rhodri	Turner, Dennis
Morley, Elliott	Wall, Pat
Mowlam, Marjorie	Walley, Joan
Murphy, Paul	Warden, Gareth (Gower)
Nellist, Dave	Wareing, Robert N.
Oakes, Rt Hon Gordon	Welsh, Michael (Doncaster N)
O'Brien, William	Williams, Rt Hon Alan
O'Neill, Martin	Williams, Alan W. (Carm'then)
Orme, Rt Hon Stanley	Wilson, Brian
Patchett, Terry	Winnick, David
Pike, Peter L.	Wise, Mrs Audrey
Powell, Ray (Ogmore)	Worthington, Tony
Prescott, John
Primarolo, Dawn	Tellers for the Ayes:
Quin, Ms Joyce	Mr. Frank Haynes and
Randall, Stuart	Mrs Llin Golding.

NOES
Aitken, Jonathan	Clark, Dr Michael (Rochford)
Alexander, Richard	Clark, Sir W. (Croydon S)
Amess, David	Colvin, Michael
Amos, Alan	Coombs, Anthony (Wyre F'rest)
Arnold, Tom (Hazel Grove)	Coombs, Simon (Swindon)
Ashby, David	Cope, Rt Hon John
Aspinwall, Jack	Cran, James
Atkins, Robert	Currie, Mrs Edwina
Baker, Nicholas (Dorset N)	Curry, David
Baldry, Tony	Davis, David (Boothferry)
Banks, Robert (Harrogate)	Day, Stephen
Batiste, Spencer	Devlin, Tim
Beaumont-Dark, Anthony	Dorrell, Stephen
Bendall, Vivian	Dover, Den
Bennett, Nicholas (Pembroke)	Dunn, Bob
Benyon, W.	Durant, Tony
Bevan, David Gilroy	Dykes, Hugh
Blackburn, Dr John G.	Emery, Sir Peter
Blaker, Rt Hon Sir Peter	Evennett, David
Bonsor, Sir Nicholas	Fairbairn, Sir Nicholas
Boswell, Tim	Favell, Tony
Bottomley, Mrs Virginia	Fenner, Dame Peggy
Bowden, Gerald (Dulwich)	Field, Barry (Isle of Wight)
Bowis, John	Finsberg, Sir Geoffrey
Boyson, Rt Hon Dr Sir Rhodes	Fishburn, John Dudley
Brazier, Julian	Forman, Nigel
Bright, Graham	Forsyth, Michael (Stirling)
Brown, Michael (Brigg & CI't's)	Forth, Eric
Bruce, Ian (Dorset South)	Franks, Cecil
Budgen, Nicholas	Freeman, Roger
Burns, Simon	Fry, Peter
Butcher, John	Gale, Roger
Butler, Chris	Gardiner, George
Butterfill, John	Garel-Jones, Tristan
Carlisle, Kenneth (Lincoln)	Gill, Christopher
Carrington, Matthew	Glyn, Dr Alan
Cash, William	Goodhart, Sir Philip
Chope, Christopher	Goodson-Wickes, Dr Charles
Clark, Hon Alan (Plym'th S'n)	Gorman, Mrs Teresa

Gow, Ian	Marshall, John (Hendon S)
Grant, Sir Anthony (CambsSW)	Martin, David (Portsmouth S)
Greenway, Harry (Ealing N)	Maude, Hon Francis
Greenway, John (Ryedale)	Mayhew, Rt Hon Sir Patrick
Gregory, Conal	Meyer, Sir Anthony
Griffiths, Peter (Portsmouth N)	Miller, Sir Hal
Grist, Ian	Mills, Iain
Ground, Patrick	Mitchell, Andrew (Gedling)
Grylls, Michael	Mitchell, David (Hants NW)
Gummer, Rt Hon John Selwyn	Moate, Roger
Hamilton, Neil (Tatton)	Montgomery, Sir Fergus
Hampson, Dr Keith	Moore, Rt Hon John
Hanley, Jeremy	Moss, Malcolm
Hargreaves, A. (B'ham H'll Gr')	Mudd, David
Hargreaves, Ken (Hyndburn)	Neale, Gerrard
Harris, David	Neubert, Michael
Haselhurst, Alan	Nicholson, David (Taunton)
Hayes, Jerry	Onslow, Rt Hon Cranley
Hayward, Robert	Paice, James
Heathcoat-Amory, David	Patnick, Irvine
Heddle, John	Pattie, Rt Hon Sir Geoffrey
Hicks, Robert (Cornwall SE)	Pawsey, James
Higgins, Rt Hon Terence L.	Peacock, Mrs Elizabeth
Hogg, Hon Douglas (Gr'th'm)	Porter, Barry (Wirral S)
Hordern, Sir Peter	Porter, David (Waveney)
Howard, Michael	Portillo, Michael
Howarth, G. (Cannock & B'wd)	Powell, William (Corby)
Howell, Ralph (North Norfolk)	Raffan, Keith
Hughes, Robert G. (Harrow W)	Raison, Rt Hon Timothy
Hunt, David (Wirral W)	Ridsdale, Sir Julian
Hunt, John (Ravensbourne)	Roe, Mrs Marion
Hunter, Andrew	Rowe, Andrew
Irvine, Michael	Rumbold, Mrs Angela
Irving, Charles	Sackville, Hon Tom
Jack, Michael	Shaw, David (Dover)
Janman, Tim	Shaw, Sir Michael (Scarb')
Johnson Smith, Sir Geoffrey	Shelton, William (Streatham)
Jones, Robert B (Herts W)	Shephard, Mrs G. (Norfolk SW)
Jopling, Rt Hon Michael	Shepherd, Colin (Hereford)
Kellett-Bowman, Dame Elaine	Shepherd, Richard (Aldridge)
Key, Robert	Shersby, Michael
Knapman, Roger	Sims, Roger
Knight, Dame Jill (Edgbaston)	Skeet, Sir Trevor
Knox, David	Speed, Keith
Lang, Ian	Spicer, Michael (S Worcs)
Lawrence, Ivan	Stern, Michael
Lee, John (Pendle)	Stewart, Andy (Sherwood)
Leigh, Edward (Gainsbor'gh)	Stokes, Sir John
Lennox-Boyd, Hon Mark	Stradling Thomas, Sir John
Lloyd, Sir Ian (Havant)	Taylor, Ian (Esher)
Lloyd, Peter (Fareham)	Thornton, Malcolm
Lord, Michael	Thurnham, Peter
McCrindle, Robert	Vaughan, Sir Gerard
Macfarlane, Sir Neil	Waddington, Rt Hon David
MacGregor, Rt Hon John	Waller, Gary
MacKay, Andrew (E Berkshire)	Wheeler, John
Maclean, David	Widdecombe, Ann
McLoughlin, Patrick	Winterton, Mrs Ann
McNair-Wilson, Sir Michael	Wolfson, Mark
McNair-Wilson, P. (New Forest)
Madel, David	Tellers for the Noes:
Malins, Humfrey	Mr. John M. Taylor and
Mans, Keith	Mr. Michael Fallon.
Marlow, Tony

Question accordingly negatived.

Mr. Bob Cryer (Bradford, South)

I beg to move amendment No. 16, in page 1, line 20, at end, insert—

'(d) assessing the needs of Metropolitan Districts in the light of increasing school rolls, number of temporary classrooms in use, unemployment levels, social security recipients, age of public building and housing stock, condition of roads, railway facilities and any other relevant factors to enable him to increase the payments of domestic rate relief grant and block grant.'. I should like to make a few brief remarks about each item in the amendment to explain why I believe that the Committee should support the amendment. As Bradford is a metropolitan district council, I propose to concentrate on that city, although my remarks apply to all metropolitan district councils.

Many of the areas about which we are concerned, such as Bradford, are older industrial cities. Bradford has a number of specific problems, one of which is increasing school rolls. It is virtually unique among the major cities of our country in that its secondary school rolls are expanding. That fact should be taken into account when considering rate support or block grant.

About 500 temporary classrooms are in use in the Bradford metropolitan district and part of the allocation for the replacement of those classrooms by permanent extensions to our schools is being used to repair the temporary classrooms which need major repairs because they have been empty for so long. That is patently absurd and, contrary to what the Tories keep telling us, is not value for money. The Minister should take into account the fact that such cities as Bradford face that great problem.

A third of our schools were built before 1903. A large proportion of those older schools are often very well designed. I am not suggesting that they should all be bulldozed immediately to be replaced by modern buildings, but there is a special problem in maintaining and modernising some of Bradford's school buildings.

Dame Elaine Kellett-Bowman (Lancaster)

I am glad that the hon. Gentleman implied that there was not necessarily any disadvantage in the design of those older schools. Is he aware that, in my constituency, there are several super schools over 300 years old which will last a great deal longer than much of the rubbish put up in the 1940s, 1950s and 1960s?

Mr. Cryer

I am sure that the hon. Lady has many happy memories of some of those schools being opened and that she will be willing to make out her own case when her turn comes.

One of Bradford's problems is that we now have a Conservative majority which is getting in on the mayor's casting vote. Most people consider that to be a form of cheating.

Dame Elaine Kellett-Bowman

Rubbish.

Mr. Cryer

The Conservative majority in Bradford recently made a number of decisions that will make the position much worse. In the previous debate, it was suggested that the Tories were saving a little money by dismissing an employee to promote peace. The Tories propose to save £1.5 million a year by raising the price of school meals to 80p a day; £250,000 a year by cutting the number of caretakers and cleaning staff, which will make the building problem worse; £100,000 by scrapping the community education budget; and £125,000 by trimming furniture repairs and replacements. They propose to replace absent teachers with temporary staff only after at least three days' absence and to abolish a fund to help hard-pressed inner-city schools, in direct contravention of the Prime Minister's stated aims. In addition, they propose to save £228,000 a year by dismissing 13 advisory teachers and 43 jobs will remain vacant to save wages and equipment funds. Further measures include withdrawing support for creches at Shipley and Keighley colleges.

Those are major attacks on education in Bradford and it behoves the Minister to accept my amendment so that he can make some compensation for those vicious attacks put through on the mayor's casting vote in what the majority of Bradford citizens see as a straightforward means of cheating.

One of the other problems affecting Bradford is the level of unemployment. Over 22,000 people in Bradford metropolitan district are unemployed at present and there are 1,700 vacancies. The Tory-controlled council is proposing to cut the equivalent of 9,000 jobs at a time when there is a deficit of over 20,000 jobs. It is proposing to throw the equivalent of 9,000 people in full and part-time jobs on to the dole. That is outrageous and that is why I included the issue of unemployment in the amendment.

The level of unemployment in Bradford is well above the national average. When unemployment pay runs out, people receive social security benefits. The number of people in Bradford receiving benefits will therefore increase and the Minister should also take that factor into account.

The Tories in Bradford also propose callously, coldly and viciously to sell off 15 old people's homes. Elderly people who have spent their lives working for the community are to be sold off like so many chattels or items on an accountant's balance sheet. At the council meeting on 25 October, a Tory councillor said: If you do not grasp the nettle of these crumbling homes for the elderly, then I think it's shameful. I invite the Minister to grasp that nettle by enabling the condition of public buildings, including old people's homes, to be taken into account in assessing the grant requirements of cities such as Bradford.

Mr. Dennis Skinner (Bolsover)

Is my hon. Friend aware that a few days after that decision was taken on the casting vote of the mayor there was a remarkable spin-off in a Nottingham by-election? When the story of the Tory decision in Bradford was told, the result was to turn a Tory majority of 400 into a Labour majority of 600. We must continue to put that message across, as my hon. Friend and others are doing in the Chamber, so as to alert the electorate in every town and city. Does my hon. Friend agree that Nottingham was a very good start?

Mr. Cryer

I am grateful to my hon. Friend for drawing attention to that. Here is an opportunity for the Government to state that there are criteria other than the whims of a tiny, extreme Right-wing clique on Bradford council. I am sure that the Government have noted the election result in Nottingham. There is no doubt in my mind or, I am sure, in the minds of my hon. Friends that if the Tories had revealed their dstardly plans to sell off old people's homes and sack 9,000 people we would have held Odsal with a vast majority.

Dame Elaine Kellett-Bowman

The hon. Member for Bolsover (Mr. Skinner) is out of date because on Thursday the Conservatives won a seat on Hyndburn district council, bringing us very near to getting control.

Mr. Cryer

The amendment concerns metropolitan districts, of which Hyndburn is not one, so the parallel cited by my hon. Friend the Member for Bolsover (Mr. Skinner) is far more accurate than any other example given so far.

Mrs. Alice Mahon (Halifax)

Is my hon. Friend aware that within two or three days of the change of control in Bradford the Tories in Halifax were bragging that if they had taken control in May they would have been prepared to close old people's homes? Does my hon. Friend agree that this may be part of a Tory plan for wholesale privatisation of old people's homes wherever they gain control?

Mr. Cryer

It is clearly implicit in the Bradford policy. Many Tories, including members of the Government, are saying that that is the kind of policy that local authorities should adopt, with callous disregard of old people's wishes.

Mrs. Teresa Gorman (Billericay)

rose—

Mr. Cryer

I will give way to the hon. Member for ticket touts in a moment.

A survey which I understand was commissioned by the local authority from Market and Opinion Research International showed that elderly people did not wish to be sold off. The so far unpublished poll of 138 elderly people showed that more were worried about being sold off than took the matter calmly and that there were high levels of satisfaction with all aspects of the local authority homes. The Minister may argue that old people's homes can be sold off and thus need not be taken into account for grant, but that survey invalidates that view. I know that the Minister supports balloting, as he voted for legislation requiring trade unions to engage in balloting until it comes out of their ears—although not, of course, at GCHQ, as today's splendid demonstrations showed. That survey by MORI, unpublished but handed to the local authority, shows clearly that old people do not want to be sold off.

8.45 pm

Mrs. Gorman

It is always stimulating to be given a rub-down by the thinking woman's version of a Brillo pad. The hon. Gentleman may be interested to know that I have had a word with the leader of the Conservatives on Bradford council on the subject of the old people's homes. It seems that under the long-term Labour administration the homes had become very rundown. The people now running Bradford are quite sensibly bringing in the private sector to do a better job for the old people with, one hopes, better conditions and better value for money. There is no question of the homes being closed down, so the hon. Gentleman is misleading the Committee.

Mr. Cryer

I intend to press my amendment on the basis that the Minister should take into account the condition of public buildings such as those old people's homes. The hon. Lady could not have raised the matter at a more opportune time, as I have here a secret internal memorandum from Bradford recommending: It should also be a condition of the sale that specific essential repairs be carried out in appropriate cases in addition to the alterations that will be necessary for each home to provide the acceptable ratio of single occupancy bedrooms required for private registration. That is a recommendation to the director of social services that money should be spent on the homes before they are put up for sale.

Mr. Patnick

Will the hon. Gentleman giveway?

Mr. Cryer

I should like to finish this point.

Moreover, there is a suggestion that the homes could be put up for sale illegally because it is proposed that there should be a restrictive covenant to ensure that they are run in a particular way. The recommendation states: You will note from the reports that in most cases that the proposal to sell the properties with the restriction on future use the expected purchase prices are less than an expected purchase price on an unrestricted sale, substantially less in some instances. It is therefore clear that the proposed disposals whether sold individually or as one sale could well be in breach of Section 123 of the Local Government Act 1972. This Act provides that an Authority must not, without the consent of the Secretary of State, dispose of land for a consideration less than the best that can reasonably be obtained. It suggests that the local authority is trying to sell off the homes at a cut price and thus to evade the provisions of the 1972 Act, and it rather suggests that the enterprise culture is indeed the corrupt culture that many of us believe it to be.

The other cruel section of the memorandum—it is merely advice given to the local authority, but it is restricted because it is not the kind of thing that the Tories would want to become public—suggests: It may be worth considering as an alternative that two or three of the homes only be sold as 'going concerns' to test the market. The proposal is that old people should be made to suffer in the evening of their lives so as to test the market to see where the wretched Tories can raise some more money.

I do not believe that the Minister shares that cold, calculating view. I hope, therefore, that in his reply today he will express some sympathy for the view that money should be available to take into account the age of public buildings so that money can be spent to satisfy those old people who were virtually balloted through MORI, their wish to stay in those homes can be met and money can be made available from central Government for repairs and rehabilitation.

Another of the criteria is the housing stock, which in Bradford is mostly intended for the elderly. Few new houses have been built. because of Government restrictions. Phase three of a development on a major estate in my constituency has been frozen. There are problems with the so-called Boot houses, which are prefabricated homes built in the 1930s that have developed faults and are expensive to repair—

Mr. Skinner

Were they built by private enterprise?

Mr. Cryer

Yes, they were built by Henry Boot. The local authority is picking up the bill for houses that, in later years, have proved to be faulty. The Minister should take that into account. The faults of private enterprise are being visited upon the tenants or, in some cases, the purchasers and the tab is being picked up by the local authority.

I am sorry that the hon. Member for Keighley (Mr. Waller) is not present this evening—

Mr. Skinner

The hon. Member for Keighley (Mr. Waller) is probably trying to sort himself out. When we recently voted on a Lords amendment relating to dental and eye check charges, he voted with the Opposition the first time but, strangely, did not do so on the second occasion.

The Temporary Chairman (Mr. Nicholas Winterton)

Order. Interventions must be relevant.

Mr. Cryer

I take my hon. Friend's point. The hon. Member for Keighley is the only one of the five Members concerned who is not here this evening. All the Labour Members are present.

In the rush towards privatisation we should remember that in 1971 the Keighley Tories privatised the council's housing maintenance department and handed it to two private contractors. That maintenance was so bad, and so little was done because the money had gone into the pockets of those contractors, that under local government reorganisation in 1974 the Bradford Tories had to establish a new direct works department. They had to spend more money in Keighley than in any other area in Bradford metropolitan district to remedy the damage done. That must be taken into account when assessing grant for Keighley.

Another of the criteria listed in the amendment relates to roads, although I do not wish to comment in detail on that. The Telegraph and Argus last year ran a campaign about the poor condition of roads. An area called Queensberry, which has produced the famous Black Dyke Mills band—the glamorous side of Queensberry—has had its expenditure on private street works frozen. Roads in some parts are like medieval quagmires. In today's society it is wrong that there are no decent roads to service decent, sturdy, terraced houses. The Government should provide grant for the carrying out of those street works.

Railway facilities are also mentioned in the amendment. At Low More in my constituency the proposed station is low on the list of priorities. The Minister should take that into account because such a station would be a boon to my constituents who have to suffer a poor bus service—which has become very much worse since the legislation introduced by the then Secretary of State for Transport, now the Secretary of State for the Environment. I note that the right hon. Gentleman is sitting shyly in a corner of the Chamber. His transport legislation was bad, as is his environment legislation. Both are so terrible that it is difficult to judge between the two. It would help Bradford if the Minister bore in mind the fact that there are two separate stations and that it would be useful to link the two. If that was done Bradford would be placed on the railway map.

The Tory council in Bradford was elected on the strength of a by-election when people were not given the relevant information. They were deceived. The Tories lied about their plans and denied that they would embark on any cuts. The Tory candidate's election address did not mention that 9,000 people would be made redundant and that there would be cuts in community centres and so on. That council is embarking on savage cuts that will have the greatest impact on the poorest people in Bradford.

In voting for the amendment, hon. Members will vote for an opportunity for central Government finance to overcome the Tories' savage cuts. I invite the hon. Members for Shipley (Sir M. Fox) and for Keighley to vote for the amendment, which would help to rescue some of the buildings and facilities in their constituencies. If the amendment is not carried, the cuts will cripple many families, both directly and indirectly through the provision of such services as education. Any Tories who vote against the amendment will be callously voting to kick the ordinary, hard-working, decent people of Bradford in the teeth.

Mr. Patnick

The hon. Member for Bradford, South (Mr. Cryer) promised to allow me to intervene in his speech, but I now realise that he suffers from galloping amnesia. As my hon. Friend the Member for Lancaster (Dame E. Kellett-Bowman) reminded us, the hon. Gentleman's description of his metropolitan district is typical of any metropolitan district today. I could make similar arguments for Sheffield: indeed, I did so on Second Reading.

I was taken to task by members of Sheffield council for suggesting that Sheffield could make further savings. Sheffield actually runs the Karl Marx memorial lecture, which was introduced by the hon. Member for Sheffield, Brightside (Mr. Blunkett) at the Sheffield memorial hall on Friday 11 March 1988. The lecture was organised by Sheffield city council's central policy unit, and supported by Sheffield city council's police and community safety panel. The subject was "the state, the police and the inner city" It was the sixth Karl Marx memorial lecture.

9 pm

In February 1985, the then leader of Sheffield city council, the hon. Member for Sheffield, Brightside (Mr. Blunkett), in an article in the well-known magazine "Sheffield Today", made the following germane point: The hardest hit councils, not just the rate capped ones, are asking for the same three things from Central Government:

1. 1. getting rid of the unfair system of financial targets and penalties which eats into council grants
2. 2. restoring the grant to a fair level so that less money has to be found from the rates
3. 3. giving up trying to use the Rates Acts to force councils into cutting jobs and services."

That is the very basis of the legislation before us.

Wages and salaries form at least 68 per cent. to 70 per cent. of the costs of running a council. I listened carefully to the hon. Member for Bradford, South (Mr. Cryer). If there are 9,000 redundancies to be made in Bradford, it would bankrupt the council. It would not have the cash to fund such redundancies. Nowhere at all can it find money for redundancy payments to 9,000 members of staff, be they full-time, part-time, or whatever. It cannot do it. It is one of the myths that the hon. Member for Bradford, South has repeated many times in the House. From all the hon. Members for Bradford we have heard the greatest crop of misinformation that has ever been placed before the House. We should tell the truth, the whole truth, and nothing but the truth. We should not hear about the way in which Opposition Members see the matter from their political stance. We should deal with it on a factual basis, and I did so. I went to see Eric Pickles, and I said to him, "With 9,000 staff and all these things you are doing, how, where and why?"

I shall give the proper story from Bradford. It is a load of rubbish that it is getting rid of many staff. One hundred and fifty staff are due to be redeployed, and that works out at a cost of £1.8 million. What did Bradford decide to do? It has freed managers to work without political interference. It removed the Left-wing trappings from standing orders. It protects the right of minority political groups and promotes open government. It has changed standing orders to reduce the size and number of committees. It has reduced committee places from 460 to 180. It has reorganised the priorities and duties of committees. It has abolished Left-wing talking shops and other things. It has introduced committees to oversee competitive tendering in all departments. It has brought in, as Sheffield had to bring in, cash-limit budgets. It has reorganised conduct and voting at council meetings in a more effective way. Savings of £6 million were needed to be approved on 25 October. Savings of £5.8 million this year and £8 million next year will prevent the council from re-rate-capping.

What about other councils? What about Wakefield? Nobody has mentioned the £20 million—

Mr. Max Madden (Bradford, West)

Before the hon. Gentleman moves from Bradford to Wakefield, if Bradford council does not plan to dismiss 9,000 men and women over the next five years—2,500 full-time jobs—will he explain why the amendment, which he and several of his Conservative colleagues sponsor, refers precisely to 2,500 fewer jobs in Bradford?

Mr. Patnick

I am obliged to the hon. Gentleman for his intervention. All will be revealed as I make my speech in my way, not in the way in which he wishes it to be made.

Already, savings of £11 million have been made in Wakefield. Sheffield has £20 million to cut from its budget, and Brent has a £17 million decrease. Hon. Members have heard a lot about benefit shops. Three were closed because they duplicated the work of social services who employed staff and a mobile advice centre. The council is moving them into one-step shops, which will enable ratepayers to go into shops and receive information. There are no education cuts. Therefore, the cost of meals is going up to 80p. Had the cost of meals gone up by 5p a year between 1984 and 1988, they would now be at 80p—the very price they are to be. According to CIPFA, Bradford recovers 21 per cent. of meal costs through revenue, while the cost of meals in Calderdale, Kirklees, Leeds and Wakefield is 10 per cent. higher than in Bradford, and one third of all meals are free. Thirty-seven per cent. of schoolchildren do not pay for any increase. In Calderdale, Kirklees, Wakefield and Leeds, the average is 22 per cent.

Brent, when faced with that problem, sacked 230 teachers, reduced teachers' salaries by £2 million, sliced discretionary awards to students, and tried to abolish school meals and nursery education, but it was unsuccessful.

I have heard quite a lot from the hon. Member for Bradford, South about the lord mayor of Bradford. There were no elections to be held during the next year, so it was decided, as the Conservatives had the majority, to use the lord mayor's casting vote. As I have explained, that is a trick or ploy that Sheffield has used for many a year. Only Socialists can ever be lord mayor of Sheffield: that is the way the cookie crumbles. But when Conservatives do it, suddenly it is all wrong.

An injection of cash is needed to bring the old people's homes up to standard. The social services directorate admitted the shocking statistic that nine of the 13 homes would fail to be registered if they were in the private sector. The council must ensure the proper care of the district's elderly people, but it is abundantly clear that it has not the resources to provide suitable facilities of its own. A feasibility study showed that, if the homes were transferred to the private sector, the Department of Social Security would provide full income support for 68 per cent. of the residents and slightly reduced income support for 19 per cent. For only 13 per cent. would no income support be provided. If all the homes were transferred, the ratepayers of Bradford would save £2.3 million a year in revenue costs. Those would be capital savings.

Mrs. Mahon

Will the hon. Gentleman give way?

Hon. Members

Give way.

Mr. Patnick

Hon. Members must not start lecturing me about etiquette and giving way. When I asked the hon. Member for Bradford, South (Mr. Cryer) to give way, he promised that he would, but carried on making his speech.

Some £10 million in capital costs will be needed to bring the homes up to a proper standard. The £2.3 million savings would finance a new team of inspectors. The eight new staff appointed will register and inspect private homes throughout the district and ensure that they meet the high standards set by the council. It is clear that, if the homes are transferred, the care of the elderly will be improved. The social services directorate said that nine of the 13 buildings were virtually unfit for human habitation and would never be improved by the council.

Mrs. Gorman

Does my hon. Friend agree that the homes were in danger of deteriorating into the kind of condition that was allowed to prevail in the Nye Bevan home run by a Socialist London council? Their state was so disgraceful that they had to be closed down by outside intervention. Does my hon. Friend agree that if the council had remained under Labour control the same would have happened in Bradford?

Mr. Patnick

I thank my hon. Friend for her intervention. It is clear that if the homes are not transferred they will deteriorate. As it is, the council has additional resources to monitor carefully the quality of care offered by the private sector. The transfer would guarantee a proper level of capital investment, while day-to-day care is as good as, or better than, that offered in the public sector. In Sheffield, homes were closed because they were claimed to be "not suitable" for the care of the elderly.

Houses have not gone into disrepair since the Tory Government came in in 1979. Council after council has allowed its housing stock to deteriorate. We have a responsibility because it was decided to replace with tower and point blocks and high-density housing, nearly all of it concrete, the smaller terrace-type houses that could be converted and improved at reasonable cost.

The hon. Member for Bradford, South mentioned Reema building such houses, but Sheffield city council built houses that had mould growing on the inside, and they have all had to be knocked down. It cannot be claimed that just one contracting company built such houses. The decision to build houses on a mass scale was a curse of the society in which we lived at the time. The Bradford Tory group on the council decided to increase rents by £3 from late November and to reconsider the housing revenue account at Budget time. The Labour group rents for the three years from 1983 to 1985 were such that if the matter were not so serious it would be laughable.

The Temporary Chairman

Order. I am listening carefully to the debate and I have allowed frequent references to Bradford, but I hope that hon. Members participating in the debate will relate their remarks to the terms of amendment No. 16, not purely to Bradford. The amendment is much wider than just the metropolitan district of Bradford.

Mr. Patnick

I am obliged to you, Mr. Winterton, for putting me back on the right road. I am referring to the needs of metropolitan district councils and the deterioration in the housing stock. What applies to Bradford also applies to Sheffield and most of the housing stock throughout the country. It is a fact that some major refurbishment is taking place with the housing action areas and the estate projects, and that the deterioration in the housing stock did not start to happen in 1979.

All authorities have a bureaucratic nature. They have central services, personnel, architects, accounting, computing and a chief executive's office. All this work has been duplicated and duplicated, and the new committee structures need to be mirrored elsewhere.

The hon. Member for Bradford, South was allowed to make his speech virtually about Bradford alone, but I appreciate my position. Nevertheless, to return to Bradford, I disagree with Opposition Members that the situation in Bradford is so different from that, were there a change in control of another local authority. I do not accept that all the ills of local government started in 1979 with the election of a Conservative Government. I do not accept that all the houses, the schools and public buildings have deteriorated since 1979.

I accept that for a long time we have needed a change in local government funding. I accept that anyone who uses council services should contribute to them both through the tax system and through the rating system. I do not accept some Labour Members' argument that the community charge is a poll tax. That is the argument of people who wish not to vote, but they can decide if and when they pay their community charge whether to go into the polling booth. The law does not insist that one votes. In Sheffield only 24 per cent. of the electorate bothered to vote. It is a fact that if people pay a community charge, more people vote.

I cannot accept the amendment or the hon. Gentleman's claim that his constituency is unique in that the Conservatives have taken control. Otherwise, Bradford would have been a rate-capped city. Sheffield was rate-capped and has not been since. It is up to the local authority to pull itself back into the 20th century and then to go forward as the Bradford Tories have done.

9.15 pm

Mr. Pat Wall (Bradford, North)

In recent years cuts in rate support grant from about 60 per cent. to 40 per cent. have placed enormous strains on local authorities, and the amendment in the names of my hon. Friends the Members for Bradford, South (Mr. Cryer) and for Bradford, West (Mr. Madden) deals with the relationship between rate support grant and the social problems of urban areas, especially the historic problems of neglect and aging over more than a century.

Government policy has meant that the more local authorities spend above GRE, the more they lose. Conversely, the greater the deficiency on GRE, the more grant aid they receive. Since 1979, we have had 20 Acts to reduce the powers of local authorities. That legislation has severely affected many local authorities. First, we had a system of targets. That system was unfair to many authorities. In the end, the Government recognised that and modified it so that local authorities were judged on their historical spending patterns. Most authorities received sums equal to the figures that they had already produced or a little above. Then we had the added complication of the so-called multiplier.

Bradford, Birmingham, Sunderland, Cleveland and an authority in Derbyshire suffered extreme losses although they have never been rate-capped or gone above GRE. The figure for Bradford for the past three years is £38 million, or a rate of 87p in the pound, and the average cost has been £110 per ratepayer. That sort of expenditure has not been repeated in many other authorities, even including Leeds—our immediate neighbour, and a city of similar size. That shows the high cost of Toryism to the ratepayers of Bradford.

About two years ago, the Government began to retreat and tried to recognise the social needs of cities and inner urban areas such as Bradford, but their wishes were overturned by the revolt of their friends in the Tory shire counties, who demanded that grants be made per head of population, not on the basis of social need. That ideal was enshrined in the Local Government Act 1988, which created the so-called community charge.

Bradford has serious problems, with one quarter of men and three fifths of women officially recognised as low-paid, one third of families on some form of state benefit and 60,000 people in receipt of the old supplementary benefit alone.

As my hon. Friend the Member for Bradford, South said, one third of our schools were built before 1903. I understand that tomorrow Dixon's will announce that it has negotiated with Bradford city council to build a city technology college in the city. It will donate about £1 million from its charity fund, which will be matched by Government expenditure of between £4 million and £10 million. Education in Bradford will be cut by £3,370,000 this year and by about £3.5 million the following year. Bradford does not need £4 million to £10 million of Government expenditure on a college for a tiny section of the community. It needs an effort to restore the cuts that are proposed by the Conservative council and to make good the years of neglect in our inner city. Newcastle, Liverpool, Manchester, Birmingham, Glasgow and the older industrial cities have suffered similarly.

Mr. Cryer

Does my hon. Friend accept that the amount of money that will come from the public purse for this CTC in Bradford is the equivalent of all the money that will go on capital expenditure for the whole of the public sector in the Bradford metropolitan area? Is it not a scandal that that should be permitted under this Tory Government?

Mr. Wall

To bring the schools in Bradford up to a modern standard requires the expenditure of £10 million a year over the next 10 years, and our allocation for school building and renovation is only £6 million a year. Our position will not be different from that of other cities.

The hon. Member for Sheffield, Hallam (Mr. Patnick) mentioned housing starts. Again, our city is not unusual; its housing starts fell from 2,200 in 1978–79 to only 800 in 1986–87—a fall of 64 per cent. At the same time, the Government have forced local authorities to sell their best houses, but have restricted their ability to reinvest those proceeds in house building. That has led to a reduction of one third in the stock of council houses in that period—in a city with a housing waiting list of more than 8,000 people.

Bradford's backlog of repairs will cost some £130 million, which is more than 10 years of our total housing grant. However, the Conservative council intends to cut expenditure on housing and the environment by £43,000 this year, including, in a spiteful move, £7,500 which was originally intended for emergency accommodation for the homeless. I raised with the Prime Minister in the House the matter of a young man of 17 who was forced to live in a rubbish skip overnight.

It is not just council tenants who suffer. The number made homeless through mortgage default or rent arrears has trebled in Bradford during the past five years. Bradford, like other cities, has real social problems that the Government penalties have created and which have led to a crisis in many urban areas. The relevance for Bradford is that unlike most urban areas, we now have a Conservative majority and, if the reactionary proposals of the council are carried through, it will be on the basis of a wild west scenario of two-vote Smith Midgeley, who has more in common with the sheriff of a wild west town, such as Dodge City, than with the mayor of a hard-working west riding city.

If I may use the western analogy again, the hon. Member for Hallam bored us with an inordinate speech on Brent last Monday, despite the fact that he was a city councillor in the city of Sheffield. Having travelled from Sheffield to Brent, he has now moved this week to the city of Bradford, and he reminds me of the motto of the old western hero, "Have gun, will travel." In his case, it is "Have local government speech, will travel to any area" where his party may need assistance, because it has a lack of speakers on the subject.

The combination of social problems and the rate support grant has hit inner-city areas, and has hit, too, the Minister's friends in Bradford. I do not think that outsiders realise that there are not just three Labour seats in the city of Bradford; it is a metropolitan district which has five seats, including Keighley and Shipley.

Mr. Madden

Where are those hon. Members?

Mr. Wall

They are not here tonight.

I have done a rough calculation without checking the figures in the Library, but in the 1987 general election the Conservatives had a majority of 9,000 votes over the Labour party for the combined five seats and, because of the peculiarities of the way in which the boundaries were drawn and because the addition of Ilkley prevented Keighley from becoming a Labour seat, the metropolitan district is not a typical Labour heartland. However, up to two years ago the council was either Conservative-run or was a hung council that was basically a Conservative council with alliance support. Labour took the council in the first place because of the rate increase of more than 30 per cent. imposed by Bradford council. It was the cut in Government rate support grant and the special cuts of £38 million for Bradford that led to that rate increase and to the defeat of the Conservative council at that time, and the election of a Labour council in the metropolitan district for the first time.

The secret behind what is happening in Bradford, which has national implications, is that we are faced with a massive auction of public assets to reduce the burden of the poll tax in its first year of introduction. That is no basis for future planning for any local authority and it is no way in which to tackle the enormous social problems that my hon. Friend the Member for Bradford, South and I have outlined today and last Monday.

The Government have a chance to consider the plight of the five towns that lost last year under the terms of the multiplier, which affected the rate support payments. They have the chance to make good that loss during the current year. That does not just go for the £38 million already mentioned. The Minister should help his political friends in Bradford by giving the council the sum of between £4 million and £10 million that will otherwise go to the city's CTC, supposing that Dixon's plans go through. In that way, the cuts of £5 million announced by Bradford council would not have to be made and a burden would be lifted from some of the poorest working-class communities in Bradford. Those people are facing an increase of £1 per week per child for school meals. If a family has three children and has to pay an extra £3 per week, that represents a real cut for a textile worker on low wages and is an infringement of that person's standard of living.

I do not believe that the flint-hearted members of the Government, the Minister's Departmant or the Tories who now run Bradford council will take a humane and reasonable attitude to the special problems that Bradford has suffered over the years. However, I must warn them, even if Bradford metropolitan district is not a traditional Labour area. The Tories tried the same trick with London as they are trying with Bradford. When they were defeated in the old London county council, they redrew the boundaries and formed the Greater London council. They met with defeat there as well. As night follows day the result of the policies introduced in the city of Bradford will mean that, for the first time, there will be a massive Labour majority when we get the next opportunity at the polls. In common with the GLC, that city council will also go Labour, it will remain so and the only way in which the Government will demolish that will be if they abolish the council itself.

Mr. Madden

We are gathered together in the Committee to consider the Rate Support Grants Bill and I shall take as my text an unlikely source—an article written—

The Temporary Chairman

Order. The text that the lion. Gentleman should take for his speech is amendment No. 16.

Mr. Madden

I wholeheartedly support amendment No. 16, which refers to assessing the needs of metropolitan districts in the light of a number of matters. I intend to refer specifically to unemployment levels and social security recipients.

In an article in The House Magazine of 7 November, Councillor Eric Pickles, the leader of the Bradiord Conservative group, said: Bradford may seem an unlikely place to host a Conservative revolution in local government … People are simply not used to decisive action in local government and the speed with which we are moving has taken them by surprise. It may have taken until 4.30 in the morning, but at the council meeting two weeks ago, we did more to reform Bradford Council in one night than the Labour Group had done in two years of control. The Conservative programme for Bradford council, the first phase of which"— I stress "the first phase"—

was passed at last month's meeting, has three related parts. Firstly, the management structure of processes within the organisation must change to meet the new environment created by Government legislation. Secondly, the structure and concerns of committees must reflect the priorities of an enabling Council, not a paternalistic bureaucracy. Finally, the extent and character of the services delivered by the Council must be made relevant to the real needs of the people of the district. Councillor Pickles has great difficulty in identifying real people. In our local media, he has been widely quoted as referring to the people who were extremely concerned about the matters that were steamrollered through at the council meeting, and to which he referred, as not "real people", but members of the Labour party.

Councillor Pickles and the hard-line clique of associates with whom he is now seeking to introduce, by stealth, his hidden agenda, must tell us how the real needs of real people in Bradford are to be met. Who decides? Who sets the criteria? As my hon. Friend the Member for Bradford, North (Mr. Wall) said, for a new city technology college to be announced tomorrow in Bradford is surprising news indeed because I do not believe that such a college represents the most overwhelming need of real people in the city of Bradford at present. An enormous amount of public subsidy will be put into building a new college in my constituency, on land that was previously devoted to housing. We have enormous housing needs and, as my hon. Friends the Members for Bradford, South (Mr. Cryer) and for Bradford, North have said, we have an education crisis and are trying to improve the education service and the fabric of our established schools, so we need a city technology college like a hole in the head.

9.30 pm

If the college comes about—I have grave doubts that it will—inevitably it will do great damage to upper schools in Bradford and to Bradford and Ilkley community college, the largest in Britain. It will cream off the ablest young pupils from upper schools and the ablest staff from existing institutions. It will do great damage to our education, which is already in considerable difficulty.

If there are large sums of money available from the private sector, I believe that it should be put into existing schools, many of which are facing great difficulties because of shortages of equipment and books and which lack other basic amenities. If the Government are willing to put into Bradford about £4 million or £6 million, the major priority must be improving our education service, and improving Bradford college, not building a shiny new college which, if it is built, will become known as Kenneth Baker's folly. I strongly urge the Government to have considerable second thoughts about the wisdom of proceeding with a city technology college in Bradford.

In Bradford there are many unemployed people and people on low incomes, who need to know where they can get help. They need information. I should like to confine my remarks to my concern and that of many others in Bradford about the decision of the new Bradford Tory council to close our benefit advice shops—unlike the hon. Member for Sheffield, Hallam (Mr. Patnick), who seems to have been imported into the debate in the absence of his hon. Friends the Members for Shipley (Sir M. Fox) and for Keighley (Mr. Waller) to speak about Bradford, but who seems to know very little about it. I hope that he knows more about Sheffield. In recent debates he has given us a gazetteer of all sorts of different places in London and other parts of the country. He should have limited his remarks about Bradford, because they seemed to be singularly uninformed.

The people of Bradford need advice on the benefit help that is available. They need to be given the correct application forms and advice and assistance in completing those forms. If help is refused, they need assistance in making appeals to social security tribunals and other appeal bodies. Many Asian men and women who live in Bradford need particular help across the range of matters that I have mentioned. Bradford Tory council's decision to close the benefit advice shops seems to be at odds with the Government's declared objective to target help where it is most needed. That is crazy and, in my language, it is plain daft.

Thousands of people in Bradford have received advice from the benefit advice shops about the DHSS, about unemployment benefit offices, about housing benefit and much else. More than 60,000 people have received good, accurate, helpful advice from our benefit advice shops over the past three years. That is very relevant to amendment No. 16. I urge the Minister, who the other day did not seem to be aware of Bradford Tory council's plans to withhold funding from Bradford's citizens advice bureaux or to close the benefit advice shops, to investigate the matter urgently. I urge him also to have talks with his colleagues in the DHSS and at the Department of Employment because I believe that this matter is vital. Bradford Tory council should be prevented from closing the benefit advice shops.

The benefit advice shops are seen to give independent advice. That cannot be said of the DHSS, the UBOs or the jobcentres. If the Minister consults the staff of those bodies, they will tell him that the public perceive the DHSS, UBOs and jobcentres as part of the system. The public do not believe that they give independent or impartial advice. Those agencies will tell the Minister that the great value of our housing benefit advice centres is that they are seen to be independent. The difficulty in Bradford is that not only is the Tory council closing the benefit advice shops: it is also threatening to close many independent advice centres organised by voluntary groups in different parts of the local community.

Ministers are obsessed with everything being cost-effective and offering value for money. I hope that the Minister will consider the contribution that the benefit advice shops make towards helping many people in Bradford. Those shops are vital to the local economy. If people are helped to get benefit to which they are entitled, they spend their benefit on local goods and services. That is good value for money.

Regrettably, the social fund has had a devastating effect on people's opportunities to get benefit to which they are entitled. In effect, it has reduced considerably the amount of money spent in our local community on goods and services by poor people and those on low incomes. I hope that the Minister, unlike the hon. Member for Hallam, will recognise that Bradford benefit advice shops do not duplicate services found in the local DHSS offices, in the local UBOs or in jobcentres. The advice shops provide advice which is perceived by the public to be extremely helpful and, most importantly, independent. They are not seen to be part of the establishment or part of the system.

In the context of this amendment, I urge the Minister to ensure that Bradford Tory council is told that it is important for the unemployed, for those on social security and for those who want to get benefit to which they are entitled, that urgent steps are taken to keep the benefit advice shops open.

I recently tabled parliamentary questions to discover the number of bilingual Asian staff in our local DHSS, UBOs and jobcentres. There are five Asian-speaking staff in the three DHSS local offices. None of the claimant advisers in our local UBOs is an Asian bilingual speaker and no such speakers are available in our job centres, each of which has only limited access to Asian interpreters. I again urge the Minister to look at the help that Bradford's benefit advice shops and other independent advice centres give to Asian people seeking information about benefit entitlement and help and information on a range of other matters.

If the Government continue down the road of targeting help on those most in need, they clearly have a responsibility to enable people entitled to help to get it easily. Those people must be able to get proper, accurate and independent advice. That need can be clearly seen in terms of family credit. We are told that the national take-up is only 30 per cent., and I do not think that it is any higher than that in Bradford.

I have raised these matters with the Minister, I think, three times. I ask him to save our benefit advice shops because if they close many Bradford people will lose. Our economy will also lose, and so will the local council. The closure of those shops will result in more rent and rate arrears. If we have to pay the dreadful poll tax, there will be poll tax arrears. There will be more disconnections of gas and electricity and more debts accruing to the electricity and gas boards. On all those matters, independent benefit advice is important.

The Minister seems to be laughing. I hope that he will address his considerable intellect, which has been displayed so often in our debates, to the real problems of people in Bradford. If he does that fairly and objectively, he will conclude, as many people in Bradford concluded long ago, that these benefit advice shops and other independent advice centres should be retained and allowed to continue to give good independent advice to the many men and women in Bradford who seek to use them.

Mrs. Mahon

I should like to address two matters relating to the amendment. One is about elderly social security recipients in residential homes and the second is about deteriorating housing stock. I challenge the statement by the hon. Members for Billericay (Mrs. Gorman) and for Sheffield, Hallam (Mr. Patnick) that it would be better for elderly people to be cared for in private homes. I can speak from some experience because I spent many years caring for elderly people. It is morally unjustifiable to move people around as if they were unit costs and not give them any choice because they are elderly.

I appeal not to the Minister's intellect but to his Christianity and ask him to think before he allows wholesale privatisation of care for elderly people. It has not been proved that it is more cost-effective to keep elderly people in private homes. Taxpayers pay billions of pounds so that some people can make profits from the care of the elderly. If local authorities were given the same handouts as the private sector, I am sure that local authority homes would not be in the state of disrepair that we have heard about in the debate.

I remind the Minister of a sad tale in Calderdale concerning the Government's foolish policy on the repair of housing stock. In 1982 my metropolitan borough suffered a gale that badly affected some houses on a hillside in Calderdale. We have many hills in Calderdale and these houses were not placed in the most suitable site. The hon. Member for Eastbourne (Mr. Gow) who was then the Minister for Housing and Construction, refused to give us a grant to repair the houses. Some years later, we were exposed to the estate action programme introduced by the Government, and the private sector let us down. We had to pull down 344 houses and flats and that was a scandal when there were 5,000 people on a waiting list.

The Government have now given £364,000 to a private developer to build on this land. The local authority is getting only £112,000 for the land and the private developer is bragging about making £250,000 profit out of the deal, but the ratepayers of Calderdale will be paying between £80,000 and £90,000 in debt charges for 40 years. I challenge any hon. Member to tell me that that is good economic sense. I urge the Minister to take note of the amendment and get some sense into local government finances.

9.45 pm

Mrs. Gorman

I had not intended to make a speech, but I wish to correct this point, because we have heard an awful lot about elderly people and homes. Privately owned homes for the elderly, as the hon. Member for Halifax (Mrs. Mahon) knows, are heavily regulated and often visited by inspectors from the public sector, so there is no question of these institutions becoming rundown unless the inspectors are not doing their job properly. It is much more likely that public sector homes become rundown, because the inspectors are often in cahoots with the people running the public sector homes, because they are in the same unions and are all working together for the same council. That is how the Nye Bevan scandal developed. Everyone was covering up for everyone else, and that happens regularly in the public sector.

Mr. Gummer

I shall look at the situation in Bradford as an example, as it is the only example that has been given. In Bradford, the grant entitlement in 1988–89, which is the one no doubt to which hon. Members would like me to apply special arrangements, will be £151.5 million, which is £14 million more than it was in 1987–88.

Mr. Cryer

Not enough.

Mr. Gummer

That is the kind of helpful remark that the hon. Gentleman has been making this evening.

I am obsessed with value for money, because it is value for the taxpayers' and ratepayers' money and the value goes to those who are least able to help themselves. I find the debate upsetting because the reason for the change that Bradford is seeking to bring about is that for some time Bradford has been run at the behest not of the clients of the local authority but of the unions that run certain services. I am not surprised, because the hon. Member for Bradford, West (Mr. Madden) was for some time the assistant campaign manager for the National and Local Government Officers Association, that he made the kind of speech that he did. The Labour party is always defending what is done by the unions, which take more from the local authorities than they should do and leave less for those who need help and whom the local authority should be helping.

It is surprising that the hon. Member for Bradford, South (Mr. Cryer) made all that fuss about the increase in price for school meals. I did not notice him shouting at the hon. Member for Halifax (Mrs. Mahon) because the Calderdale local authority in her constituency was charging 70p when Bradford was charging 60p. Is Calderdale a disgusting authority? Did I hear a fight about that? A price of 80p is not out of the ordinary. It is not a high price to pay for school meals when a third of those who take them get them free. It seems much better to give the money directly to those who need it.

It was a pity to hear the reactionary views of the hon. Member for Bradford, West about the city technology college. I do not know what the decision about the CTC will be, but I know that the attempt is to give better education in Bradford and to get a good deal of money for it from the private sector. The hon. Gentleman should welcome that. I am ashamed that he has tried to turn that down for his own city.

The hon. Member for Bradford, West should be ashamed of making his disgraceful comments about the staff of the unemployment benefit offices who work hard to provide advice. His comments were an insult to those who work long hours in difficult circumstances in those offices.

The hon. Member for Bradford, South should recognise that we should support a local authority which has changed control and wishes to do things for those who are least able to help themselves. An example is what that council is doing with old people's homes. The so-called "secret document" which the hon. Gentleman produced was no doubt another example of the kind of theft of which we have seen so much—[Interruption.] Well, it was either untrue to say that it was secret or, if it was secret, how did it get into the hon. Gentleman's hands—

Mr. Cryer

On a point of order, Miss Boothroyd. The Minister, whose tongue frequently runs away with him, has implied that I stole the document. May I put it on the record that that document was sent to me by a constituent and that Members of Parliament have every right to receive documents from constituents so that they can expose scandals that are taking place under Tory control?

The Second Deputy Chairman

That is not a point of order. Our Standing Orders have not been breached.

Mr. Gummer

I regret the comment that it was in any sense a theft by the hon. Gentleman. The document obviously fell off a lorry.

The truth is that Bradford has sought to do something about its old people's homes. As the document showed, Bradford has tried to raise the standards of its old people's homes, which had fallen disgracefully under the previous Labour administration.

The hon. Gentleman should take a leaf from the book of the Bishop of Bradford who, having discussed the matter with the leader of the Conservative group, said, "We shall be watching what the Conservative group does. We shall be monitoring it most carefully. I have now been satisfied on a number of things about which I was worried." I believe that under its new control, Bradford city council will try to improve things for the people of Bradford. I shall be watching and monitoring it most carefully. However, at least I shall do so honourably ad with an open mind instead of with the closed, reactionary Left-wing minds from which we have heard today.

What has been said has little to do with the Bill. However, it has shown that Opposition Members are still smarting from having lost that by-election.

Mr. Rooker

The Minister's comments are not an answer to the debate. The right hon. Gentleman has made absolutely no attempt to answer any of the debate on amendment No. 16. That is disgraceful. My hon. Friends, the Members for Bradford, South (Mr. Cryer), for Bradford, North (Mr. Wall) and for Bradford, West (Mr. Madden) make no apology for devoting the debate to the Bradford issue. My hon. Friend the Member for Halifax (Mrs. Mahon). Has made points about her own local authority, as did the hon. Member for Sheffield, Hallam (Mr. Patnick). However, the Minister completely ignored the issue.

Let us stick with Bradford a moment. The Minister may say that everything is okay, fine and rosy, but like other hon. Members, I have in my possession not a stolen document, but a disreputable document. It is the Conservative manifesto from last May. There is not a single mention in it of any of the things that are now being introduced by Bradford's Tory-controlled authority.

The Minister referred to attacks on staff in unemployment benefit offices and at the Department of Social Security. My hon. Friend the Member for Bradford, South made no such attack. Indeed, the Minister must know that it is not part of the function of a civil servant in an unemployment benefit office or a social security office to give advice. Such civil servants are specifically debarred from giving advice. That is why, in all the social security pamphlets published by the Government, people are advised to go to citizens advice bureaux. Civil servants are not empowered to give advice. Therefore, my hon. Friend's point is valid because advice shops were and are required.

Advice bureaux are one of the areas of activity covered in the document which was compiled by the controlling group in Bradford. Among the political objectives set down by it for discussion on Tuesday 27 September was abolition of current local authority functions not politically acceptable". Giving advice to poor people so that they can maximise their benefits to assist the local economy is politically acceptable to the Opposition, but Conservative Members want no part in it.

The Minister talked about value for money. That is an important matter, to which we shall no doubt return. I suspect that, during the current year and probably the following year, Bradford will figure largely in that context. It will certainly figure next May, like the other large cities and metropolitan districts to which the amendment applies, because that is when the 36 metropolitan districts should have elections. We demand those elections. It does not matter whether they are in Birmingham or Bradford: we want those elections. The Government have banned the election in those 36 large towns and cities next May. They could easily have restored the annual elections in those cities when they abolished the metropolitan counties. Bradford can get away with what it is doing now because it does not have to face the electorate for two years.

The Labour party is not afraid to face the electorate. [Interruption.] We will stand by the results of the ballot box. The Government are scared stiff of bringing back annual elections in the large cities. They talk about democracy and accountability, but that is sheer cant and hypocrisy. We want those elections in the metropolitan districts next May.

One of the proposals put forward by Bradford, which I have not yet heard explained—perhaps one of my hon. Friends can explain it—relates to the top management contracts that will be introduced. Four factors were listed in the document. The top management will be placed on seven-year contracts. Salaries will be cut to 80 per cent., but it is clear that most top managers will be able to earn at least their existing salary, and it is intended that they will have the opportunity to earn 115 per cent. of their existing salary. Performance targets will be set and reviewed every two years. There is nothing wrong with that; that is good management practice, whether in the public or private sector.

However, I want an explanation of the words "perks to be introduced". I want to know what perks will be given to top management. Clearly, those would be supported by Government. They will be paying rate support grant in order to pay the perks to top managers who will be able to earn 115 per cent. of their salary. What perks will the Government be funding through the rate support grant? I want the answer to that question.

Mrs. Mahon

May I remind the Minister that Calderdale was controlled by Tories and Liberals continuously until May of this year?

Question put, That the amendment be made:

The Committee divided: Ayes 173, Noes 215.

Division No. 471]	[9.57 pm
AYES
Abbott, Ms Diane	Coleman, Donald
Adams, Allen (Paisley N)	Cook, Frank (Stockton N)
Allen, Graham	Cook, Robin (Livingston)
Archer, Rt Hon Peter	Corbett, Robin
Armstrong, Hilary	Cox, Tom
Ashdown, Paddy	Crowther, Stan
Banks, Tony (Newham NW)	Cryer, Bob
Barnes, Harry (Derbyshire NE)	Cunliffe, Lawrence
Barnes, Mrs Rosie (Greenwich)	Cunningham, Dr John
Barron, Kevin	Davies, Rt Hon Denzil (Llanelli)
Beckett, Margaret	Davies, Ron (Caerphilly)
Bell, Stuart	Davis, Terry (B'ham Hodge H'l)
Benn, Rt Hon Tony	Dixon, Don
Bennett, A. F. (D'nt'n & R'dish)	Dobson, Frank
Bermingham, Gerald	Doran, Frank
Bidwell, Sydney	Duffy, A. E. P.
Blair, Tony	Dunnachie, Jimmy
Blunkett, David	Dunwoody, Hon Mrs Gwyneth
Boateng, Paul	Eastham, Ken
Boyes, Roland	Evans, John (St Helens N)
Bradley, Keith	Ewing, Harry (Falkirk E)
Bray, Dr Jeremy	Fatchett, Derek
Brown, Gordon (D'mline E)	Faulds, Andrew
Brown, Nicholas (Newcastle E)	Fearn, Ronald
Buchan, Norman	Field, Frank (Birkenhead)
Buckley, George J.	Fields, Terry (L'pool B G'n)
Caborn, Richard	Fisher, Mark
Callaghan, Jim	Flannery, Martin
Campbell, Menzies (Fife NE)	Flynn, Paul
Campbell, Ron (Blyth Valley)	Foot, Rt Hon Michael
Campbell-Savours, D. N.	Foster, Derek
Clark, Dr David (S Shields)	Fraser, John
Clay, Bob	Galbraith, Sam
Clelland, David	Galloway, George
Clwyd, Mrs Ann	Garrett, John (Norwich South)
Cohen, Harry	Gilbert, Rt Hon Dr John

Godman, Dr Norman A.	Nellist, Dave
Gordon, Mildred	Oakes, Rt Hon Gordon
Gould, Bryan	O'Brien, William
Grant, Bernie (Tottenham)	O'Neill, Martin
Griffiths, Nigel (Edinburgh S)	Orme, Rt Hon Stanley
Griffiths, Win (Bridgend)	Patchett, Terry
Grocott, Bruce	Pike, Peter L.
Hardy, Peter	Powell, Ray (Ogmore)
Heffer, Eric S.	Prescott, John
Henderson, Doug	Primarolo, Dawn
Hinchliffe, David	Quin, Ms Joyce
Home Robertson, John	Randall, Stuart
Howarth, George (Knowsley N)	Redmond, Martin
Hoyle, Doug	Richardson, Jo
Hughes, John (Coventry NE)	Roberts, Allan (Bootle)
Hughes, Robert (Aberdeen N)	Robinson, Geoffrey
Hughes, Roy (Newport E)	Rogers, Allan
Hughes, Sean (Knowsley S)	Rooker, Jeff
Illsley, Eric	Ross, Ernie (Dundee W)
Janner, Greville	Rowlands, Ted
John, Brynmor	Sedgemore, Brian
Jones, Barry (Alyn & Deeside)	Sheerman, Barry
Jones, Martyn (Clwyd S W)	Sheldon, Rt Hon Robert
Kirkwood, Archy	Shore, Rt Hon Peter
Leadbitter, Ted	Short, Clare
Leighton, Ron	Skinner, Dennis
Lestor, Joan (Eccles)	Smith, Andrew (Oxford E)
Lewis, Terry	Soley, Clive
Litherland, Robert	Spearing, Nigel
Livingstone, Ken	Steel, Rt Hon David
Livsey, Richard	Steinberg, Gerry
Lofthouse, Geoffrey	Stott, Roger
Loyden, Eddie	Straw, Jack
McAvoy, Thomas	Taylor, Matthew (Truro)
McCartney, Ian	Thompson, Jack (Wansbeck)
McKelvey, William	Turner, Dennis
McLeish, Henry	Wall, Pat
McNamara, Kevin	Wallace, James
McTaggart, Bob	Walley, Joan
Madden, Max	Wardell, Gareth (Gower)
Marion, Mrs Alice	Wareing, Robert N.
Marek, Dr John	Welsh, Michael (Doncaster N)
Marshall, Jim (Leicester S)	Williams, Rt Hon Alan
Martlew, Eric	Williams, Alan W. (Carm'then)
Meale, Alan	Wilson, Brian
Michael, Alun	Winnick, David
Michie, Bill (Sheffield Heeley)	Wise, Mrs Audrey
Mitchell, Austin (G't Grimsby)	Worthington, Tony
Morgan, Rhodri
Morley, Elliott	Tellers for the Ayes:
Morris, Rt Hon A. (W'shawe)	Mr. Frank Haynes and
Mowlam, Marjorie	Mrs. Llin Golding.
Murphy, Paul

NOES
Alexander, Richard	Brazier, Julian
Amess, David	Bright, Graham
Amos, Alan	Brown, Michael (Brigg & CI't's)
Arnold, Tom (Hazel Grove)	Bruce, Ian (Dorset South)
Ashby, David	Budgen, Nicholas
Aspinwall, Jack	Burns, Simon
Atkins, Robert	Burt, Alistair
Baker, Nicholas (Dorset N)	Butcher, John
Baldry, Tony	Butler, Chris
Banks, Robert (Harrogate)	Butterfill, John
Batiste, Spencer	Carlisle, Kenneth (Lincoln)
Beaumont-Dark, Anthony	Carrington, Matthew
Bendall, Vivian	Cash, William
Bennett, Nicholas (Pembroke)	Chope, Christopher
Benyon, W.	Clark, Hon Alan (Plym'th S'n)
Bevan, David Gilroy	Clark, Dr Michael (Rochford)
Blackburn, Dr John G.	Clark, Sir W. (Croydon S)
Blaker, Rt Hon Sir Peter	Clarke, Rt Hon K. (Rushcliffe)
Bonsor, Sir Nicholas	Colvin, Michael
Boswell, Tim	Coombs, Anthony (Wyre F'rest)
Bottomley, Peter	Coombs, Simon (Swindon)
Bottomley, Mrs Virginia	Cope, Rt Hon John
Bowden, Gerald (Dulwich)	Cran, James
Bowis, John	Currie, Mrs Edwina
Boyson, Rt Hon Dr Sir Rhodes	Curry, David

Davis, David (Boothferry)	Lang, Ian
Day, Stephen	Lawrence, Ivan
Devlin, Tim	Lee, John (Pendle)
Dorrell, Stephen	Leigh, Edward (Gainsbor'gh)
Dover, Den	Lennox-Boyd, Hon Mark
Dunn, Bob	Lester, Jim (Broxtowe)
Durant, Tony	Lloyd, Sir Ian (Havant)
Dykes, Hugh	Lloyd, Peter (Fareham)
Emery, Sir Peter	Lord, Michael
Evennett, David	McCrindle, Robert
Fairbairn, Sir Nicholas	Macfarlane, Sir Neil
Fallon, Michael	MacGregor, Rt Hon John
Favell, Tony	MacKay, Andrew (E Berkshire)
Fenner, Dame Peggy	McLoughlin, Patrick
Field, Barry (Isle of Wight)	McNair-Wilson, Sir Michael
Finsberg, Sir Geoffrey	McNair-Wilson, P. (New Forest)
Fishburn, John Dudley	Madel, David
Forman, Nigel	Malins, Humfrey
Forsyth, Michael (Stirling)	Mans, Keith
Forth, Eric	Maples, John
Fox, Sir Marcus	Marlow, Tony
Franks, Cecil	Marshall, John (Hendon S)
Freeman, Roger	Martin, David (Portsmouth S)
Fry, Peter	Maude, Hon Francis
Gale, Roger	Mayhew, Rt Hon Sir Patrick
Gardiner, George	Mellor, David
Garel-Jones, Tristan	Meyer, Sir Anthony
Gill, Christopher	Miller, Sir Hal
Glyn, Dr Alan	Mills, Iain
Goodhart, Sir Philip	Mitchell, Andrew (Gedling)
Goodson-Wickes, Dr Charles	Mitchell, David (Hants NW)
Gorman, Mrs Teresa	Moate, Roger
Gow, Ian	Montgomery, Sir Fergus
Grant, Sir Anthony (CambsSW)	Moore, Rt Hon John
Greenway, Harry (Ealing N)	Moss, Malcolm
Greenway, John (Ryedale)	Moynihan, Hon Colin
Gregory, Conal	Mudd, David
Griffiths, Peter (Portsmouth N)	Neale, Gerrard
Grist, Ian	Neubert, Michael
Ground, Patrick	Nicholson, David (Taunton)
Grylls, Michael	Onslow, Rt Hon Cranley
Gummer, Rt Hon John Selwyn	Paice, James
Hamilton, Neil (Tatton)	Patnick, Irvine
Hampson, Dr Keith	Patten, John (Oxford W)
Hanley, Jeremy	Pattie, Rt Hon Sir Geoffrey
Hargreaves, A. (B'ham H'll Gr')	Pawsey, James
Hargreaves, Ken (Hyndburn)	Peacock, Mrs Elizabeth
Harris, David	Porter, Barry (Wirral S)
Haselhurst, Alan	Porter, David (Waveney)
Hayes, Jerry	Portillo, Michael
Hayhoe, Rt Hon Sir Barney	Powell, William (Corby)
Hayward, Robert	Price, Sir David
Heathcoat-Amory, David	Raffan, Keith
Heddle, John	Raison, Rt Hon Timothy
Hicks, Mrs Maureen (Wolv' NE)	Ridley, Rt Hon Nicholas
Hicks, Robert (Cornwall SE)	Ridsdale, Sir Julian
Higgins, Rt Hon Terence L.	Roe, Mrs Marion
Hogg, Hon Douglas (Gr'th'm)	Rowe, Andrew
Hordern, Sir Peter	Rumbold, Mrs Angela
Howard, Michael	Ryder, Richard
Howarth, Alan (Strat'd-on-A)	Shaw, David (Dover)
Howarth, G. (Cannock & B'wd)	Shaw, Sir Michael (Scarb')
Howell, Ralph (North Norfolk)	Shelton, William (Streatham)
Hughes, Robert G. (Harrow W)	Shephard, Mrs G. (Norfolk SW)
Hunt, David (Wirral W)	Shepherd, Colin (Hereford)
Hunt, John (Ravensbourne)	Shepherd, Richard (Aldridge)
Hunter, Andrew	Shersby, Michael
Irvine, Michael	Sims, Roger
Irving, Charles	Skeet, Sir Trevor
Jack, Michael	Smith, Tim (Beaconsfield)
Jackson, Robert	Speed, Keith
Janman, Tim	Spicer, Michael (S Worcs)
Johnson Smith, Sir Geoffrey	Stern, Michael
Jones, Robert B (Herts W)	Stewart, Andy (Sherwood)
Jopling, Rt Hon Michael	Stradling Thomas, Sir John
Key, Robert	Taylor, John M (Solihull)
Knapman, Roger	Thornton, Malcolm
Knight, Dame Jill (Edgbaston)	Thurnham, Peter
Knox, David	Trippier, David
Lamont, Rt Hon Norman	Vaughan, Sir Gerard

Waddington, Rt Hon David
Wakeham, Rt Hon John	Tellers for the Noes:
Wheeler, John	Mr. David Maclean and
Widdecombe, Ann	Mr. Tom Sackville.
Wolfson, Mark

Question accordingly negatived.

It being Ten o'clock, THE SECOND DEPUTY CHAIRMAN left the Chair to report Progress and ask leave to sit again.

Ordered, That, at this day's sitting, the Rate Support Grants Bill may be proceeded with, though opposed, until any hour.—[Mr. Neubert.]

Again considered in Committee.

Mr. Cryer

On a point of order, Miss Boothroyd. A serious constitutional matter arose in the previous debate. The hon. Member for Sheffield, Hallam (Mr. Patnick) appeared to take over the job of the Members of Parliament for Sheffield and Keighley, in that the Bradford amendment was proposed, but there was no representation of the Tory view from other hon. Members in the metropolitan district. I want to be assured that hon. Members are not having their jobs taken from them by the hon. Member for Hallam.

The Second Deputy Chairman of Ways and Means

The Chair cannot give any assurance on that point. It has no relationship whatsoever to the Chair.

Clauses 1 and 2 ordered to stand part of the Bill.

Schedule 1 agreed to.

Clause 3 ordered to stand part of the Bill.