Rate Support Grants Bill [Money] (Hansard, 31 October 1988)

§ Mr. Bob Cryer (Bradford, South)
I do not think that we should allow money resolutions to go through on the nod. There may well be some public expenditure involved. The resolution that we are debating authorises the payment out of money provided by Parliament of any increase attributable to that Act in the sums payable out of money so provided under any other Act. However, the financial effects of the Bill are not clearly set out in the explanatory and financial memorandum.[Interruption.]

§ Mr. Speaker
Order. Will hon. Members beyond the Bar please leave quietly?

§ Mr. Cryer
These are important matters, Mr. Speaker, and I am grateful for your attention.
The relevant paragraph states: The Bill will require calculations and estimates of individual authorities' block grant entitlements to be based not on their total expenditure but on the relevant amount as defined by the Bill. The "relevant amount" is defined in schedule 1. The result is that the aggregate amount of block grant payable for the years 1985–86 to 1989–90 may be either more or less than if the block grant entitlements were based on total expenditure.
I want to know what the financial effects of the Bill, as calculated by the Department, will be. Will more money be paid out? When the Minister opened the debate, I understood him to say that all the information has been received from the local authorities, apart from two. Therefore, the Department ought to have been able to calculate the financial effects of the Bill. I accept that the Department cannot be precise, but it ought to be able to provide some information.
The paragraph on the financial effects of a Bill usually says that it will cost, say, an additional £15 million or £20 million. Occasionally that amount cannot be calculated, and then it is a matter for the House. This paragraph is not the clearest that has ever been contained in an explanatory and financial memorandum. Will the financial effects of the Bill enable the £38 million that an all-party delegation that visited the Department of the Environment asked should be paid to Bradford to be paid? Bradford has been the subject of considerable debate. The point has been made repeatedly that, according to the local authority's calculations, £38 million has been denied to Bradford over a period of three years. Should a calculation of that kind be included in the financial effects of the Bill?
Bradford will suffer a cut of £3.7 million because of the Bill. Some local authorities will benefit from it, but it appears that most local authorities will suffer a cut. Bradford, with the Right-wing Tory clique in control, faces difficulties. The Tories appear to have been taken over by Right-wing extremists. I hope that traditional members of the Tory party—the one-nation group, or the wets as they are contemptuously described by the Prime 762 Minister—will exert themselves in Bradford and stand out against these onerous and vicious attacks on the people of Bradford.
Bradford will face a cut of £3.7 million. On top of the cuts for all local authorities, the general financial effect will be a cut in Government expenditure. I understand the reason for the money resolution. If there should be an unauthorised increase in expenditure, the Government will have to come back to the House for that authority, so it is convenient for them to obtain that authorisation now. However, I should like to know what the precise effects will be, how much money is involved and whether the £38 million that is due to Bradford will be paid.

§ Mr. Frank Haynes (Ashfield)
I am pleased to hear the comments of my hon. Friend the Member for Bradford, South (Mr. Cryer). There is no doubt about it: what he says is quite true. There will be massive cuts. I hope that the Minister for Housing and Planning is listening, rather than reading and talking, because we have a credible Opposition over here. Now the Minister is laughing because he finds that funny. We are a credible Opposition talking seriously about a serious problem. I wish that the Minister would not talk to his hon. Friend the Under-Secretary of State, but that he would listen to what is being said.
We are talking about the problems of local authorities. I am afraid that, although we have a Conservative-controlled local authority in the city of Nottingham, on Thursday the Conservatives will lose control of that council and we shall then be able to put things right in Nottingham.
My hon. Friend the Member for Bradford, South is right about the cuts that the Government have made in local authority grants, which seriously affect the services provided by those authorities. Earlier today the Minister would not give way to me. He is going to get it now. He stood there like Maria Heep. [HON. MEMBERS: "Who is Maria Heep?"] When they sit round the table in the Department, they are all like Maria Heep, looking to see where they can cut and cut and seriously affect our local authority services.
I come now to a very serious point—

§ Mr. Roger King (Birmingham, Northfield)
Hear, hear.

§ Mr. Haynes
That fellow has not been here very long. Some of us have been here a long time.

§ Mr. Speaker
Order. He is not "that fellow". He is an hon. Member.

§ Mr. Haynes
I accept your ticking off, Mr. Speaker, as always. The hon. Gentleman has not been here very long. Some of us who have been here a long while know how the House works under the Conservative Government. The hon. Gentleman supports the Government, although it will be interesting to find out whether he supports them tomorrow night.
My local authority strives very hard, under the difficult circumstances created by cuts in the rate support grant, to provide the necessary services. The Minister does not seem to realise that, whereas we used to have nine coal mines in my constituency, we now have only four. The mines made a massive contribution in rates. Now that money has gone and this lot have not made it up. In Ashfield we are 763 struggling to provide the necessary services, and now the lads are having to sit around the table because of the law that this lot have passed and because of decisions that they have made. My colleagues are having to try to find ways of cutting services that they should be providing. They were providing the services before 1979. The hon. Member for Nottingham, South (Mr. Brandon-Bravo) should not look surprised.

§ Mr. Brandon-Bravo (Nottingham, South)
rose—

§ Mr. Haynes
I see that I have drawn him.

§ Mr. Brandon-Bravo
It would he quite wrong to allow the House to think that when a mine closes the local authority loses rates and that jobs are lost. I remind the hon. Gentleman that the site of the Wilford pit, in my constituency, which was closed, now accommodates the Queen's industrial estate, which employs four times as many people as ever went down the pit.

§ Mr. Haynes
I did not mention jobs. I simply talked about the rate support grant and said that the industry paid rates which were lost when the pits closed.

§ Mr. Geoffrey Lofthouse (Pontefract and Castleford)
Is my hon. Friend aware that what the hon. Member for Nottinghamshire, South (Mr. Brandon-Bravo) said does not apply in all areas? In my constituency, there were eight pits before the miners' strike and there is now one, and no jobs have been put in their place—

§ Mr. Speaker
Order. This is a debate on the money resolution, not about jobs.

§ Mr. Haynes
That is right. That is why I steered clear of the subject. I was not going to have you pull me up again, Mr. Speaker. The hon. Member for Nottinghamshire, South drew me into the subject as he mentioned Wilford pit, which is in his constituency. When that pit closed, there was a Labour Government. We made it right when the pit closed. This lot do not. Services have to be cut. My colleagues in Ashfield have to see what services they can cut to come into line with the laws that this lot make. I am talking about the Government. I could say many things about the right hon. Lady at No. 10, but I shall not wander off the money resolution. No doubt there will be other opportunities to talk about her. I have always tried to stay within the rules of the House and your strictures, Mr. Speaker.
The Government have cut ever since I have been here. I came here when they came to power. Like many others, my local authority is struggling to provide services. Ministers and the Prime Minister say regularly that some local authorities are overspending. I am making out a case for my local authority, which has lost money in two ways. First, it has lost as a result of pit closures. Five pits have gone, so there is a lot less money coming in to provide services. Secondly, the Government have cut rate support grant.
How does the Minister expect my colleagues in Ashfield to provide necessary services? They have difficulty standing still, never mind providing the additional services that are required. When the Minister spoke on Second Reading, he would not give way to me and give me an opportunity to put my case to him. He was frit. He did not know what was coming. He looked at me and said, "I am not giving way to the hon. Member." It will be there in 764 Hansard. I said that I would have a word with him outside, but the money resolution has given me an opportunity to put my case to him now. I am looking for some answers.
I know that the Minister has moved from the agriculture Ministry. He was supposed to look after wild animals while he was there, but he did not do a very good job. I hope that, now he has moved, he will help my local authority to overcome some of its financial difficulties. I do not want the Minister to sit on his backside and say nothing. He should let me know what he will do about it.

§ Mr. Alun Michael (Cardiff, South and Penarth)
I am sad to note the lack of a Welsh Office Minister in the Chamber, as I want to return to a point that I raised earlier. Perhaps the hon. Member for Vale of Glamorgan (Sir R. Gower) has rushed into the House to support my argument because of the way in which ratepayers in his constituency will be affected by the money resolution.
Does the money resolution take account of the likely legal costs of disentangling the arguments which are inevitable in view of the impropriety of the elements in the Bill to which I drew attention earlier and which were ignored in the Minister's winding-up speech?
In her summing up the Minister made great play of the benefits of certainty, as did her ministerial colleague earlier in the debate, and she referred to statements by the former Secretary of State for Wales and the Secretary of State for the Environment. Those statements offered certainty that the final grant decision made by the Government would be determined not by updated estimates, to which the hon. Lady referred, but by the actual money spent by the local authority. Those assurances were given in the House, without equivocation, there were no ifs and buts, yet the point was avoided during the debate and in the Minister's reponse. Both Ministers made great play of the benefits of certainty, but they offered the House all the predictive certainty of being told, "You were hanged yesterday. so would you kindly lie down in the coffin and stop making a noise about it?"
Cabinet Ministers gave assurances to the House about precisely how the system would operate. There is bound to be an argument, because the Bill seeks to overturn those explicit and clear assurances.
I spoke earlier of two local authorities that had met all the Government's requirements and more. How can Ministers come to the House and suggest that, somehow, a failure to answer a questionnaire, which was not about actual costs, but about estimated costs, which was not available until a couple of days before the statement in the House on 7 July, which did not require a response until the end of July, is the basis upon which they can change the rules overnight?
If there is any integrity among Ministers, they will accept my point and amend the Bill during its passage through the House. I hope to be able to welcome such a move at a later stage of the Bill, and not to have to worry about whether the money resolution caters for the inevitable arguments that will arise if they do not.

§ Mr. Tony Banks (Newham, North-West)
I want to ask the Minister some questions about the aspects of the money resolution that affect staffing, under the heading: Public service manpower effects of the Bill. 765 "Staffing effects' would be more appropriate wording. Having heard Ministers speak in many local government debates about staffing implications and reductions in the number of people employed within local authority areas because of the provisions passed here, none of which they have been prepared to quantify, will the Minister this evening tell us what staffing requirements will stem from the Bill?
The Bill states: There will be a small reduction in staffing requirements within central government"— I trust that it will not affect the Minister's job, or that of his colleagues on the Government Front Bench— and there may also be a small reduction in the administrative work load of local authorities. Will the Minister at least attempt to give us some idea of the numbers? Hopefully, he will be able to secure the information that he obviously needs. If the Bill says that there will be a small reduction, surely someone somewhere must have a figure for that.
I do not understand how a local authority such as Brent, which will suffer a £9 million loss because of the Bill, the London borough of Greenwich, which will suffer a £1.2 million loss, or the London borough of Southwark, which will also suffer a financial loss, will be able to reduce the number of staff required to administer the new system. As there is a large number of losers as well as gainers from the Bill, clearly the administrative problems of local authorities will be enormous. In those circumstances, when faced with a Government who keep changing the rules, making life more and more difficult for treasurers' departments, how on earth can the Minister justify the statement that there may also be a small reduction in the administrative work load of local authorities."? It sounds like pious hopes. As with so many other aspects of local authority legislation that we have unfortunately passed in the House, Ministers and Conservative Members have some ideas about what they would like to see in the future, but at the same time they are unprepared to— [Interruption.] My hon. Friend the Member for Ashfield (Mr. Haynes) is disrupting my concentration. I cannot work out whether he wants to join the Conservative party or to impart important information. Perhaps he feels that the points that he made in his contribution need more detailed intercourse with the Minister and that is why he has crossed the Floor. If so, he places a low value on the power of his oratory, which we all value. I am sure that the Minister understood the points that he made without it being necessary for him to cross the Floor and explain in detail in his right ear.
The Minister will have to quantify the statement made in the Bill. We have heard so many promises from Ministers about the staffing implications and the impact of various aspects of local government legislation that the Minister cannot be surprised at the fact that we do not believe what we read in the Bill. Perhaps the Minister will explain what is meant in terms of numbers.

§ Mr. Pat Wall (Bradford, North)
In making the financial calculations on the Bill I wonder whether the Minister has taken account of rent arrears in respect of local government finances. It is an important point. There 766 have been cuts of £28.4 billion in central Government support to local government since 1970 and there is a growing problem of rent arrears. It has been calculated that Bradford has lost £80,000 a week in housing benefit. That means that we lose £4.1 million a year in benefits. Of that £80,000, £67,000 relates to local authority tenants and only £13,000 relates to private tenants. Because that money has not been paid, the poorest in our community have to spend money on rent that they would normally have spent on food, clothing and essentials. That has a multiplier effect in terms of a loss of expenditure in the city.
For the first time in Bradford's history council house rent arrears passed the £2 million figure some weeks ago. That has an enormous effect on the general standard of living, the general revenue of the council and the general welfare of the citizens of Bradford. The story is the same in other cities. Doncaster has one of the lowest levels of council house rent arrears. However, since the introduction of the new social security measures on housing benefit, debts in council house rents to the Doncaster local authority have increased by 50 per cent. On a television programme we saw and heard about a gentleman who was paying rent. The proportion that he had to pay had increased from £6 to £26. To ask an unemployed man to find an extra £20 a week is a harsh imposition.
Can the Minister give us some idea of the Government's views on that issue?

§ The Minister for Housing and Planning (Mr. John Selwyn Gummer)
I shall respond to the reasonable comments of the hon. Member for Bradford, South (Mr. Cryer). Until we have certain audited reports from local authorities, I cannot give him, as I think he realises, an exact final outcome. That is why we have a money resolution.
It may be that over the number of years concerned we will pay out rather more of taxpayers' money to local authorities than we would have done had we not made these changes. Any argument that people are losing or being cheated under these arrangements falls to the ground. We expect that over the years the amount paid out will be even-Stephen, but I cannot guarantee that. My guess is that it might be a little more than we expect. As long as it is not too much more I should be sympathetic, because it would prove that everything that I have said is true. The hon. Member for Bradford, South was right to raise the matter, and I hope the House will accept that as a reasonable assessment in advance of the audited reports.
The hon. Member for Ashfield (Mr. Haynes) generously and politely explained that he would have to leave, but he has returned, so I shall say what I intended to say in the first place. I am sorry that I did not give way to him, not because of what happened thereafter—although I was glad that it happened openly rather than in the dark corridors of this building—but because I gave way generously to many hon. Members, and at some point one has to say no. I thought that he was mature enough an hon. Member—he said how long he had been an hon. Member—to take it in the way that it was intended. I have nothing against the hon. Gentleman, and we have crossed swords with pleasure—

§ Mr. Haynes
On a point of order, Mr. Deputy Speaker. Normally, the Minister says "No, I am not giving way any 767 more", but he said to me "I am not giving way to that hon. Member", which is different. I am asking the Minister to put things right.

§ Mr. Deputy Speaker (Mr. Harold Walker)
Order. That was the last debate.

§ Mr. Gummer
If the way in which I refused to give way to the hon. Member for Ashfield caused him embarassment or remorse, I apologise. I very much enjoy crossing swords with the hon. Gentleman, but I refused to give way to two of his hon. Friends and I thought that it would have been invidious to pick him out after our long association in agriculture matters. I am pleased to note his interest in this subject, and I should not have liked to miss it.
The House is indebted to the hon. Member for Ashfield, because if he was not the hon. Member for Ashfield we might have had the present deputy leader of Nottinghamshire county council. Had that gentleman been chosen, although we would have done' Nottinghamshire county council a favour, we would have rued the day to a degree that I should not like to contemplate.
The Conservative-controlled city of Nottingham—I am trying to apply this closely to the money resolution—has done much good for its people. I was lucky enough to see the extremely good refurbishment of council houses, which it now takes five weeks to complete instead of a year. Young couples are able to obtain council houses, which is an opportunity that they would never have had if the Socialists had been in control. I disagree with the comments of the hon. Member for Ashfield about one of the best-run councils in the United Kingdom. I am sad that the hon. Gentleman—a man of such upstanding and outstanding worth—should have looked forward to linking arms with a Communist to control the city—

§ Mr. Deputy Speaker
Order. Now perhaps we can get to the money resolution.

§ Mr. Gummer
I was coming to that, Mr. Deputy Speaker. The money resolution has been attacked by the hon. Member for Ashfield, who said that the closure of nine coalfields would have an effect on—

§ Mr. Haynes
On a point of order, Mr. Deputy Speaker. I did not refer to the closure of nine pits. I referred to the closure of five out of nine.

§ Mr. Gummer
I am sorry—the closure of five out of nine coal mines. That meant that the rates that would have come from those five hypothecated coal pits would no longer come to the local authority That is true. But the rate support grant that is given to the local authority is adjusted to take account of the reduced local resources. The hon. Member for Ashfield always wants to have it both ways. I now see that I should have given way to him. That would have been a useful point to make in the middle of a debate that was perhaps even better attended than this one.
It was a pity that the hon. Member for Ashfield referred to laws that "that lot"—the Conservatives—had passed. These are not laws that we have passed. They are laws that Parliament has passed. It is important in a democracy to accept that, when Parliament has decided, we have all decided and we all obey those laws. We now have an Opposition who say that they do not pay taxes that they do not like, who advise other people not to pay taxes that 768 they do not like, and who do not sack Opposition spokesmen who promote that view. Therefore, the hon. Member for Ashfield is only taking his cue from his leader.
The hon. Member for Cardiff, South and Penarth (Mr. Michael) asked whether there would be extra payment for the legal costs of disentangling the arguments that would result from the money resolution. One reason for this simple stocktaking system is that we do not want to have vast legal costs and arguments to decide whether this or that audited report is right or wrong, or whether this or that date which this or that local authority decides is right is the right one. We have a simple system about which legal arguments cannot obtain, because it is what we received on 7 July. There is a good reason for doing that.
Cardiff city council had a very long time—well before it produced its budgets and well before 7 July was near —to make such adjustments to its spending as it thought suitable. It did not do so. I find it difficult to say that Ministers, the House and the whole of the United Kingdom must wait for Cardiff city council to decide at what point it will please it to meet the statutory requirements. It is not unreasonable, when all that time has been given, to take the figures that were given by the council's financial officer, and signed by him as the best estimates that he could give, as the figures upon which the Government could act. I cannot see that there is an alternative if one is moving from one system to another.

§ Mr. Michael
rose—

§ Mr. Gummer
We are about to move into the Committee stage of the Bill and I do not wish to presume upon your ruling, Mr. Deputy Speaker, but I have a suspicion that you might suggest that detailed discussions of the Bill's effect on Cardiff city council would be more appropriately dealt with when we come to the clause which covers that matter.

§ Mr. Michael
rose—

§ Mr. Gummer
I am happy to continue arguing with the hon. Gentleman, but I have given way to him, if not four times, then certainly three, so I do not intend to do so again.

§ Mr. Michael
rose—

§ Mr. Gummer
I gave way three times and my hon. Friend the Minister gave way once. That was four times in one debate. It is not unreasonable to complete this debate without giving way.
The hon. Member for Newham, North-West (Mr. Banks) talked about staffing resources. I do not have an exact figure. We have suggested that, with a system that most people can understand, it is likely that fewer people will be needed to organise it at local authority level than if it were complicated. That is all that has been carried out.
I cannot accept that it is reasonable for local authorities such as Brent to fail to deliver their figures months after the date on which they are supposed to do so. I cannot see that one can run a public authority on the basis that Greenwich runs its public authority when, after having repeatedly been asked for the figures, it still does not give them. Greenwich received the form for 1986–87 on 26 May for return by 31 July 1987, but had still not returned it by 7 July 1988.
How can we have accountability and a sensible system of running local authorities when people cannot produce 769 a form a year after it is sent to them? A private business would be struck off the companies register if it behaved in that way. Someone would make it clear that it had to be done and would come round and collect the form. It is certainly not reasonable for the hon. Gentleman to complain that the Government should have allowed more time. We cannot give him the figures that he wants, because some authorities seem to find it difficult even to fill in a form on time.
I do not know how Brent intends to deal with this, just as we do not know how Brent intends to clean up the streets. The hon. Member for Normanton (Mr. O'Brien) is no longer present—I am sorry that Labour Front-Bench Members are not here to discuss the money resolution which their supporters regard as so important—but, in the light of his comment about people wanting their streets kept clean, I hope that he will go to Brent and see what happens when a Left-wing Labour authority cannot, and in certain areas says that it will not, keep the streets clean.

§ Mr. Tony Banks
rose—

§ Mr. Gummer
No, I shall not give way. The hon. Member who made the point is not here, so he deserves to have it thrown back at him.
I was surprised to hear the hon. Member for Bradford, North (Mr. Wall) raise the subject of rent arrears, as one of our problems has been that Labour authorities have not called on people to pay the rent that is due. They have not collected the rents, and have very often then asked taxpayers elsewhere, in local authorities which have collected their rents, to make up the shortfall. That seems wholly unacceptable. The hon. Gentleman must look a little beyond Bradford and ask himself whether it is fair that other people should bear the burden of an authority that has failed to collect its own rents.
As for the hon. Gentleman's comments about the Social Security Act, we are spending more money on social security, not less, but we are concentrating that greater amount on those who most need it. The result, therefore, should be more regular payment of rents rather than less. It is only because of Labour party propaganda that anyone has used that Act as an excuse.
The battle in Bradford, and in many other places, is not so much about the town hall being run by one lot of people rather than another, but about whether it should be run by cosy arrangements with the unions or on the basis of value for money. If local authorities were run on the basis of value for money, the money would be available to provide the services that are necessary in so many areas. The hon. Member for Bradford, North will rue the day he raised the subject of rent arrears, because in this regard Labour authorities are the experts. It is they who have failed to collect the rents and then had the effrontery to ask the general taxpayer to pay for their incompetence and their uselessness.

§ Mr. Max Madden (Bradford, West)
The debt counselling unit of Bradford citizens advice bureau has done an impressive job in reducing rent arrears by advising people how to manage their affairs more effectively, but the CAB is threatened with closure because the new Tory controlling group is threatening to remove its funding from the budget as well as refusing to provide additional funding for the debt counselling unit. We share the 770 Minister's concern about the rent arrears and other debts that are building up as a direct result of Government credit policy. Will he therefore ensure that Bradford CAB receives the necessary support to continue its important work and that extra funding is made available by the Department of Trade and Industry to the CAB nationally so that people can be given more advice about managing their affairs, which will help to reduce the debts about which he and I are so concerned?

§ Mr. Gummer
Although I understand the hon. Gentleman, there appear to be two precisely opposite points. The hon. Member for Bradford, North said that the amount of rent arrears in Bradford had increased out of all proportion. The hon. Member for Bradford, West (Mr. Madden) has asked me to congratulate the CAB on the reduction in rent arrears. It must be one or the other. I have great respect for the CAB, which is an extremely efficient body that works hard in my constituency. I do not know the precise arrrangements in Bradford for its funding because I believe in local government and I expect Bradford city council to make its own decisions on how to spend its ratepayers' money. Unlike the hon. Gentleman, I do not believe in central control over how local authorities make decisions.

§ Mr. Wall
rose—

§ Mr. Gummer
I shall give way to the hon. Gentleman because I have been very tough about his remarks.

§ Mr. Wall
Rent arrears in Bradford have risen to above £2 million for the first time. However, that does not conflict with what my hon. Friend the Member for Bradford, West (Mr. Madden) said. Considerable efforts have been made to reduce that debt. The problems of debt arise, not because people deliberately want to defraud other citizens who are paying their rent, but because of the impossible position in which those people now find themselves.
I deliberately refer to Doncaster, which has a Labour administration. According to the Audit Commission, it has one of the best records for rent collection in the country. It is not the most prosperous area, but it has the Yorkshire tradition of meeting its bills. If rent arrears in Doncaster have risen by 50 per cent., it is a sign of real problems for families. The problem will be compounded even further by the increase in rents in Bradford well above the level of inflation, and in electricity prices nationally. It is really striking home that the CAB has had to put at least half its staff on to debt counselling, which shows that there is a real problem, not just some invention.

§ Mr. Gummer
The hon. Gentleman must still face the fact that the Government have increased the amount provided for social security, but have directed it at those who are most in need. Therefore, those who were least able to pay their rents should now be able more easily to pay them. That is a fact of life. If hon. Gentlemen insist—

§ Mr. Allen McKay (Barnsley, West and Penistone)
rose—

§ Mr. Gummer
I shall not give way, as I have given way many times already during this debate, as I did in the previous one.
If we are to have a society in which we try to help those who are least well off, it means that those who can afford 771 to pay their rents should be encouraged to do so as a matter of priority, rather than that being put at the bottom of the list.

§ Mr. Allen McKay
rose—

§ Mr. Gummer
I shall not give way. I have already told the hon. Gentleman that.
It is clear that Labour authorities are less willing, less enthusiastic and less hard working in the collection of rents than are Conservative authorities. Until that is changed I shall take no lessons from those who fail to 772 produce the figures, but who ask the remainder of the community—decent, hard-working people who pay their rents—to pay their rents in advance.