§ Mr. Speaker
We now come to the first of the Opposition motions—that on the poll tax. I must announce to the House that I have selected the amendment in the name of the Prime Minister.
§ Dr. John Cunningham (Copeland)
I beg to move—[Interruption.] That is all very well, but we would like to see that right hon. Gentleman replaced with a Socialist Secretary of State.
I beg to move,That this House rejects the unfair, inefficient, intrusive and bureaucratic poll tax, the so-called community charge, because the tax will bear most harshly on the poorest and weakest in the community, will discriminate against carers at home, will undermine and distort local accountability by concentrating an unprecedented 75 per cent. of local authority expenditure under Ministerial control, and is capricious and unfair in its effect on areas of the country with low rateable values; furthermore regards the proposed rebate system as mean and inadequate; recognises that the national business tax will cause grave financial problems for thousands of small business people; and calls upon Her Majesty's Government to abandon these proposals.We already have evidence of those effects in Scotland.
Before I proceed, I want to congratulate the right hon. Gentleman the new Secretary of State on his major promotion. We know that he brings considerable intelligence and ability to a Department much in need. of both. However, what has been lacking in the Department of the Environment are not just those things, but good judgment and coherent principles to safeguard the environment, the essential public services and local democratic government.
§ Mr. Tony Banks (Newham, North-West)
Will my hon. Friend remind the House of how many Environment Secretaries he has seen off since he has been Shadow Environment Secretary? How long does he think the new incumbent will last in his office before we have a Socialist Environment Secretary?
§ Dr. Cunningham
As I said earlier, it is all very well seeing off Tory Secretaries of State, but I am getting a little fed up with them being replaced by other Tories. Next time we want to replace not only the right hon. Gentleman, but all Members of the Treasury Front Bench.
The new Secretary of State and his new Minister for Local Government, the hon. Member for Wirral, West (Mr. Hunt), whom we also congratulate and welcome, must have at least some private misgivings, because they have inherited something of a shambles. The poll tax, water privatisation, the Government's failure adequately to safeguard the environment, both nationally and internationally, are, together with the threat to the National Health Service, the most deeply resented issues in British politics.
It is evident that no amount of repackaging or changes in personnel can possibly make the poll tax and water privatisations popular, or acceptable to the British people. Both are clearly seen as deeply unfair, inefficient and 857 damaging to families, to services such as education, and to the environment. Both are inconsistent with the widespread desire of the British people for a better quality of life.
Therefore, without fundamental changes in the policies themselves, the new Secretary of State faces just as rough a ride with his colleagues as his predecessor—indeed, an even tougher time, as the awful truth of the consequences of the poll tax and the national business tax on property dawn on the Tory party and the people.
§ Dr. Cunningham
No, I shall not give way.
We shall, of course, miss the special and idiosyncratic presentational skills of the previous Secretary of State, whom we also wish well. Opposition Members take considerable pleasure in the knowledge that he is still on the loose, still on the Government Benches and free to range the country in an attempt to recover support for the Tories, much of it lost by his own policies at this Department in the first place. British industry has been remarkably and uncharacteristically silent about its new Secretary of State. We share its obvious misgivings about the future well-being of industrial policy, jobs and the economy.
Like his hon. Friends, we shall listen to the Secretary of State's speech with particular interest. Indeed, the Labour party chose this debate because we wanted to give him the earliest opportunity to announce the changes in policy that he envisages. We promise him a warm welcome.
The Secretary of State will know about the uproar in the Chamber last week about the poll tax—or the "Tory tax" as the right hon. Member for Henley (Mr. Heseltine) rightly calls it. That uproar was yet another sign of the fear that is spreading through the Tory party about the implications of the poll tax for them and their survival. Like us, I am sure that they too will be anxious, if not desperate, to hear about changes in policy, not just in personnel and presentation.
It was the predecessor of the Secretary of State who, with typical candour, blew the gaff on the Conservative Government's real intentions about the poll tax when he asked why a duke should pay more than a dustman. The implication is clear. The intention was to introduce a tax unrelated to income or to the ability to pay, and that is exactly what the Tory Government have done.
The people of Scotland have already been made to suffer, but they have reaped their revenge through the ballot box. The people of England and Wales will eventually do so too.
§ Dr. Cunningham
No, I shall not give way at the moment. We say that there are many reasons—equity, social justice and the principles of progressive taxation—why someone such as Lord King, the chairman of British Airways, with a reported salary of £386,000 per annum, should pay more than an engineering apprentice in his company with a take-home pay of between £65 and £85 per week. We know instinctively that it is grotesquely unfair to make them pay the same contribution in local taxation—[Interruption.]
858 Did I hear a Tory Member mutter something about rebates? Yesterday, I released up-to-date figures compiled by the statistical section of the Library, which showed the mean and inadequate rebates that would have been available if the poll tax had been in operation this year. Last week, the Department finally published its illustrative poll tax figures for 1989–90. Using the latest poll tax figures, I asked the statistical section of the Library to calculate for each local authority the maximum level of net weekly income at which poll tax rebate would be payable to single persons, married couples and pensioners.
The Government have always been afraid and unwilling to publish that information. The Social Security Act 1986 and the poll tax Act 1988 require everyone to pay at least 20 per cent. of the rates bill, regardless of their circumstances or ability to pay. That extremely unfair rule continues next year, when the poll tax comes into force on 1 April 1990 in England and Wales.
§ Dame Elaine Kellett-Bowman (Lancaster)
Will the hon. Gentleman admit that, because the figures published in the document about the Labour party's proposed capital tax and local income tax showed how catastrophic they would be for the British public, the Labour party abandoned those policies?
§ Dr. Cunningham
No, I will not admit that, because it is not true. There has been no abandonment of policy. Nor did the previous Secretary of State for the Environment publish any realistic figures. The right hon. Gentleman told me in a note referred to in a parliamentary answer on 9 November 1987:There is no comprehensive data available from which to assess the outcome of a capital revaluation of domestic rateable values, and it is not Government policy to undertake such a revaluation. Some insight into the possible effect of a revaluation on the basis of capital values can be obtained by considering the relationship between house prices and existing rateable values in England.But the Department does not have the data. It was quite dishonest of the previous holder of that high office to fabricate the results.
§ The Secretary of State for the Environment (Mr. Chris Patten)
I notice that the Leader of the Opposition said last week that the Opposition's policy needed sophisticating. Will the hon. Gentleman say when it is likely that their policy will be sophisticated enough to share with the rest of us?
§ Dr. Cunningham
We are sophisticating all our policies all the time. That is why there is such a large and growing gap in British public opinion about the relative merits of party policy. When we have finished our considerations of these matters, the Secretary of State will not be the first to know, and that will come as no surprise to him. However, his right hon. and hon. Friends are waiting to hear from him not about Labour party policy, but how he proposes to dig them out of the appalling mess that present Government policy has got them into in their constituencies. Let me illustrate how big that mess is.
Figures show that a single pensioner in the Prime Minister's Finchley constituency, would face a poll tax bill of £290 per person per annum and would lose all entitlement to rebate if his or her net income exceeded £72.50 per week. In other words, a pensioner with a net income of £73 per week would be expected to find £5.57 per week to pay the poll tax. In Bath, the constituency of the Secretary of State, a single pensioner faced with a poll 859 tax bill of £281 per year, according to the Government's figures, would lose all entitlement to rebate if his or her net income exceeded £71.60 per week.
A married couple with two children aged eight and 10 living in Finchley would lose all rebate if their net income exceeded £151 per week. In other words, they would have to find £11.15 per week just to pay their combined poll tax. A married couple with two children living in similar circumstances in the Secretary of State's constituency would lose all entitlement to rebate if their income exceeded £149.10 per week, and would have to find £10.81 per week to pay their combined poll tax bill.
§ Dr. Cunningham
A single person under 25 living in Finchley would lose all entitlement to a rebate if his or her net income exceeded £58.80 per week, and nearly 10 per cent. would go towards the poll tax.
Those are the realistic implications of the impact of the poll tax on take-home pay, including the Government's current proposals for rebates. Those figures prove that all but the poorest face substantial additional tax burdens, with everyone required to pay the minimum 20 per cent. The tables show how little the rebates are related to the ability to pay or personal circumstances and are based on this Government tolerating scandalously low levels of pay and poverty.
The figures reinforce the conclusion of yesterday's Child Poverty Action Group report on poll tax benefits and the poor, which said:The poll tax is intrinsically unfair—as a flat-rate tax, it falls equally on the shoulders of the rich and the poor. Even with the help of rebates it is poorly related to the ability to pay.The inefficiencies of the poll tax are legion. Local government has already been faced with bills two to three times those for the collection of rates. At the annual conference of the Tory-dominated Association of District Councils, its leader, Tory councillor Roy Thomason, interrupted the then Secretary of State, the present Secretary of State for Trade and Industry, to say:£200 million more, Secretary of State.The then Secretary of State replied:My advice to you is to find better ways of raising the community charge and try to make savings, rather than always complaining about not having enough money.That answer was jeered to the rooftops by the Tory-dominated conference of the Association of District Councils.
Last week. there was a fiasco when the Government announced the so-called "safety nets". Howls of outrage from Tory Members rang round this Chamber, but in the main, they were only getting what they voted for in Division after Division, when, with a few honourable exceptions, they passed the legislation in the first place. The panic in the Tory party was astonishing.
§ Mr. Squire
As the hon. Gentleman and the House know, I come into the category he has just mentioned. If he is to beguile me to an alternative solution, he must—as I am sure he will—suggest one or more alternative ways in which we may proceed; otherwise, I may be convinced to follow my right hon. Friend the Secretary of State.
§ Dr. Cunningham
I recollect that the hon. Gentleman had his own alternative, which he tried to persuade his 860 ministerial colleagues to accept, without success. In the main, Tory Members voted for what they are getting, and their panic is astonishing. It exposes the reality that many of them apparently did not know what they were voting for.
The safety net financial allocations are as capricious as every other aspect of the poll tax. Their application has nothing to do with efficiency or otherwise. Tories in the north, especially the north-west and Yorkshire, want more grant for their often Labour-controlled authorities because they fear a political backlash. Tories in the south complain that their constituents will subsidise their colleagues' areas. Let us consider the reality.
Wandsworth, for example, a Tory borough, gains £46.4 million from the safety net system. Is Wandsworth inefficient? Is that what Conservative Members are saying? Is it a poor council? Or is there a political reason for that allocation? Birmingham, a Labour city, contributes £50.2 million. Birmingham certainly qualifies under the Tory definition of efficiency, yet Birmingham has huge problems in housing, employment and inner-city difficulties. It has had to adjust to a cumulative loss of more than £500 million in rate support grant alone under this Government. Yet the people of Birmingham, under the safety nets, are asked to contribute an additional £50.2 million to subsidise the poll tax.
Let us consider Westminster. Is that a well-run Tory council? The safety net effect adds £33 per adult to the poll tax of £428 in Westminster. Lady Porter's policy of "building stable communities", which was described by Tory councillor Mrs. Patricia Kirwan as "gerrymandering the electoral processes", will cost each poll tax payer in Westminster an extra £60 a year. Is Westminster efficient? Are any Conservative voices raised about what is going on there?
Copeland borough council in my own constituency, which, under Labour control, had no rates increases for seven years, gains £5.2 million from safety netting—equivalent to £94 poll tax per adult—but the average two-adult household in my constituency will still be £40 a year worse off under the poll tax than under the rating system. So much for Tory claims that people are benefiting.
We know that poll tax registration involves massive new and regrettable intrusions into people's privacy and family lives. Many councils are asking people to respond to questions that the registration officer has no right to ask in the first place. Breaches of the Data Protection Act 1984 have occurred, and more than 300 councils are being required by the Data Protection Registrar to account for the questions on their forms. I seriously ask the Secretary of State to go away and look at that problem and do something about it. Will the Government stop unnecessary, and in some cases unlawful, activity by poll tax registration officers?
Those problems were highlighted during our debates, but they were dismissed by the then Ministers.
I should like to know whether the Secretary of State intends to make any changes. Responsibility for the final level of poll tax charged will overwhelmingly rest with Ministers and not with councils, whatever their political control. Ministers will decide and control 75 per cent. of council income, and they have already begun to consider how they can gerrymander the situation.
In the controversial propaganda leaflet that was sent to every household earlier this year, the Government said: 861Every council will decide the level of its community charge—just as it decides the rates now.Of course, that statement is totally untrue. The leaflet goes on to mention the needs grant that each council will get. What the leaflet does not say is that the Secretary of State himself will decide how much each council needs to spend. His decisions could make hundreds of pounds of difference to the poll tax to be paid by almost every adult. That is what the system provides for.
The Opposition have a copy of the Government's working documents. For instance, one set of figures in front of the Secretary of State tells him that Birmingham needs to spend £627 million to provide a standard level of finance—to the Government's standards, that is. However, another figure tells the Secretary of State that Birmingham needs to spend £750 million to provide that same standard level. An analysis of the figures shows that the different formulae available for the Secretary of State to choose from could add over £3 a week to the poll tax for everyone in Birmingham. In almost every local authority, the situation and the effect are the same.
In Westminster, for example, the Secretary of State's choices could influence the poll tax by as much as £4.76 a week, in Kensington and Chelsea by £4.41 a week, in Wandsworth by about £3.70 a week, in Portsmouth by £2.20 a week, in Manchester by £3.40 a week, in Newcastle by £2.70 a week, and in Newham by as much as £5.40 a week. That is the Secretary of State's latitude, in addition to his 75 per cent. control, in determining exactly how much poll tax will be paid by people in towns and cities. It is nonsense to claim that that increases accountability and leaves more decision taking for local government. It does exactly the opposite.
The figures make a mockery of the Government's claims that high levels of poll tax are due to inefficiency or high spending. They demolish the argument that the poll tax will increase local accountability. Hundreds of pounds per person per year can be added to councils' bills by the Government and the figures that they decide to put into their computers.
From April 1990, Tory Ministers will control more than 75 per cent. of all local government income, an unprecedented state not only in Britain but in any western democracy. The Government's documents expose their determination to exercise even greater control over local government revenue raising. They show that the biggest influence on poll tax bills will be central Government policies and decisions, not local authority decisions taken in the communities.
For the increasingly large number of Tory Members who are now panicking, there is more bad news on the way. Last February, the Government announced their proposal for phasing in the combined effects of the nationalisation of business rate poundages and the first revaluation since 1973. Increases in business rate bills are planned to be restricted to 20 per cent. per annum plus inflation. Businesses gaining from the changes will have their benefits delayed. It all sounds remarkably like poll tax safety nets, and will have the same political effect when Tory Members and those business people active in local Conservative associations wake up to what is happening. An increase of 20 per cent. per annum plus inflation means rates bills going up by three times in five years.
862 Even five years of safety nets will not lead to the full introduction of the new business rate arrangement. Businesses in Tory areas in the south will find their poundages rising hugely. Government figures included with the poll tax calculations published on 19 July show that Kensington and Chelsea's business rate poundage will rise by 111.4 per cent., Wandsworth's by 60 per cent., Westminster's by 51 per cent., Redbridge's by 46 per cent., Bromley's by 43 per cent. and South Herefordshire's by 23 per cent. The revaluation will push up the figures even further. The combined effect of national business tax and revaluation in, for example, Kensington and Chelsea will have astronomical implications for the business rates that people will be expected to pay.
The Government are trying to cover up that unpalatable arithmetic. The new rateable values for every individual property must be deposited by the Inland Revenue with charging authorities by 31 December—yet the first that businesses will know about them, unless they or their advisers track them down in the town halls, will be when they receive the bills in March 1990. The Government hope that ratepayers will look only at the amount payable, restricted to an increase of 20 per cent. plus inflation, and not the eventual liability shown by the rateable value. Most business people will soon see through that. If Tory Members think that they are in trouble now because of the poll tax, let them wait until the facts of the new business tax come out.
A number of Conservative Members have asked about Labour party policy. For the expenditure of a modest 75p and a letter to Walworth road, they can have a copy of our document. We intend to introduce a modern property tax based on the capital value of a property, with up to 100 per cent. rebates for low-income families or those least able to pay; we will reduce the proportion of local taxes raised through property tax; we will dedicate an element of the income tax to local government; we will restore business rates as a local tax; we will return meaningful purpose to the statutory consultation between local authorities and local businesses; we will end the ever-changing and chaotic restrictions, penalties and cuts; and we will have annual elections for a part of every local authority.
That will provide for a local taxation system that is genuinely fair because it is directly related to the ability to pay. It will end the need for dramatic increases in local tax bills. It will restore the right of local people and their councillors to govern their communities and raise revenue free from central control. It will take account of the differences in resources of authorities in different parts of the country.
§ Dr. Cunningham
The Cirencester besom has been replaced by the modern Tory technological broom, from arid Silk Cut dry to Blue Chip glistening wet. The Secretary of State comes with a record of rebelling against cuts in employment and housing benefit, being in favour of aid to the poorest and of incomes policy, and is described as the heir to the tradition of Macmillan and Macleod.
§ Dr. Cunningham
The Secretary of State was co-author of the pamphlet by the Blue Chip Group, which argued 863 that the Prime Minister's economic policies were socially divisive and politically unworkable. He was vice-president of the Tory Reform Group. He has now been promoted to patron of the Tory Reform Group, the body which published a paper on the poll tax which said:The Government's case for the community charge rests, above all, on achieving proper accountability. Yet this is precisely where it fails.It said that the poll taxshows every sign of being an administrative nightmareand that the uniform business ratewill result in a massive increase in the centralisation of power.Those are the views of the Tory Reform Group, of which we learn that the right hon. Gentleman is no longer a mere vice-president but a patron.
What has changed? Have his views changed, have the views of the Tory Reform Group changed, or have the Prime Minister's policies changed? If he was asked for his view yesterday, did he say with candour—candour which we know that he has in abundance—"Margaret, we have got it about as wrong as possible"? Or was it "as you were" with the policy?
The Secretary of State's problem is that the profoundly detested policies that he has inherited are the Prime Minister's own ideas. The policies have exceeded their shelf life. The ideas have passed their sell-by date and the British people will no longer buy them.
The flat-rate poll tax is a scandal which divides Britain from the rest of Europe and every other western democracy. The poll tax is unique to Britain; no other country in Europe has a tax that is so harsh, unfair and intrusive. The 24th amendment to the constitution of the United States of America rules out any connection between poll tax and citizenship. Churches, charities, voluntary organisations, businesses and many——
§ Dr. Cunningham
Unfortunately, the hon. Gentleman does live here.
—leading Tories have all condemned the poll tax proposals, and the Labour party's protest campaign has informed and focused the overwhelming opposition of the British people.
§ Dr. Cunningham
But whatever the Secretary of State's message today, our message is clear: the poll tax will go when the Prime Minister and her Government go. There can be no future for such an iniquitous, unfair, inefficient and capricious tax. A Labour Government will abolish it.
§ The Secretary of State for the Environment (Mr. Chris Patten)
I beg to move, to leave out from "House" to the end of the Question and add instead thereof:supports the introduction of the community charge, the principles of which are manifestly fairer and simpler than those that now apply to domestic rates; welcomes the exemptions conferred on those who cannot be asked to pay and the generous discounts, rebates and increased income support available for those on low incomes; recognises that the unified business rating system introduces a valuable stability for non-domestic ratepayers; congratulates Her Majesty's Government on implementing proposals that will improve the accountability of local government by insisting 864 that all who benefit from their services should have a say in their quality and cost; and notes that either a local income tax or a two-tax system based upon local income tax and capital value tax would be much more expensive to implement, much more unfair and make local government much less accountable.I shall begin as I am sure the hon. Member for Copeland (Dr. Cunningham) and I will go on. The hon. Gentleman paid me some very genial courtesies, and I return the compliment. As the House knows, the hon. Member for Copeland was a Labour moderate before it became compulsory. He was a moderate before anyone had heard the name of Peter Mandelson. As a result, he has always enjoyed the respect of the House. I realise that, for as long as the hon. Gentleman comes to the Opposition Dispatch Box, I shall always have my work cut out. Between the two of us—wild eyed fanatics that we both are—I am sure that we shall keep our debates within the bounds of sobriety and public decorum.
A combination of typical ministerial humility and concern for all right hon. and hon. Members who wish to participate in the debate persuades me to be brief. [Laughter.] I knew that the hon. Member for Copeland would believe that. It is always tiresome when Front Bench speakers take up too much time in short debates.
The burden of the comments that I have heard from Labour spokesmen, such as those made on television last night by the right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley) and in the speech of the hon. Member for Copeland is—I shall try to be briefer than the hon. Gentleman managed to be—different man, same policy. Having listened to the comments of the hon. Member for Copeland, I have an overwhelming feeling that, had I been privileged to participate in earlier debates, I could say of him now—same man, same speech.
The House can be in little doubt that the hon. Member for Copeland does not care much for the Government's reform of local government finance, but he remains more than a trifle obscure on what he would do instead. There is an unfashionable degree of consensus on one particularly important point. On the Opposition, Conservative and Democrat Benches, there is agreement that the existing system of domestic rates must be replaced. The main reason why that must be done is that the domestic rating system is unfair. Whatever may have been the case in the 19th century, there is little relationship today between the rateable value of domestic property and the value of the services that individuals receive from their local authorities.
Still less is there much of a relationship in many cases between the value of a house or flat and the ability of its occupant to pay for local services. Moreover, the present system obscures the relationship between expenditure on services and payment for them. I shall deal with those points in more detail shortly.
I was not sure from the remarks of the hon. Member for Copeland, and from the Opposition's comments over the past few weeks, about their alternative. Sometimes they seem to have one, sometimes not. Today seemed to start as a have day, then it was a not day, and then a have day again. On have days—and perhaps this is one of them after all—it is suggested that about 80 per cent. of locally raised revenue should come from capital value rates. That would exacerbate the problems of the existing system. We all know well enough that an increase in the value of our house or flat does not mean that we can afford to pay more 865 for local authority services or for anything else. If that is true for most people, what about the retired, the widowed, and all those people living on fixed incomes?
§ Mr. David Winnick (Walsall, North)
Is the Secretary of State aware that the Select Committee on the Environment of the 1979 Session, which had a Conservative majority, totally rejected the poll tax as an alternative to the rating system? The poll tax was rejected also by one of the right hon. Gentleman's predecessors as Secretary of State for the Environment, the right hon. Member of Henley (Mr. Heseltine). May we take it that the Secretary of State is enthusiastic about the poll tax as an alternative to the existing rating system?
§ Mr. Patten
My memory of past Environment Select Committee reports is clearly not as extensive as the hon. Gentleman's. What I do recall is that I, along with my right hon. and hon. Friends, have fought two elections arguing the case for a community charge, and that we won those elections with what can only be described as comfortable majorities.
§ Mr. Brian Wilson (Cunninghame, North)
If the Secretary of State is going to cling to this policy, may I suggest that he learns his history a little better? Is he not aware that a White Paper in 1982 specifically rejected the idea of a poll tax, on the grounds that it was unworkable and unfair? Does he recollect that the Government went into the 1983 general election making no mention of a poll tax, and—again—specifically rejecting the possibility of one?
§ Mr. Wilson
It is no use the Secretary of State shaking his head. The poll tax was invented in panic after revaluations in Scotland in 1984. Does the right hon. Gentleman not accept that it is both paradoxical and an insult to his own intelligence that he should start his speech by congratulating my hon. Friend the Member for Copeland (Dr. Cunningham) on his moderation and then—apparently—give notice that he is going to accept uncritically the most extreme and offensive of the Government's policies?
§ Mr. Patten
That intervention suggests that we should not give way in debates such as this as often as we would like. Let me point out to the hon. Gentleman—I know perhaps even more than he does about these matters—that we began to advocate the abolition of domestic rates in 1974, and included that view in our election manifesto. [Interruption.]
§ Dr. Cunningham
I am grateful to the Secretary of State for giving way. I do not give way to hon. Members who sit and shout abuse during debates.
The Secretary of State does not seem to have a very clear grasp of the chronology of policy development in his own party. Is he not aware that his right hon. Friend the Member for Henley (Mr. Heseltine) has gone on record, as have his supporters, as making it clear that he worked with all his might and main to ensure that no mention was made of the poll tax in the Tory party's 1983 manifesto?
§ Mr. Patten
Whatever our disputes about the history of Conservative manifestos, I think that even the hon. 866 Gentleman will concede that there was a clear mention of the community charge in our last manifesto. If it will suit him, I will settle for one example: the majority that we won in the last election, which we fought on the community charge.
I was pointing out that capital-value rates, as advocated by Opposition Members—coupled with a local income tax—would not be fair or administratively simple; nor would they overcome the lack of accountability to the electorate. That is one of the great drawbacks of the existing system. I know that the Opposition have criticised us for allegedly distorting their policy and its effects, but I am prepared to do a deal, and I hope that the hon. Gentleman will consider it fair. If the Opposition will tell us clearly exactly what their policy is, and the assumptions on which it is based, we shall be willing to work out with them a fair comparison of our proposals and theirs. I do not think that anything could be fairer than that.
§ Dr. Cunningham
The Secretary of State's predecessor made the same offer. The right hon. Member for Cirencester and Tewksbury (Mr. Ridley), however, was not aware that I had already tabled a parliamentary question asking him to do just that. When we are ready, we will ask the Secretary of State to do it, but as he wants to avoid distorting the implications of our policy, why does he not consult the Institute for Fiscal Studies? The Sunday Times—not, incidentally, a known supporter of the Labour party—invited the institute to examine our proposals, and this is what it reported:Smith found that Mr and Mrs Average, a couple with children, and an income of £13,000 a year, could expect to pay a total of £394 a year in poll tax, but only £363 under Labour's plan.In other words, they would do better under Labour.
The Rating and Valuation Association has also carried out studies, which conclude that our proposals are not only fairer but more efficient than the poll tax. Why does the Secretary of State not read those?
§ Mr. Patten
The hon. Gentleman had better have a word with his right hon. Friend the Leader of the Opposition, who only last week told the hon. Gentleman and others that their policy needed sophisticating, as it was not quite right. When the hon. Gentleman has finished his sophisticating, and has put his policy in place, we shall be happy to look at it. I hope that, when we do so, the hon. Gentleman and other Opposition Members will not complain as they did last week when we present the House with the consequences.
§ Mr. Patten
I have already given way as many times as the hon. Member for Copeland, and I wish to get on.
There are three main attacks in the motion and the hon. Gentleman's speech. We are told that the new arrangements are unfair, undemocratic and unworkable. We all know that domestic rates are an unfair tax on property. They are paid for by only half the adult population. They take no account of the number of adults living in a house, and there is a poor fit between the rateable value of a property and the income of its occupants. Four out of 10 people in above-average rated properties have below-average incomes. By contrast, the community charge is fairer, simpler and more honest. It is based on people rather than property, and for the first time 867 it will be paid by almost all adults. The charge will share the cost of paying for local council services more widely and fairly, but people will not all pay the same bill.
§ Rev. Martin Smyth (Belfast, South)
I welcome the Secretary of State to his new position. He has served in Northern Ireland in the past. Can he enlighten us as to why the boon has not been extended to Northern Ireland? Is it because, in the past, we believed that those who paid rates had a responsibility to take part in local authorities?
§ Mr. Patten
I had some responsibility for local government in Northern Ireland a few years ago. As the hon. Gentleman will know, local government in Northern Ireland, for a variety of historical reasons with which the hon. Gentleman will disagree, has different functions and responsibilities from local government in this country. If the hon. Gentleman would like the community charge to be introduced in Northern Ireland, he will be able to pursue that in conversations with the responsible Minister in the Northern Ireland Office.
As I have said, people will not all pay the same bill. The rebate system that we are introducing offers help where it is most needed—among those with low incomes or no income at all. It is more generous than the present system of rate rebates. Taking the arrangements for the community charge and the rebate together, it is worth noting that one in four charge payers will receive a rebate. I am extremely concerned that those who need help should receive it. I am asking my officials, as a matter of urgency, to review the arrangements we are making to maximise the take-up of rebates.
For 5 million people, the continuation of the maximum rebate and the uprating of income support, which has already taken place, will mean that, unless they live under a very high-spending authority, they will not be paying anything extra in community charge. Indeed, they may well be a little in pocket.
§ Mr. James Hill (Southampton, Test)
When my right hon. Friend is listening to the selective figures from the hon. Member for Copeland (Dr. Cunningham) will he give the figures for Southampton, which are extremely favourable to a city of 250,000 people? At the same time, will he try to get out of the Opposition Front Bench spokesmen their policy to take over from the poll tax?
§ Mr. Patten
I am afraid that my knowledge of the position in Southampton is not as encyclopaedic as my hon. Friend's. I will encourage my hon. Friend who will reply to the debate to refer to those figures. Widows, single-parent families and others who are hard hit by rates in particular areas will be more fairly treated.
The next plank of the argument advanced by the hon. Member for Copeland is that there is something undemocratic about the new arrangements. There is certainly something deeply undemocratic about the present system. Only half the local electorate pay for the services enjoyed by us all.
§ Mr. Allan Roberts (Bootle)
Why does the Secretary of State continue with the myth that, because there are only half as many rate bills as poll tax bills, only half as many people contribute? Do not all members of his household, like all other households, contribute to the rates bill? I assure the right hon. Gentleman that in my constituency, 868 if a son is working, he contributes to the rates bill and if a wife has an income, she contributes to the bill—all the family pay the rate bill.
§ Mr. Patten
That is not the criticism that has been put and believed widely by those who have argued against the domestic rating system for many years—certainly at every election that I have ever fought.
We have seen the results of undemocratic weaknesses in many parts of local government, particularly in some inner-city areas governed by the extremist councillors that the Labour party tries to keep under wraps. We have seen sky-high rates for domestic ratepayers; businesses and jobs chased away from where they are needed as a result of rocketing business rates; and waste, inefficiency and extravagance in local authority budgets, contributing to an ever-increasing burden on the few who pay rates.
Under our system, there will be a simple link between the cost of services that an authority chooses to provide and the level of the community charge. People can decide what they think about the quality and cost of those services. The community charge bill will show this crucial relationship in the clearest possible way. Every pound per adult that an authority chooses to spend above the standard level of service will mean £1 extra on the community charge bill. Equally, every £1 per adult saved feeds through to £1 off the bill. That is a major improvement in local accountability and democracy. It gives a clear choice about the cost of local authority policies, which is precisely what the Labour party is so concerned about. The community charge puts I he community in charge.
The other argument that we hear from the Opposition is that the new arrangements are complicated and unworkable. The hon. Member for Copeland referred to a scare story and to invasion of privacy. The legislation was drafted specifically to limit the amount of information for which registration officers can ask. We give specific advice, which we agreed with the local authority associations and the Data Protection Registrar, on the registration form. Some registration officers went beyond that and, quite properly, were pulled up short by the registrar. I hope that they will listen to our advice.
§ Dr. Cunningham
This is one of the few points of debate on which there is some agreement. That statement has been made previously by Ministers, but it seems to have gone unheeded. Why does not the Department take action by writing to community charge registration officers or issuing notes for guidance to stop this practice, which is an unnecessary invasion of people's privacy and, in some cases, is illegal? I assume that there is no party political dispute about that matter at least.
§ Mr. Patten
As the hon. Gentleman knows, we have issued guidance. I am certainly prepared to consider whether there is a case for further guidance, because I agree with the hon. Gentleman that in some cases registration officers have gone beyond what the law should have allowed.
It would be remarkable if a system that abolished rates and introduced a long overdue reform of local government finance could be achieved without some disadvantage to some people. Without undermining the principles on which this reform is based, we shall continue to do all we 869 can to smooth the transition. Much of the recent discussion about the new system has, understandably, concentrated on the safety net.
The changes that are coming next April are substantial. We are moving from a discredited system under which grant is distributed largely on the basis of rateable values to a fairer system. Inevitably, whenever there is change, some people benefit but others are worse off.
One of the main changes is the ending of resource equalisation. That has meant in practice that grant is taken from areas with high rateable values and directed towards areas with low rateable values. This might be a sensible basis for paying grant, but only if one accepts that rateable values are a fair basis for local taxation. As I have explained, that is not the case. With the move to the community charge, we are doing away with that cross-subsidy. It is a cross-subsidy of which few people are aware. It illustrates one of the problems of lack of accountability in the present system.
Councils providing the same level of service will in future be able to set the same community charge. If we had not introduced the new system, those authorities contributing to resource equalisation would have had to continue to pay that back-door cross-subsidy indefinitely. We shall do away with that unfairness.
The issue is how fast we can move to the new system. Some of my hon. Friends want us to move the whole way immediately. They represent those who have been paying the burden of resource equalisation in the past. They want to get rid of it now. I appreciate their concern, but it would not be easy to move to the new system overnight, and what my right hon. Friend proposed last week makes a big start towards phasing out a penalty and phasing in a gain.
Those areas which have traditionally benefited from resource equalisation need a period, however short, to adjust to the new circumstances. Other hon. Members representing those parts of the country have stressed that they need time for people to adjust to the withdrawal of the hidden subsidy. We have, first, made the system explicit. No longer will there be disguised cross-subsidy in the grant system. But we have proposed a temporary safety net which is separately identifiable and which makes clear what is happening.
Secondly, we have nearly halved the amount which contributors will have to pay to the safety net. Over 200 authorities will be better off as a result of the change. They will now pay 40 to 50 per cent. less in the first year than they would have paid under the old safety net proposal. That is significant progress.
I wish to make it absolutely plain that I shall look carefully at the points that were made when my right hon. Friend the Member for Cirencester and Tewkesbury (Mr. Ridley) made his statement on local government finance last week. Naturally, some would like to go faster, with more of the gains coming through immediately. Others would wish to go more slowly, giving greater protection to the losers. I am not sure whether that circle can be squared, but I shall pay the closest attention to what is said in this debate and in future discussions.
I come to these issues relatively new. The hon. Member for Copeland made that point. I recognise that there will be many further exchanges across the Floor of the House before the charge is brought in next spring. I shall of 870 course want to listen to any helpful suggestions on how we might make the transition as easy as possible. It would also be a welcome change to hear from Opposition Members—perhaps we have been making progress today; a bit here and a bit there—precisely what they would do, sophisticated or perhaps not so sophisticated.
For our part, we shall continue to press ahead with the introduction of this reform, whatever the kebabing tactics of the Opposition. We shall press ahead for the reasons set out in our amendment to the motion, and I urge the House, for the reasons there set out, to vote with us at the conclusion of the debate.
§ Mr. Dick Douglas (Dunfermline, West)
I listened to the maiden speech by the new Secretary of State for the Environment, the right hon. Member for Bath (Mr. Patten), with great interest. I congratulate the right hon. Gentleman on his appointment. I have known him for some time in the House. I met him first as a colleague on the Select Committee on Defence, and I recognise his outstanding ability to grasp, and master, issues. I do not think that he needs to excuse himself if he finds this issue difficult to grasp.
I caution him that he does not need to look at the crystal ball—in Scotland we have the book. The poll tax books are coming through the door. Some of the three-monthly payments are due right now. Nice little letters come through the door to remind us that, if we do not pay for the three months, the whole year will become due.
I caution the Secretary of State because I think that he, is a fair man. He comes from overseas development, where he considered the world situation. It was his responsibility to attempt to transfer resources from the richer nations to the poorer nations. An outstanding example of that was his experience in Nepal. We know that because the Select Committee on Defence went there and because of our exchanges with him.
I shall give a graphic illustration of the effect of the poll tax. An old man, aged 90, in my constituency told me that he and his wife, aged 88, have £6,000 in the bank. They pay two poll taxes. He asked, "Dick, my boy, does that mean that I will have to pay the same as the Earl of Elgin?" I told him, "Aye, that's the law." In God's name, is that fair? How can one say honestly that someone who has taken notice of the credos of the Tories, who has been careful and has built up a capital sum, should pay two poll taxes?
An old lady moved about 200 yards down the road to look after her mother, aged 90. The law says that she is now resident there and they will have to pay two poll taxes there and two poll taxes at the standard charge rate for the house that she has vacated. Instead of paying about £800 in rates, they are paying £1,200. How in God's name is that fair?
We have a tax on property. Does the Secretary of State not know that the standard charge is a tax on property? I part company with many of my hon. Friends on many issues, but I think that, in a system of taxation which is multi-based, there is no reason for excusing property. Everything else is taxed, so why in heaven's name is there a case for exempting property? That is what the Tories have tried to do, however, on the basis of accountability.
If one wants to evade accountability for looking after old people properly within the community, what does one 871 do? Put them in a hospital, or a nursing home, where they do not pay any poll tax. Have them in the bosom of the family, however, and they will pay the tax. How in God's name can that be defended in a civilised society which prides itself on trying to look after elderly people?
§ Dr. Norman A. Godman (Greenock and Port Glasgow)
In their constituency surgeries, Scottish Members have come across people who have been crippled by the poll tax. Does my hon. Friend agree that, yesterday, we saw a plain reaction to the Scottish poll tax in the resignation of the right hon. Member for Ayr (Mr. Younger)? Does he also agree that the right hon. Gentleman's resignation shows plainly that he and others in Ayr have given up hope of the Conservatives retaining that seat, because of this and other legislation?
§ Mr. Douglas
I will not digress too much.
The Secretary of State has had experience of Northern Ireland. There is no way the Government would try to introduce the poll tax in Northern Ireland without first putting it in their manifesto, but they did that in Scotland. They put it into practice without it being in the manifesto and the Scottish people have pronounced on it—we have voted on it.
I ask the Secretary of State to give me his attention and not to talk to the hon. Member for Salisbury (Mr. Key), who is trying to get his ear.
In Scotland, we pronounced on the poll tax. Accountability is the argument for the poll tax, but the only part of the United Kingdom that had the poll tax in 1987 was Scotland, and the Scottish people overwhelmingly rejected it.
The Secretary of State should not look at a crystal ball when he can read the book. He should consult his colleague, the Secretary of State for Scotland and, in a moment of reasonable quietude, perhaps achieve some understanding of what is happening there. Many people are paying poll tax, but many others, like me, are not. We will accept the odium.
I notice that people in certain parts of England have achieved a change of Secretary of State by burning an effigy of the right hon. Gentleman's predecessor. I wholly disapprove of that practice. I think that it is more illegal, and more of an incitement to bad behaviour, to burn an effigy of the right hon. Gentleman than to say there is a basic right in a civilised society to object, through civil disobedience, to the imposition of an unfair and unjust tax that has been rejected by our people in a democratic ballot. What can we do if they do not listen?
The Secretary of State's closing remarks showed, although it is early days, that he is looking at ways in which the safety net can be shaded. I think that a large proportion, if not all of the safety net, will be borne by the Exchequer.
We came first in Scotland and the Scottish people inherently and instinctively resent being made the guinea pig for legislation which cannot work in any part of the United Kingdom and is certainly not working in Scotland.
I do not know what the figure will be—whether we will have 500,000 non-payers by August—and I cannot predict it, but I predict that it will be substantial. That underlines the fact that payment has brought about an enormous amount of resentment, which has been added to by behaviour in this House last week such as when the right hon. Member for Brent, North (Sir R. Boyson) who, 872 although he is a supporter of the poll tax, said that he resented the way that the safety net has been arranged. Also, for the first time in the British media we have seen resentment at the poll tax.
Last year, I ran all the way from Edinburgh to London to protest against the poll tax. I shall continue to protest. This is a marathon race that has been taken up by Opposition Members. We do not intend to renege on that. We will go the distance until the poll tax legislation is removed from the statute book, because it is unfair and unjust, and does not do what the Government have suggested it does. It is unfavourable to the poorer sections of the population and to those sections of the population who ought to be cossetted—the sick and the mentally handicapped. Those people ought to be assisted.
I have sufficient faith in the right hon. Gentleman's background—I will not dwell on his religious upbringing—to believe that, when he examines the matter, there will be adjustments, but they should come in Scotland first. The ideal solution is to remove the legislation from the statute book.
§ Sir Rhodes Boyson (Brent, North)
I recognise the time constraints in this important debate, but I should like first to welcome my right hon. Friend the Member for Bath (Mr. Patten) to the Dispatch Box as Secretary of State for the Environment. We served together in the Northern Ireland Office, and I am sure that he will do an excellent job in charge of the Department of the Environment. It is an important portfolio. I welcome also my hon. Friend the Member for Wirral, West (Mr. Hunt) to his new portfolio—because he will reply to the debate, I have tried to win his favour before deploying my arguments.
First, I believe in effective local government. I do not want power to be centralised, because liberty comes from a balance of power. I spent 10 years in local government and I do not want local government to be stripped of its powers. Over the past 20 years, local government has been threatened because often the majority party in local government differed from the party in government, so they do not have much time for each other. The danger is that the party in control may ride roughshod over the other party.
Secondly, I believe in the community charge. There is a straight difference of opinion between the two sides of the Chamber on this matter, but I believe that people should pay at least something towards what they vote for. That is what responsible government is about. We can argue about the amount that people should pay and about the amount of rebates.
It has been said that people pay as part of a family, but in some parts of the country only one in four of the people on the register pay rates, compared with one in three and one in two in other areas. That is wrong. There is an incentive to increase expenditure when some people can vote to spend other people's money. As a northern nonconformist, I believe that there is no political morality in that. I welcome the community charge as a means of bringing political responsibility into local government voting.
We have frequently heard about the peasants' revolt. Their revolt was basically against the oppressions of the feudal controls on the labour market. I would argue that that was a Thatcherite revolution. If I had met Wat Tyler 873 on his way to London bridge, I think that I could have made him a member of the Brent, North Conservative association. His supporters wanted a free labour market. If they were marching on us today, I believe that there would be more of their supporters sitting on the Conservative Benches than on the Opposition Benches.
Thirdly, the present method of funding the safety net is immoral and is political suicide for the Conservative party. The idea of transferring money over four years from the heavy community charges levied on careful Conservative areas to spendthrift Labour authorities is unsaleable in Conservative areas. That will take place over a full four-year cycle of local government elections in England and Wales, over a general election and within one month of the next European election. All that time, electors in prudent areas will see that they are transferring through their community charge £25, £50 or £75 per person per year to areas that have more amenities because they have spent more money.
About a fortnight ago, a list that I compiled was printed in, I think, The Times. I referred to 25 Conservative seats in which all the constituents were to transfer considerable sums through the community charge over four years to largely Labour areas, yet the majority vote in favour of the main party was less than 5,500 in each constituency. This matter will be raised repeatedly in those constituencies.
§ Sir Rhodes Boyson
There is no shame in it. Those authorities made a decision to be prudent—the shame lies with those who have wasted the money. The shame is that people in prudent areas have to pay for someone else's waste of money. I am grateful to the hon. Gentleman for allowing me to bring in a moral point. This is a dangerous and indefensible action.
Fourthly, I believe that a safety net so funded will break the morale of many good Conservative authorities. The hon. Member for Copeland (Dr. Cunningham) referred to Wandsworth. It was Thatcherite before Thatcherism, John the Baptist before anyone else came along. My hon. Friend the Member for Southampton, lichen (Mr. Chope), who I believe is still in the Department of the Environment—it is difficult to keep up with everything that is happening—made his name in Wandsworth by being a Thatcherite and bringing down expenditure.
The average rates bill per household in Tower Hamlets is £500, compared with £360 in Wandsworth. Tower Hamlets is usually Labour—controlled but at present is under the control of the Liberals-most hon. Members on both sides of the house, except perhaps the hon. Member for Truro (Mr. Taylor), hope that that is only temporary. After the calculations on the community charge and safety net have been made and the money has been passed back and forth, an individual in Tower Hamlets will pay £153 and an individual in Wandsworth £148. That is the result after all the efforts over the past 15 years in Wandsworth to build up a Conservative careful authority, which documents such as "Good Council Guide: Wandsworth 1978–87" have made famous. It is a green-coloured document, which shows that the council was going green at that time and knew what would happen to the Department of the Environment.
§ Sir Rhodes Boyson
I shall give way when I have finished this point. We must go through paragraph by paragraph—it is much tighter and neater that way. It is like writing essays—we must do it properly.
After all that time, people in Wandsworth will be only £5 better off than people in Tower Hamlets. That is why I believe that this proposal will destroy the morale of many Conservative authorities.
I shall now give way to the hon. Member for Truro, as long as he makes just an intervention, not a speech.
§ Mr. Taylor
I hope that the right hon. Gentleman accepts that there are differences between Tower Hamlets and Wandsworth in terms of, for example, housing pressure. Tower Hamlets has large immigrant communities moving in, unlike Wandsworth. I think that all hon. Members accept that point. I hope that the right hon. Gentleman welcomes the fact that Tower Hamlets, under the Liberal Democrats, has cut rates.
§ Sir Rhodes Boyson
For the hon. Gentleman's benefit, I shall repeat my point. Wandsworth will compare the old rates and the new community charge and ask what it has done over those 15 years. I stand by what I say, whether or not the hon. Gentleman agrees with me.
Fifthly, the safety net is a strange formula. I spent nine months as Minister for Local Government. I always wondered where the calculations came from, where we changed them and what the computers did. Sometimes I felt that there were satanic demons, or gremlins, in the basement and, after we had all gone home, they moved the computers around. I believe that they have now moved up the stairs and are coming out.
I am sorry that the hon. Members for Brent, East (Mr. Livingstone) and for Brent, South (Mr. Boateng) are not in the Chamber. Using the straightforward community charge, people in Brent will have to pay the second highest amount in the country—£561 per person, according to the projected figures. The safety net was supposed to give councils a chance to get it right, but Brent will have to transfer £36 per person per year to other overspending authorities. Anyone who can defend that should be a member of the Magic Circle and performing at the London Palladium.
§ Mr. John Marshall
Does my right hon. Friend accept that many people in the Department of the Environment and elsewhere believe that Brent Council, as presently constituted, is beyond redemption?
§ Sir Rhodes Boyson
I must not get into a religious argument with my hon. Friend, for whom I have great respect, but I believe in the saving of souls and the redemption of all men. It seems that I may have cross-party support on that.
My sixth point is that, if there is to be a safety net, the money must come from the Treasury. It must not come from the good authorities, because that makes a farce of the community charge and destroys the whole basis of the new arrangements. If my right hon. Friend the Secretary of State wants to retain the safety net—and that is his right as Secretary of State—the Treasury must pay the lot. We do not want all kinds of formulas that we cannot understand; we have had too many of those from the Department of the Environment already.
875 We are told that £630 million will be needed next year to cover the safety net. If my right hon. Friend the Secretary of State comes back in October and says, "My right hon. Friend the Member for Brent, North can sit at ease; he does not need to intervene because I have got hold of the £630 million," I shall decide that his is the best of the recent appointments. He will command my support on almost every other issue—that is a dangerous thing to say—for as long as he and I are still battling in the Chamber.
Consider what a headmaster would do. If 10 boys broke 10 windows in my school, I would charge the 10 boys, as would all old schoolmasters; even Scottish dominies would charge the boys, and it would be for the boys to decide how to raise the money. The last thing I would do would be to say to those 10 boys, "Go away. You have done nothing wrong," and then call the rest of the school together and say, "You are paying for the 10 windows." There would be a riot in the school, and there is no doubt in my mind that when Conservative voters find that they are paying for windows, as it were, that others have broken, there will be a riot in the constituencies.
I shall vote against the Opposition motion this evening, for the simple reason that there is a new Secretary of State in whom I have great faith. Earlier, we were talking in religious terms. I am not suggesting that my right hon. Friend should move mountains; I just want him to remove the safety net. That will do for me at the moment. My right hon. Friend can move mountaains later as part of the Department's activities on the green side, but on the local government side, all I want is for the safety net to be removed.
If, by the time we next debate the safety net in the House, it has not been announced that it will be financed from Treasury money, I shall certainly vote against it. I am not putting the Secretary of State on probation. I have total faith in him and I know that he will solve the problem—[Interruption.] I must not argue with the hon. Member for Dunfermline, West (Mr. Douglas). I am sorry that no Treasury Minister is here to listen to what I, at least, believe to be words of wisdom. On the day when we discover that the safety net is to be funded by the Treasury, a cheer will go up throughout the country. I look forward to that day arriving before we reassemble after the recess.
§ 5.2 pm
§ Mr. Matthew Taylor (Truro)
I join in welcoming the Secretary of State to his new role. There has certainly been a change of image. The only thing that I would say to him—I am sure that others have given him this advice—is that the quality of the salesman will not make up for duff goods. The fact that we have already heard criticisms from Conservative Back-Bench Members, mollified only by his newness and not by his remarks, is a sign of the difficulties that he may experience in his new role. I wish him luck, however, and I hope that we see some changes in practice as well as in presentation.
The poll tax is the most unpopular measure to have come from this Government so far. I say "so far" because it has had to jostle for its place with other measures. Later this evening I shall refer in an Adjournment debate to the reform of the National Health Service, and I think that the Bill containing the proposals for that reform may topple the community charge as the most unpopular measure when it is introduced in the autumn.
876 I am afraid that we are past the point at which we can expect Ministers—under this Prime Minister at least—to say, "We got it wrong. We shall change the provisions fundamentally." Ministers have committed themselves to the proposal. I suspect that, when the Prime Minister interviewed replacements for the previous Secretary of State, she checked that they were not likely to rock the boat. I can imagine her asking the current Secretary of State some questions: "You are patron of this organisation the Tory Reform Group. You don't really mean it, do you? You are there as a figurehead, are you not? I am sure that you do not stand by what that body says and that you would not want to have to take responsibility for it. You would not agree with its members any longer, would you?" I can imagine the right hon. Gentleman thinking about it, but not very hard, and deciding that perhaps he could sell the required message. With a change of Prime Minister or a change of Government, perhaps the right hon. Gentleman will get the chance to do otherwise.
This debate allows us a moment of reflection, and it is to be hoped that it will allow the new Secretary of State to consider changes that he may be able to introduce even under a Prime Minister who has an iron will and dislikes deviation from the set course. I was pleased to hear at least one Conservative Member speak up from the Back Benches. I was particularly pleased that the right hon. Member for Brent, North (Sir R. Boyson) pressed for change by calling for Treasury cash. The great error that the former Secretary of State made when he addressed I he House last week was to try to reconcile the irreconcilable by telling those whom he had previously said needed help and support that they would get a little less, to help those whom he had said were getting more than they deserved. That was not an easy concept to sell, and he failed to sell it. If a safety net is needed, it should be funded by the Treasury, not by calling on other local authorities to step in merely to suit the Treasury's other financial aims.
The debate has been called so that we can consider the effects of the poll tax on ordinary people. One thing seems certain: As with so many measures that have been introduced under this Government, the effect of the poll tax will be to hit the poor and advantage the rich—in. particular, to hit the old and the young——
§ Mr. Taylor
I shall give way in a moment, when I have had the chance to develop my argument.
The community charge will affect most those just above the level at which one can claim supplementary benefit, who may have to pay the full poll tax. Equally, because the income support increase to help people pay the poll tax is based on the national average charge, people who live in areas of high poll tax—which tend to be the most deprived areas—will lose most. The living standards of those on low incomes will inevitably be adversely affected by the poll tax.
The analysis by the Child Poverty Action Group gives us evidence to support that. It considered the effect of the poll tax on the living standards of poor and middle-income families. I am sure that the new Secretary of State has recently been briefed on this. He will know that, overall, 63 per cent. of tax units will lose by the poll tax and 37 per cent. will gain.
§ Mr. Taylor
We are talking not about individuals but about families paying tax—or tax units—63 per cent. of which will lose and 37 per cent. of which will gain.
The key figure to which the Child Poverty Action Group draws attention is this. Of the bottom range of taxpayers, 83 per cent. will lose and only 16 per cent. will gain, and the average loss involved will be more than £1 a week. In contrast to that, of the top range taxpayers—the very rich—71 per cent. will gain and 29 per cent. will lose. That is an almost complete reversal of the figures for the population as a whole. That is why I say that the poor will incur the losses and the rich will gain the advantage.
§ Mr. John Marshall
The hon. Gentleman said that the old would suffer under the community charge. Does he agree that 90 per cent. of single pensioners will be better off under the community charge?
§ Mr. Taylor
I do not agree with that figure. Some single pensioners will gain, but not 90 per cent. of them. They might also gain under other systems. That is an argument against the rates, but not for the poll tax.
Combined with the changes in social security benefits, the poll tax will be a particularly bad deal for the worse-off in society. That is hardly a more equitable system than the rates. The two changes mean that families, with children who have a net income of less than £75 a week—which is a third of all families with children—will lose between £4.88 and £5.01 a week. I know that the Prime Minister does not believe in society, but I thought that she and her Ministers made a virtue of supporting family life. These changes will make life harder for families, and there is no justice in that.
This weekend I was approached by a pensioner in my constituency who lives in a residential care home and will be exempt from the poll tax. Did she congratulate the Government on exempting her? No. She said that she did not understand why those being cared for by their families at home should be penalised for the privilege, while she was exempt. She wondered whether the Government really intended to force people into residential care homes. She did not criticise the Government's treatment of her—she understood why people might wish to be cared for in residential homes—but she could not understand why the Government wanted to create a financial incentive to take people out of the family home and put them into care, no matter how good the care was.
The Secretary of State referred to the difficulties of taking up means-tested benefits and said that he would seek ways to alleviate them. I wonder whether much can be done within the present system of rebates. In Scotland, the take-up of rebates by people on low incomes is extremely low. In some areas, it is as low as 25 per cent. The Secretary of State was right to highlight the difficulties. I am not convinced that, under the poll tax and the cumbersome system of rebates and help that goes with it to make it workable, the Secretary of State will be able to achieve his objectives. It is good to hear a Government spokesman speak in favour of helping people to claim the money, but the Government do not have much chance of succeeding in that. Time will tell, but I believe that our fears will be proved correct.
The implications of the poll tax for civil liberties cause great anxiety. It brings with it wide and intrusive powers 878 to establish and maintain the register and to enforce payment. Only today, I heard about an example in Rochdale which illustrates the problems of enforcing the poll tax. It is not an extreme example, but it illustrates the effect on people's daily lives, which is unnecessary and would not have arisen if the Government had not insisted on introducing the system.
Since last Friday, 33 canvassers have been calling at homes in Rochdale at 8.30 pm or at weekends to chase people about their poll tax registration. It is bad enough to approach people at a time of day when they cannot telephone anyone to advise them on their rights, but to call on the elderly and infirm at 8.30 pm is to frighten them. That is not simply because they are frightened of officials, but in some cases any unannounced caller at 8.30 pm causes fear and anxiety. Such calls would not be necessary but for the cumbersome nature of the system of taxation that the Government have chosen to introduce.
The effects of the uniform business rate are mentioned in the Labour party motion. Non-domestic rates currently raise more than domestic rates. The new rate will be set nationally, yet Ministers talk about the need for more local control and accountability and a greater link between people and their local authority and between businesses and their local authority. Ministers should be aware that the uniform business rate breaks the link. Deprived of locally raised non-domestic rate revenue, local authorities will depend on central Government for about 75 to 80 per cent. of their funding. So much for the supposed increased accountability of the poll tax.
The uniform business rate will penalise local businesses in areas where local authorities have done most to help them by keeping rates down and spending money sensibly. Businesses in my constituency are being asked to pay increases in their rates, in some cases massive increases, to fund local authorities elsewhere which in the past set high rates and provided more services. They are being asked to pay a considerable increase without seeing an improvement in local services in an area already acknowledged to be deprived and where incomes are almost 20 per cent. lower than the national average. We have more small local businesses than almost any other area. They thought that the Government were on the side of businesses, but they are penalising them.
As shop owners discover the effects on their business of this change, combined with the effects of revaluation and a wholly inadequate system of safety nets, they will go bust and change their vote. They will wish that they had not left it so late to change their allegiances.
In Truro, small shop owners paying rates of £767 will be shocked to see them rise to £1,750 over five years. That is an increase of 128 per cent., allowing for an inflation rate of 7 per cent. The bill of another retail outlet that we looked at would rise from £810 to £2,100. That is because the Government will not acknowledge their responsibility to support businesses. They are simply breaking local contracts.
The poll tax has been completely discredited. My party has never defended the rating system. For years, we have advocted a system of local income tax. Unlike the Labour party, we argued that case throughout the debates on the Local Government Finance Bill. We gave Ministers details of the alternative system that we would introduce. Ministers did not give figures on or make comparisons with our system, but snatched figures out of the air for their version of a local income tax system to mock it. They 879 say that they are prepared to consider the Labour party's proposals and produce figures on them, but they dare not do so for a truly accountable and effective system of local income tax.
That is surprising, because every other European country has a system of local income tax, and it is used around the world. No other country uses the poll tax. Local income tax makes more sense. I do not know whether the Minister noticed that I was disturbed by what the hon. Member for Copeland (Dr. Cunningham) said. It appears that the Labour party is moving away from any attempt to introduce in part a local income tax. The hon. Gentleman said that he sought to allocate a proportion of national income tax to local authorities, which is different. We have read in the newspapers that even the leadership of the Labour party believes that the system that it has come up with is too complicated.
§ Mr. David Blunkett (Sheffield, Brightside)
I should hate another hare to start running, so I shall put the record straight. There has been no change this afternoon. We are in favour of a system based on the capital values of property, adjusted to take account of the income of those in the household.
§ Mr. Taylor
I may be wrong, but I think we are getting further developments as things go along. It is interesting to listen to what is happening. It would be easiest if the hon. Member for Sheffield. Brightside (Mr. Blunkett) would accept the advice of those in his party who I know believe that a straightforward and simple system of local income tax would be the most workable alternative for the party to defend. I regret that the Labour party was unable to put forward any proposals during our debates on the Local Goverment and Finance Bill. It might have done more to put the Government on the spot at a time when we were all agreed that the existing rating system was an inadequate alternative to the poll tax.
In Cornwall, as in many other areas, domestic ratepayers and business men will be horrified to find that they are being asked to work under and pay for a system which means that the least efficient and the highest-spending authorities are subsidised by those which are most efficient and have the fewest local services. I do not believe that that will be any more popular in my local authorities than many Conservative Back-Bench Members believe that it will be in theirs.
Perhaps I should thank the Secretary of State's predecessor for handing me votes on a plate, but I honestly believe that the impact on those who will have to pay the poll tax—it will hit the poorest hardest—is insupportable. I regret the fact that those people will be penalised in that way. Although he was handed a job that he wanted to take and that will allow him to develop many of his ideas on the environment and other areas, which we look forward to hearing, I believe that the Secretary of State will regret the fact that he has to defend the indefensible and put forward a policy that hits those who are most defenceless.
§ Mr. John Heddle (Mid-Staffordshire)
I join other right hon. and hon. Members in sincerely congratulating my right hon. Friend the Member for Bath (Mr. Patten) on his appointment as Secretary of State, and my hon. Friend the Member for Wirral, West (Mr. Hunt) on his appointment as Minister of State. I would like to place on record my 880 personal gratitude to my right hon. Friend the Member for Cirencester and Tewksbury (Mr. Ridley) for the consistently courteous and thoughtful way in which he received many of us who are especially interested in matters affecting the Department of Environment and local government. His attitude and his approach to his parliamentary colleagues bore no relationship to the sort of comments that we have heard from Opposition Members and those that have appeared in some of the less informed sections of the media.
I join my right hon. Friend the Member for Brent, North (Sir R. Boyson) in wanting a closer, healthier link between central Government and local government, and between local government and the householder and the consumer of local government services. I ask my right hon. Friend, as a former Minister in the Department of Education and Science, when he further considers the matters generally, to give further thought to the possibility of the transfer of teachers' salaries to the centre, which would inevitably mean a lower community charge bill for all households.
The whole question of the reform of the domestic rating system has moved since 1974 further and further up the political agenda. All major and serious political parties at the last election committed themselves to a reform of the domestic rating system. However, the Conservative party was the only one to come forward with any credible alternative, having given serious and comprehensive thought to all other alternatives. It was for that reason that I supported, in principle, this legislation through all its stages.
However, the official Opposition simply said, "We will abolish the Rates Act and we will do away with the community charge in Scotland." There was no mention in their manifesto of any alternative, but now it has crept out bit by bit—the twin tax of capital valuation and local income tax. I was delighted to hear from the hon. Member for Sheffield, Brightside (Mr. Blunkett) that the official Opposition are still committed to those two unfair strands of taxation. They are committed to them because they represent a wealth tax and have no relationship with the value of a person's property, whether they own it or not, or to the cost of the services provided.
I will give way to the hon. Member for Brightside if he can confirm to me and to all my Mid-Staffordshire constituents, who do not own their own homes, but who are tenants of local authorities, that what they would pay, if a Labour Government were subsequently returned, would be a capital tax based on the value of the property which they occupy, even though they do not own it. [Interruption.] I will willingly give way to the hon. Gentleman. I am grateful for the confirmation that 40 per cent. of local authority tenants in Lichfield and Cannock Chase district councils and Stafford borough council will pay a valuation tax based on the capital value of a property in which they have no personal direct stake.
§ Mr. Blunkett
In view of the way in which the hon. Gentleman is managing to create himself a scenario, which is completely out of tune with what we are suggesting, I shall put him straight. We are not suggesting that people will be in that position. I made it clear that our tax would be a fair tax and it would therefore take account of the ability to pay of those in the household. That is different 881 from what the hon. Gentleman has said. It would be over and above the question of rebates, as all progressive taxes should be.
§ Mr. Heddle
As the hon. Gentleman has responded to my invitation, I shall push him a little further. I ask him yet again to confirm that the capital taxation that his party proposes to introduce will be based on the value of a person's property, even though he does not own it. In other words, a council tenant occupying a property in Mid-Staffordshire, possibly worth £100,000, will pay tax to the local authority, especially if his income is in excess of the threshold which the hon. Gentleman implied would be introduced. Is that true or false?
§ Mr. Heddle
I am just about to come to that. The hon. Gentleman has confirmed the worst fears of a significant proportion of the population who do not own their properties. We shall pursue that point relentlessly between now and 1992, until the truth is told.
§ Mr. Heddle
I am sure that the hon. Gentleman will have an opportunity to make his speech. I know that a number of Opposition Members wish to make their contributions. If the hon. Gentleman will allow me, I would like to pursue the policies of the Liberal party. At the last election, in its manifesto, the Liberal party, under the paragraph beginningLocal government needs a fair system of local finance which the rates no longer provide",said:We are committed to the planned introduction of a local income tax as the main source"—not the only source—of local government revenue in place of domestic rates. We believe that business rates should be related to ability to pay and we will consult with industry and commerce as to how this can be achieved.The second part of that commitment means that the Liberal party does not have any policy at all on how non-domestic ratepayers should be treated.
§ Mr. Heddle
No, but I shall willingly give way to the hon. Member for Truro (Mr. Taylor) if he will now tell the House and the nation how much he would put on the standard rate of income tax to take account of local income tax to fund the main contribution of local government expenditure, and then what other additional tax he would impose to take account of the balance.
§ Mr. Matthew Taylor
The hon. Gentleman is more than welcome to have a copy of our pamphlet on this subject. If he drops me a note, I will send him a copy. The answer is that, as the tax will be set locally, it will, of course, vary, but it will vary between 5 and 8 per cent., roughly speaking.
§ Mr. Heddle
I am baffled by the hon. Gentleman's answer—between 5 and 8 per cent. of what? If it was between 5p and 8p in the pound on the standard rate of income tax, I would believe that the hon. Gentleman was 882 somewhere near the truth because those were the figures produced by the Layfield committee when it reported in 1977.
That brings me back to the position today. Why was the Conservative party committed to reforming the rating system in the first place? The answer is not only because the domestic rating system is wholly out of date and wholly unfit for the second half of the 20th century and bears no relationship to the cost of the services provided, but because successive Governments—both the Conservative Government in the early 1970s and subsequently the Labour Government and then the Government under the control of the Liberal party in partnership with the Labour party—funked the issue of rating reform. It is because there is now no possibility of revaluing domestic property on any sensible scale that an alternative system had to be introduced.
§ Mr. Turner
On behalf of the people of Mid-Stafford-shire, will the hon. Gentleman address the issue that we are debating—the here-and-now position of thousands and thousands of people in his constituency and in mine who will have to pay a heavy price for this change of policy? Will the hon. Gentleman tell the people of Mid-Stafford-shire that they will pay precisely the amount that was quoted in the paper produced last week by his right hon. Friend the previous Secretary of State? Is that a correct figure? No, it is a false figure. Will he tell the people of Mid-Staffordshire that they will have to pay more than the Government are saying they will have to pay?
§ Mr. Heddle
I am grateful to the hon. Gentleman for inviting me to conclude my remarks. We have established that the official policy of the Labour party is that a significant amount of the money that it would raise if it were in government would be found from the tenants of properties and would be based on a capital value in which they have no interest and over which they have no control. We have established that the Liberal party would increase the standard rate of income tax by between 5 and 8 per cent., or thereabouts. In the absence of any more comprehensive information, I believe that figure to be absolutely correct——
§ Mr. Heddle
No, I have given way once to the hon. Gentleman already.
I turn now to the safety net and to the position of my constituents in Mid-Staffordshire and to those of the hon. Member for Coventry, South-East—[Interruption.]
§ Mr. Heddle
I beg the hon. Gentleman's pardon. I meant the hon. Member for Wolverhampton, South-East (Mr. Turner).
§ Mr. Heddle
It is inevitable—[HON. MEMBERS: "Give way."] It is inevitable that anomalies will arise when transferring from an unfair and outdated system. They have arisen in the non-domestic sector and that is why my right hon. Friend the Member for Cirencester and 883 Tewksbury introduced transitional relief phased over a five-year period. I do not believe that period to be long enough, because it will coincide with the next revaluation in 1995 and, having regard to the fact that most commercial and industrial leases today have rent reviews every five or seven years, it will add to the temporary rates burden on the non-domestic sector. I should like to pursue that matter further with my right hon. Friend the Secretary of State in correspondence.
The transitional relief that my right hon. Friend's predecessor introduced for the non-domestic sector should form the basis for a transitional relief, by way of a safety net, in the domestic sector. I join my right hon. Friend the Member for Brent, North in wishing to see the safety net expanded and funded from central taxation, but targeted most specifically on those in particular need.
My constituents in Mid-Staffordshire are sick to death having to fund the expenditure of spendthrift and profligate local authorities, such as the adjoining local authority of the city of Stoke-on-Trent, when they themselves are well provided for by the prudent and Conservative-controlled Lichfield district council and Stafford borough council.
§ Mr. Dave Nellist (Coventry, South-East)
The bonhomie of Cabinet reshuffles tends to pass me by. I fail to see how a rubber stamp can be reshuffled. The only achievement of the new Secretary of State for the Environment in opening the debate was his acknowledgement that he has been handed a poisoned chalice—one that saw off his predecessor yesterday and one that I confidently predict will see off both him and the Prime Minister before the next general election.
Last week, we had a near-riot when Tory Members finally discovered what the poll tax is about in terms of the safety net. They were rewarded for their political cowardice in voting for it last summer when they suddenly realised that between 25 and 30 marginal Tory seats could be affected at the next general election. Again, I confidently predict that that number will be one third, if not less, of the number of seats that will be lost to the Tory party in Scotland, in England and in Wales by the full enactment of the poll tax legislation—if it goes ahead.
Just under two years ago, the Tory Reform Group described the poll tax asfair only in the sense that the Black Death was fair; it is indiscriminate. striking at young and old, rich and poor, employed and unemployed alike".That description was wrong in one basic respect. At least the rich could catch the plague—the rich will not catch the poll tax. That is why, last summer, when an amendment to the legislation was being considered by the other place, 100 Lords were literally dug up to vote it down. Individuals such as Lord Vestey, the owner of Dewhurst butchers, currently pays £6,000 in rates on a country estate, but will pay only £200 in poll tax, while I and other hon. Members, especially Labour Members, have constituents on £50 or £60 per week who will have to spend between 10 and 15 per cent. of their income on the new poll tax.
The poll tax is a wealth transfusion from the poor to the rich. It was introduced in Scotland this April, and one year later—next April—we will get it in England and Wales. Why the difference? Perhaps there are still some military strategists in the higher echelons of the Tory party who remember the basic lesson of not taking on all one's 884 enemies in one go. The Government decided to divide and rule and to have a testing ground to see how the poll tax goes, because that leaves the possibility of withdrawing it later, if necessary.
What happened in Scotland? On the introduction of the poll tax, The Scotsman described the chaos of the poll tax as likewaking up to a nightmare.Earlier this month, having contacted all the officials of the regional councils, the Scotland on Sunday newspaper estimated that the level of non-payment of the poll tax was 800,000 people out of the 3.9 million people on whom it is levied. However, I believe that that figure of 800,000 is on the low side, for two reasons. First, the numbers who have paid the poll tax have been artificially inflated by counting somebody who has paid the whole year's poll tax as 12 people. Secondly, the figure of 800,000 does not include those people who have paid the first instalment of the poll tax but have now decided not to make the second or subsequent payments. Those 800,000 people in Scotland have crossed the Rubicon; they have decided on the illegal non-payment of the poll tax.
If one transposes those figures to England and Wales, and assumes that the conditions here next April will be exactly the same, one must assume that more than 7 million people will be unable or unwilling to pay the poll tax. That is a staggering figure. At that level, the poll tax will be unworkable.
Why are so many people refusing to pay the poll tax? Bodies such as the Scottish Federation of Anti-Poll Tax Unions have played a major part in the campaign. There are now 550 anti poll tax unions in England, Scotland and Wales, most grouped into city or regional federations. I address two or three meetings every week about the poll tax, and the attendance is double the attendance I would expect at a meeting on any other subject.
§ Mr. Nellist
The hon. Gentleman makes cracks. but I can tell him that the meetings I address are usually attended by between 100 and 500 people.
The poll tax is one of the most serious attacks on the living standards of working-class people and the provision of jobs and services by local authorities in the 10 years under this Government. In the past four months alone, there have been three demonstrations, two in Glasgow and one in Edinburgh, attended by more than 20,000 people. Those in the Press Gallery should ask their editors why the London-based newspapers have never reported those demonstrations. I checked in the Library on the Monday following those demonstrations and there was not a single report. Are they afraid of contagion, of mass non-payment spreading south of the border? That is the only conclusion I can draw from that.
For 15 years, the Prime Minister has been making vague promises and pledges about the abolition of the rates under her Government. In 15 years in politics, most of the complaints I have received about the rates have been not about the method of collection but, in the past eight or nine years, about the amount people have had to pay. The main reason why rates have more than doubled in the past 10 years has been the £31,000 million in rate support grant withheld from local authorities because of cuts in Government funding.
If people are casting around for simple solutions to the opposition to the rebates, one solution could be to restore 885 Government funding to 1979 levels. That would mean that Coventry would get back some if not all of the £110 million stolen from us in the past eight years. Domestic rates could be halved merely by restoring the level of Government funding to that pertaining at the beginning of the decade.
Another way in which domestic rates could be halved involves a precedent which the Government have developed and exposed most recently yesterday. According to the Secretary of State last week, if the poll tax were in operation this year, it would be £315 per head in Coventry—the highest figure in the west midlands. The lowest figure in the west midlands would be in Hereford, at £167.
Conservative Members such as the hon. Member for Mid-Staffordshire (Mr. Heddle) would say that the council in Coventry is profligate or spendthrift, but let me tell him and others who believe such idiotic notions that Coventry has not had the money to build a single council house since 1981. It is closing down old people's homes and children's nurseries because of the cuts in Government funding. It is heading towards a crisis in education because of lack of school provision.
One of the reasons for charging £315 per head is that Coventry was bombed out during the second world war, with the destruction of virtually the entire city centre and much of the housing stock, so it has had to build a large number of council houses. Where do local authorities get such funds? They borrow from banks and finance houses. Over the past 40 years, Coventry's debt has risen to £300 million to build houses, schools, roads and community centres and the city council has to pay interest charges on that money. Every year, Coventry pays £30 million in debt service charges, not repayments. If Coventry were not paying that level of interest, it could halve domestic rates again.
However, is cancellation of debts impossible? Not for Rover, when £640 million-worth of debt was cancelled to give the company away to British Aerospace; or Rolls-Royce when £670 million was cancelled for privatisation; or the water authorities, when £5,000 million of debts have been cancelled. Yesterday, in the electricity privatisation statement, £4.4 billion of debt was effectively cancelled by the removal of the Magnox nuclear power stations from that privatisation. If financial restructuring can take place on that scale, I am sure that it will not be beyond a future Labour Administration to tackle the millstones around the necks of local authorities which have had to borrow money to build the infrastructure of cities. If we cancelled local authorities debt and restored the level of Government support, domestic rates would be one quarter what they are today and no one would object about the level of their rates.
The official Government figure for Coventry's poll tax is £315 per head. The city treasurer estimates that it will be £350, and it could be £60 higher, depending on Government grants to Coventry. Last week, we heard that total Government spending on local authorities would rise by about 3.8 per cent. over this year's spending, but inflation is 8.5 per cent. so there will be a 5 per cent. gap in total Government funding to local authorities. If the poll tax is up and running by next April, local authorities 886 will control only one quarter of their spending and three quarters will be controlled by Whitehall setting the business rate and the level of Government grant.
How will Coventry bridge a 5 per cent. shortfall in Government funding? The only way is through a 20 to 25 per cent. increase in poll tax, which would increase it to £394. But even the £315 figure assumes that everyone will pay the poll tax. But if, as in Scotland, 20 per cent. are unable to pay, and as the poll tax has to raise the total sum for the council from the people who actually pay it, the tax will have to increase by 25 per cent. so that Coventry council can raise the money it needs.
The head of the local government division of the Chartered Institute of Public Finance Accountancy, Rita Hale, wrote in a recent article:building in 5 per cent. inflation and … unwinding safety nets, there were increases in local bills"—that is the poll tax—from one year to the next of 30–40 per cent. When you've got that happening by the mid-1990s, you start to question whether it can be sustained as a believable system.With the reduction of the safety net, and current inflation, particularly if the Government do not match the needs of local authorities with decent grants, the level of poll tax will double or treble in the next four, five or six years.
I shall not speak for long, as some of my hon. Friends have waited several weeks to get into a debate on the poll tax, as I have. I shall briefly examine who will be worst hit by the poll tax. Eighty per cent. of the young people who are in work earn less than the Council of Europe decency threshold of £150 a week, but they will have to pay exactly the same poll tax as anyone earning more.
About 10 minutes ago, the hon. Member for Birmingham, Northfield (Mr. King) mentioned rebates. Let us examine the rebates for young people. The official Government figure for Coventry's poll tax is £315. Any young person under 25—including any rights to Government funding through family credit or benefit—who takes home more than £61.35 a week will have to pay the full £30 to £40 a month in poll tax. In Birmingham, the estimated figure is £307. Single people under the age of 25 who take home more than £60.55 a week do not have a rebate.
The vast majority of young people escape unemployment by taking cheap labour jobs in hotels, cafes, bars, shops, restaurants, clothing establishments and other places and will lose the minimum protection of wages council rates if the next Employment Bill abolishes those wages councils. How does the hon. Member for Northfield expect those youngsters who are on a maximum of £80 or £90 a week to pay? If they take home more than £60.55 a week, there is no rebate. He should not tell the House of Commons about the rebate system, as it is non-existent.
Last year, 64,000 student nurses were told that they would receive an 80 per cent. rebate. Then, in the guise of a written answer, it was withdrawn. Unless Project 2000 is up and running—and that will take three or four years—there is no rebate for student nurses.
The 80,000 homeless teenagers in Britain will increase in number by those who leave home to avoid paying the poll tax. That is what has happened when youngsters have been forced to pay 20 per cent. of rates becauseof cuts in housing benefits and delays in the payment of that benefit.
What about women? On average, women earn between two thirds and three quarters of the average wage of a 887 man, but they will have to pay the same poll tax. Five million women in this country cannot go out and take jobs, because they are underpinning the National Health Service or the local authority social services department by being carers who are looking after elderly or infirm relatives, or sick or disabled children. There is no rebate for them under the poll tax if they are not on income support.
What about black and Asian families? I come from a pit village in Yorkshire. When I left home at 18, I did not know that small families existed. I grew up with my mum, my dad, my grandma, my grand-dad, my great-uncle and two sisters. There were eight in our household. As I grew up in the 1960s and 1970s, I realised that people liked to leave their families earlier and move away.
That is not the tradition in West Indian and Asian households. Eleven per cent. of West Indian households and 29 per cent. of Asian households contain six or more adults because they look after their old folk rather than allowing them to go into residential accommodation. In Coventry, they could be living in a presently low-rated property and paying £300 or £400 in rates. They will face bills of £2,500 under the poll tax, so it discriminates against the black and Asian community.
We hear about exemptions. The only way to escape the poll tax is to be declared insane or to join a monastery or the Foreign Legion; and people have been trying that in recent weeks. One of the most disgraceful aspects of the poll tax is that those with a mental handicap, which is a disability from birth, can find some relief from the poll tax if they get the agreement of two doctors, but the level of disability is irrelevant for physical disabilities and there is no rebate or exemption from the poll tax. Some old folk develop Alzheimer's disease, even if it is not assisted by faulty water purification in the south-west. What about old people who become more confused and more infirm as they get older and who develop mental disabilities? They are not exempted from the poll tax.
What about youngsters who stay on at school to do A-levels? They are exempt while they are 18 and their mothers are still getting child benefit for them, but on the day of their 19th birthday, they will lose all exemptions. There are 76,000 families with youngsters who stay on past their 19th birthday to re-take their A-levels.
What about the dead? There are no exemptions for them. [Laughter.] That provokes laughter among Tory Members and I hoped that it would. I want to see them laugh when they hear about two real cases. Donald McLean from Elgin died at the age of 39 on 4 April, three days after he was due to start paying the poll tax in Scotland. His grieving father, whose wife also died recently, was sent a £1.43 poll tax bill for his son. That callous lack of sympathy led his father to complain bitterly:It's a wonder he wasn't billed for the few hours he lived into the 4th day of April.Donnie Young, a 43-year old trawlerman from Burghead, was killed at sea on 10 April. He set sail on 26 March and never set foot again on the Scottish mainland. A bill for £6.44 was sent to his widow. Mrs. Young is refusing to pay, and I congratulate her on that. Public pressure forced the Democrat chairman of the Grampian finance committee to back off on the case of Donald McLean and set a limit of £5 below which bills would not be sent out in cases of bereavement, but the Audit Commission has ruled that a poll tax bill has to be sent on 888 every demand, even if it is as low as 72p. Let us see Tory Members laugh now about sending bills in cases of bereavement.
I give a clear warning to the new Secretary of State that millions of people in England and Wales will not be able to pay and that millions more will be unwilling to pay the poll tax because of the unfairness of the system. A movement of popular resistance is growing throughout the country. I and a number of my colleagues, including my hon. Friend the Member for Dunfermline, West (Mr. Douglas) have said that we will not pay the poll tax. We have been saying that since last July, and we repeat it again today.
That is not a decision we take lightly. We do not come here as law makers to argue universally in favour of law breaking. I do not go out of this Chamber and say that people should run bairns down on zebra crossings. There are certain morally justifiable laws which we all accept should be kept for the good running of society. But the poll tax is not morally justifiable; it is a class law, designed to benefit the rich at the expense of the poor.
Our great-grandparents broke the class laws at the turn of the century and gained the right for workers to join trade unions. Sixty or 70 years ago, in addition to those who threw themselves in front of horses in the Derby, women—and especially the working-class women at the cotton mills in Lancashire and the north-west—broke the class laws of the 19th century to give women the right to vote. The poll tax, which threatens people's democratic right to vote, their living standards, their jobs and their services from local councils, is in precisely the same mould as that class legislation of the 19th century.
I have no compunction about arguing that people should not pay. We shall not be alone. A major campaign is brewing up inside the trade unions. Only last month, the National and Local Government Officers Association at its conference in Blackpool passed a resolution that providing mass non-payment was a viable option and that there was a viable national campaign, the association would back that campaign. I have a message for the Secretary of State and his hon. Friend the Member for Salisbury (Mr. Key), who keeps interrupting him from behind. People in factories and offices throughout the country are discussing the formation of anti-poll tax unions. By the end of the year, the numbers will run into four figures.
I can mention only briefly those who presently pay their rates within their rents. In Scotland, people find that they are paying the same rent and being charged the poll tax, and that is perfectly legal. There is opposition to the poll tax in Coventry. I have received letters from club stewards in working men's clubs, such as that from Mr. Ron Nicholson from Canley, asking whether they too will face the same problems those living in Scotland already face.
I have another question for the Secretary of State—to which I shall return in the next Session—which affects two of his major responsibilities. At present, water rates are based on the rateable value of a house. What will happen when we do not have rateable values because we have the poll tax? I can predict what will happen. Along with privatisation, the water authorities will take the opportunity to hike up the level of the water charges. They will bring in a mirror image of the poll tax, with a water poll tax based on the number of people who live in a house.
What will the effect be on civil liberties? There are dozens of local authorities, such as Solihull, where 889 personal privacy has been invaded by over-detailed registration forms being sent out. [Interruption.] The Secretary of State should listen for a second. I have read many of the 736 sets of regulations, which we have not debated properly because they are introduced at dead of night, such as on 23 May, when we debated 94 pages in one and a half hours.
What will the Secretary of State do about a person who, at present, can go to the social services department of a local authority and say with confidence that he suspects that a bairn is being sexually or physically abused down the road? A person can give such information in confidence to the social services department knowing that an investigation can take place and he can hope that a tragedy like the case of Jasmine Beckford will be prevented. What will the Secretary of State say when those same officers are told by the community charge registration officer that they have to give up their confidential records and reveal to him the names and addresses of the people who had informed the social services department about potential child sex abuse? That is the depth of the invasion of personal privacy to which the poll tax reaches. I say to the hon. Member for Pembroke (Mr. Bennett): read the regulations, sunshine, to find out whether that is legal or not.
The Chancellor of the Exchequer may escape getting his head chopped off, which was the fate of the Chancellor in the peasants' uprising in 1381, but I predict that the new Secretary of State and his mistress, the Prime Minister, will not escape the political decapitation that awaits them in the poll tax battle. The Prime Minister said that the poll tax was to be the flagship of her third term in office. I shall make one final prediction. The poll tax will go down in the history books not as the flagship, but as the Prime Minister's Titanic—and with a bit of luck, the captain is going down with the ship.
§ Mr. John Marshall (Hendon, South)
This debate was billed in advance as a major assault upon the community charge. It seems to be a major assault for which most of the troops have no enthusiasm. Throughout most of the debate, fewer than 12 or 15 Opposition Members have been present. During his speech, the poor Democrat, the hon. Member for Truro (Mr. Taylor), had no support from any of his colleagues.
§ Mr. Marshall
The hon. Member for Hammersmith (Mr. Soley) may regard it as cheap, but the Opposition's motion, and the fact that his colleagues do not want to support it, says something about their enthusiasm for it.
Debates on local government generate a great deal of humbug and synthetic indignation from the Labour party. As one who served in local government for 17 years, I cannot help but compare the concern expressed by the hon. Member for Copeland (Dr. Cunningham) about the level of community charges with the actions of Labour councillors. The Labour party objects to the fact that, in April of next year, voters in London will ask, "Why is the community charge £290 in Barnet when, in the neighbouring borough of Brent, it is £597, and, in the Labour-controlled borough of Haringey, it is £642?" 890 Opposition Members know full well that Labour councils combine poor quality service with a very high price to the ratepayer. [HON. MEMBERS: "Rubbish."] Opposition Members may say that it is rubbish. In the London borough of Brent the cost per secondary pupil is £2,142, which is 40 per cent. above the average for outer London boroughs. Every day of the week, 2,000 pupils become refugees from the people's republic of Brent and choose to get their education in the London borough of Barnet. The London borough of Brent charges 40 per cent. more and has such a poor service that pupils go in droves to Barnet and Harrow, and a large number of teachers also leave the borough.
§ Mr. Marshall
Of course the community charge will help that. If the hon. Member for Dunfermline, West (Mr. Douglas) did not make so many sedentary observations, I could point out very simply how the community charge will benefit that. The people in Brent will ask, "Why should we pay twice as much for an inferior service as the people in Barnet?" I will quote one statistic to show how the London borough of Brent is twice as expensive for a poorer service.
I refer to housing management. The London borough of Brent can boast of rent arrears of over £8 million, or 46.9 per cent. of its annual rent roll, compared with 3.7 per cent. in the London borough of Barnet. However, the London borough of Brent's housing management costs are 60 per cent. higher than in all the outer London boroughs. Anyone who believes that the Labour party is at all concerned about the level of the community charge should consult the ratepayers in Haringey who had to pay 61 per cent. more, or the ratepayers in Brent who had to pay 30 per cent. more. If anyone wants confirmation, he can ask the Leader of the Opposition himself. In the London borough of Ealing, he has had to pay 30 per cent. more in rates this year than he did last year.
The Labour party is against low rates. When I was a councillor in Ealing, we could boast that we had the lowest rates in west London. When the Labour party took control in 1986, the first thing it did was remove the sign from the town hall. The Labour party was determined that never again would Ealing have the lowest rates in west London.
The motion refers to increasing Government control. That comes ill from a party which, when in government, sought to legislate grammar schools away and to restrict the sale of council houses. One of the greatest benefits facing local government at present is the introduction of compulsory competitive tendering, a course of action to which the Labour party was always opposed. There is no doubt that compulsory competitive tendering is leading to a reduction of about 15 per cent. to 20 per cent. in the prices charged to the ratepayer.
§ Mr. Peter L. Pike (Burnley)
Is it not a fact that that is at the expense of the conditions and wages of those who work for councils and those who compete for service contracts? We have seen it in the bus industry and we are now seeing it in local authorities.
§ Mr. Marshall
As the hon. Member for Burnley (Mr. Pike) should know, a majority of the contracts that have gone out to tender have been won by direct labour organisations who, prior to compulsory competitive tendering, used working practices that were far out of date.
§ Mr. Marshall
No views could be more out of date than those of the hon. Member for Coventry, South-East (Mr. Nellist). If he regards the House as out of date, he can leave. There would be loud applause from Conservative Members and many of his own colleagues.
There is no doubt that compulsory competitive tendering gives local authorities the opportunity to provide better value for money and better services at the same time. In my experience of local authority work, whenever a contract went out to tender the ratepayer got a very much better deal, and the community charge payer will, too. In the London borough of Ealing, we were able to save hundreds of thousands of pounds on the school meals service. My son came back after a week and said, "Daddy, why are the meals so much better than they were last term?" I said, "Son, you are learning a basic political truth. When services are provided competitively, they are better than they otherwise would be."
The hon. Member for Copeland was concerned about the average community charge bill facing pensioners in the London borough of Barnet. He did not tell the House that the average rates bill there at the moment is £708 or that, next year, under the community charge, it will be £290, or that, if the misguided safety net could somehow be spirited away, it would be £235. Charges for the vast majority of single pensioners in Barnet, be they in my constituency or in those represented by my right hon. and hon. Friends, will be substantially lower than they are today.
It is all very well for the hon. Member for Coventry, South-East to talk about groups such as the disabled. He knows very well that all those groups are currently paying domestic rates. If the Labour party thinks that they should not pay the community charge, why did it not legislate to prevent them paying domestic rates?
The most irresponsible speech that we have heard today was by the hon. Member for Coventry, South-East, who talked about morally justifiable laws. To quote the hon. Member for Dunfermline, West, it is nonsense. It is a recipe for anarchy.
§ Mr. Marshall
No, I will not give way. The hon. Member for Dunfermline, West makes sedentary interventions which become tedious in the extreme. To give way to him would be to invite a lengthy speech with, no doubt, little relevance to the subject under discussion. He and the hon. Member for Coventry, South-East are seeking to incite——
§ Mr. Marshall
No, not even to a fellow graduate of St. Andrews will I give way.
The hon. Members for Coventry, South-East and for Dunfermline, West and their boroughs are producing a recipe for anarchy. They are seeking to put forward a course of action that can only interfere with local authorities' cash flows and mean a decline in the quality of services provided next year.
§ Mr. Marshall
The hon. Gentleman spoke at great length. Throughout his speech he said that there was bale time, but he proceeded to speak at great length.
§ Mr. Deputy Speaker (Sir Paul Dean)
Order. The hon. Member for Hendon, South (Mr. Marshall) has said that he will not give way.
§ Mr. Marshall
I now refer to the remarks of my right hon. Friend the Member for Brent, North (Sir R. Boyson).
§ Mr. Salmond
If I am not mistaken, the hon. Gentleman is a campaigner on behalf of refuseniks in the Soviet Union who are fighting against unjust laws. At the last election, when the poll tax was clearly declared as an election issue, the people of Scotland voted overwhelmingly against it. People in Scotland are fighting against unjust laws. Will the hon. Gentleman summon up some sympathy for the refuseniks in Scotland?
§ Mr. Marshall
When I visit Scotland this coming weekend, I shall compare it with the Soviet Union, which I visited last year. I suspect that the comparison will be very much to Scotland's advantage. It is absurd to relate the condition of the people of Scotland to the plight of the refuseniks in the Soviet Union. The people of Scotland are part of a unitary United Kingdom. They made England suffer Socialist Governments in 1964 and 1974. They should not be surprised that the Conservative Government of 1987 adhere to the policies on which they were elected.
I want to continue my remarks about the safety net, because people in the borough of Barnet feel as strongly about it as those represented by my right hon. Friend the Member for Brent, North. Under the safety net provisions for next year, the London borough of Lewisham—which the Department accepts is a heavily overspending authority—will receive a safety net provision of £293 and pay a community charge of £215. The London borough of Lambeth, which has long been recognised as one of the most profligate local authorities, will receive a safety-net provision of £246 and will pay a community charge of £297. That will be only £7 higher than that paid in the London borough of Barnet. Why should the ratepayers of Barnet pay £55 in safety-net provision towards the extravagant, high-spending authority of Lambeth?
§ Mr. John Fraser (Norwood)
Perhaps, as a very late act of conversion, the former Secretary of State recognised the enormous problems in Lambeth. He might have thought that, as a substitute for the old equalisation scheme, it would be a good idea to transfer money from the richer boroughs to the poorer boroughs. That is what happened for many years under the old equalisation scheme.
§ Mr. Marshall
I agree that Lambeth is in enormous difficulty, but that is mainly because its borough council has done much to aggravate the problems.
The safety-net provision is a tax on low-spending authorities. It is a penalty for prudence and a premium for extravagance. I hope that my right hon. Friend the: Secretary of State will reconsider the safety-net provision and, when he comes to the House in the autumn, tell us that it has been substantially refined.
§ Mr. Jeff Rooker (Birmingham, Perry Barr)
I join in the congratulations expressed by hon. Members to the new Secretary of State. As his former responsibilities concerned overseas development and Northern Ireland, our paths have not crossed very often. He will get away with his faux pas at the Dispatch Box today simply because of the regard in which he is held on both sides of the House—and I say that quite sincerely. The right hon. Gentleman has made many trips abroad and his experience is rather more global than mine. I was surprised that he did not bring to the Dispatch Box examples of other countries that operate a flat-rate poll tax system to fund local government.
Some of the sentences in the right hon. Gentleman's brief struck a chord with me. I had already heard them in Committee and on Report more than a year ago. I caution him to look behind the jargon to ensure that he is not fed a duff line. I have no doubt that he will come to understand the differences between tax units, households and individuals. There will always be arguments about the number of single pensioners who might gain from the poll tax, but the right hon. Gentleman should recognise the difference between a single pensioner and a single-pensioner household. The fact is that 1 million single pensioners will lose because not all single pensioners live in single-pensioner households. Such crucial distinctions in the terminology used about the poll tax can sometimes be used to feed new Ministers a bad brief.
In the short time available I shall concentrate, rather more positively than did the hon. Member for Truro (Mr. Taylor), on the effect of the poll tax on living standards. That is where the essential unfairness of the system arises. The poll tax cannot be separated from the changes in social security legislation, especially the compulsory 20 per cent. payment that was introduced in 1986, before the election, but did not come into effect until 1988, after the election. The analysis of how that is provided for in income support shows that it is a crucial factor. There is no doubt that some people will lose and some will gain because of the so-called average amount of 20 per cent. By definition, no one could be poorer than those on income support. Some of them will be worse off, because their income support will not take account of the 20 per cent. of poll tax that they will have to pay.
Any simple system is unfair. That is why life is so complicated in a country of 55 million people. If everyone received the same pay, paid the same amount of income tax and had the same outgoings, the system would not be so unfair. It would be a simple head tax. However, the income and outgoings of families are not the same, so the poll tax will unfairly affect household incomes and family budgets.
The Government argue that the cost of local services should not be hidden by allowing those on low incomes to pay a lower tax. There is a paradox—they want people to pay as high a tax as possible, but it is hidden in the rhetoric of rebates. However, the argument changes slightly when it comes to the safety net, which will severely affect those who will not receive rebates.
I want to give only one brief example from the tome that I collected from the Vote Office yesterday. An average poll tax couple with two children, claiming family credit and housing benefit and with a gross income of £100 a week, will receive a rebate of £2.62 a week. However, the interaction of income tax, national insurance, lost benefit 894 and the poll tax rebate means that they will have to pay a marginal tax rate of 83p in the pound for every extra pound that they earn over £100 a week. Should that family have a gross income of only £80 a week, their marginal tax rate would rise to 94p in the pound.
Yesterday the Child Poverty Action Group produced a useful publication setting out certain calculations. They have not yet been challenged, but I do not doubt that Ministers will be put up to challenge them, if not tonight then during the recess. However we look at the figures on the poll tax, nothing can hide the fact that only the rich will gain. The poor will lose significantly and the middle-income groups will lose most of all.
Two examples are clearly shown in the publication. The first table gives a simple comparison between poll tax and rates, and ignores all the changes to social security benefits in 1986 and 1988. Only the top three deciles show a gain—the top decile gains £3.65 a week—and the other seven deciles show losses. The greatest loss is in the fifth decile—the middle range. Three quarters of all the families in the bottom 10 per cent. end up worse off. Fifty-six per cent. of families lose and 44 per cent. gain.
That is the position before we take into account the effect of the social security changes. Table 6.2 shows that 63 per cent.—not 56 per cent.—of families lose, and 83 per cent.—not 79 per cent.—of the bottom decile lose more than £1 a week on average. Again, the biggest single losers are the fifth decile, the middle-income groups, with an average loss of £1.72 a week. Only the top 10 per cent. gain. Those figures are produced using average poll tax figures which smooth out many of the unfairnesses. A high poll tax will be paid in deprived areas where income tends to be low. Everyone accepts that that is the case.
I make no apology for taking my constituency as an example. We were told last week that the poll tax for Birmingham will be £307, fully safety-netted. This year, Birmingham is one of five authorities with zero underspend and zero overspend. Were it not for the safety net, the poll tax in Birmingham would be £240 this year. As it is, it will be £307—a poll tax surcharge for the safety net of £67. I do not deny that it will be different in later years, but it is the first year that my constituents will be worried about next April.
There are 35,000 front doors in my constituency. Most hon. Members know the number of letterboxes in their constituencies. I have taken 50 roads, with 7,000 dwellings and 14,000 adults. They comprise one fifth of my constituency—the biggest in Birmingham. This year, those 7,000 dwellings will pay £3.3 million in rates. I have not taken rebates into account because I would not dream of asking for such personal information. Using national averages for empty dwellings and a figure of £307 for each adult's poll tax, the poll tax for the equivalent period would be £4..3 million—£1 million extra from one fifth of my constituency.
A few of the 50 roads that I chose will be gainer roads. I challenge anyone to say that I have not used a representative group of roads. My constituency will pay an additional £5 million in poll tax. The dislocation that that will cause to the local economy and to families in my constituency does not bear thinking about. The reality is not people refusing to pay; rather it is of paying the poll tax or buying food.
I have four wards in my constituency. Wards in Birmingham are all large, with electorates of between 18,000 and 21,000. In Tintern road in the Handsworth 895 ward, which is fairly typical and being done up under the urban development scheme, the rates this year will be £33,535. The poll tax will be £70,600—almost double. In Leonard road the rates will be £64,600; the poll tax will be £125,000. The dwellings there are pre-first world war with a less than average rateable value, occupied by average families. However, in the Handsworth ward I am one of an ethnic minority. Some of those dwellings house extended families with six or seven adults and there is no way in which they will be able to pay such sums. In Freer road the rates will be £58,000 and the poll tax will be £111,000.
In the outer-city ward of Kingstanding in my constituency, with 12,000 dwellings built in the 1920s and the 1930s having rateable values within £5 of each other, every couple household will lose because of the nature of the rateable values. In Hurlingham road, the rates will be £69,000 and the poll tax will be £106,000. In Dovedale road, the rates will be £113,000 and the poll tax will be £174,000.
Perry Barr, an outer-city ward from which my constituency takes its name, is a middle-income ward. It is usually the only ward in Birmingham, along with the three wards in Sutton Coldfield, with a below average unemployment rate. Therefore, compared with the others, it is a middle income ward. In Rocky lane, where 800 people live in outer suburban semis—an awful lot of Tory voters—the rates will be £189,000 and the poll tax will be £245,000. In Mildenhall road, which is similar, the rates will he £113,000 and the poll tax will be £151,000.
The Labour party does not get the majority of the votes in those roads. It has come close to winning that ward, but it has not done so since 1963. That is middle-income territory in outer suburban Birmingham. I do not deny that there will be gainers and losers in those roads. In three of my wards, single people will gain, but those living in single dwellings, pre-first world war, in the Handsworth ward, will lose because their rates are less than they will pay in poll tax. That is the reality in low rateable value, deprived, inner-city areas. That is why there will be trouble next year.
No Conservative Member can explain how making a person pay more in poll tax than he pays in rates will put an extra burden of accountability on the city council. Why a constituency such as mine will pay £5 million more in poll tax than in rates cannot be explained away. When one examines the income distribution of other parts of Birmingham such as Edgbaston and Sutton Coldfield, that cannot be defended.
The poll tax is unfair. It is designed to be unfair. That realisation has not come in a blinding flash to me and my hon. Friends. It does not matter how one tinkers with the rebates or what the new chairman of the Tory party will say. There is no way in which, with the best will in the world, pushing back all his previous doubts, trying to present the package in another way and winning a few more million pounds from the Treasury, the Secretary of State and the new Minister for Local Government will ever be able to sell the poll tax. It is too hot to handle and they will soon realise that. The tax's inherent unfairness means that it cannot be sold to the electorate. The Government may face most pressure from Conservative Members in respect of the safety net, but when the bills start dropping through the letter boxes in marginal Conservative constituencies next year, the message will come home.
896 The Labour party did not want the poll tax and saw no benefit in its inherent unpopularity. We did not say to the Tories, "Please bring in the poll tax because we know that it will make you even more unpopular." Instead, we took every opportunity in Committee and on Report to alter the flat-rate nature of the tax. We also warned the Government that if they persisted, we would screw every ounce of political capital out of their policy at the hustings and at the ballot box. We shall do so, and we do not apologise for that.
Nor do we need to be defensive about out replacement for the poll tax. Any tax, be it based on the occupancy of a property or on the occupant's income, that is directly related to the occupant's ability to pay will always win the argument over a flat-rate tax. That is why the poll tax will not stand the test of time, a change of Government, or even a change of Prime Minister.
§ Mr. W. Benyon (Milton Keynes)
I warmly welcome my right hon. Friend the Secretary of State on taking up his new appointment. He comes to it with a fresh mind, and his concluding remarks showed his appreciation of the great difficulties that confront him on the community charge.
I have always opposed the community charge and voted against it on every possible occasion. I do not intend to change my record tonight. I shall not rehearse the arguments against the poll tax, because right hon. and hon. Members have heard them over and over, and again this afternoon. Nevertheless, I emphasise to one or two Opposition Members that the tax is now the law of the land and that that law must be obeyed. Conservative Members have a particular duty to make the best of it, because to do so is extremely important in electoral terms.
Whatever method one uses to raise local government finance—be it rates, a community charge, local income tax, or the combination proposed by the Labour party—if the burden on local authorities is too high, people will resist the tax and blame not the local authorities but the Government. I sometimes wonder about the nature of the constituencies that some of my right hon. and hon. Friends represent. Not one of my constituents has said to me, "I am worried that my local authority will be extravagant." Instead, constituents have asked, "Will the local authority be given enough Government grant?"
Reading the Layfield report after so many years repays itself, because the situation is exactly as Layfield described it all that time ago. I say to the Government that they are being blamed now, and if things continue as they are, they will be blamed even more at the next general election. The Treasury's restrictions on any further relief on the tax will be bought at a very high price.
The solution is twofold. First, as has been mentioned by a number of my right hon. and hon. Friends, one must rid the community charge payer of the safety net, which must be borne instead by the Exchequer. I made the point to my right hon. Friend's predecessor last Monday that if there is to be accountability, which is the real reason for the tax, the community charge must get off on the right foot, so that the taxpayer can say, "I know that the community charge being imposed by my local authority is just that and not something different."
Secondly, either the revenue support grant must be increased or a major item of local authorty spending must 897 be transferred to the Exchequer. If that is not done, the community charge will start life in the worst possible way. The hon. Member for Birmingham, Perry Barr (Mr. Rooker) gave detailed examples of certain wards in his constituency, and they are repeated throughout the country.
If it is found after the community charge is introduced next year that concessions are necessary, they will have to be wrung out of the Government and will be confessions of failure, rather than tokens of success. I urge those of my right hon. and hon. Friends who have joined the Treasury Bench to act now, while there is still time.
§ Mr. George Howarth (Knowsley, North)
I congratulate the Secretary of State on his new appointment. He must realise from listening to his own hon. Friends on the Conservative Back Benches that the task ahead of him is not to be envied. The poll tax was bad enough in its conception, but its presentation last week by the right hon. Gentleman's predecessor was absolute chaos. The comments of all Conservative Members today, and particularly the eloquent remarks of the right hon. Member for Brent, North (Sir R. Boyson), must leave the Secretary of State in no doubt about the problems confronting him.
The former Secretary of State for the Environment tried to improve the poll tax by softening the blow in Tory constituencies through his use of the safety net. However, this afternoon, speaker after speaker from the Conservative Benches has complained about its effect on his own constituency. My constituency is, by any measure, one of the most deprived in the whole country, yet as a result of the safety net, each payer of the poll tax will have to find £311, for which there can be no justification.
That inequality is not confined to my own constituency. The hon. Member for Wirral, West (Mr. Hunt), who has been elevated to Minister of State, Department of the Environment, may be aware that, as a consequence of the incompetence of the former Secretary of State for the Environment, the Wirral—which is represented also by the right hon. Member for Wallasey (Mrs. Chalker) and the hon. Member for Wirral, South (Mr. Porter)—is the highest-rated on Merseyside, yet still it will contribute to the safety net. I speak up for those right hon. and hon. Members because they are not present in the Chamber to speak for themselves. The hon. Member for Crosby (Mr. Thornton) is in the same position.
Although Merseyside is, justifiably, barely represented by Conservative Members, the Government will penalise not only Labour-held constituencies such as my own but Tory-held constituencies in my area. The malice was bad enough, but the incompetence and chaos that followed penalises even Conservative constituencies.
The poll tax is a bad measure, made worse by the former Secretary of State for the Environment—and I do not think that the mess can be cleared up, even by his successor.
§ Mr. David Blunkett (Sheffield, Brightside)
I add my congratulations to the Secretary of State and to the hon. Member for Wirral, West (Mr. Hunt) on their promotions. 898 I shall miss the former Minister for Local Government, the right hon. Member for Suffolk, Coastal (Mr. Gummer)—not because of his personality but because the Chamber will be free of the growling, barking and snarling that so upset my dog very time that the right hon. Gentleman rose to speak. Having now savaged the General Synod, the right hon. Member for Coastal has moved on to do something miraculous with loaves and fishes.
We are talking not about personalities or presentation, but about policies. This afternoon, the Secretary of State commented that the man has changed but the Government's policies have not. That sums up the dilemma facing the Secretary of State and the Government. I do not accept that the right hon. Gentleman believes in the Government's policy or in the words in the brief that he read this afternoon. If he does, he is a lesser man for it. Anyone who has a feel for progressive, reasonable and caring policies knows that the poll tax is not the solution to the problem of an alternative for the present rating system.
The poll tax is based on particular values and ideology that the former Secretary of State for the Environment was more than happy to articulate because he believes in inequality—and said so. He believes in reducing progressive taxation, and was honest enought to say so. It is difficult for someone who does not believe that to put forward a convincing case for a tax that involves equality and uniformity of contribution, but inequality in relation to the amount of misery that it produces. For that is what the poll tax is about: the poor will be hit hardest and the rich will gain most, not only in cash terms—although that is important—but in terms of services.
The Cheshire study carried out not long ago showed clearly that the better-off gained most from the way in which local spending was organised. That applied to education, road use and even the relative cost of emptying dustbins outside large houses with long drives in sparsely populated areas. They will not be charged extra for their services; they will be charged less. They will not feel the burden: it will be borne by the less well-off, the ragged-trousered philanthropists of the 1990s, who will contribute their income so that others may pay less for more advantageous services.
That burden, in terms of payment, is grossly distorted. the railway porter earning just over £100 a week could, in London, be paying 10 per cent. of his income in poll tax, while a Cabinet Minister will be paying 1 per cent. The ratio is 10 to one: that is how much worse off those in work but on low incomes will be than the better-off. That is the stark reality. There is no element of equality, or of payment for services received. It is the opposite: the less people receive, the greater the likely burden on their incomes.
That is why many of those who will gain believe that the poll tax is not only politically inept but morally bankrupt. Millions who will, at least temporarily, be better off will say, like us, that a system that takes from the poor rather than the better-off and distributes resources to the disadvantage of those who are struggling to escape from the poverty trap—as described by my hon. Friend the Member for Birmingham, Perry Barr (Mr. Rooker)—is immoral, and must be rejected on those grounds.
We must recognise that this is not a charge for services rendered, but an unfair and grossly distorted form of taxation. Otherwise, the myth will be put about that we are merely making people pay for the first time. Some 899 interesting points have been made about that this afternoon. The hon. Member for Mid-Staffordshire (Mr. Heddle) suggested—becoming caught in a tremendously tangled web as he did so—that council tenants would somehow be disadvantaged by an alternative to the poll tax. As his right hon. Friend the Member for Henley (Mr. Heseltine) knows very well and has pointed out, those whose properties have low rateable values will be hardest hit.
Owner-occupiers living in small terraced properties—the category that the right hon. Gentleman described in the Report and Third Reading debates on 18 April last year—may have thought of voting Tory in the past. Let us make no mistake, however: they will not think of doing so in the future, and that applies equally to the people to whom the hon. Member for Mid-Staffordshire referred. We are talking not merely about the impact of the tax on each individual, but about the change in the distribution system that the Secretary of State described. The study carried out by the Child Poverty Action Group and the Local Government Information Unit has shown that, in the 50 most disadvantaged areas in the country, the average loss to the individual will be £58 a year.
The Parliamentary Under-Secretary of State gave me some staggering figures on 25 November last year relating to the losses in the regions. The northern region would lose £156 million, the Yorkshire and Humberside region £256 million and the north-west £91 million. The Secretary of State described the abolition of the equalisation system as a great bonus for the country as a whole. Under that system, inner London loses £493 million. The south-east gains by £525 million, but that can hardly be described as the righting of a great wrong. Clearly the Government have not stepped in like a knight in shining armour to correct a distortion. The effect of what they are doing will be felt throughout the country.
The right hon. Member for Brent, North (Sir R. Boyson) is rightly concerned about the impact of the safety-net provisions. I wondered whether the previous Secretary of State did not have a few tricks up his sleeve a la Lady Porter: if we examine the figures closely, some interesting political conclusions can be drawn. Is it not in the Government's interest for certain London boroughs to find that next year's tax is very high? Is it not in their interest that residents of the borough of Ealing, which they have been attacking, must pay an extra £21 each because of the safety net? In Brent, referred to by the right hon. Member for Brent, North, the figure is £36, and in Haringey it is £15. Is it not advantageous for them to award the borough that I live in, Wandsworth—the jewel in their crown, as they have described it, and the borough that the Conservatives are hanging on to—an incredible safety-net benefit amounting to a staggering £227, reducing my poll tax to £148? Bradford, the other jewel in their crown, will benefit by £36.
The chickens will come home to roost, but presumably, once next year's London and metropolitan borough elections are over, the system will be readjusted to take account of the approaching general election. The Secretary of State would be well advised to put his mind not only to the survival of his Back Benchers in the election—those representing marginal seats containing properties with low rateable values—but to whether the electorate as a whole will begin to suss out what is going on, and what their reaction will be.
900 I was pleased when the Secretary of State said that he would look again at registration after the shambles that we have already seen, but it is now far too late: people have filled up their forms, believing that they would be behaving illegally if they did not answer questions that have now been ruled intrusive and unnecessary. Any action would be welcome, however. It would also be helpful if the Secretary of State re-estimated the true poll tax average: the Government's 1987 estimate of £178 had risen to £275 in their latest estimate, produced last week. Even then they performed a conjuring trick, assuming that local authorities would be able to contribute the same amount from their balances as last year. Last year, the Government estimated the average poll tax at £274, so Lord knows what the figure will be when they finally get round to being honest about it.
We need an alternative to the poll tax, based on fairness and ability to pay. I give an absolute pledge from the Dispatch Box that our proposals will benefit not only the very poor but those on average incomes above the poverty line, who will pay according to their ability to find the cash. They will not be penalised through capital-value rating; they will not be discriminated against in areas with high property values. This party will treat them decently.
We believe in a system which is fair for the individual and equal in its distribution of the burden throughout the community, and which makes it possible to raise and spend money fairly and equally on decent public services. Our policy will be pitted against the Government's and although the cost of the poll tax must be borne by the people, its price will be paid by the Government in defeat at the polls.
§ The Minister for Local Government (Mr. David Hunt)
Unaccustomed as I have been for two years to speaking from the Dispatch Box, I welcome the opportunity to do so in a debate on a rating system that I have long believed to be discredited and unworkable. I welcome the community charge system, to which I was committed at the last election and to which I remain committed as a much fairer and better system.
I much appreciate the generous words of welcome from hon. Members to my right hon. Friend the Secretary of State and me. I much welcome the warm tributes that were paid to my right hon. Friends the Members for Cirencester and Tewkesbury (Mr. Ridley) and for Suffolk, Coastal (Mr. Gummer)—[HON. MEMBERS: "What tributes?"]. The small group of Labour Members present would be much wiser men if they had listened more carefully to the debate, because they would have heard such tributes.
§ Mr. Alex Salmond (Banff and Buchan)
Will the Minister use his previous experience in the Whips Office to tell the House whom of his hon. Friends will give him the most trouble? Will it be the hon. Member for Milton Keynes (Mr. Benyon), who, in ignorance, voted for the Scottish poll tax, rebelled against the poll tax in England and now wants us to make the best of it? Will it be other Conservative Members who, in ignorance, voted for the poll tax in England and Scotland but are now whining about its impact on their constituencies?
§ Mr. Hunt
Having had the privilege of being Government Deputy Chief Whip for two years, I do not recognise the meaning of the word "trouble" with my right 901 hon. and hon. Friends. From time to time, we may have genuine disagreements, but we are united, especially about the unfairness of the present rating system and the importance of the new one. Concern was rightly expressed about how the community charge should be introduced.
I heard 12 speeches from start to finish. Although I disagree with many of the points made by Labour Members, I congratulate all hon. Members who participated in a good debate. Having sat for some time on the Select Committee considering the televising of Parliament, I think that a debate such as today's will do the House much credit when it is televised in the autumn.
Labour Members have not spoken to their motion, nor have they proved a word of it. It says that the community charge is unfair, bureaucratic and difficult to collect. Those allegations would be serious had Labour Members substantiated them, but they have not. Labour Members have been unable to prove their case. Thanks to some clever speeches from Conservative Members, Labour Members have been forced on to the defensive—[Interruption.] Those who are shouting loudest have been most noticeable by their absence from the debate. Labour Members have been forced on to the defensive because they have been unable to defend an alternative policy that changes every day. The Labour party has been unable to control Labour Members who advocate illegal action; we heard two speeches of that nature from Labour Members this afternoon.
Perhaps the most serious allegation made against the new arrangements is that of unfairness. The only way that Labour Members can begin to substantiate that charge is by deliberately not taking into account the generous rebate system that we have built into the new arrangements. I have much time and respect for the hon. Member for Birmingham, Perry Barr (Mr. Rooker). I remember that he celebrated my appointment as Whip on the Finance Bill by leading for the Opposition on that Bill, which lasted longer than any previous Finance Bill. I came to know the hon. Gentleman reasonably well, and I believe him to be a fair man. Being a fair man, he will recognise that those little words at the end of his press release which say that he left out of his calculations rate rebates or community charge rebates in reaching his conclusions, throw his calculations into disrepute.
§ Mr. Rooker
The only way that one can compare like with like is to use unrebated figures. It is not possible for any hon. Member to ask a local authority, "What are the rates for a road net of rebate?" That is private information. I argued that the same would apply if one compared rebated figures, but that information is not available because it is confidential. When it is, I shall do the same exercise.
§ Mr. Hunt
Let me deal with the hon. Member for Perry Barr.
902 The hon. Member for Perry Barr said that the community charge is unfair, but I contend that it is much fairer than the domestic rating system. When the community charge is fully implemented, 58 per cent. of households—over 11 million adults—will gain; 83 per cent. of single-pension households will pay less in community charge than they pay in rates; and 75 per cent. of other single-adult households—widows and one-parent families—will gain. On average, the community charge will cost less than domestic rates for all income bands below £200 a week.
§ Dr. Cunningham
How can it be fairer to make people who pay nothing because their earnings are low pay a minimum of at least 20 per cent. of the charge?
§ Mr. Hunt
The hon. Gentleman ignores income support. When considering the overall impact of the community charge, we must not pick and choose. Labour Members already have the relevant information.
My right hon. Friend the Member for Brent, North (Sir R. Boyson), who made a typically robust defence of the community charge, said that people must pay something for the local services they use, but that the community charge must not be artificially high. A number of hon. Members mentioned the safety net. We shall consider carefully what they said, but I emphasise that the purpose of the safety net is to phase in the new system over a relatively short period, so that those who lose have an opportunity to adjust to the new circumstances. Gainers will receive a substantial part of their gain in the first year, but they cannot receive all their gain if areas facing sharp increases are to be given time to adjust.
My right hon. Friend the Member for Brent, North suggested that the taxpayer—the Exchequer—should pay for the safety net. The proposals announced last week for next year's grant settlement envisage an 8.5 per cent. increase in the amount to be provided from Government grants and business rates. I believe that to be a fair and reasonable increase in Exchequer support. But we shall listen and consider: this is a matter of balance and it cannot be solved by throwing money at it.
§ Mr. Nellist
I have a question in two parts for the Minister. The first is about rebates. Is he aware that in Coventry, for example, where the poll tax will be £315, according to official Government figures, a single person aged under 25 will receive no rebate if he or she takes home more than £61 a week? Secondly, since when has the business rate been part of Exchequer contributions to local authority spending?
§ Mr. Hunt
Again, the hon. Gentleman has totally missed the point—[Interruption.] Far more serious was the speech he made earlier in the debate, in which he advocated support for illegality. How can the hon. Member for Sheffield, Brightside (Mr. Blunkett) expect one day to become a Minister of the Crown without condemning the intemperate words used by his hon. Friend the Member for Coventry, South East (Mr. Nellist)?
The policy of the Opposition changes day by day. When they have a policy, let them come to the House and seek support for it. I urge my right hon. and hon. Friends to reject the motion and support the amendment.
§ Question put, That the original words stand part of the Question:—903
§ The House divided: Ayes 211, Noes 304"906
|Division No. 320]||[7.1 pm|
|Abbott, Ms Diane||Fraser, John|
|Adams, Allen (Paisley N)||Galbraith, Sam|
|Allen, Graham||Galloway, George|
|Alton, David||Garrett, John (Norwich South)|
|Anderson, Donald||Garrett, Ted (Wallsend)|
|Archer, Rt Hon Peter||George, Bruce|
|Armstrong, Hilary||Gilbert, Rt Hon Dr John|
|Ashdown, Rt Hon Paddy||Godman, Dr Norman A.|
|Ashley, Rt Hon Jack||Golding, Mrs Llin|
|Ashton, Joe||Gould, Bryan|
|Banks, Tony (Newham NW)||Graham, Thomas|
|Barnes, Harry (Derbyshire NE)||Grant, Bernie (Tottenham)|
|Barnes, Mrs Rosie (Greenwich)||Griffiths, Nigel (Edinburgh S)|
|Barron, Kevin||Griffiths, Win (Bridgend)|
|Battle, John||Grocott, Bruce|
|Beckett, Margaret||Hardy, Peter|
|Bell, Stuart||Harman, Ms Harriet|
|Benn, Rt Hon Tony||Hattersley, Rt Hon Roy|
|Bennett, A. F. (D'nt'n & R'dish)||Haynes, Frank|
|Bermingham, Gerald||Healey, Rt Hon Denis|
|Bidwell, Sydney||Heffer, Eric S.|
|Blair, Tony||Henderson, Doug|
|Blunkett, David||Hinchliffe, David|
|Boyes, Roland||Hoey, Ms Kate (Vauxhall)|
|Bradley, Keith||Home Robertson, John|
|Bray, Dr Jeremy||Hood, Jimmy|
|Brown, Nicholas (Newcastle E)||Howarth, George (Knowsley N)|
|Buckley, George J.||Howell, Rt Hon D. (S'heath)|
|Caborn, Richard||Hoyle, Doug|
|Callaghan, Jim||Hughes, John (Coventry NE)|
|Campbell, Menzies (Fife NE)||Hughes, Robert (Aberdeen N)|
|Campbell, Ron (Blyth Valley)||Hughes, Simon (Southwark)|
|Campbell-Savours, D. N.||Illsley, Eric|
|Canavan, Dennis||Ingram, Adam|
|Cartwright, John||Janner, Greville|
|Clark, Dr David (S Shields)||Johnston, Sir Russell|
|Clarke, Tom (Monklands W)||Jones, Barry (Alyn & Deeside)|
|Clay, Bob||Kennedy, Charles|
|Clelland, David||Kilfedder, James|
|Clwyd, Mrs Ann||Kinnock, Rt Hon Neil|
|Cohen, Harry||Kirkwood, Archy|
|Coleman, Donald||Leadbitter, Ted|
|Cook, Frank (Stockton N)||Leighton, Ron|
|Cook, Robin (Livingston)||Litherland, Robert|
|Corbett, Robin||Lloyd, Tony (Stretford)|
|Corbyn, Jeremy||Lofthouse, Geoffrey|
|Cousins, Jim||Loyden, Eddie|
|Crowther, Stan||McAllion, John|
|Cryer, Bob||McAvoy, Thomas|
|Cummings, John||McCartney, Ian|
|Cunliffe, Lawrence||Macdonald, Calum A.|
|Cunningham, Dr John||McKay, Allen (Barnsley West)|
|Darling, Alistair||McKelvey, William|
|Davies, Rt Hon Denzil (Llanelli)||McLeish, Henry|
|Davies, Ron (Caerphilly)||Maclennan, Robert|
|Davis, Terry (B'ham Hodge H'I)||McNamara, Kevin|
|Dewar, Donald||McWilliam, John|
|Dobson, Frank||Madden, Max|
|Doran, Frank||Mahon, Mrs Alice|
|Douglas, Dick||Marshall, Jim (Leicester S)|
|Duffy, A. E. P.||Martin, Michael J. (Springburn)|
|Dunnachie, Jimmy||Martlew, Eric|
|Dunwoody, Hon Mrs Gwyneth||Meacher, Michael|
|Eadie, Alexander||Meale, Alan|
|Evans, John (St Helens N)||Michael, Alun|
|Ewing, Harry (Falkirk E)||Michie, Bill (Sheffield Heeley)|
|Ewing, Mrs Margaret (Moray)||Morgan, Rhodri|
|Fatchett, Derek||Morley, Elliot|
|Fearn, Ronald||Morris, Rt Hon A. (W'shawe)|
|Field, Frank (Birkenhead)||Morris, Rt Hon J. (Aberavon)|
|Fields, Terry (L'pool B G'n)||Mowlam, Marjorie|
|Fisher, Mark||Mullin, Chris|
|Flannery, Martin||Murphy, Paul|
|Flynn, Paul||Nellist, Dave|
|Foot, Rt Hon Michael||Oakes, Rt Hon Gordon|
|Foster, Derek||O'Brien, William|
|Orme, Rt Hon Stanley||Soley, Clive|
|Owen, Rt Hon Dr David||Spearing, Nigel|
|Patchett, Terry||Steel, Rt Hon David|
|Pendry, Tom||Steinberg, Gerry|
|Pike, Peter L.||Stott, Roger|
|Powell, Ray (Ogmore)||Straw, Jack|
|Prescott, John||Taylor, Mrs Ann (Dewsbury)|
|Primarolo, Dawn||Taylor, Matthew (Truro)|
|Quin, Ms Joyce||Thompson, Jack (Wansbeck)|
|Radice, Giles||Turner, Dennis|
|Randall, Stuart||Vaz, Keith|
|Redmond, Martin||Wall, Pat|
|Rees, Rt Hon Merlyn||Wallace, James|
|Richardson, Jo||Walley, Joan|
|Roberts, Allan (Bootle)||Wardell, Gareth (Gower)|
|Robinson, Geoffrey||Wareing, Robert N.|
|Rogers, Allan||Watson, Mike (Glasgow, C)|
|Rooker, Jeff||Welsh, Andrew (Angus E)|
|Ross, Ernie (Dundee W)||Welsh, Michael (Doncaster N)|
|Rowlands, Ted||Williams, Rt Hon Alan|
|Ruddock, Joan||Williams, Alan W. (Carm'thon)|
|Salmond, Alex||Wilson, Brian|
|Sheldon, Rt Hon Robert||Winnick, David|
|Shore, Rt Hon Peter||Wise, Mrs Audrey|
|Short, Clare||Worthington, Tony|
|Sillars, Jim||Wray, Jimmy|
|Skinner, Dennis||Young, David (Bolton SE)|
|Smith, Andrew (Oxford E)|
|Smith, C. (Isl'ton & F'bury)||Tellers for the Ayes:|
|Smith, Rt Hon J. (Monk'ds E)||Mr. Ken Eastham and Mr. Martyn Jones.|
|Smith, J. P. (Vale of Glam)|
|Aitken, Jonathan||Carlisle, John, (Luton N)|
|Alexander, Richard||Carlisle, Kenneth (Lincoln)|
|Alison, Rt Hon Michael||Carrington, Matthew|
|Allason, Rupert||Carttiss, Michael|
|Amery, Rt Hon Julian||Cash, William|
|Amess, David||Chapman, Sydney|
|Amos, Alan||Chope, Christopher|
|Arbuthnot, James||Churchill, Mr|
|Arnold, Jacques (Gravesham)||Clark, Hon Alan (Plym'th S'n)|
|Arnold, Tom (Hazel Grove)||Clark, Dr Michael (Rochford)|
|Ashby, David||Clark, Sir W. (Croydon S)|
|Atkins, Robert||Clarke, Rt Hon K. (Rushcliffe)|
|Atkinson, David||Conway, Derek|
|Baker, Rt Hon K. (Mole Valley)||Coombs, Anthony (Wyre F'rust)|
|Baker, Nicholas (Dorset N)||Coombs, Simon (Swindon)|
|Baldry, Tony||Couchman, James|
|Batiste, Spencer||Cran, James|
|Beggs, Roy||Currie, Mrs Edwina|
|Bellingham, Henry||Curry, David|
|Bendall, Vivian||Davies, Q. (Stamf'd & Spald'g)|
|Bennett, Nicholas (Pembroke)||Davis, David (Boothferry)|
|Bevan, David Gilroy||Day, Stephen|
|Biffen, Rt Hon John||Devlin, Tim|
|Blackburn, Dr John G.||Dorrell, Stephen|
|Blaker, Rt Hon Sir Peter||Douglas-Hamilton, Lord James|
|Body, Sir Richard||Dunn, Bob|
|Bonsor, Sir Nicholas||Eggar, Tim|
|Boscawen, Hon Robert||Emery, Sir Peter|
|Boswell, Tim||Evans, David (Welwyn Hatf'd)|
|Bottomley, Peter||Fairbairn, Sir Nicholas|
|Bottomley, Mrs Virginia||Fallon, Michael|
|Bowden, A (Brighton K'pto'n)||Farr, Sir John|
|Bowden, Gerald (Dulwich)||Favell, Tony|
|Bowis, John||Fenner, Dame Peggy|
|Boyson, Rt Hon Dr Sir Rhodes||Field, Barry (Isle of Wight)|
|Braine, Rt Hon Sir Bernard||Finsberg, Sir Geoffrey|
|Brandon-Bravo, Martin||Fishburn, John Dudley|
|Brazier, Julian||Fookes, Dame Janet|
|Bright, Graham||Forman, Nigel|
|Brown, Michael (Brigg & Cl't's)||Forsyth, Michael (Stirling)|
|Browne, John (Winchester)||Forsythe, Clifford (Antrim S)|
|Buchanan-Smith, Rt Hon Alick||Forth, Eric|
|Burns, Simon||Fowler, Rt Hon Norman|
|Burt, Alistair||Franks, Cecil|
|Butcher, John||Freeman, Roger|
|Butler, Chris||French, Douglas|
|Butterfill, John||Gale, Roger|
|Gardiner, George||Lilley, Peter|
|Garel-Jones, Tristan||Lloyd, Sir Ian (Havant)|
|Gill, Christopher||Lord, Michael|
|Glyn, Dr Alan||Luce, Rt Hon Richard|
|Goodson-Wickes, Dr Charles||Lyell, Sir Nicholas|
|Gow, Ian||McCrindle, Robert|
|Grant, Sir Anthony (CambsSW)||Macfarlane, Sir Neil|
|Greenway, Harry (Ealing N)||MacKay, Andrew (E Berkshire)|
|Greenway, John (Ryedale)||Maclean, David|
|Gregory, Conal||McLoughlin, Patrick|
|Griffiths, Sir Eldon (Bury St E')||McNair-Wilson, Sir Michael|
|Griffiths, Peter (Portsmouth N)||McNair-Wilson, Sir Patrick|
|Ground, Patrick||Madel, David|
|Gummer, Rt Hon John Selwyn||Major, Rt Hon John|
|Hague, William||Malins, Humfrey|
|Hamilton, Neil (Tatton)||Maples, John|
|Hampson, Dr Keith||Marland, Paul|
|Hanley, Jeremy||Marlow, Tony|
|Hannam, John||Marshall, John (Hendon S)|
|Hargreaves, A. (B'ham H'll Gr')||Marshall, Michael (Arundel)|
|Harris, David||Martin, David (Portsmouth S)|
|Haselhurst, Alan||Maude, Hon Francis|
|Hayes, Jerry||Mawhinney, Dr Brian|
|Heathcoat-Amory, David||Maxwell-Hyslop, Robin|
|Heddle, John||Mayhew, Rt Hon Sir Patrick|
|Hicks, Mrs Maureen (Wolv' NE)||Mellor, David|
|Hicks, Robert (Cornwall SE)||Miller, Sir Hal|
|Higgins, Rt Hon Terence L.||Mills, Iain|
|Hill, James||Mitchell, Andrew (Gedling)|
|Hind, Kenneth||Mitchell, Sir David|
|Hogg, Hon Douglas (Gr'th'm)||Moate, Roger|
|Holt, Richard||Molyneaux, Rt Hon James|
|Hordern, Sir Peter||Monro, Sir Hector|
|Howard, Michael||Montgomery, Sir Fergus|
|Howarth, Alan (Strat'd-on-A)||Moore, Rt Hon John|
|Howarth, G. (Cannock & B'wd)||Morris, M (N'hampton S)|
|Howell, Rt Hon David (G'dford)||Morrison, Rt Hon P (Chester)|
|Hughes, Robert G. (Harrow W)||Moss, Malcolm|
|Hunt, David (Wirral W)||Moynihan, Hon Colin|
|Hunt, Sir John (Ravensbourne)||Mudd, David|
|Hunter, Andrew||Neale, Gerrard|
|Hurd, Rt Hon Douglas||Nelson, Anthony|
|Irvine, Michael||Neubert, Michael|
|Irving, Charles||Newton, Rt Hon Tony|
|Jack, Michael||Nicholls, Patrick|
|Jackson, Robert||Nicholson, David (Taunton)|
|Janman, Tim||Nicholson, Emma (Devon West)|
|Jessel, Toby||Norris, Steve|
|Johnson Smith, Sir Geoffrey||Onslow, Rt Hon Cranley|
|Jones, Gwilym (Cardiff N)||Oppenheim, Phillip|
|Jones, Robert B (Herts W)||Page, Richard|
|Jopling, Rt Hon Michael||Paice, James|
|Kellett-Bowman, Dame Elaine||Parkinson, Rt Hon Cecil|
|Key, Robert||Patnick, Irvine|
|King, Roger (B'ham NWield)||Patten, Rt Hon Chris (Bath)|
|Kirkhope, Timothy||Patten, John (Oxford W)|
|Knapman, Roger||Pawsey, James|
|Knight, Greg (Derby North)||Porter, Barry (Wirral S)|
|Knowles, Michael||Porter, David (Waveney)|
|Lamont, Rt Hon Norman||Portillo, Michael|
|Lang, Ian||Powell, William (Corby)|
|Latham, Michael||Price, Sir David|
|Lawrence, Ivan||Raffan, Keith|
|Lawson, Rt Hon Nigel||Raison, Rt Hon Timothy|
|Lennox-Boyd, Hon Mark||Redwood, John|
|Lightbown, David||Renton, Tim|
|Rhodes James, Robert||Summerson, Hugo|
|Riddick, Graham||Tapsell, Sir Peter|
|Ridley, Rt Hon Nicholas||Taylor, Ian (Esher)|
|Ridsdale, Sir Julian||Taylor, John M (Solihull)|
|Rifkind, Rt Hon Malcolm||Taylor, Teddy (S'end E)|
|Roberts, Wyn (Conwy)||Tebbit, Rt Hon Norman|
|Roe, Mrs Marion||Thompson, D. (Calder Valley)|
|Rossi, Sir Hugh||Thompson, Patrick (Norwich N)|
|Rost, Peter||Thorne, Neil|
|Rowe, Andrew||Thornton, Malcolm|
|Rumbold, Mrs Angela||Thurnham, Peter|
|Sackville, Hon Tom||Townend, John (Bridlington)|
|Sainsbury, Hon Tim||Townsend, Cyril D. (B'heath)|
|Sayeed, Jonathan||Tracey, Richard|
|Scott, Rt Hon Nicholas||Tredinnick, David|
|Shaw, David (Dover)||Trippier, David|
|Shaw, Sir Giles (Pudsey)||Twinn, Dr Ian|
|Shaw, Sir Michael (Scarb')||Vaughan, Sir Gerard|
|Shelton, Sir William||Waddington, Rt Hon David|
|Shephard, Mrs G. (Norfolk SW)||Wakeham, Rt Hon John|
|Shepherd, Colin (Hereford)||Waldegrave, Hon William|
|Shersby, Michael||Walden, George|
|Skeet, Sir Trevor||Walker, A. Cecil (Belfast N)|
|Smith, Sir Dudley (Warwick)||Walker, Bill (T'side North)|
|Smith, Tim (Beaconsfield)||Waller, Gary|
|Smyth, Rev Martin (Belfast S)||Wardle, Charles (Bexhill)|
|Soames, Hon Nicholas||Warren, Kenneth|
|Speed, Keith||Wells, Bowen|
|Speller, Tony||Wheeler, John|
|Spicer, Sir Jim (Dorset W)||Whitney, Ray|
|Spicer, Michael (S Worcs)||Widdecombe, Ann|
|Stanbrook, Ivor||Wiggin, Jerry|
|Stanley, Rt Hon Sir John||Wilkinson, John|
|Stern, Michael||Winterton, Nicholas|
|Stevens, Lewis||Wood, Timothy|
|Stewart, Allan (Eastwood)||Woodcock, Dr. Mike|
|Stewart, Andy (Sherwood)||Yeo, Tim|
|Stewart, Rt Hon Ian (Herts N)|
|Stokes, Sir John||Tellers for the Noes:|
|Stradling Thomas, Sir John||Mr. Tony Durant and Mr. Alastair Goodlad.|
§ Question accordingly negatived.
§ Question, That the proposed words be there added, put forthwith pursuant to Standing Order No. 30 (Questions on amendments), and agreed to.
That this House supports the introduction of the community charge, the principles of which are manifestly fairer and simpler than those that now apply to domestic rates; welcomes the exemptions conferred on those who cannot be asked to pay and the generous discounts, rebates and increased income support available for those on low incomes; recognises that the unified business rating system introduces a valuable stability for non-domestic ratepayers; congratulates Her Majesty's Government on implementing proposals that will improve the accountability of local government by insisting that all who benefit from their services should have a say in their quality and cost; and notes that either a local income tax or a two-tax system based upon local income tax and capital value tax would be much more expensive to implement, much more unfair and make local government much less accountable.